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+Santoli’s Wednesday market notes: Could September’s stock shakeout tee up strength for the fourth quarter?,https://www.cnbc.com/2021/09/29/santolis-wednesday-market-notes-could-septembers-stock-shakeout-tee-up-strength-for-the-fourth-quarter.html,2021-09-29T17:09:39+0000,Michael Santoli,CNBC,"This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics.","cnbc, Premium, Articles, Investment strategy, Markets, Investing, PRO Home, CNBC Pro, Pro: Santoli on Stocks, source:tagname:CNBC US Source",https://image.cnbcfm.com/api/v1/image/106949602-1632934577499-FINTECH_ETF_9-29.jpg?v=1632934691,"This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics.
- A muted, inconclusive bounce that has left the indexes fully within yesterday's low-to-high range all morning so far.
The US government is increasingly likely to convert a $13.4 billion loan to General Motors into common stock, sharply reducing the company's debt burden and giving taxpayers a major stake in the struggling auto maker, sources tell CNBC.
The move, which is still under discussion, is partly aimed at getting GM's bondholders and the United Auto Workers union to make more concessions and avert a possible bankruptcy filing, these sources said. The government is pressuring the UAW to make concessions on GM retiree health benefits.
People involved in the talks caution that nothing has been decided yet. Officials from President Obama's auto task force and the UAW had no comment.
The US agreed to loan GM up to $13.4 billion in December provided the auto maker convinced bondholders and the UAW to accept much of what the company owes them in stock rather than cash.
So far, both groups have balked. Both the union and bondholders are worried that if they accept stock, and the company goes bankrupt anyway, they will be left with nothing.
However, if the government converts its loan to equity, it signals to both groups that the White House will not let the company fail, and that the stock will eventually be worth something.
GM owes the UAW $20 billion for its retiree health care benefits, and it owes bondholders $27.5 billion.
Crucial to all of this: a new business plan for GM that reflects the current economic environment. That means fewer plants, fewer models, lower pay for union employees and a balance with far less, if any, debt. If that cannot be achieved, President Obama has said that forcing the company into bankruptcy is a strong possibility.
Previously, GM offered the bondholders 8 cents in cash, 16 and half cents in new debt, and 90% of the company's equity. It offered the union $10 billion amortized over 20 years, and $10 billion in preferred stock with a 9% interest rate. However, the auto task force told GM those offers were too generous because of the unprecedented and precipitous decline in auto sales.
Those previous offers were based on the assumption that auto sales would return to an annual pace of around 11 million cars. Thus far however, they have hovered around 9 million cars per year.
As CNBC reported more than a week ago, GM is planning to offer the bondholders no cash, no new debt, and only as much as 20% of the stock of GM, perhaps even as little as 10%. Again, negotiations are ongoing and nothing has been finalized. Terms of a possible offer could change on a daily or even hourly basis.
Reuters reports they are considering offering the unions only stock as well. If true, that would sit very poorly with the union, as it needs cash to pay for retiree health care benefits. Doctor visits and MRIs can't be paid for with stock.
However, the union retiree benefit plan does have some cash. GM had already paid them $10 billion out of $30 billion owed to them, late last year. Some argue that would justify paying the rest that is owed to them in stock, which down the road they could sell, and use to pay retiree health care benefits.
President Donald Trump hailed the U.S.-led intervention in Syria as ""perfectly executed,"" adding that the military campaign to degrade Bashar Assad's chemical weapons capability had accomplished its goals.
Less than a day after U.S., British and French forces targeted suspected chemical weapons sites in retaliation to an attack that left dozens of civilians dead last week, Trump thanked the U.S. coalition partners.
Yet in an echo of former president George W. Bush, Trump used words that ultimately came back to haunt his predecessor, by pronouncing ""Mission Accomplished."" That characterization raised questions about whether Western forces would intervene again if Assad used chemical weapons again, or if the conflict escalated amid Russia's growing bellicosity.
""A perfectly executed strike last night. Thank you to France and the United Kingdom for their wisdom and the power of their fine Military. Could not have had a better result. Mission Accomplished!"" Trump said in a Twitter post.
Defense Secretary James Mattis called the strikes a ""one time shot"" aimed at the Syrian government's chemical weapons infrastructure.
""Clearly, the Assad regime did not get the message last year,"" Mattis told reporters on Friday from the Pentagon.
""Together we have sent a clear message to Assad and his murderous lieutenants that they should not perpetrate another chemical weapons attack for which they will be held accountable.""
Back in May 2003, Bush prematurely declared the Iraq war as being over, in the wake of U.S. forces successfully toppling the government of Saddam Hussein. The event, staged on a U.S. bomber under a massive banner that screamed ""Mission Accomplished,"" overshadowed the years of conflict and bloodshed that followed.
In a briefing on Saturday, Pentagon officials also described the Syria bombing as having successfully accomplished its goals.
Trump's declaration came as Moscow, which is backing Syria in its long civil conflict, has denounced the bombing campaign with undisguised contempt. In the wake of Friday's strike, Russia's ambassador to the U.S. warned of ""consequences,"" while Russian President Vladimir Putin reportedly called the intervention an ""act of aggression.""
--CNBC's Amanda Macias contributed to this article.
Chevron Chief Executive John Watson told CNBC Tuesday that he ""strongly supports U.S. tax reform"" under President Donald Trump's administration.
Trump's administration wants to make U.S. tax reform competitive, Watson said during an interview on CNBC's ""Closing Bell."" Specifically he discussed a proposed bill — a border-adjustment tax — that could hike rates on American imports.
Despite concerns that a border tax could hurt oil prices, Chevron's Watson said industry imports would ""come into balance"" over time. ""The unpredictable effects of the U.S. dollar strengthening is what concerns a lot of people,"" he explained.
A border-adjustment tax would likely result in the appreciation of the dollar, to ease the burden of hiked prices on consumers. Would this hurt a company such as Chevron? Not so fast, Watson said.
""I think what you'll see is a disconnect,"" he explained. U.S. oil prices might rise, but international prices would offset this.
And Chevron wouldn't try to move money offshore, either, CEO Watson told CNBC. ""What we'll tend to do is take the cash flow that's generated ... and we'll recycle it into shorter cycle-time investments — the portfolio of assets we have in the U.S., in the Gulf of Mexico, in California and elsewhere.""
Since former Exxon Mobil Chief Executive Rex Tillerson joined the Trump administration, Watson said he's visited with White House staff on multiple occasions and has been encouraged by those meetings.
""We've seen a more pro-business environment ... I think the approach they're taking toward business — toward enabling our economy to grow again — is a real positive.""
LONDON — European stocks closed higher on Thursday as traders reacted positively to comments from the U.S. Federal Reserve that it will continue to support the economy.
The pan-European Stoxx 600 provisionally closed up by around 0.4%, with retail shares adding 2.1% to lead gains as most sectors and major bourses advanced.
The positive trend comes after the Fed said it will buy at least $120 billion of bonds each month ""until substantial further progress has been made toward the Committee's maximum employment and price stability goals.""
Fed Chairman Jerome Powell also said on Wednesday that stock prices are not necessarily highly priced given how low interest rates are.
On Wall Street, the S&P 500 and Nasdaq Composite opened at record highs on Thursday, boosted by hopes of Washington coming through on additional financial aid before the end of 2020.
Congressional leaders on Wednesday closed in on a $900 stimulus package that would include direct payments to individuals.
In Europe Thursday, the Bank of England kept its main lending rate at 0.1%, having earlier cut twice from 0.75% since the onset of the pandemic in March, and retained its target stock of asset purchases at £895 billion ($1.2 trillion).
In terms of individual share price action, British aviation firm Signature Aviation skyrocketed 40% to lead the Stoxx 600 after confirming it was in talks with Blackstone for a possible cash takeover offer of $5.17 a share.
At the other end of the index, Austrian chipmaker AMS slid nearly 5%.
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— CNBC.com staff contributed to this market report.
Oppenheimer Asset Management's John Stoltzfus suggests investors may want to fasten their seat belts.
The long-time bull expects a wave of near-term volatility to pressure stocks. He's blaming uncertainty surrounding this week's Federal Reserve decision on interest rates, another big batch of second quarter earnings results and a fresh round of U.S.-China trade talks.
""Any kind of disappointment in a sense, okay, I can kind of take profits today without FOMO [fear of missing out] gripping my soul,"" the firm's chief investment strategist told CNBC's ""Futures Now"" last Thursday.
With the fear of missing out gripping fewer investors, Stoltzfus contends it's not the time to get aggressive.
""We're highly selective at this point with the S&P 500 up over 20%,"" he said.
The index, which closed the week at new record highs, has already surpassed Stoltzfus' year-end target of 2,860 by almost 6%. He's planning to tweak the number once there's more visibility.
""It's under revision at this time. We're going to wait until after the Fed makes its decision on the 31st,"" he said ""At that point, we'll put in our new target for the year-end, depending on how that goes.""
Stoltzfus notes a more favorable development in the U.S.-China trade war would be an integral part of his bull case. He believes it's the biggest headwind holding back stocks from ripping even higher.
""It would be confirmation that indeed the markets thought things weren't so bad, were actually pretty good,"" he said.
For now, Stoltzfus is bracing for a 3 to 4% pullback to strike stocks near term. He'd look to add cyclical names such as consumer discretionary, industrials, financials and technology on weakness.
""Tech looks like a great place to be because technology flows into all of the eleven sectors. Every business needs technology,"" Stoltzfus said.
James Gorman, Morgan Stanley’s chief executive, has been in discussions with Moody’s in an attempt to maintain its credit ratings and stave off a downgrade that could diminish the bank’s ability to buy the rest of Citigroup brokerage Smith Barney, according to people familiar with the matter.
Morgan Stanley owns 51 percent of Smith Barney, and holds an option, which kicks in at the end of May, to increase its stake to 65 percent. Taking full control of the brokerage is a centrepiece of Mr Gorman’s strategy. Morgan Stanley declined to comment.
People familiar with the bank’s thinking have said Morgan Stanley could consider buying all of Smith Barney outright, but its ultimate decision will depend on price. Analysts have valued Citi’s remaining Smith Barney stake at around $10 billion.
Morgan Stanley would most likely have to issue debt to fund the purchase, people say. That would become more expensive if Morgan Stanley is downgraded. Moody’s put Morgan Stanley, along with five other banks, on review for a downgrade in February. The bank could see its rating reduced by as many as three notches to Baa2 - two levels above junk status.
A downgrade would also force Morgan Stanley to provide additional collateral to back its vast derivatives business, where it acts as a counterparty.
Mr Gorman has been meeting Moody’s executives since earlier this year. The chief executive, who took over from John Mack at the beginning of 2010, is also thought to be discussing possible steps the bank could take to cushion the impact of a downgrade. These include shifting the banks’ derivatives books to a higher-rated subsidiary, which would help save it collateral costs. Other banks including Citigroup and Bank of America have done this.
Other major banks, such as JPMorgan and Goldman Sachs , are also on review for downgrade at Moody’s.
Morgan Stanley agreed to fold its retail brokerage business into a joint venture with Smith Barney in 2009. The venture is a key component of the bank’s push to become less dependent on volatile trading operations.
“[A downgrade] will make it more expensive [to issue debt] on the margin, but the overall cost of funding is not very expensive,” said one banker, who specializes in selling financials’ debt. Markets may be pricing in a higher cost of funding, he added.
We know that one of the principal focuses of the government in their investigation into insider trading in general—and into hedge funds in particular—are the so-called ""expert-network"" firms.
The purpose of the expert network firms is to provide information and insight about companies that investors are interested in—and also, perhaps more crucially, to help manage the relationships between the investors and the managers of companies they seek to invest in. Think about the nature of that scenario: Investors and managers chatting together informally, outside the scope of more traditional venues like earnings calls and IR events. It seems a safe bet that, amid allegations of widespread insider trading, the government might be interested in exploring that channel to see if material nonpublic information might have changed hands.
Today, the news is that Gerson Lehrman Group, the largest of the expert network firms, had at least one of its consultants questioned by the FBI. For those not familiar with the hedge fund/expert network axis, the significance of this may not be immediately obvious.
While Gerson Lehrman Group may sound to the uninitiated a bit like a dish prepared by the Swedish Chef on the Muppets, this firm is a very serious player in the expert network space. The Wall Street Journal reports that ""Gerson controls two-thirds of the market for expert networks""
To put that number in perspective, think about this: JPMorgan is the current leader in capital markets transaction—and they control only 7.8 percent market share.
So, in the space they play in, Gerson is a vampire squid on steroids.
The Wall Street Journal article alludes to the significance: ""The FBI questioning of the Gerson consultant shows the government's examination of the expert-network business is broader than Primary Global. Criminal and civil authorities are investigating whether these consultants passed inside information to clients, who pay the expert companies large fees for their services.""
It seems that it's not just Gerson in the crosshairs—but more broadly the clients they serviced.
And which firms are Gerson clients?
According to the Journal: ""In recent years, Gerson's client roster has included prominent hedge funds like SAC Capital Advisors LLC, mutual-fund company Fidelity Investments, private-equity firm Carlyle Group LLC and Wall Street investment banks, said people familiar with the matter.""
The phrase ""has included"" tells you that we're not looking at an exhaustive inventory in the list that follows—but only a sampling.
And the message from that sample seems to be that Gerson clients are many of the big boys.
Interestingly, no ""Wall Street investment banks"" are cited by name – but if the sampling of hedge funds and private equity groups provided is representative of the caliber of firms Gerson did business with on the banking side, you might expect to see some of your favorite A-list players from the top of the banking league tables represented on their client list.
The Journal article reports that Diamondback Capital —which has already been raided by the FBI in the probe—is a client of Gerson.
It is important to note that no allegations of wrongdoing have been made against Gerson or any of its employees related to the current probe.
Nonetheless, one's curiosity might naturally be piqued by the client list and the nature of the relationships involved—enough to keep following this story. Closely.
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The first U.S. tax filing season under the overhaul that President Donald Trump signed into law at the end of 2017 got off to a slow start in the first week, with data released on Friday showing a significant drop in returns and refunds.
According to the Internal Revenue Service, the total number of returns received in the week ending Feb. 1, 16.04 million, was down 12.4 percent from the week that ended on Feb. 2, 2018. Only 13.31 million returns were processed, down 25.8 percent from the year before. The average refund of $1,865 was 8.4 percent smaller than the average refund in the period last year.
The partial government shutdown - at 35 days, the longest in U.S. history - ended three days before the tax filing season officially opened on Jan. 28. The final deadline is Apr. 15.
Republicans passed a $1.5 trillion tax overhaul in the final weeks of 2017 that cut rates for both individuals and corporations, giving fellow Republican Trump a major policy victory. Democrats had warned that the cuts and other changes in the overhaul would primarily benefit the country's wealthiest, and many are eager to see how it will affect average Americans.
Treasury Secretary Steven Mnuchin said in a statement on Friday that the 2019 ""filing season has successfully launched with millions of tax returns having been filed.""
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Oaktree Capital Management co-chairman Howard Marks on Wednesday will speak from the Context Summits Miami conference in Miami Beach, Florida.
Marks is known for his prescient investment memos, which warned about the financial crisis and the dot-com bubble implosion. During the 2007-09 market meltdown, the longtime investor established an $11 billion distressed-debt fund aimed at buying the financial instruments of companies near or currently in bankruptcy, helping Marks deliver some of the best returns on Wall Street at the time.
Oaktree Capital had $124 billion of assets under management as of September 2018, according to its website.
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Renewable energy is poised to play an ever greater role as the world shifts away from fossil fuels, and the recent pullback in clean tech stocks presents a buying opportunity, Guggenheim said while initiating coverage on solar stocks.
""We believe that the shift to distributed energy generation and storage is a large, sustained phenomenon, and owning best-in-class companies makes sense,"" the firm wrote in a note to clients. ""We expect distributed solar installations to continue growing robustly, especially now that energy storage is becoming economically viable.""
Following a 140% gain in 2020, the iShares Global Clean Energy ETF has dipped 20% this year. The S&P 500, by comparison, has gained 12%.
Guggenheim pointed to several possible factors driving the declines, including excessive valuations after 2020's record run, as well as slower-than-expected governmental policies. Other concerns include rising input costs, such as for steel and semiconductors, and higher interest rates.
But given solar's large and growing market, Guggenheim said the pullback is an ""attractive opportunity"" to pick up shares of quality names.
Italian oil and gas company Eni has bought upstream assets in the Gulf of Mexico from Dominion Resources for $4.757 billion, Eni said in a statement on Monday.
Eni said the acquisition would boost its production in the area to more than 110,000 barrels of oil equivalent per day (boepd) in the second half of 2007. In the period from 2007-2010, production from the new assets would average more than 75,000 boepd.
Eni, Europe's fourth-biggest oil company by market value, said included in the purchase were exploration assets for $680 million and said around 60% of he overall leases were operated.
""Through this transaction we reach the necessary critical mass for our activities in the Gulf of Mexico,"" Eni Chief Executive Officer Paolo Scaroni said in the statement.
Eni is one of the few world oil majors which has been able to largely avoid a decline in output as it adds production both through acquisitions and as new fields come onstream.
It has made several large acquisitions recently.
Earlier this month it won with Italian utility Enel a $5.8 billion auction for assets formerly held by bankrupt oil firm YUKOS but they handed the bulk of the prize to Russian gas monopoly Gazprom.
Eni agreed to buy a package of Congolese assets from France's Maurel et Prom for $1.4 billion earlier this year and in March struck a deal to split a stake in one of those fields with Burren Energy.
Jim Paulsen, chief investment strategist of Wells Capital Management, believes the stock market sell-off is not over.
""Finding a bottom in the stock market may well be a fool's game, but that does not stop us fools from trying,"" Paulsen wrote to clients Tuesday.
He added: ""In our view, a quick recovery back near all-time highs would leave the stock market with many of the same vulnerabilities that started the correction. Consequently, we would not be surprised if the stock market tests its correction low yet again and perhaps even fails before reaching a final bottom.""
Here is why he believes the market is vulnerable…
CDC scientists say their investigation into a rare blood clotting issue linked to the Johnson & Johnson Covid-19 vaccine has identified 28 people who developed the potentially life threatening blockages — three of whom have died.
The Food and Drug Administration and Centers for Disease Control and Prevention on April 13 asked states to temporarily halt using J&J's vaccine ""out of an abundance of caution"" while it investigated six women, ages 18 to 48, who developed cerebral venous sinus thrombosis, or CVST, in combination with low blood platelets within about two weeks of receiving the shot.
They recommended resuming use of the shot 10 days later after the CDC determined that the benefits of the inoculations outweighed their risks.
CVST is a form of thrombosis with thrombocytopenia, or TTS, which are blood clots with a low platelet count that puts patients at risk for a stroke. Platelets actually help the blood to clot.
CDC official Dr. Tom Shimabukuro said Wednesday that four of the 28 people with TTS remained in the hospital as of May 7, one of whom was in the ICU, and two have been discharged to a post-acute care facility. The remaining 19 patients have all been discharged, he said during a presentation to the CDC's Advisory Committee on Immunization Practices. The panel voted earlier in the day to recommend the Pfizer-BioNTech vaccine for use in 12- to 15-year olds.
The median age of the patients with TTS was 40, ranging from 18 to 59 years old. Women who were 30 to 39 years old accounted for the biggest risk group. All of the patients received the J&J shot before the pause on April 13. Out of the 28 TTS cases, 19 affected the brain with 10 of those patients suffering from a cerebral hemorrhage, Shimabukuro said.
The other clots formed in the lower extremities, pulmonary arteries or other areas of the body.
Forbes has ""leaned in,"" releasing its annual list of the world's 100 most powerful women, looking largely outside the corporate C-suite for its power players.
""We've taken a much more expansive, dynamic look at power, not just traditional power roles such as running a corporation or head of state, but also creative dynamic power,"" Moira Forbes, president and publisher of ForbesWoman, told CNBC.
""Money is always important to look at because it is a form of influence particularly when you're looking at the size of a global business, the impact it has, the size of an economy,"" Forbes said. ""But also we looked at things like social influence.""
Read More Why am I rich? Wealthy women cite frugality, good advice
She cited Sheryl Sandberg, the chief operating officer at Facebook, ranked ninth on the list, as an example, noting Sandberg is a business leader, self-made billionaire and uses her influence to drive dialogues on women in leadership through her ""lean in"" campaign.
""This is someone who not only has huge power in the business arena, changing the face of connectivity as we know it, but someone who's also shaping the agenda and driving conversations on critical issues for women,"" Forbes said. ""That is power and that is using it across multiple spheres.""
Read More Boardroom boys club: Women still mostly shut out
Only three of the top-10 come from the corporate world, likely a side effect of the few female leaders at the largest companies, but the 28 corporate CEOs on the list control around $1.7 trillion in annual revenue and 18 founded their own companies or foundations.
Angela Merkel, the chancellor of Germany, topped the list, her 10th appearance since the list was created 11 years ago. The second spot went to Janet Yellen, the chief of the U.S. Federal Reserve, in her inaugural appearance on the list.
Melinda Gates, the co-chair of the Bill & Melinda Gates Foundation, Dilma Rouseff, the president of Brazil, and Christine Lagarde, managing director of the IMF, round out the top five spots, according to Forbes.
Read More 'Constant inspection' stymies women in power: Wolf
Among women who have made the list every year, Hillary Clinton, a former U.S. senator, former U.S. Secretary of State, former First Lady and likely presidential candidate, took the number six spot.
Within Asia, Ho Ching, the CEO of Singapore's sovereign wealth fund Temasek, which has around $170 billion under management, moved up to number 59 from 64 last year. She's been on the list every year since its founding.
The list also includes some less obvious players, such as list newcomer Yao Chen, a Chinese actress, who ranked at 83.
Read MoreWomenomics: Japan's new growth bazooka?
""She's someone who reflects a new dynamic of power, with 51 million followers on Weibo, the largest social media following of any of our listees,"" Forbes said. ""She's become a huge voice for human rights in a country like China. She's become the first U.N. refugee ambassador form the country. So she's leveraging that influence not just for her celebrity brand, but in a positive way to spotlight critical issues.""
One high profile dropout from the list this year was Yingluck Shinawatra, who was removed from her post as the prime minister of Thailand shortly before a military coup. Yingluck is currently under house arrest and forbidden from leaving her country.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1
Wal-Mart has a reputation for offering shoppers low prices, but a report in The Wall Street Journal found that the independent banks it houses inside its stores levy some of the highest bank fees, largely as a result of overdraft charges.
After analyzing federal filings, the publication found that last year, the five banks that have the largest presence in the discounter's stores were among the top 10 domestic banks in terms of income from fees as a percentage of deposits.
Those banks are Fort Sill National Bank, First Convenience Bank, Academy Bank, Woodforest National Bank and City National Bank and Trust Company.
Overdraft fees can be a big issue for people struggling financially, as accruing them over time makes it makes it difficult to get out of debt.
A Wal-Mart spokesperson told the Journal it plays no part in operating the banks, but that it ensures ""they're in line with Wal-Mart's philosophy of saving customers money.""
To read the full story, click here.
In Monday’s Web Extra, Pete Najarian reveals where he’s seeing put buying. Also why stocks are plunging in Japan. This content is only available online - you won't find these trades on TV.
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Trader disclosure: On Mar. 3, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (INTC), (ATVI) (YHOO); Najarian Owns (AAPL), (C), (ETFC), (MS), (MSFT), (XLF); Najarian Owns (COP) Calls; Najarian Owns (YHOO) And (YHOO) Puts; Finerman Owns (GS); Finerman's Firm Owns (AAPL), (MSFT), (TSO), (YHOO), (BJS); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM); Finerman's Firm Is Short (LEH) And Owns (LEH) Puts; Charles Schwab Is A Sponsor Of ""Fast Money""
California Gov. Jerry Brown and state leaders unveiled legislation Thursday for a $1 billion drought relief package designed to help the state deal with ongoing dry conditions.
""This unprecedented drought continues with no signs yet of letting up,"" Brown said in a release. ""The programs funded by the actions announced today will provide direct relief to workers and communities most impacted by these historic dry conditions.""
Read More2014 California drought was bad. 2015 will be worse
The package would include funding for safe drinking water and infrastructure projects designed to help the state deal with dry weather.
It would also accelerate $128 million in funding from Brown's budget to communities heavily affected by the drought, the governor's office said.
About 93 percent of California remains in at least a severe drought, according to the U.S. Drought Monitor. Drought in the state is expected to causes losses of about $3 billion this year.
Read MoreWhy California's dairy cows are leaving the state
California has pledged more than $870 million to drought relief since last February. Brown has previously called on California residents to reduce their water use.
Philippines' economic growth halved in the first quarter from the previous three-month period as weak exports and agriculture hurt overall output, the statistics agency said on Thursday.
The economy grew 1.1 percent in the first quarter, below the 1.6 percent forecast in a Reuters poll, and slower than the upwardly revised 2.1 percent in October-December.
From a year earlier, first quarter growth was 6.9 percent, picking up from 6.5 percent in the fourth quarter and stronger than a forecast 6.6 percent.
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Gov. Rick Scott wants the head of the state's tourism marketing agency to step down after Visit Florida refused to publicly disclose it paid rapper Pitbull $1 million to promote the state.
Scott made the request Friday in a letter sent to the agency's board. The governor is also asking Visit Florida to begin publishing its spending, contracts, salaries, audits and other financial information.
The requests comes after Visit Florida refused to make public the contract it had with Pitbull, who recorded a video of the song ""Sexy Beaches"" to promote Florida.
House Speaker Richard Corcoran sued this week to have the contract released, and Pitbull — not Visit Florida — made it public two days later.
Scott said it is ridiculous that Visit Florida wasn't transparent about its spending.
Atlanta-based Delta and its competitor United Airlines over the weekend said they would no longer offer discounts for travel to the meeting in May. The airlines joined a list of other companies, including Avis Budget Group, Hertz Global Holdings and Metlife that announced they would end their relationship with the gun rights group after 17 people were killed in the mass shooting at Marjory Stoneman Douglas High School in Parkland, Florida, on Feb. 14.
Candidate for lieutenant governor and former state senator Rick Jeffares tweeted that he is ""leading the charge to let Delta know their attack on the NRA and our 2nd Amendment is unacceptable.""
If Delta is so flush that they don't need NRA members hard-earned dollars, they can certainly do without the $40 million tax break they are asking GA taxpayers for
After its tweet announcing the end of the NRA discounts, Delta said in a statement that the ""decision reflects the airline's neutral status in the current national debate over gun control amid recent school shootings"" and that it was taken ""out of respect for our customers and employees on both sides.""
The airline added that ""it continues to support the Second Amendment.""
On social media, some customers thanked the airlines for taking a stance against the NRA while others said they would take their business to other airlines. Delta is the second-largest airline behind American Airlines, which does not have such a discount agreement with the NRA, a spokesman said. Southwest also said it does not have an agreement with the NRA.
The NRA called the decision of the companies to cut perks to the NRA ""a shameful display of political and civic cowardice.
In time, these brands will be replaced by others who recognize that patriotism and determined commitment to Constitutional freedoms are characteristics of a marketplace they very much want to serve,"" the NRA added.
United and Delta had offered airfare discounts of between 2 percent and 10 percent, according to the NRA's website.
The decision by the two airlines is more ""symbolic"" and doesn't cut any meaningful discount, said Henry Harteveldt, a travel-industry expert and founder of the consulting group Atmosphere Research Group. After airlines have gone through waves of large mergers many travelers may not have much choice in alternative carriers.
""You have consolidation,"" Harteveldt said.
So what do the guys think is the best ETF overall?
Jeff Macke says it’s the EWA, the Australian ETF that services the explosion in China without all the volatility. Australia is a long-term growth story, he says.
Pete Najarian loves the refiners, and thinks PXE is the best ETF to play them.
Guy Adami likes the German EWG for its financial and utilities spin.
Eric Bolling has two dividend-yielding ETFs: the DVY as a domestic play and the PID for international exposure.
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Trader disclosure: On July 3rd 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Macke Owns (DIS); Najarian Owns (DNDN), (ERIC), (HLT), (JNPR (CBH), (IMMR); Najarian Closed Out Of (BIDU) Today; Bolling Owns (DIS), (T), (XOM), Natural Gas, Corn; Najarian Owned (HOT) On 6/4/07
U.S. stocks fell sharply in choppy trade Wednesday, giving up earlier gains, as Wall Street wrapped up a volatile month for the major averages.
The Dow Jones industrial average closed 380.83 points lower at 25,029.20, with Caterpillar as the worst-performing stock in the index.
More than half of the day's losses came in the final hour of trading with the Dow losing more than 240 points in the final 60 minutes.
The pulled back 0.9 percent to close at 2,713.83, with energy as the worst-performing sector. The Nasdaq composite ended 0.8 percent lower at 7,273.01.
Jeff Kilburg, CEO of KKM Financial said the S&P 500 dipped below its 50-day moving average late in the session. ""That forces some technical selling pressure and flushes out some weak longs,"" he said.
Earlier in the session, the S&P 500 and Nasdaq rose as much as 0.6 percent and 0.7 percent, respectively. The Dow gained as much as 166.12 points.
The Dow and S&P 500 snapped 10-month winning streaks, their longest since 1959. The Nasdaq posted a monthly loss for the first time in eight months. For the month, the Dow and S&P 500 closed lower by 4.3 percent and 3.9 percent, respectively. The Nasdaq closed February down 1.9 percent.
February was a volatile month for stocks. The major averages dipped in correction territory earlier this month, falling 10 percent from record highs set on Jan. 26. The move lower came as fears of rising inflation sent rates higher and sent market volatility surging after a year of unprecedented calm.
""The volatility is being caused by one overarching theme: The market doesn't know what to expect from the Fed,"" said Tom Essaye, founder of The Sevens Report. ""There's uncertainty around that and it's going to continue for the next several months.""
But the Dow, S&P 500 and Nasdaq had recovered some of those losses as of Wednesday's close. The Dow and S&P 500 are 6 percent and 5.5 percent, respectively, below their all-time highs, while the Nasdaq was 3.1 percent away.
Stocks rose earlier on Wednesday as interest rates stabilized. On Tuesday, the 10-year U.S. note yield jumped about five basis points to over 2.9 percent after Federal Reserve Chair Jerome Powell hinted at the possibility of more than three rate hikes for 2018 in his testimony to Congress members.
Powell's testimony also sent stocks reeling. The Dow closed nearly 300 points lower, while the S&P 500 and Nasdaq finished the previous session down 1.3 percent and 1.2 percent, respectively.
""Valuations keep getting stretched,"" said Eric Ervin, CEO of Reality Shares. ""As long as rates remain low, the market can justify them. But as rates go higher, then we have to have higher earnings growth. The question is can companies sustain this.""
Powell is scheduled to testify in front of Congress again on Thursday.
In corporate news, home improvement retailer Lowe's reported weaker-than-expected quarterly earnings, sending the company's stock down more than 6 percent.
Booking Holdings — formerly known as Priceline — saw its shares spike more than 6 percent after reporting better-than-expected adjusted earnings.
Correction: Powell is scheduled to testify in front of Congress on Thursday. A previous version of this story misstated the day.
Down big in the first half of the year, up big in the second – that is Cramer’s latest investing thesis.
The Mad Money host found a number of stocks, culled from the S&P 500’s worst-performing sectors, that he thinks offers a tremendous amount of snapback potential. One of them, in fact, has lost almost half its value so far in 2010, but Cramer said it could end up being one of the best stocks to own over the next six months.
The others, whose loses may not be as severe, still stand up as very attractive buys for the rest of the year, Cramer said. Investors who agree with him probably want to buy in now, as these picks won’t stay secret for long.
Read on for the Top 6 Comeback Stocks of 2010.
Posted 26 July 2010
When Cramer highlighted Verizon on July 12, the stock had fallen 15% over the first six months of 2010. They may come as little surprise given that telecommunications was the S&P 500’s worst-of-the-worst sector over the same time period, but Cramer is expecting a turnaround here, at least for Verizon.
He said the company holds “huge opportunities” in the wireless space, where it owns 55% of the second-largest carrier in the industry, Verizon Wireless. And with the “reaffirmed rumors” that the company will start selling the Apple iPhone in January 2011, “I think … Verizon should lead the industry in terms of market share gains,” given how much of a game-changer the handset was for AT&T.
And that’s not even taking into account smartphones as a whole. Only 17% of the company’s wireless subscribers own true smartphones, leaving open a huge opportunity for revenue growth as they make the switch.
Click here for more on Verizon.
Cramer thinks this graphics chipmaker, down 40% in the first half of the year, should snap back thanks to a number of new revenue-driving products for gaming PCs, notebooks, netbooks tablets and smartphones. There’s also new visual computing software, like Adobe’s Creative Suite 5, require NVIDIA’s high-end semiconductors, also giving a boost to revenues.
The company���s ION chips for notebook computers are in 70 laptop designs, 50 of which are scheduled to start production in the next six months. And NVIDIA’s chip for smartphones and tablets should be in a whole slew of products that are also going into production during the last part of the year.
For these reasons, NVDA should be ramping ahead of these products launches, not losing nearly half its share-price value. And that’s why Cramer thinks the stock could be “one of the biggest gainers in the second half” of 2010.
Click here for more on NVIDIA.
Oddly, Jabil’s stock took a 15% hit over the first two quarters of the year, even though the company’s June 22 earnings report showed a business that is firing on all cylinders. The problem? Too much exposure to Europe – as much as 31% of Jabil’s production ends up on the Continent – and that has sent investors running.
According to the company, though, there has been no slowdown in business there. So that collective freak-out was all for naught. And as Europe comes back, Cramer said, so should JBL. Investors might consider buying the stock now given how cheap it is.
Click here for more on Jabil Circuit.
The catalyst for this stock’s rebound will most likely be study that Range Resource conducted on its drilling practices that flew in the face of environmentalists everywhere.
Hydraulic fracturing, or fracking, is a process by which natural-gas drillers like RRC use large amounts of water with some chemical additives to boost production, and there had been concerns from both environmentalists and the Environmental Protection Agency that it could contaminate drinking water – even though there never been any documented cases of that contamination.
Well, Range Resources in July disclosed that , for its Marcellus shale wells, 99.86% of its drilling fluid consists of water and sand, with just 0.14% comprising highly diluted chemicals. RRC was the first company to “open its books,” so to speak, in this way, and RRC rallied accordingly.
“I think maybe this the beginning of a major turn in the stock,” Cramer said.
Click here for more on Range Resources.
This health-care company lost 11.4% of its value this year, in part, because of its exposure to Europe – 24% of the company's sales come from the Continent. But Cramer thinks this will become less of an issue in the second half of the year, as CEO Miles White has vowed to take a conservative stance on European business.
Cramer also likes the pharmaceutical company's range of drugs and little exposure to generics. Its flagship product, Humira, is a psoriasis drug and anti-inflammatory, which makes up 35% of the company's sales and is growing by 20%.
The Abbott Park, Ill.-based company is also making ""savvy"" acquisitions in emerging markets, including India, which is an $8 billion pharmaceutical market that's expected to double in size by 2015.
Plus, the company boasts a 3.6% dividend yield and, for the last 38 years, has increased its payout every year. 2010 should be no different, Cramer said, because it's growing earnings at 11% annually, which is twice the pace of other pharmaceuticals.
Click here for more on Abbott Labs.
This West Chester, Ohio-based steel company struggled in the first half of the year, posting a 37% decline year-to-date. Cramer didn't like this stock at first because it's not a vertically-integrated steel maker, meaning it doesn't have its own mines and needs to buy its primary raw materials. In other words, AK Steel's operating costs were very high.
But Cramer thinks this stock could be poised for a turnaround, as those costs have since plummeted. He also likes the company's management, who reduced the employee headcount by 30% while maintaining the same production capacity. At the same time, the company has used more than $2 billion of internally generated cash to shore up its balance sheet. It has also managed to muddle through the recession without selling equity, issuing debt or cutting its small dividend, which has a 1.4% yield.
Click here for more on AK Steel.
Apple’s jaw-dropping announcement that it had nearly $100 billion in cash on hand at the end of the last quarter has many people scrambling for ideas about what Apple should do with all that loot.
Apple said this week it ended the last quarter and the year with $97.6 billion in cash, to be exact — much of it held overseas for tax purposes. By comparison, that's twice as much cash as Google, which ended the year with $44.6 billion in the bank.
Apple officials said the company is discussing ways to use the cash. There’s some speculation that they could use it to build out the supply chain, lending money to their suppliers to bolster productivity, or perhaps increase their investment in Apple TV.
Many investors, of course, would like the see the company pay a dividend. But the low multiple to earnings suggests that the market doesn’t see this in the offing.
The main problem with a company that has accumulated a huge amount of cash is the temptation to do something foolish with it. Acquisitions, for instance, tend to increase when companies find themselves with an abundance of cash. This seems unlikely in the case of Apple, since there appears to be few acquisition opportunities that wouldn’t raise antitrust concerns.
What most people do not appreciate about cash is that it is a strategic asset. Cash holdings might appear to do nothing in good times, but when credit constricts or markets wobble — and usually these things happen together — he who lives with the most cash wins.
It's tempting to think of Apple's cash hoard as a shield it can hide behind in tough times. But that's not quite right. It's more like a sword — a weapon to strike against weaker rivals.
Companies with large cash holdings are reliably able to capture market share from cash-constrained competitors. Where the cash-poor competitors are forced to cut costs, reduce marketing and slow expansion if consumer demand slows, the cash rich can pour even more resources into hiring, marketing and development. They can use a crisis as an opportunity.
This is competition at its bloodiest. You can see why so many of the other top tech companies — such as Google and Microsoft — are also accumulating cash. They are all attempting to assure that if global markets take a downturn, they can keep flying high.
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U.S. government debt prices were lower on Monday morning as investors monitored U.S.-Russia relations and digest new earnings reports.
The yield on the benchmark 10-year Treasury notes sat at 2.291 while the yield on the 30-year Treasury bond was slightly higher at 2.894 percent. Bond yields move inversely to prices.
A monthly index of signed contracts to purchase existing homes increased 1.5 percent in June compared to May, and May's figure was revised slightly higher, according to the National Association of Realtors.
Also on the data front, manufacturing activity across Texas rose at a faster pace in July than in June, according to the Federal Reserve Bank of Dallas's production index. The Dallas Fed's production index, a key measure of manufacturing conditions in the state, rose 11 points to 22.8, while its general business activity index edged higher to 16.8.
The White House dramas continued in the afternoon after President Donald Trump removed newly-appointed Anthony Scaramucci as communications director. The decision came at the request of John Kelly, the president's new chief of staff, according to the New York Times.
On Friday, the Kremlin has told the United States it needs to cut 755 of its staff members in Russia and further measures could be taken as a result of new sanctions against the Moscow.
In commodity markets, prices hit a two-month high on Monday morning as the U.S. considers sanctions against Venezuela. Brent was trading higher at $52.62 and WTI stood at $50.15.
Apple as a non-confirmation? It started in the middle of February: Transports failed to keep advancing with the Industrials. At the time, the failure was blamed on higher fuel prices; indeed, oil prices hit a 10-month high as we closed out that month.
That was the first non-confirmation that got bears going.
Then, as we moved into a new quarter in April, it was noted that the small-cap Russell 2000 began underperforming the S&P 500. It is a modest underperformance (down 4.7 percent for the month vs. the down 2.9 percent S&P underperformance) but it too has been seized upon by bears as a sign that U.S. growth — even with modest expectations of 2.5 percent GDP growth — may be moderating.
Now, the Nasdaq — which has dramatically outperformed the S&P 500 all year (up 14.5 percent vs. 8.7 percent), is underperforming — but only for today. Volume on the Nasdaq is slightly higher than normal.
It's not just Apple , plenty of other companies like Seagate, Broadcomm and even Netflix have turned in stellar performances this year.
I know everyone is worried about AAPL down 5 days in a row, but this is the first day the Nasdaq has significantly underperformed.
It's a sign of the power of AAPL that even a one-day drop has traders wondering.
This is tricky. Apple, by traditional valuation metrics, is not overpriced. But the investor concentration in the name, along with a 50 percent runup in a little more than three months, has got many nervous.
And the bears have noted for weeks that estimates — and price targets — for AAPL have continued to climb.
Glass half empty? Economic data very mixed this morning: positive retail sales, but the Street is concentrating on the lower than expected housing and Empire Manufacturing figures.
The National Association of Home Builders Sentiment Index got an unusual amount of commentary this week, largely because of this comment from Chief Economist David Crowe: ""Interest expressed by buyers in the past few months has yet to translate into expected sales activity.""
Not all negative news: Reliance Steel this morning increased its Q1 guidance to $1.50, well above prior guidance of $1.22-$1.40 and above consensus of $1.29. CEO David Hanna attributed the higher guidance to better pricing and ""somewhat stronger"" demand. RS is primarily a U.S.-based producer; their core business operates service centers that distribute metal products all over the U.S.
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The Phoenix Suns announced Tuesday it will partner with sports merchandise company Fanatics.
Fanatics will oversee the Suns' online, mobile and in-venue team shops at Phoenix Suns Arena in what is labeled an ""omnichannel retail partnership."" Fanatics will also control e-commerce operations for the Suns' sister team, the Mercury of the Women's National Basketball Association, and collaborate with team jersey patch partner PayPal for payment options for consumers.
Fanatics said the deal is ""long-term"" but didn't provide financial details. In such agreements, National Basketball Association clubs usually provide Fanatics with a percentage of net revenue from merchandise sold.
The NBA said the team ranks in the top half of merchandise sales but didn't respond to messages seeking where the team exactly ranks. The Los Angeles Lakers, Brooklyn Nets and Golden State Warriors are the top three clubs on the list, which ranks the most popular team merchandise for the first half of the NBA's 2020-21 season.
""We're really excited about the collaborative approach and the future innovations that we'll create together,"" Ed O'Brien, Fanatics senior vice president of business development, said in a statement announcing the Suns deal.
Fanatics now operates 13 NBA clubs. In March, the company raised $320 million in new funding, giving it a valuation of $12.8 billion, up from $6.2 billion last August. And in February, it started its Fanatics China operation, joining investment firm Hillhouse Capital.
Fanatics expects its China operation will be worth over $1 billion.
The Suns are preparing for the NBA's postseason for the first time in a decade. The team is currently sitting second in the Western Conference with a 48-20 record.
Business partnerships are accumulating now that the club is back in contention. The Suns announced an alliance with FanDuel to capitalize on Arizona's decision to allow mobile wagering. And last November, Verizon acquired the naming rights to the Suns' new $45 million practice center.
The team has a significant asset open with its arena name, though. The Suns completed upgrades to their downtown complex via a $230 million project with the help of city funding. Suns CEO Jason Rowley told CNBC in April the naming rights slot is gaining interest.
""We're making sure we pick the right partner, and it's a good fit for the partner and us,"" he said. ""These are long-term relationships that need to be mutual and beneficial.""
Disclosure: CNBC parent Comcast and NBC Sports are investors in FanDuel.
Saudi Arabia raised $7.5 billion in its first dollar bond sale since the killing of Saudi dissident and U.S. resident Jamal Khashoggi incited an international uproar.
Khashoggi's killing sparked concerns that international investors would shun the kingdom. Saudi Arabia is prosecuting several agents and officials allegedly involved in the slaying at the Saudi Consulate in Istanbul.
Riyadh denies that Saudi Crown Prince Mohammed bin Salman was involved in the murder, but the CIA has reportedly concluded that the king-in-waiting was complicit in the killing.
While some business executives have cut ties with the kingdom over the incident, bond buyers do not appear ready to overlook an investment opportunity in Saudi Arabia, the world's largest oil exporter.
The issuance was nearly four times oversubscribed, with the order book peaking at $27.5 billion, according to the Saudi Ministry of Finance.
Saudi Arabia sold $4 billion in 10-year notes that mature in 2029, and $3.5 billion in in 31-year notes that come due in 2050.
U.S.-based investors accounted for 40 percent of the 2029 bond purchases and 45 percent of the 2050 debt, according to Reuters.
On Wednesday, Saudi Energy Minister Khalid al-Falih said state-owned oil giant Aramco will issue bonds in the second quarter of this year. The debt will most likely be issued in dollars, he said.
WATCH: Turkish foreign minister says Saudis have heard Khashoggi killing audio
Major League Baseball spring training is underway and some of the biggest concerns about spending by teams headed into the MLB season have now been addressed, with roughly $1 billion spent on new player contracts within the last two weeks.
On Thursday, all-star outfielder Bryce Harper signed a 13-year, $330 million contract with the Philadelphia Phillies, the largest contract in MLB history in total value, though not per-year salary. The week previous, the San Diego Padres doled out $300 million over 10 years to Manny Machado. The Colorado Rockies also resigned Nolan Arenado to an eight-year, $260 million contract; the New York Yankees gave outfielder Aaron Hicks a seven-year, $70 million deal; and the St. Louis Cardinals starter Miles Mikolas received four years and $68 million.
But bigger problems persist for the MLB: Attendance is down, games are still too long, and the gap between the richest and poorest teams remains wide, leading to a lack of competitiveness from many teams .
Eight major league teams experienced double-digit attendance losses in 2018, led by the Miami Marlins' 52 percent decline — the laggard was no surprise, as the Marlins traded both 2017 National League Most Valuable Player Giancarlo Stanton to the New York Yankees and Christian Yelich to the Milwaukee Brewers (who went on to win the 2018 National League MVP award) before the season began, as part of the beginning of a long rebuilding process.
Several currently successful teams embraced a rebuilding process, such as the 2017 World Series champion Houston Astros and 2016 World Series champion Chicago Cubs. The Padres will be another test case this season: The team inked the Machado deal after amassing what is widely regarded as one of the best farm systems in baseball, but also after close to a decade of consistently poor results on the field — the team has not had a winning record since 2010 and has not made the playoffs since 2006.
Like the Padres' 66-96 record last season, there have been several other teams who have drowned in losses, mostly from stripping talent away, attempting to rebuild younger and cheaper rosters. The Baltimore Orioles went 47-115 last season; the Chicago White Sox and Cincinnati Reds have both had five or more straight losing seasons since 2014.
Stephen J.K. Walters, a professor of economics at Loyola University Maryland and former economic advisor to MLB teams, said mid- and small-market teams are taking an approach that is defensible. ""The current amount of competitive imbalance — for example, Baseball Prospectus forecasts that only 5 of 15 American League teams will have winning records, with 82 wins or more — is chiefly a result of mid- and small-market teams' acceptance of the idea that they can get away with boring their fans for a few years as also-rans while they hoard high draft picks and prospects, and then they'll be good and all will be forgiven.""
According to Roto Champ, the Padres now have the second-best prospect in baseball with Fernando Tatis Jr., a 20-year-old shortstop from the Dominican Republic and son of a former major leaguer. The Padres, White Sox, Reds and Rays possess a combined seven of the top 20 players on Roto Champ's list.
Under the current Collective Bargaining Agreement (CBA), revenue sharing dollars have to be utilized in effort to try and improve winning but that does not necessarily mean those dollars have to be invested in free agency. The MLB commissioner may require a team to submit a report that details its efforts to win over the next two years if he feels that team has violated any of the rules that come along with the revenue sharing procedure.
Last year, the MLB Players Association filed grievances against the Tampa Bay Rays, Miami Marlins, Pittsburgh Pirates and Oakland Athletics, claiming each team did not spend its revenue sharing money in the expected manner.
In the Moneyball era, spending smart on talent doesn't have to mean spending the most and there are examples of tighter-wad teams performing on the field at a high level. The Athletics made the playoffs last season, losing to the Yankees in the American League wild card round. The Rays won 90 games, but fell short of clinching a playoff spot. Each of these team's 2018 payrolls was below $90 million and this year seems to be heading in the same direction. These four teams rank towards the bottom (25-30) of team payroll trackings, with the Rays at a league low just above $51 million.
MLB Commissioner Rob Manfred addressed the grievances during a recent spring training appearance with the Pittsburgh Pirates president Frank Coonelly. ""Tony Clark (MLBPA Director of Player Relations) started the assertion that teams aren't trying to win by singling out four teams,"" Manfred said, according to a report in the Pittsburgh Gazette. ""He did a very poor job with those teams. One won 97 games, another won 90, and the other was a game above .500, right Frank (Coonelly)? Two games above .500. Our teams are trying. They all want to win."" Manfred added, ""This narrative that our teams aren't trying is just not supported by the facts. Our teams are trying. Every single one of them wants to win. It may look a little different to outsiders because the game has changed. The way people think about putting a winning team together has changed. But that doesn't mean they're not trying.""
Walters said part of the competitive balance problem is the revenue sharing model used by the MLB.
""The fix: a requirement that the bulk of revenue-sharing receipts gets spent on major-league talent,"" he said. ""In any case, competitive balance is more about 'compression' of spending on payroll. … To encourage those low-spending, small-market teams to buy a little more talent, I'd tweak MLB's revenue-sharing formula. It's complicated, but right now money gets distributed based on market size, but if it was a combination of market size and wins, that would breathe more life into the free agent market.""
In effect, it would incentivize smaller market teams to spend more on players and create a positive feedback loop in which spending more would result in receiving more from revenue sharing.
""Optimal revenue sharing is an empirical question because it ultimately depends on the supply-side objectives of club owners throughout the league. Owners range from being profit maximizers who are only in it for the money to sportsmen gamers who are only in it to win it,"" said John Vrooman, an economics professor at Vanderbilt University.
But not all economists agree that revenue sharing is broken, or even, the root of the problem. David Berri, professor of economics at Southern Utah University and the author of ""Sports Economics"" views a limited population of talent rather than revenue sharing as the primary reason for the competitive imbalance.
""Baseball was not competitive in the first half of the 20th century because the talent pool was restricted (only white males from the U.S. played). Racial integration and a global search for talent expanded the talent pool and made the game much more competitive,"" Berri said.
None of this is to say the business of baseball is not a financial success. In fact, the MLB is flush with cash. The league grossed $10.3 billion in 2018, the 16th-consecutive year that the league saw record gross revenue, according to a widely cited annual Forbes report based on information provided from league sources to baseball writer Maury Brown. And despite a 4.1 percent attendance drop in 2018, television broadcasts for twelve major league teams ranked first in their market in primetime, according to Major League Baseball.
The MLB saw a five-year viewership high on its Fox package, which in part contributed to a seven-year extension with Fox Sports, continuing to air World Series and All Star games through 2028, an extension worth a reported $5.1 billion.
The MLB also was ahead of professional sports league peers in its development of streaming technology, a forward-thinking effort that ultimately resulted in Disney's billion-dollar-plus purchase of BAMTech, the MLB's internet start-up, now valued at close to $4 billion.
Although the MLB has crowned eight different World Series winners in the last 10 years, it has for the most part been a similar set of teams making the playoffs each year. The Los Angeles Dodgers (who lost in the last two World Series) have consistently won the National League West since 2013. The Boston Red Sox (the current World Series champion), have won four titles since 2004. And the New York Yankees, another money spending powerhouse, have only missed the playoffs four times since 2008. These teams are consistently atop league leaders in payrolls.
Despite competing for a good majority of last season, the Phillies faded down the stretch, finishing the season with an 80-82 record. Phillies owner John Middleton said in November that his organization was going into the offseason ready to spend ""and maybe even be a little bit stupid about it.""
As Red Sox owner John Henry put it: ""It's very difficult to predict things in baseball, to predict player performance. Spending more money helps.""
China's retail sales growth surged in August to its quickest pace in more than three years, beating forecasts, but analysts said the jump largely reflected stronger inflation, not necessarily quicker underlying growth.
Retail sales, which are tracked in nominal terms, grew 17.1% from a year earlier, compared with 16.4% in July. The uptick roughly tracked a rise in annual consumer inflation in August to 6.5%, from 5.6% in July.
""Retail sales growth is obviously strong. The problem is that the figures are being pushed up by the rising inflation as well. So actually, on a real basis, I don't think there's much of an acceleration,"" said Paul Cavey, an economist with Macquarie Securities in Hong Kong.
August's pace, the quickest since May 2004, beat economists' expectations of a 16.5% rise. Consumer inflation data, released on Tuesday, also surprised on the upside.
Beijing would welcome an increase in real buying activity by the country's consumers. It is trying to tilt its economy away from what economists call an unsustainable reliance on exports -- to the tune of 40% of national output.
Not only does China's gaping trade surplus -- it hit $25 billion in August -- contribute to tensions with its major trading partners, it also exposes it more to any downturn in the United States or other economies.
Cavey said that a lynchpin of Beijing's efforts to spur spending would be their effectiveness in the countryside, and that a recent epidemic among pigs was likely to blunt growth in spending there this year.
""We will expect retail sales growth to continue to be strong next year as the countryside gets over all this,"" he said.
In the details, the retail sales data suggested a significant impact from the recent spike in food price inflation. Sales of grain and edible oils and meat, eggs and poultry, two of the categories where price rises have been most striking, rose 44% and 45.2%, respectively.
Still, Lin Songli, senior economist at Guosen Securities in Beijing, said the figures showed that consumption was starting to take up a greater role in driving the world's fastest-growing major economy.
""Consumption growth has not reached its peak yet, and we are now expecting even higher growth rates in coming months,"" Lin said.
European stocks, especially the transportation sector, were declining, in the wake of Tuesday's terrorist attacks at the main Brussels airport and a metro station near European Union buildings.
Nandini Ramakrishnan, global market strategist at JPMorgan Asset Management, told CNBC's ""Worldwide Exchange"" the blasts were likely to dampen a key driver of Europe's recovery.
""I think there's a larger story here, where these types of events do affect consumer sentiment,"" Ramakrishnan said. ""We're worried about consumer discretionary sectors, which have been really pioneering the European recovery.""
European airlines stocks fell after news of explosions. Air France, for example, was down about 4 percent. Travel on small commercial flights, which Europe is known for, is likely to continue slowing as fears about terrorism reignite, Ramakrishnan said.
""[But] markets are a bit more resilient than we think, people are still waiting to see as the news develops,"" she said. ""It's very difficult for traders and investors to position themselves in any way for something like this.""
The attacks in Brussels could impact the so-called ""Brexit"" referendum in June, said Ramakrishnan. ""An event like today certainly does push the case for certain campaign language for the U.K. to leave the EU a bit further.""
Ramakrishnan sees shakiness in U.K. equities, because of investor indecision on whether to put money into companies that rely on the close relationship with the European Union.
""We're in a bit of a wait-and-see mode,"" she added. ""The uncertainties could certainly affect markets in a negative way.""
Ben Emons, managing director and portfolio manager at Leader Capital, was also clear about Tuesday's attacks influencing this summer's vote on whether the U.K. should exit the EU.
""The security of Europe continues to be in question,"" Emons told ""Worldwide Exchange"" in a separate interview. ""Political pressure is clear and this will only fuel your skeptics.""
The dollar has weakened against a basket of currencies over the past few weeks but the index was reversing slightly Tuesday. Emons said the trend is this is likely to continue. ""I think the dollar takes some of the weakness back and just gets strength in a day like this.""
Economic surveys out of Belgium, he said, are key consumer indicators for the rest of Europe. They're likely to be dulled by the explosions in Brussels, he said.
""Belgium is an open economy, very dynamic, and has the largest port in Europe, so that will be a level of disruption, too,"" Emons said.
China will take steps to contain a renewed burst in bank lending and a larger-than-expected rise in the country's controversial trade surplus last month, senior officials said on Friday.
Speaking on the sidelines of a annual parliamentary session, which ends on Friday, central bank governor Zhou Xiaochuan said the authorities would place further controls on bank lending.
""From a commercial perspective, it is understandable for the banks to lend aggressively at the beginning of the year,"" Zhou told reporters. ""But from a macro perspective, after serious study, we decided to place further controls (on it),"" he said. He did not offer any timeframe.
Lending data released this week reinforced concern that banks, awash with cash, may fund a new round of speculative investment. Lending surged by 413.8 billion yuan in February, compared with an increase of 149.1 billion yuan in February 2006.
Separately, Commerce Minister Bo Xilai said the nation's trade surplus had been ""too large"" in February and reaffirmed that Beijing planned new steps to trim exports and step up imports.
China on Monday reported its second-biggest monthly trade surplus on record, dwarfing forecasts and handing fresh ammunition to critics who say Beijing is giving its exporters an unfair edge by holding down the yuan.
The surplus for February ballooned to $23.76 billion, with exports leaping 51.7% from a year earlier. ""We are also very nervous about that,"" Bo said of the size of February's surplus. ""We're seriously studying the whole situation to find the underlying reasons.""
One reason for the surge was a propensity among Chinese firms to ship their goods out of the country to prevent them from being penalized by possible policy changes, he said.
The Commerce ministry would make appropriate adjustments to the export tax rebate system, paying special attention to the area of processing trade as that generated the biggest portion of the surplus, Bo told reporters, without giving details.
Zhou also said the authorities were keeping a wary eye on inflation, which he said had been running too high.
Asked whether the central bank would raise interest rates soon, Zhou said they were seriously studying the inflation situation and would take ""appropriate measures"".
Stocks were searching for direction on Thursday with investors digesting generally positive earnings reports versus not so positive economic news.
Among the Dow components 3M, Travelers and McDonald's all posted solid results suggesting strength, however, the number of workers filing new jobless claims rose by 11,000 last week, indicating the labor market remains fragile.
Adding to the negative tone, one day earlier, widely followed bank analyst Dick Bove cut his view of Wells Fargo saying loan losses were mounting. However Wells along with Goldman and other banks shrugged off the negative comments and trended higher.
How should you be positioned?
Instant Insights with the Fast Money traders
It seems to me investors are digesting the harsh sell-off that followed Bove’s comments, muses OptionMonster Jon Najarian. Personally, I think it’s positive that the S&P has stabilized at this level. And I’m watching Goldman closely, he adds. Positive momentum in Goldman shares could be a ‘tell’ for the market overall. Into the close, if Goldman goes up, I think the market goes up. Follow the money.
It seems to me resistance at these levels is strong, muses Mike Gurka of Empower. By and large earnings have been beating expectations. With trim payrolls and lower inventories the future may look brighter for Corporate America.
I’m watching the December S&P contract, explains Greg Troccoli of Opalesque. Any close below 1071 and I would sell the S&P outright and take a short position. As for Goldman, I would not be a buyer at these levels. The stock has almost quadrupled since last November. I think upside is limited.
In the banking space I’m watching Capital One, adds Jim Strugger of MKM. Around 37.50, I’d take a shot with a 38- strike call in November.
TAKE YOUR POSITION: MICROSOFT
Tech investors are keeping a close eye on Microsoft Thursday. The software giant reports earnings on Friday before the bell.
Ahead of the results, the company launched Windows 7 OS, its most important release for more than a decade, aiming to win back customers after the disappointing Vista and strengthen its grip on the PC market.
The success of Windows -- which accounts for more than half of Microsoft's profit -- is crucial for Chief Executive Steve Ballmer to revive the company's image as the world's most important software firm
What’s the trade?
I think over the long run Windows 7 will do well, muses Mike Gurka. But on the day-to-day side of trading, I wouldn’t be surprised to see the market anticipate a pullback in this stock.
I would buy Microsoft on weakness, counsels Jon Najarian. And I’d take a look at Hewlett Packard as a beneficiary of Windows 7.
-------
WITH OIL AT $80 TIME TO BUY?
Oil slipped below $81 on Thursday as a stronger dollar encouraged investors to lock into profits from a 12-month high hit the previous day.
On Wednesday, U.S. crude surged to $82, the highest price since October last year, as weekly U.S. government oil data showed a large drop in gasoline inventories over the last week and fuel demand rising about 4 percent year-on-year.
It's also important to note that many analysts think the oil trade is more about the dollar right now than supply and demand.
It is becoming almost imperative to trade the commodity markets from the perspective of the dollar these days, as nothing else seems to count for very much, MF Global wrote in a research note.
What’s the trade?
I’m a buyer, says Greg Troccoli. As long as oil stays above $76 I think it goes to $89.
--------
FAST & FURIOUS: THE KEY QUESTIONS INTO THE CLOSE
BUY AXP? With American Express reporting after the bell today, should you buy?
I’m seeing mild bullish options action, explains Jon Najarian.
BUY BNI? Buffett favorite Burlington Northern is set to report after the bell, should you buy?
I’m a buyer, reveals Mike Gurka. I think the company is well positioned domestically.
--------
CALL THE CLOSE
Jon Najarian: If Goldman goes up, I think the market should go up. Follow the money.
Greg Troccoli : I’m a seller
Mike Gurka : Don’t sell
Jim Strugger from Stamford: I’m buy puts against long stock.
______________________________________________________
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CNBC.com with wires
The L.A. City Council voted Tuesday to make condom use mandatory in adult films. And adult studios are already planning how to minimize the effects of that law.
Technically, the legislation, which will tie mandatory condom use on set to city film permit approvals for porn shoots, needs to first be approved by the city's mayor — and won't go into effect until police officials, the city attorney and others figure out how it might be enforced. That gives adult entertainment companies time to adapt. And some of the biggest studios say the first option is to relocate production to other areas.
""[Studios] will move out of the city of L.A. and they'll stop shooting here,"" says Steven Hirsch, founder and co-chairman of Vivid Entertainment, the industry's largest studio. ""There's no question of that. … I'm not sure what they're going to accomplish aside from kicking the industry outside of the city ""
Hirsch estimates porn studios have shot over 300,000 scenes in the past six years, with the majority of those being filmed in the L.A. area. (The San Fernando Valley is nicknamed ""Porn Valley"" because of the industry's tight concentration there.)
A filming permit in L.A. carries a basic application fee of $625 and usually comes with additional costs, depending on location and the activities filmed. That makes the porn industry a notable source of revenue for the city.
Scott Taylor, founder of New Sensations, says his company will comply with the law for L.A. shoots, but he, too, expects to move filming outside the city.
""L.A. County does have borders and if we need to adapt, we will,"" he says. ""It's a real pain to do so, but we will have to find off-the-beaten-path locations.""
One location that could become a new favorite is Las Vegas. The town that bills itself ""Sin City"" is already a second home to the porn industry, playing host to its annual convention each year. Additionally, there are tax savings to be had by shooting there that could cover some of the expenses of moving production to the area.
Ultimately, say studio executives, the decision on where to focus shooting if they do move productions outside of L.A. will depend on where the performers settle.
The decision to make condom use mandatory for adult actors is a notable winfor the AIDS Healthcare Foundation, which has been lobbying for it for some time. The Free Speech Coalition, the porn industry's trade association, criticized the vote. A legal challenge is possible, though isn't certain, say insiders.
And the porn exodus might not stop at filming locations. Hirsch says Vivid hasn't made any final decisions but is not opposed to relocating to another city if performers begin to settle in a new territory.
That's a move of last resort, of course. Moving a company to another state carries a lot of expense — and for a studio as diversified as Vivid or New Sensations, it's not always practical.
Taylor, for instance, says he has no plans to leave L.A.
""I have a multitude of businesses,"" he says. ""I have a distribution facility that puts the products in stores and an Internet division that handles a lot of digital sites, so uprooting that core and moving it really isn't realistic.""
Smaller studios, though, might be more willing to uproot. Or, alternatively, they might simply ignore the regulations or film without permits — as many currently do.
""There will be many smaller companies that will go ahead and shoot anyway,"" notes Hirsch. ""Some people will shoot their movies regardless.""
Some porn studios, meanwhile, won't be affected at all by the law. Girlfriend Films, which specializes in lesbian movies, won't have to change its practices. And Wicked Pictures has maintained a condoms-only policy since 2004, putting it in compliance with the new legislation.
Check out the companies making headlines in midday trading.
Ford — The legacy automaker's stock rose 2% after Ford reported better than expected earnings for the fourth quarter and updated investors on its plans for electric and autonomous vehicles. The company said it will spend $29 billion on the new technology through 2025. Revenue for the fourth quarter did miss expectations, however.
T-Mobile — Shares of the telecommunications company fell more than 3% despite a stronger-than-expected fourth quarter report. T-Mobile reported 60 cents in earnings per share and $20.34 billion in revenue. Analysts surveyed by Refinitiv had penciled in 51 cents per share and $19.93 billion in revenue. The company's guidance for cash flow metrics in 2021 missed expectations, however, according to FactSet.
Peloton — Shares of the at-home cycling stock fell more than 7% after the company outlined ongoing supply chain issues amid a surge in demand for its products. Peloton, however, reported sales growth of 128% during the fiscal second quarter, bringing in more than $1 billion in a single quarter for the first time in the company's history. Peloton earned 18 cents versus the 9-cent profit expected by the Street. Revenue came in a $1.06 billion, also ahead of the expected $1.03 billion, according to Refinitiv.
Activision Blizzard — The video game maker led the S&P 500 on Friday with a nearly 10% gain after it reported fourth-quarter profit and revenues ahead of Wall Street's expectations. Rob Kostich, president of Activision Publishing, said Thursday evening that its ""Call of Duty"" franchise, including free-to-play ""Warzone,"" was a key driver of the company's business in 2020 and that the game is ""going to be front and center for us for a long time.""
Snap — The social media company saw its shares jump nearly 6% after beating expectations on earnings, revenue and user growth. Snap posted an adjusted earnings per share of 9 cents, versus 7 cents expected by analysts, according to Refinitiv. However, the company issued a light first-quarter guidance and warned that Apple's privacy changes could ""present another risk of interruption to demand.""
Estee Lauder — The makeup company saw its shares rise 7.5% in midday trading after it reported a surprise fiscal second-quarter sales gain instead of the decline it had expected. Estee Lauder said stronger Asia-Pacific and online sales drove the revenue gain. Second-quarter sales in the Americas dropped to $1.05 billion from $1.23 billion a year ago.
— CNBC's Yun Li, Maggie Fitzgerald and Jesse Pound contributed.
Unless you live under a rock, you know that the investors are focused on one thing – Europe.
And a key summit is expected to conclude on Wednesday afternoon with optimists hoping to hear that leaders have come up with a comprehensive plan to stem the crisis.
Of course, that’s not to say there aren’t pessimists – there are.
And growing chatter on the floor suggests markets are likely to be disappointed by the comments.
Waht should you expect? Get all the details from Sony Kapoor, managing director of Re-Define Think Tank. Watch the video now!
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Trader disclosure: On October 25, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s ""Fast Money"" were owned by the ""Fast Money"" traders; Nathan is long Oct. put spread AMZN; Nathan is long Jan. put spread BAC; Nathan is long Nov. put spread MS; Nathan is long Oct. put butterfly NFLX; Nathan is long Oct. put spread GS; Nathan is long Mar. call spread RIMM; Adami Owns AGU; Adami Owns C; Adami Owns GS; Adami Owns INTC; Adami Owns MSFT; Adami Owns NUE; Adami Owns BTU; Finerman owns AAPL; Finerman owns GOOG; Finerman owns JPM stock leaps; Finerman owns MSFT; Finerman’s firm owns AAPL; Finerman’s firm owns JPM stock leaps; Finerman’s firm owns MSFT; Finerman’s firm owns short calls IBM; Terranova owns IBM; Terranova owns AAPL; Terranova owns AXP; Terranova owns CAT; Terranova owns F; Terranova owns GS; Terranova owns OXY; Terranova owns FCX; Terranova owns LQD; Terranova owns MUB
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Citigroup, the top U.S. bank by assets, expects its investment spending next year to be less than half the 2006 level, its chief executive said on Thursday, acknowledging that its consumer bank has yet to turn the corner.
Speaking at the bank's analyst day presentation, Charles ""Chuck"" Prince also said he shares investors' frustration with the bank's lackluster share performance, but encouraged shareholders to be patient. ""I feel very good about the changes were making ... but there's no short-cut to get from where we are to where we're going,"" he said.
Prince, under increasing pressure from investors, on Monday named a new chief operating officer at the bank and promised an increased focus on costs.
During Thursday's presentation, Prince discussed ways Citigroup aims to increase revenue, including expanding its financial advisory business and increasing its private banking efforts.
Increased revenue and lower investment spending should help Citigroup's revenue grow faster than expenses next year, and profits grow faster than revenue, Prince said. That ""positive operating leverage"" would reverse a trend this year of operating expense growth outpacing revenue growth.
Citigroup's relatively weak earnings growth has weighed on its shares, which are up 8.7% so far this year, lagging an 11.6% gain in the KBW Bank index for the same period.
Investors gave a moderate vote of confidence to Prince's latest prescriptions for the bank's ills, boosting Citigroup shares by 0.8% and making them one of the session's top gainers in the sector index. ""That (cut in 2007 investment spending) is giving investors confidence that
there may be operating leverage in 2007 after not seeing a lot of operating leverage in the last couple of years,"" said Sam Rahman, portfolio manager at Baring Asset Management Inc. in Boston, which owns Citigroup shares. ""I think that's what investors are keying off on.""
Overseas Growth
Others remained skeptical. ""It's more of the same,"" said William Smith, chief executive of SAM
Advisors, LLC, which owns Citigroup stock. ""In our opinion, it's disturbing that he (Prince) does not understand what's going on. He is losing the battle here as far as what shareholders want.""
Smith said Citigroup shares had been bolstered last week by talk that the bank could replace Chief Financial Officer Sallie Krawcheck or even Prince, or could spin off some units.
Prince said revenue growth in the U.S. consumer bank was taking longer than he had expected, but he was cautiously optimistic about it improving. The company is taking steps like combining its brokerage and bank franchises, in an effort to offer more products to customers.
Prince said the company was unlikely to make any large U.S. bank acquisitions in 2007, reiterating that there were better opportunities to buy businesses overseas.
Citigroup on Wednesday agreed to acquire Central American commercial and retail bank Grupo Cuscatlan for $1.51 billion and last month led a team of investors that won control of China's Guangdong Development Bank with a bid of 24.3 billion yuan ($3.1 billion).
Citigroup is budgeting for moderate deterioration in credit quality for 2007, Prince said.
Prince, who met with analysts alongside chief-operating-officer-to-be Robert Druskin, Krawcheck and other executives, also said Citigroup could boost credit loss reserves in Japan due to legislative changes.
By Jan Strupczewski
BRUSSELS, Oct 8 (Reuters) - Euro zone finance ministers willlaunch their 500 billion euro ($653.00 billion) permanentbailout fund on Monday, putting in place a major defence againstthe debt crisis that now threatens Spain.
The fund, called the European Stability Mechanism (ESM),will be used to lend to distressed euro zone sovereigns inreturn for strict fiscal and structural reforms that aim to puteconomies that have lost investor trust back on track.
It is part of the single currency area's drive for anoverhaul of its economic structures and deeper integration, adiscussion that will be taken forward on Monday with talks on anidea to create a single euro-zone budget.
Euro zone finance ministers, who form the ESM's board ofgovernors, will hold their inaugural meeting in Luxembourg twoyears after EU leaders endorsed the idea of setting up such apermanent institution.
""The ESM will be operational as of Monday,"" said a euro zoneofficial, linked to the ESM.
The fund's lending capacity will be based on 80 billioneuros of paid-in capital and 620 billion of callable capital,against which the ESM will borrow money on the market to lend iton to governments cut off from sustainable market funding.
It will reach its full capacity gradually by 2014.
Its first task will be to lend to Spain for therecapitalisation of its banking sector, hit hard by a collapseof the real estate market - a programme inherited from thetemporary European Financial Stability Facility (EFSF).
Madrid is likely to ask for about 40 billion euros torecapitalise its banks following independent assessments of thesectors' needs -- well within the 100 billion euros set aside byeuro zone finance ministers for the purpose in July.
The ESM money would flow to Spain in November, afterEuropean Commission competition authorities approve conditionsfor the recapitalisation for each bank.
SPAIN IN FOCUS
Spain is in investors' focus because it has struggled to cutone of the euro zone's largest public deficits as the countrysinks deeper into its second recession in three years.
In Luxembourg, euro zone ministers will also discuss arequest, expected from Spain sometime in the coming weeks, for aprecautionary credit line from the ESM that they hope will boostinvestor confidence and keep Madrid in the capital markets.
A euro zone source said they may also discuss Spain's tough2013 budget, outlined last month, which the InternationalMonetary Fund and the European Commission both believe is basedon an over-optimistic forecast of a 0.5 percent economiccontraction next year. The current IMF forecast of a 1.2 percentrecession may be revised further downwards on Tuesday.
A revised budget based on updated IMF and EU forecasts maybe one condition for assistance from the ESM.
Such a programme would likely entail the issuance offirst-loss guarantees on bonds sold by Spain at auction, or somesimilar form of rescue to bolster Madrid's credibility.
Guaranteeing the first 20-30 percent loss on new Spanishbonds would allow - through leveraging - all of Spain's 207billion debt issuance in 2013 to be made much more attractive toinvestors using roughly 50 billion euros of euro zone money.
Such an amount would fit comfortably within the 100 billionlimit already approved by parliaments for the bank rescue incountries with strong anti-bailout sentiment like Germany andFinland, making it politically more palatable, even iftechnically it would remain a separate operation.
A credit line for Spain would also open the way forpurchases of Spanish bonds on the secondary market by theEuropean Central Bank -- a prospect that has lowered Spanishyields already from above 7 percent in July to below 5.72 now.
But Germany opposes a Spanish bailout request now, becauseit would prefer to bundle Spain with a request for a small, 15billion euro bailout for Cyprus and a revision of the second,130 billion euro bailout for Greece in one crisis-solvingpackage later this year.
This would allow German Chancellor Angela Merkel, wary ofshaky support for bailouts in her own ruling coalition, to pushthe large crisis package through parliament in one go, ratherthan fight separate battles for each.
As a result, a Spanish request is unlikely for a few weeks.
The ministers will also take stock of the efforts of Greeceto unblock payments from the second bailout agreed in Februaryafter reforms in the debt-laden country stalled because of twogeneral elections in May and June.
Inspectors representing international lenders are in talkswith the Greek government on reforms and austerity needed tounlock financial aid, but their full report is unlikely beforethe end of October.
EU Economic and Monetary Affairs Commissioner Olli Rehn saidon Saturday he expected Greece's government to agree on neededsavings in the coming days since the lengthy talks between thetroubled euro country and lenders had advanced.
($1 = 0.7657 euros)
(Additional reporting by Julien Toyer in Madrid; Editing byPaul Taylor)
((jan.strupczewski@thomsonreuters.com)(+32 2 287 68 37)(ReutersMessaging: jan.strupczewski.reuters.com@reuters.net))
Keywords: EUROGROUP/
Those tuning into the Grammys may have caught a glimpse of a television milestone, and it didn’t happen on stage at the music awards show.
Absolut vodka debuted a new ad, marking the first time a spirits brand aired a commercial during the Grammys. More importantly, it was also a first for spirits advertising in prime time in several CBS markets.
The ad, which ran in 15 of the largest media markets on many CBS-owned-and-operated stations, is a breakthrough for the spirits industry, which has been rebuffed in its attempts to buy airtime on the major networks in the past.
No doubt, the proliferation of advertisements on cable stations and local network affiliates has laid the groundwork for this event.
“We’re not surprised, it’s been a steady progression,” said Frank Coleman, a spokesman for the Distilled Spirits Council of the United States, an industry trade group.
Coleman said the television advertising of spirits brands has built steadily over the past decade, although it has leveled off more recently as companies have spent more of their ad budget online.
Absolut, a Swedish vodka brand that was purchased by Pernod Ricard last year, has long been known for its memorable advertising.
“I think we continue to take an innovative approach to media and advertising,” said Ian Crystal, brand director of Absolut Vodka at Pernod Ricard USA.
- Slideshow: Best Premium Liquor Brands
According to Crystal, there wasn’t any resistance at CBS and its affiliates. He attributes this to the “iconic” nature of the Absolut brand.
For the first 25 years, the brand’s image was built around print advertising that centered on the distinctive shape of its bottle. But the campaign shifted in May 2007, with the launch of the “In An Absolut World” campaign. Now about 30 percent to 40 percent of the brand’s ad budget is spent on television and film advertising.
According to Crystal, the campaign’s concept is about ideas, which translate well on film, and therefore lends itself to television advertising.
The latest incarnation of the campaign is the “Hugs” spot, which depicts scenes from an idealized world. As the music of Louis Armstrong plays, people from around the world exchange hugs and other signs of affection rather than currency.
The 30-second spot, created by ad agency TBWAChiatDay, will continue to air on broadcast and cable in seven key markets over the next week.
Events like the Grammys are often used by advertisers as a way of reaching a mass audience joined by a common interest.
Music is a leading interest among adults 21 years to 24 years old, who are Absolut’s key demographic.
Last year, the Grammy Awards reached an estimated 17 million viewers. Ratings for Sunday’s show were not immediately available.
More from Consumer Nation:
Questions? Comments? Email us at consumernation@cnbc.com
After six years of discussion, the Keystone pipeline is finally going to get an up or down vote on the U.S. Senate floor, confirming the adage, elections have consequences. What led to this change? Politics.
On Wednesday, Sen. Mary Landrieu, the embattled Democrat, facing a Dec. 6 runoff, called on the Senate to put the Keystone pipeline issue up for a vote. She was pushing for this to be the first order of business in the lame-duck session of Congress.
In quick turn, the Democratic leadership blessed the gambit, in what political reporters on Capitol Hill are calling the ""Hail Mary"" to save Landrieu's Senate seat. The idea is to get her name on the bill that approves the pipeline, which is very popular in her home state of Louisiana, where she is behind in in the polls.
Late Wednesday the Republican leadership announced they had a deal with Democrats for a vote as early as Tuesday. How did the decisions to vote next week happen? Politics.
When House leadership got wind of the Hail Mary, they quickly crafted a Keystone pipeline bill to hit the House floor this week. The author of the bill is listed as Rep. Bill Cassidy, the Republican congressman from Louisiana and the candidate facing Landrieu in the Dec. 6 runoff election for the Senate seat.
Read MoreEconomics no longer makes Keystone pipeline viable
The political calculus goes something like this: Passing the Cassidy bill on the House floor this week will give him top billing in the news cycles through the weekend and the final bill will likely bear both of their names.
In addition to the timing issues, the bill will need 60 votes to overcome procedural hurdles. Until now the best Keystone had done was 54 votes. This means passage will require six Democrats to flip their votes, something the Republican supporters of Cassidy look forward to pointing out to anyone who will listen.
The remaining issue is if this will become law. While most believe the White House was going to approve the program eventually, one analyst questions whether the administration wants to let Congress upend the process that has been slowly moving through the regulatory gauntlet.
""The president could veto it because there's an established review process in place and he would stick to that established review process. It's been going on for six years,"" said Dan Clifton, head of policy research at Strategas.
The approval of the Keystone XL pipeline extension was held up by the Obama administration initially for environmental impact studies. The pipeline's approval came under the auspices of the State Department because TransCanada's pipeline would cross over the border into the U.S. after passing through Alberta and Saskatchewan in Canada. It would then travel through Montana, South Dakota and Nebraska and link up with another pipeline, carrying crude from Canada, North Dakota, Montana and Oklahoma to the Gulf Coast.
Read More
Back in Louisiana, Landrieu is running about 5 percentage points behind Cassidy in the latest polling. Clearly, her campaign could use the Hail Mary.
—CNBC Executive News Editor Patti Domm contributed to this report.
What follows is a look at stocks in the S&P 500 displaying unusual volume in today's trading session.
Some of the highlights include: Wynn Resorts (WYNN), Thermo Fisher Scientific (TMO), and Scripps Networks Interactive (SNI).
>>> S&P Stocks Trading at New 52-week Highs
No more retail ""nirvana,"" David Berman, founder of Durban Capital, which manages over 100 million in assets told CNBC today.
Berman has focused solely on retail for some time. This past spring he changed his opinion and downgraded the retail sector for several reasons.
First, ""WalMart is back to being Walmart,"" the hedge fund manager said. The company represents 23 percent of all sales from publicly traded retail companies.
With this enormous stronghold, ""this is not good for the supermarket chains or for discounters now that WalMart is back to being more price competitive,"" he said. Take J.C. Penney and Kohl’s for example, they may get hurt because Walmart does have some apparel.
Second, if you look at the math in the retail sector in general—home improvement, discounters, apparel retailers, supermarkets, and department stores—""this sector could turn negative come September,"" Berman said, adding, ""people are worried about. ""
Third, the rising labor costs are weighing on retailers.
Fourth, electronic sales are slow with high inventories, for example Best Buy.
Also struggling are drugstores—with Walgreen and CVS Caremark among them.
But not all is lost: William Somona is a good example of what is working. Their same store sales are up 17 percent but inventories are down 8.5 percent. Also, the shoe industry is seeing the highest in sales growth, he said.
""The key to retail is to look at inventories,"" in relation to sales, Berman concluded.
.
""The Strategy Session,"" hosted by David Faber and Gary Kaminsky, airs weekdays at Noon ET on CNBC.
Comments from Saudi Arabian officials stirred speculation OPEC could be considering abandoning its market-based pricing strategy, but the cartel is unlikely to change policy and it heads into next week's meeting less relevant than ever.
Oil surged Monday on remarks from Saudi officials that the country is willing to work with oil producing and exporting countries, both inside and outside of OPEC to maintain market and price stability. West Texas Intermediate crude futures shot higher after the comments but then fell back and fluctuated.
""It's really just short covering. The Saudi comments are a reminder to the market that the Saudis aren't powerless, but OPEC is overall for sure. At some point, the sell-off will be vulnerable to a production response. The fact of the matter is if they really do cut production by a million or 2 million barrels, the market would react to that. I don't think they're ready to do that yet,"" said oil analyst John Kilduff of Again Capital.
The comments echo others made by Saudi officials. But they did come a day after Venezuela's oil minister said OPEC cannot allow a price war and must act to stabilize prices. He said oil could go as low as the ""mid-$20s.""
Read MoreHere's the comments that sent oil higher
The Organization of the Petroleum Exporting Countries just a year ago moved to a policy of allowing the market to set prices for the first time, instead of trying to stabilize them with a production response. Saudi Arabia, then the world's swing producer, said it would not cut production unless others producers joined in, particularly the high-cost producers. That would include U.S. shale drillers.
OPEC meets again on Dec. 4. ""They're not going to do anything. They're going to sit pat,"" said Edward Morse, head of global commodities research at Citigroup.
Morse said he expects OPEC members like Venezuela will be pleading with the Saudis to cut production. ""I don't think Saudi Arabia or any of the Gulf Cooperation Council yet are in a position to say our strategy doesn't work,"" he said. ""I've written that OPEC is dead frequently enough that I have to believe it,"" said Morse. ""It's unlikely they're going to get a joint decision anytime soon involving a production cut that includes Iraq, Iran and Venezuela, let alone Libya.""
Iran's oil minister, Bijan Zanganeh, said Monday he doubted OPEC has the will to act as a group to support oil prices. When asked about the Saudi comments, the minister said, ""I don't believe there is strong intention from some parts of OPEC to stabilize the market."" He said the cartel's mission is to stabilize the market for the benefit of all its members. ""If (that) is subject to cooperation with non-OPEC producers then it means we are going to do nothing.""
Iran is a particular challenge for OPEC since it has vowed to return to production as soon as it can under an international agreement to end its nuclear program. Some analysts expect tension between Iran and Saudi Arabia, which has benefited from Iran's loss of share in the global oil market.
""Iranians want to raise production. The Saudis don't want to accommodate them. The Saudis aren't going to do that. It's really a nonstarter,"" said Greg Priddy, director of global energy and natural resources at the Eurasia Group.
""I don't think there's a commonality of interest,"" said Priddy of OPEC's members. Priddy, however, said he expects the cartel to stay in existence despite the differences because the members could lose face if they disbanded.
OPEC's price strategy backfired in some ways because other producers, like Russia and U.S. shale, were willing to keep pumping and now oil is stuck at a low price for longer.
""I think the members that matter, the Saudis and their close partners, are simply maintaining output and letting the rebalancing play out. It hasn't played out as they intended but they're locked into it now,"" Priddy said.
He said the inventories could continue to build into late next year, and it could be into 2017 before there is a drawdown.
As for Monday's oil price move, analysts said OPEC was firing off rhetoric ahead of its meeting. WTI closed at $41.75, down 15 cents, but it had been more than $1 higher.
""They know there's a lot of short interest in the market right now. You can trigger a mini short squeeze that plays out over a couple of hours. I think they are trying to blunt the downward momentum,"" he said.
Read MoreGasoline could go to $1.50 in these states
Neither of the two contenders for president understands the economy and they are likely to cause more problems than they would solve, investor Jim Rogers, CEO of Jim Rogers holdings, told ""Squawk Box Europe"" on Friday.
""Neither one of these guys understands what's going on, they don't understand currency markets, economies, they don't understand the world,"" Rogers said. ""Both of them are going to cause us more problems than they're going to solve.""
Democratic nominee Sen. Barack Obama pledged to reverse the economic failures and blamed the Republicans for the poor shape of the U.S. economy in his speech on Thursday formally accepting to run for president for his party
But Rogers said this was unlikely.
""He's talking about spending a lot of money … I don't consider that very good, going deeper into debt. The United States is already the largest debtor nation in the history of the world. I'm not sure that that's going to solve anything,"" he said.
(Click Here for a Video of Jim Rogers' interview)
Republican presumptive candidate Sen. John McCain chose Alaska Gov. Sarah Palin as his running mate.
'Bailing Out their Friends on Wall Street'
Deep changes are needed in the U.S. system and big Wall Street banks should not be rescued by the authorities when they run into trouble, to avoid moral hazard, Rogers told CNBC Europe.
""They're bailing out Wall Street, because all their friends are on Wall Street,"" he said. ""When Ben Bernanke gets a phone call from the head Lehman, he takes the call, but if some poor school teacher in Oklahoma calls him, he doesn't take the call.""
""He's dealing with his friends on Wall Street trying to save them when in fact he should let them fail. That would be the better solution, at least for 300 million Americans,"" Rogers added.
The economic stimulus package launched this year to try and fend off recession in the U.S. is unlikely to have positive consequences in the long term, despite a higher-than-forecast advance of gross domestic product in the second quarter, Rogers said.
Supporting troubled investment banks instead of letting them go bust prevents a cleansing of the economy while putting additional burdens on taxpayers, but neither of the two candidates is likely to stop this, he added.
""If you happen to be friends with whoever wins, sure, you're going to have a better time in the next four years. But the rest of us, the 300 million Americans, are going to be worse off in four years. In fact the world will be worse off,"" Rogers said.
A judge has granted former Uber CEO Travis Kalanick a legal win on Wednesday by sending an explosive lawsuit brought by his investors to arbitration rather than ordering it to play out in his courtroom.
The decision is the latest dramatic turn in an rift between Uber and once of his closest allies, Benchmark Capital, and moves the ugly fight between them out of the spotlight as Uber's new CEO tries to assert control.
""Mr. Kalanick is pleased that the court has ruled in his favor today and remains confident that he will prevail in the arbitration process,"" a Kalanick spokesperson said. ""Benchmark's false allegations are wholly without merit and have unnecessarily harmed Uber and its shareholders.""
More from Recode:
Travis Kalanick's new lawyers say the Uber-Benchmark lawsuit belongs in arbitration
A top venture capital lobbyist says more sexual harassment allegations will emerge from Silicon Valley
Some startup founders are 'nervous' about dealing with Benchmark after it sued Uber
The arguments were made in a courtroom in Georgetown, Del., before Judge Samuel Glasscock of Delaware's Court of Chancery.
Benchmark sued Kalanick after ousting him as CEO of the world's most valuable privately held company, claiming that he defrauded them. The firm asked the court to remove him from Uber's board, among other actions. Kalanick, Uber's founder, says he is the victim of a malicious slander brought by disgruntled investors.
Benchmark was seeking a status quo order that would effectively freeze Kalanick's involvement in Uber business. Kalanick's lawyers tried to move the case to arbitration, allowing him to avoid a possibly damaging deposition.
The judge did not immediately rule on the status quo order.
There is still risk with such a move. Arbitration rulings are typically binding and if Kalanick loses he won't be able to appeal.
—By Theodore Schleifer, Re/code.net.
CNBC's parent NBCUniversal is an investor in Recode's parent Vox, and the companies have a content-sharing arrangement.
Turkey is as complex as a Byzantine mosaic or a potent Turkish coffee. Straddling Europe, Asia and the Middle East, it’s a Muslim country with ancient Christian roots — but founded as a modern nation in 1923 by a militant secularist, Mustafa Kemal Ataturk. For decades an economic backwater, it’s now the fastest-growing economy in Europe.
That economic success was achieved by an Islamist-leaning government that has managed successfully to meld the conservative religious devotion of the masses with the economic interests of the secular elite.
But what if Turkey, propelled by its majority of populist conservative Muslims, were to adopt a more extreme version of Islam? Syria, its neighbor to the south, is disintegrating — abetted according to some reports by rebels connected to Al Qaeda. Some of those rebels may be drifting across the border into Turkey. And there are rumors that Prime Minister Recep Tayyip Erdogan has intestinal cancer; with no clear successor to his decade-old leadership, his ruling Justice and Development (AKP) party could splinter and give rise to a more extremist Islamic rule.
(Read More: Slideshow: Investing in Turkish Art)
Yet experts say Turkey is so much improved economically from a decade ago that there is little chance its people would risk that prosperity — and relations with the West — to adopt an extremist Islamic state.
That is not to say, however, that Turkey isn’t dealing with a precarious religious situation. “The society is going more conservative,” said Ebru Erdem, political science professor at the University of California at Riverside. “It’s been going on since the 1990s, and that is still in progress.”
Erdem said Turks who don’t fast during the holy month of Ramadan, for instance, or who drink alcohol, face ostracism. And last spring the AKP ignited a debate about the morality of abortion and C-sections, two issues Erdem said had never before caused so much as a flicker on the Turkish radar screen.
“They are not like the Islamist parties of before,” Erdem said. “They come from the same traditions, but they said they have taken off that shirt and they present themselves as a ‘liberal’ political party.”
Erdem and other Turkey experts liken the religious dynamic in Turkey to none other than the U.S., comparing the AKP to the most conservative Christians of the Republican Party.
“They are modeling on the Americans,” Erdem said. For instance, she said, the government has gradually begun regulating alcohol sales. “They say it’s not good for you, and they give the example of the U.S. Bible Belt, where you can’t buy alcohol on Sundays.”
Brian Mello, a Turkey expert who teaches political science at Muhlenberg College in Pennsylvania, said “political Islam is really popular, especially in Istanbul. You’ll see a lot of women wearing a headscarf, and if you look at the popular support for the ruling party, they’ve done nothing but increase their support.”
He said “the real fear” is that Turkey is home to “various Islamic movements that have sought to reclaim the capacity to engage in religion in the public square. ... That could be a slippery slope to an Iranian-style Islamic regime.”
The emphasis is on the word “could,” however.
According to Mello, “if you look at the U.S. now, and look at all the anti-abortion laws passed in state legislatures, and if you’re a secularist, then you might become afraid about the role of religion in American politics. If those fears are legitimate in the U.S., they’re legitimate in Turkey, too.”
But Mello added: “The way religion affects the Republican Party in the United States is stronger than the way it affects (the ruling AKP) in Turkey.”
Which is to say — interesting, worrying if you happen to be a secularist — but likely unimportant when it comes to the economy.
(Read more:Investing in Europe’s Fastest-Growing Economy)
Andrew Birch, senior economist for Europe for IHS, agrees. “When you look at the Justice and Development Party, there are a lot of concerns from the West, including the party’s lack of democracy. But from an economic point of view, they’ve been good stewards of the economy.”
The biggest recent concern about Turkey’s Muslim bent was that its banks would adopt Islamic-style banking. (.) But that hasn’t happened — in fact, most of the country’s biggest banks operate exactly like Western ones.
A more immediate concern is that Turkey’s economy has begun to slow, Birch said. Last year the economy grew at an 8.5 percent pace, but in the first half of 2012, its growth was below 3 percent.
“If there are economic hardships, that’s going to give a boost to Islam because the fundamentalist movement is being drawn from poorer, disenfranchised areas,” Birch said. “But I’m not worried about them cycling back. As long as Istanbul stays important — that’s where the secular business people reside and hold a strong grasp — I wouldn’t be worried that much about an influx of conservative ideology going into the business sector.”
Erdem says the ruling party would probably like to enforce a more conservative Islamic society — but can’t afford to.
“The current success is dependent on incoming foreign flows,” she said. “Especially with the financial crisis in Europe, a lot of hot money has come to Turkey because Turkey is stable.
“Even if they wanted to [enforce a change] for an ideological reason, they couldn’t risk it,” Erdem said. “They owe their electoral success to economic security.”
Crude oil prices in the short-term future will likely hinge on several factors, including the European debt crisis and the situation in Iran, traders said Friday on “Fast Money.”
Crude soared to $103 a barrel earlier this week and dropped to $98 in midday trading.
“We haven’t been talking about Iran when oil is concerned so that’s always the headline risk,” trader Steve Grasso said. “I would expect it to sell off a bit and then rally a bit over the next couple of weeks back toward that $100 mark.”
Such an intense focus on Europe, which experienced turbulence from disappointing bond results in Spain this week, has drawn attention away from the Persian Gulf.
“As soon as you start focusing more on Iran, I think you get that goosebump back up to par,” Grasso said.
The European outlook isn’t good and will have a lasting effect, said trader Stephen Weiss.
(Related Story: Technicals, Euro Debt Fears Driving This Market)
“Europe is going into recession. I think it’ll be in a deep recession,” he said. “That’s going to hit demand, and China’s just going to bump along. ... Oil has a better chance going into the 80s than it does breaking $100.”
Trader Zach Karabell added, ""Oil stocks and oil services stocks are clearly in the camp of oil-is-going-to-come-down because they clearly have not reflected the rising price of oil, at least in the current equity action.""
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Trader disclosure: On Nov. 18, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s ""Fast Money"" were owned by the ""Fast Money"" traders; Weiss owns KO; Weiss owns HPQ; Weiss owns RIMM; Weiss owns EUO; Weiss owns WLP; Karabell owns AAPL; Karabell owns MS; Karabell owns IBM; Grasso owns AKS; Grasso owns AMR; Grasso owns ASTM; Grasso owns AVAV; Grasso owns BA; Grasso owns BAC; Grasso owns D; Grasso owns KEG; Grasso owns LIT; Grasso owns MHY; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XLU
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After three tough months for Apple, the tech giant is finally finding a bottom, according to one trader.
Apple shares are down more than 20 percent since November due to concerns about slowing iPhone sales and a difficult economic environment in China. But that selling makes this the ideal time to make a bullish play on the stock, according to Andrew Keene of AlphaShark.
Keene believes that new products will give Apple a much-needed boost. Keene also noted that the company is still holding plenty of cash.
""In the short term, we might get some volatility, ... [but] it is starting to consolidate here,"" Keene said Thursday on CNBC's ""Trading Nation."" ""This is a tug of war between the bulls and the bears to see who wins.""
And Keene says the bulls now have the edge.
Read More Why traders are betting on a big bounce for the metals
""By 2017, I think Apple can march its way back to up to the highs, just like Facebook did, up to that $115 level,"" he said.
To make a bullish trade, Keene is buying the January 2017 105-strike call and selling the January 115-strike call for a total cost of $2.50 per share, which is an options strategy known as a ""bull call spread."" Keene sees maximum profits if Apple rises to $115 by January expiration, but the trade is profitable if Apple shares rise to $107.50 by that time. Below that level, his losses are capped at the amount spent on the trade.
A jump to $107.50 would be a 12 percent move for Apple's stock, which traded around $96 on Friday morning.
Want to be a part of the Trading Nation? If you'd like to call into our live Wednesday show, email your name, number, and a question to TradingNation@cnbc.com
Like many 16-year-olds, Chase Reed spends his days tied to his iPhone and Instagram account.
But you won't catch his dad, Troy Reed, bugging him to get off social media anytime soon. That's because with each ""like"" the teenager acquires online, the father and son are seeing big dollars.
The father and son have opened a pawnshop exclusively devoted to sneakers. Sneaker Pawn USA is based in an apartment in New York's Harlem where the two used to live and have converted into sneaker start-up central. The duo advertise on social media platforms and share their inventory. Sneakers fans from around the world visit their Harlem shop, and shoes can be purchased online.
Chase works along side his father to buy, trade and sell Air Jordans and other brands in the store, which opened in June.
Troy says his son—still in high school—runs the show. ""I actually work for him, and it's probably the best job I've ever had,"" said Troy, himself a serial entrepreneur. His past ventures included barber shop. He now works full-time at the sneaker pawn shop.
The pair got the idea for the business when Chase was 14. Troy, who is divorced, admits he indulged his son and allowed him to amass a basketball sneaker collection worth about $30,000. Troy then persuaded his son to sell the shoes to generate the cash for a physical store.
""It was hard to let go of the collection because I was 14 years old with 200 pairs of sneakers, and all of the sudden you have to go back to zero,"" Chase said. ""But it was just part of becoming a young man and an entrepreneur.""
In 2013, they sold Chase's shoes right out of the trunk of Troy's car on 125th Street. But as word spread, they quickly realized they were onto a big trend. Mom-and-pop pawn shops are ubiquitous, but few if any are devoted to sneakers.
The duo now have hundreds of pairs of sneakers in the store.
Read MoreYoung entrepreneur 'gloves' his way to $8 million mark
The basketball sneaker market is booming. Market research firm Janney Capital Markets reports basketball footwear sales hit $4.2 billion in 2014 in the U.S., citing data from SportScan, a consumer insights firm. Janney forecasts sales will increase 12 percent to $4.7 billion in 2015.
Once considered a fringe urban shoe trend, collecting basketball shoes reached a broader audience when Nike released its Air Jordan I in 1984. The shoe was launched by Michael Jordan.
Troy said the markup on previously owned sneakers can be anywhere from 100 percent to 800 percent given consumer demand. For example, Nike's LeBron James ""Crown Jewel"" sneaker originally retailed for $250. But they're selling the pair for more than $1,200 at Sneaker Pawn USA because of its limited edition status.
""This is the new stock market—these sneakers are commodities,"" Troy said.
Troy and Chase won't disclose how much cash they're bringing in per month, but say they hope to attract a private investor in the next year to help them keep up with demand and expand into locations across the country. In just six months of being open, they say they're profitable.
This year Chase is teaming up with a shoe manufacturing company, Relevant Customs in Mount Vernon, New York, and plans to release a high-end line of shoes. Styles will feature exotic leathers with price tags of $10,000 and higher.
As for Chase's own private sneaker collection, it stands at around 50 pairs today. He has learned the art of looking cool, letting go and making money—all before his 18th birthday.
""If I get a nice shoe in the store, I'll end up selling it rather than collecting it,"" Chase said. ""I'm a businessman now.""
Read MoreMain Street reaches for a comeback
—CNBC's Betsy Cline contributed to this report.
A cruise line said it is making the passengers stranded aboard a disabled ship in the Gulf of Mexico as comfortable as possible with running water and some working bathrooms, contradicting the accounts of some passengers who told relatives of filthy, hot conditions and limited access to food.
The ship, the Carnival Triumph, is still at least a day from being guided to a port in Mobile, Ala.
Carnival President Gerry Cahill said Tuesday the ship has running water and most of its 23 public restrooms and some of the guest cabin bathrooms were working. He downplayed the possibility of an outbreak of disease from unsanitary conditions, saying the ship had not seen an abnormal number of people reporting to the infirmary as being ill.
""No one here from Carnival is happy about the conditions onboard the ship,"" Cahill said at a news conference in Miami. ""We obviously are very, very sorry about what is taking place.""
(Read More: Sick Guests, Dirty Boat: Inside Stranded Carnival Ship)
Jimmy Mowlam, 63, whose 37-year-old son, Rob Mowlam, got married Saturday onboard the ship, said his son told him by phone Monday night that there is no running water and few working toilets. He said passengers were given plastic bags to ""use for their business.""
Despite a forecast of brisker winds and slightly higher seas, the Coast Guard and Carnival said they did not expect conditions to deteriorate aboard ship.
A cold front was expected to cross the central Gulf where the vessel is under tow, bringing north and northwesterly winds of 15 to 25 mph and seas of 4 to 6 feet, said Dennis Feltgen, spokesman for the National Hurricane Center.
However, such conditions shouldn't affect conditions aboard ship, said Bill Segelken, spokesman for the Coast Guard Galveston command center.
The ship was about 200 miles south of Mobile, Ala., as Tuesday faded into Wednesday, the Coast Guard said. Carnival says the ship is expected to arrive in Mobile on Thursday.
The ship left Galveston, Texas, for a four-day cruise last Thursday with 3,143 passengers and 1,086 crew members. The ship was about 150 miles off Mexico's Yucatan Peninsula on Sunday when an engine room fire knocked out its primary power source, crippling its water and plumbing systems and leaving it adrift on only a backup power.
No one was injured in the fire, but Carnival spokeswoman Joyce Oliva said Tuesday that a passenger with a pre-existing medical condition was taken off the ship as a precaution.
Everyone else likely will have to remain onboard until the ship reaches Mobile, Ala., which is expected to happen Thursday, weather permitting.
Besides two tugs, at least two other Carnival cruise ships have been diverted to the Triumph to leave supplies and a 210-foot Coast Guard cutter was at the scene, Coast Guard Petty Officer Richard Brahm said Tuesday.
Mowlam said his son told him the lack of ventilation on the Triumph had made it too hot to sleep inside and that many passengers had set up camp on the ocean liner's decks and in its common areas. Mowlam said he wasn't sure where his son was sleeping.
""He said up on deck it looks like a shanty town, with sheets, almost like tents, mattresses, anything else they can pull to sleep on,"" said Mowlam, of the southeast Texas town of Warren. His son is from nearby Nederland.
Mowlam said his son indicated that passengers are trying to make the best of a bad situation.
""So far people have been pretty much taking it in stride,"" Mowlam said his son told him.
Rob Mowlam told his father the ship's crew had started giving free alcohol to passengers.
""He was concerned about what that was going to lead to when people start drinking too much,"" Mowlam said.
Other passengers have described more dire conditions, including overflowing toilets and limited access to food.
Jay Herring, a former senior officer for Carnival Cruise Lines, said one of the biggest concerns crew members will have until the ship docks is the potential for disease outbreak, particularly norovirus, which causes vomiting and diarrhea.
""Housekeeping, others are probably working double shifts to keep the mess clean and wipe down and sanitize all the common areas,"" said Herring, who worked for Carnival from 2002 to 2004 and spent four months on the Triumph.
Carnival hasn't determined what caused the fire, said Oliva, the company spokeswoman.
The National Transportation Safety Board announced Tuesday it has opened an investigation into the cause of the fire. The NTSB said the Bahamas Maritime Agency will lead the investigation because the ship carries a Bahamian flag.
The ship was originally going to be towed to a port in Progreso, Mexico, but after currents pushed it northward, the company decided to take it to Alabama, saying it would make it easier for passengers without passports to get home.
Cahill said Carnival has reserved more than 1,500 hotel rooms in Mobile and New Orleans for Thursday. The company plans to return passengers back to Houston on Friday using charter flights.
A similar situation occurred on a Carnival cruise ship in November 2010. That vessel, named Splendor, was stranded with 4,500 people aboard after a fire in the engine room. When the passengers disembarked in San Diego, they described a nightmarish three days in the Pacific with limited food, power and bathroom access.
Cahill said the Spendor's fire was different because it involved a ""catastrophic explosion"" in a diesel generator, and the Triumph's fire had ""some other cause."" He could not say what the economic impact will be due to the fire aboard the Triumph. The impact from the Splendor was $40 million, he said.
Carnival canceled the Triumph's next two voyages, scheduled to depart Monday and Saturday. Passengers aboard the stranded ship will also receive a full refund.
Some people who toil discontentedly in corporate cubicles regard entrepreneurship as the cure for all workplace ills. Only when they’ve experienced running a business personally do they find that the reality is much different.
Mike Cleary, for example, left his job as a sales and marketing executive to become an entrepreneur because he was tired of office politics. But after buying a franchise and an existing business about eight years ago, Cleary sparred with difficult vendors and suppliers. “It seemed very one-sided, with many commitments and obligations on my part, and much less required of the people I was buying from,” he said.
In an effort to establish trust, he says, he extended credit to a client of the previous owner. Unfortunately, he says, the client was not forthcoming with payment, costing him tens of thousands of dollars in lost revenue.
The Hiring Hurdle
Finding loyal employees was no picnic, either. “It was a harsh wake-up call,” said Cleary, adding, “to find out how many employees are not truly committed to the business they’re working for.”
The recent recession was particularly hard on the revenue and cash flow of his small business. Eventually, he found himself too deeply in debt to continue, and he returned to working for an established organization.
Today, he is content in his role as senior vice president for strategic marketing and field operations at the National Wild Turkey Federation in Edgefield, S.C., where he feels that he is living his personal mission to help conserve natural habitats. “I love that I’m finally in a position to worry about the high-level strategy instead of the other stuff, which just sapped my energy,” Cleary said. “It’s really freeing.”
Many prospective entrepreneurs fail to realize that office politics are everywhere, and that you can’t escape them when you strike out on your own. You may still have to contend with rude clients and partners, with many situations feeling eerily similar to those of your days by the water cooler. And you often learn the hard way that people tend to clash regardless of the environment.
Challenges to an Entrepreneurial Path
There are other reasons you may want to steer clear of the entrepreneurial path. First, there’s the sheer difficulty of finding a market niche for your product or service, as well as the proper resources to make a new business happen. Then there are the minutiae. As the founder, you will find that anything and everything is your responsibility. You will oversee production, distribution, marketing, sales and turning a profit. You’ll have to manage employees and vendors, and pesky details like accounting, taxes, insurance and licenses.
Would-be entrepreneurs who want to have a better work-life balance are in for a rude awakening. For at least the first few years, you may be on the job at all hours. If a customer has a problem in the middle of the night, you are the one who’s getting up to address it. And if the company goes under, you are solely accountable for that failure, sacrificing your financial livelihood in the process.
These days, the traditional business world gets a bad rap. But there are some highly valuable aspects of regular jobs that we don’t think about until they are gone. These are the three P’s: peace, prestige and perks.
When you are one employee out of 1,000 or 100,000, you have much more peace. It’s actually possible to leave your work woes at the office and turn off your BlackBerry without jeopardizing the company’s future. Life is simpler. You have a defined set of responsibilities, and if you carry them out well and get results, you can go about your business with the certainty that the rest of the company can take care of itself.
And if you are intelligent and personable, you can rise to a respectable place in an esteemed organization. Your friends and family won’t fidget nervously when you tell them about your job. Being able to put a known company on your résumé equals credibility and opens career doors.
Remember the Perks
Finally, don’t forget about the perks. At a large organization, your compensation package is just that: a package. Besides base salary, the money your employer contributes to your health insurance and retirement plans can be essential to surviving in today’s world. And don’t discount the value of possible benefits like cars, gym memberships, child care, on-the-job lunches and big discounts on company products.
The corporate world also gives you the opportunity to be around lots of people all the time. And, inevitably, some will be executives in a position to help with your career. The ability to establish relationships with powerful people in the context of your daily work is the best kind of networking out there.
The entrepreneurial lifestyle isn’t for everyone. It wasn’t for Cleary, and it may not be for you. Before you decide to take the plunge, think long and hard about what you’ll be getting yourself into, and what you’ll be giving up.
VMware CEO Pat Gelsinger said that if majority owner Dell follows through with a spinoff of his company, it would provide him with greater flexibility to team up with other hardware makers.
Speaking to CNBC ahead of this week's virtual VMworld conference, Gelsinger said VMware's server virtualization software could start to ""show up with HP"" if that's what customers want.
""The ecosystem would look favorably on a more independent VMware,"" Gelsinger said. VMware shares have dropped this year, underperforming tech stocks and the broader market, as the coronavirus pandemic has pushed more businesses to the cloud and away from physical data centers.
Dell, which acquired its 80% stake in VMware through the 2016 acquisition of data storage maker EMC, said in July that it was exploring a VMware spinoff to Dell shareholders, in part to enhance ""strategic flexibility."" Any deal wouldn't happen before September 2021, Dell said.
In addition to greater partnership opportunities, operating independently could make VMware a more attractive destination for top talent and give the company more freedom to do deals, Gelsinger said.
""I can't effectively use my equity for acquisitions today,"" he said. ""There's a very tight ownership range I have to live inside of.""
That's not to say VMware has shied away from dealmaking. Since becoming CEO in 2012, Gelsinger has completed more than 40 acquisitions, including Carbon Black, CloudHealth and VeloCloud, helping bolster VMware's subscription software business. He also led a partnership with Amazon Web Services in 2016, so customers could use a combination of cloud and on-premises services for their workloads.
After the coronavirus pandemic forced companies to close their offices, some VMware customers became more reliant on cloud services from AWS. That theme has played out across the cloud infrastructure landscape. Microsoft CEO Satya Nadella told analysts in April that ""we have seen two years' worth of digital transformation in two months,"" referring to sales, customers service and security all moving into ""a world of remote everything.""
VMware's license revenue dropped 7% in the quarter that ended July 31, compared with 2% growth in the prior quarter. The company's cloud and subscription unit grew 44%.
Gelsinger said some companies are heading in the other direction with their infrastructure, because cloud costs can get hefty. Comcast, he said, had about half its capacity in the cloud and the other half in traditional data centers and is increasing the portion of on-premises work to 70%.
That split ""gives them a much better economic model,"" Gelsinger said.
There are also laws in various countries that prevent some applications from being hosted in the cloud, and there are other instances where data doesn't need to move over the internet so it's better served on-premises. VMware is still investing in its traditional business. On Tuesday, it announced that it is working with chipmaker Nvidia to make it easier for customers to run artificial intelligence workloads using VMware's vSphere server-management software.
As the company heads toward a possible ownership change, Gelsinger said investors are looking for leadership continuity.
""I'm a very happy CEO these days, and I don't expect that to change,"" Gelsinger said.
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.
WATCH: VMware CEO Patrick Gelsinger on its second-quarter results
Check out which companies are making headlines before the bell:
Fiat —The automaker finally reached a long-sought agreement to buy the shares of Chrysler it doesn't already own for $3.65 billion. The stock has been owned by a United Auto Workers union health care trust.
Apple–The iPhone maker was downgraded to ""market perform"" from ""outperform"" at Wells Fargo, which points to valuation as well as possible profit margin pressure at whatever time Apple introduces another new version of the iPhone.
Bank of America–Citi upgraded B of A to ""buy"" from ""neutral"", saying the bank is no longer impacted by legacy issues.
Google–The search giant is shutting down recently acquired Bump, so that the Bump team can work on other Google projects. The unit is the developer of software that allows smartphones to transfer information by tapping them together.
Newmont Mining, Goldcorp–These and other gold producers could get a bump today, as gold rallies following the metal's biggest yearly drop in 32 years.
Campbell Soup–Campbell has issued a recall for about 300 cases of Prego Traditional Italian sauce, saying there is a risk of spoilage.
Diageo, Barclays, and Nokia–The three are among the U.S.-traded stocks included in Bank of America Merrill Lynch's top EMEA (Europe, Middle East, and Africa) stock ideas for the first quarter.
Xilinx–The stock has been upgraded to ""buy"" from ""neutral"" at Goldman Sachs, while rival specialty chip maker Altera has been cut to ""neutral"" from ""buy"".
Retailers–Jefferies upgraded retailers American Eagle, , , and to ""buy"" from ""hold"", saying they've done well in a challenging environment, while cutting and to ""hold"" from ""buy"", citing what Jefferies sees as a long recovery period following difficult times.
–The drug maker entered an agreement with (CVS) which will make its diet drug Qsymia available for co-payments of $15 to $75 in cases where patients have obesity coverage.
–The mobile carrier's stock was cut to ""market perform"" from ""outperform"" at Cowen & Co., which still has a positive long term outlook but said the stock is currently ahead of where it should be.
–Goldman Sachs removed the stock from its ""conviction buy"" list, although a ""buy"" rating remains. Goldman cites a more balanced risk/reward ratio at current levels, but also raised the 12-month price target to $37 based on T-Mobile's possible value as a takeover target.
—By CNBC's Peter Schacknow
Questions? Comments? Email us at marketinsider@cnbc.com
Until recently, Amazon and Google competed for presence in our homes through their own gadgets: Smart speakers like the Amazon Echo and Google Home, TV add-ons like Chromecast and Fire TV and even home security systems like Nest and Ring.
But, at CES 2019, that competition was brought to a boil as partners from both companies launched dozens of products that will bring Amazon Alexa and Google Assistant into nearly every aspect of our lives.
I've been attending CES for more than a decade, and it's always home to all sorts of new doohickeys, from robots to health trackers and the latest in TV technology. While those things were all on display this year, too, I couldn't help but notice the massive presence of Google and Amazon, two companies that didn't even exist at CES a couple of years ago. That's because their smart assistants, the ones you can control by voice, are being built into almost every category of new product that was introduced at CES, from TVs to ovens — even lawnmowers and a toilet.
Google tripled the size of its booth this year, where it even had a roller coaster that brought riders through an experience that explained how you can use Google Assistant throughout the day, from getting directions and traffic information to ordering food and snapping a selfie.
Amazon had three different booths. There was one for ""Key by Amazon,"" which showed how you can have packages delivered inside your house, into your car and — new this year — into your garage. It also had a booth dedicated to Ring, its home security system, that showed off a range of new products like security cameras and lights. Amazon also had an entire room where it had an array of products from its partners, including smart glasses, coffee machines, ovens and more, all with Alexa built-in.
Both firms also revealed how widespread their ecosystems are.
Google said that by the end of January, more than 1 billion devices will have Google Assistant built-in. That's up from 500 million in May, but a lot of that growth is because Assistant now ships as a standard feature on Android phones. Google Assistant is also built into 10,000 different smart home devices from more than 1,600 brands, the company said.
Amazon said there are now more than 150 products with Alexa built directly in — which means you can talk right to it without also owning an Echo — and more than 28,000 products from 4,500 brands that support it. That means you need an Amazon Echo to control the gadget. Amazon also said it has now sold more than 100 million Alexa devices.
There's a reason the number of products that support the assistants is skyrocketing.
Last year, Amazon introduced a developer kit that made it much easier for partners to add Alexa to their devices. It showed this with a proof of concept microwave that it now sells. If a partner decides to add Amazon Dash integration, then it can be used to automatically order more supplies when you run low, like more detergent for your Alexa-powered dishwasher. Google also introduced similar tools for developers.
By pure booth presence alone, Google left the biggest impression on me at CES. I've just never seen a roller coaster in a booth. But, and this was clear walking around the show, more brands and products were on display with Amazon Alexa on board. Some supported both.
For consumers, this means that as you shop for new products in the coming years, whether it's a car or TV or a home appliance, you'll probably see Alexa or Google built-in, even if you don't necessarily want to use it. If you do, you'll be able to tell Alexa to start the dishwasher or ask Google to set your oven to 375 degrees.
And this means that Amazon and Google are becoming nearly omnipresent, whether you want them to be or not. Since Alexa and Google Assistant learn from what you ask of them, that means Amazon and Google will be able to learn more than ever about you and your habits. And for them, that's big business. It gives Amazon the ability to gather data on your purchasing habits and recommend more items you're likely to buy. And Google will learn more about you for its targeted advertising business.
The outlook for Singapore's economic growth was trimmed yet again, according to an official survey of forecasters released Wednesday.
The December survey of professional forecasters, sent out in late November, by the city-state's central bank, the Monetary Authority of Singapore (MAS), found economists turned more bearish since the previous survey.
They expected Singapore's economy would grow just 1.5 percent in 2017 on average, down from the September survey's forecast for 1.8 percent and the June survey's projection of 2.1 percent.
The latest forecasts for 2017 growth ranged from 0.7 percent to 2.3 percent.
The December survey, which had 22 respondents, doesn't reflect the MAS' own forecasts.
In a statement released December 2, the MAS said it expected Singapore's gross domestic product (GDP) would rise by 1-3 percent in 2017 after rising an estimated 1.0-1.5 percent in 2016.
Singapore's small, open economy has been buffeted by declines in global trade as well as its exposure to sharp drops in commodity prices. Redundancies in the first nine months of the year hit their highest since the first nine months of 2009, during the global financial crisis, government data earlier this week showed.
The forecasters expected the headline consumer price index (CPI) would rise 1.0 percent next year.
The survey found the Singapore dollar was expected to weaken further against the greenback, with the average forecast expecting the U.S. dollar to be fetching around 1.465 Singapore dollars at the end of 2017. The forecasts ranged from 1.37 to 1.55 Singapore dollars. At 12:06 p.m. HK/SIN, the greenback was fetching S$1.4255.
In the survey, the forecasters also cut their outlook for this year's growth to 1.4 percent from 1.8 percent in the September survey. That followed third-quarter growth coming in weaker than expected at 1.1 percent on-year, below the September survey's forecast of 1.7 percent.
The forecasts for 2016 growth ranged from 1.1 percent to 1.6 percent.
The economists now expected the finance and insurance sector would grow just 0.5 percent in 2016, down from 2.0 percent in the previous survey. They also cut the wholesale and retail trade growth forecast to 0.1 percent for 2016, down from the September survey's 2.1 percent growth forecast.
The private consumption growth forecast was cut to 1.4 percent for this year, down from 3.0 percent in the September survey.
The headline consumer price index was expected to fall 0.5 percent for the full year, with the forecast unchanged from September.
For the fourth quarter of 2016, economists expected just 0.6 percent on-year growth on average, with a median forecast of 0.8 percent. The forecasts ranged from a 0.6 percent contraction to 1.4 percent growth.
One of the biggest mistakes investors in managed funds make is chasing returns. Now, New York City pensions look as if they want to make chasing returns official policy.
Larry Schloss, the city's chief investment officer, wants New York to emulate the Ontario teachers pension fund. It's easy to see why. The fund has seen a 9.6 percent return on its investments since 2003, compared with an 8 percent gain in New York's pension funds.
What's more, Ontario pays far less in fees to asset managers because it actually makes investment decisions on its own. To do that, it employs real live investment professionals, paying competitive salaries. By contrast, the guys running New York's pension system get paid an average of $100,000 each. Schloss earns just $224,000.
He imagines that the city could hire ""a VP at MetLife who makes 500,000 bucks."" But this is probably unrealistic.
New York is just a far more competitive place than Toronto when it comes to top-quality investment professionals. There are more opportunities for making tremendous amounts of money. If you're a New Yorker who can generate consistent 9.6 returns without leverage, you can easily raise money for a hedge fund that will make you a millionaire.
What's more, the Canadian fund has benefited from that country's real estate boom. It owns a lot of assets that have risen in value with the home and commercial real estate market. If Canadian real estate crashes—as some expect it will—the fund performance will probably suffer.
The average return on the S&P 500 for the past decade is 7.6 percent, which means that a simple index fund could achieve much of the gains that New York's pension funds need to remain solvent. Why compete with Wall Street and hedge funds when you can make perfectly respectable returns passively?
By CNBC's John Carney. Follow me on Twitter @Carney
Germany is considering how to implement a gradual recovery from the coronavirus pandemic, the country's health minister, Jens Spahn, told CNBC on Monday.
""We are thinking about step by step, that is important ... going back to a new normal,"" Spahn said on ""Closing Bell.""
Spahn, who was speaking from Berlin, stressed that it will indeed be a new normal because ""all the measures we have taken like keeping distance, wearing masks, no parties ... are definitely measures that need to be there in place for months to come.""
But Germany is in a place to begin considering what a recovery looks like because its rate of new infections has continued to slow, Spahn said. He cited the effectiveness of social distancing measures and applauded the country's residents for taking them seriously.
There are more than 128,000 confirmed cases of Covid-19 in Germany and around 3,000 deaths, according to Johns Hopkins University.
Spahn said the German government is now seeking to find ""the right balance"" between health and economic considerations.
""I would say it's not the health of people versus the economy because they are very much interlinked,"" Spahn said. ""You need a strong economy to have a well-equipped health system, for example. Or unemployment, a recession, is harmful for the mental and physical health of people, too.""
Germany has received praise, albeit with some caution, for its response to the Covid-19 outbreak.
Spahn said he was ""humble"" but not ""overconfident"" about how Germany has handled the spread of the coronavirus.
He cited the strength of Germany's health-care system, in particular its high number of intensive care unit beds, as one reason why the country was well equipped to respond to the pandemic.
The country also placed an early emphasis on testing capacity, Spahn said. He said the the country had a strong network of labs, and he noted that the first diagnostic test for Covid-19 was developed in Germany in January.
""It's like pointing a flashlight into the dark,"" Spahn said of testing. ""If you don't do it, you'll just see different shades of gray. With extensive testing, you can really see what's going on. You don't just see the symptomatic cases, but the mild and asymptomatic ones, too.""
Read all of CNBC's coronavirus coverage here
The 25 highest-paid hedge fund managers made a record $32 billion in 2020, up more than 50% over 2019, according to Institutional Investor's Rich List.
A total of 15 hedge fund managers made $1 billion or more, compared with only eight in 2019. The big gains during the coronavirus pandemic, coupled with the public debate over hedge funds in the wake of the GameStop controversy, is likely to draw criticism from lawmakers and the public over hedge fund pay and fairness in financial markets.
The top earner was Israel ""Izzy"" Englander of Millennium Management, earning $3.8 billion. His flagship fund was up 26% last year, which was its best return in 20 years. Like many of the top-performing funds last year, Millennium relies more on stock picking than quantitative strategies using computer algorithms.
In second place is Jim Simons of Renaissance Technologies, who earned $2.6 billion. His investors, however, didn't do as well. Renaissance Technologies' three main funds for outside investors were down 20% to 30%, according to report. But its Medallion fund, which is mainly for employees, was up 76%. Simons retired as chairman on Jan. 1.
Chase Coleman of Tiger Global came in third place, with a $2.5 billion payday. The fund was an early investor in tech stocks and overseas plays that did well during the pandemic, giving his fund a 48% return. His partner Scott Shleifer, the head of Tiger's private equity business, was tied for eighth with $1.5 billion. Shleifer just bought the most expensive home ever sold in Florida, paying more than $130 million for a newly built mansion in Palm Beach.
Ken Griffin of Citadel, who is at the center of the GameStop debate, came in fourth, with $1.8 billion as his fund was up 24%. Steve Cohen of Point72 Asset Management, who owns the Mets, was tied for fifth, along with David Tepper of Appaloosa, both at $1.7 billion.
Correction: An earlier version of this story incorrectly attributed Mets ownership.
For the second time in 10 years, the University of Connecticut is sending both its men's and women's basketball teams to the NCAA finals.
And that means this year's Huskies squads are again likely to be a boon for the university and its bottom line.
""It's infinitely priceless,"" said Mike Enright, associate director of athletics for communications at UConn, referencing the Huskies' Final Four appearances. ""It brings great notoriety for the teams, but it also brings great notoriety for the university.""
Read MoreBoston's Green Monster goes digital with selfies
Enright said that based on observation from the 2004 season, when the Huskies sent both teams to the Final Four and won both championship titles, higher merchandise sales on items like T-shirts and caps will likely be one of the most tangible effects of the increased attention.
""We saw a doubling of our money resulting from the licensing of our goods,"" he said. ""We doubled it from approximately half a million to $1 million.""
Next season's ticket sales and prices could also see a boost, said Chris Matcovich, vice president of data and communications at TiqIQ.
""You'll see an initial bump at the beginning of the season for early conference matchups,"" said Matcovich. ""It definitely increases the level of enthusiasm.""
There may also be an increase in financial contributions from alumni, said UConn's Enright. The school currently has an annual athletics budget of $62 million.
Winning brackets may even translate into a larger applicant pool, he said.
""We always look at athletics as the front door for UConn,"" said Enright. ""We hope that through this a lot of people learn about our university.""
However, David Carter, professor of sports business at the University of Southern California's Marshall School of Business, cautions that any basketball-generated spike in university applications may come with a question mark attached to its quality.
Read MoreThere's no paternity in baseball!
""You sit back and wonder, 'Gee, if that spike is due to athletic performance, are these students really academically inclined?'"" said Carter. ""These may not be the kinds of students that these universities really want, and that's a concern that a lot of schools have.""
For UConn, though, such concerns would likely be minor, said Patrick Rishe, associate professor of economics at Webster University. While UConn's tournament wins may boost application numbers slightly, the university won't likely experience the kind of boost that universities with lower profiles have generated through unexpected athletic success.
""These spikes are probably going to be larger for schools that have not had that level of success previously,"" said Rishe. ""For instance, the University of Dayton reached the Elite Eight. You would expect schools like that to have spikes because many had not heard of them before.""
Read More
Spikes in university applications and enrollment stemming from athletics has become known as the ""Flutie effect,"" originating with the stunning, Doug Flutie-led football victory for Boston College over the defending national champions, the Miami Hurricanes, in 1984. Boston College reportedly saw a dramatic increase in applications for the following academic year.
""The Flutie effect only happens when you have a school that is a true Cinderella story, like Butler, George Washington, and VCU,"" said Rishe, referencing tournament underdogs from recent years. ""UConn's women's program is always good, and the men's basketball program has been good for the past 20 years. They're both blue-blood college basketball programs.""
—By CNBC's Adam Molon
* Sandy caused industry to lose 20,000-25,000 sales -Ford
* Industry likely to miss sales estimates for October
* Still, GM, Chrysler report best October sales in 5 years
* Ford October sales edge up; Toyota's up 16 pct
* Ford shares down 1.4 pct, GM down 0.6 pct
(Adds results from GM, Ford, Toyota and VW, adds comments by Ford, GM and VW, adds stock prices)
DETROIT, Nov 1 (Reuters) - General Motors Co and Chrysler Group LLC both reported their strongest U.S. sales for the month of October since the financial crisis sent both U.S. automakers into bankruptcy, but the destruction of storm Sandy will cause the sector to miss overall sales expectations.
Ford Motor Co's sales last month edged up 0.4 percent, while Toyota Motor Corp's sales rose about 16 percent.
GM sales rose 4.7 percent to 195,764 vehicles, while those at Chrysler, an affiliate of Italy's Fiat SpA, increased 10 percent to 126,185 vehicles. Both totals were the best either automaker had seen since 2007, before the U.S. economy went into recession and caused a drastic decline in sales that led GM and Chrysler to file for bankruptcy in 2009.
Still, results of Ford, Chrysler and Toyota came in below expectations, while GM missed some analysts' estimates, suggesting that the U.S. industry will have a hard time reaching the 14.9 million-vehicle annual sales rate economists had predicted for the month before Sandy pummeled the U.S. East Coast. Auto sales are an early indicator each month of U.S. consumer demand.
The massive storm, which hit New York City on Monday evening, hurt U.S. demand at the end of the month, with Ford officials estimating the lost sales for the entire industry at 20,000 to 25,000 vehicles.
Ford officials said that would hurt the annual rate by 300,000 vehicles, although analysts have said the industry would likely make up any lost sales in November. GM officials agreed, saying Sandy hurt the annual rate by at least 300,000 vehicles.
GM said it sees an October annual sales rate in the range of 14.4 million vehicles. Ford estimates the rate in the high 14 million range including heavy and medium-duty trucks, in line with GM.
Volkswagen AG's U.S. operations chief, Jonathan Browning, said the industry would fall short of the 10 to 11 percent gain many had predicted.
``This is not yet a full-blown recovery,'' Browning told reporters on a conference call. ``The overall environment is one of improving optimism, but it's still not a strong positive development in terms of the overall economy.'' He added that demand had been choppy in some regions even before Sandy.
Before the massive storm hit, analysts had predicted the industry would show an 11 percent sales gain, led by Toyota and Honda Motor Co, which benefited from increased demand for compact cars as gasoline prices remained high across the country.
Many automakers still made gains in the month as rising home prices, attractive vehicle financing options and Americans' growing need to replace their aging cars spurred more consumers to showrooms. That bodes well for the future, a top GM executive said.
``Year over year, the light vehicle selling rate has increased for eight consecutive quarters without a tailwind from the residential housing sector, but that is starting to change,'' Kurt McNeil, GM's vice president of U.S. sales operations, said in a statement. ``If these trends continue, housing may be the final piece of the puzzle that lifts sales above 15 million units on an annual basis.''
Over the last five years, the U.S. auto sector has undergone a wrenching overhaul that led to plant closures, job losses and the government-financed bankruptcy restructurings of GM and Chrysler. Ford also overhauled its U.S. operations, but did not take a government bailout.
The October sales report will be the last before Election Day, marking the end of a contentious U.S. presidential race that has repeatedly thrust GM and Chrysler into the spotlight in televised debates, stump speeches and campaign advertisements.
The sales report also caps a busy week for the U.S. auto industry, which saw third-quarter profit reports from all three Detroit automakers.
GM shares were down 0.6 percent at $25.34 on Thursday morning, while Ford shares were down 1.4 percent at $11.00. The broad S&P 500 Index was up 1 percent.
(Additional reporting by Paul Lienert and Deepa Seetharaman in Detroit; editing by Gerald E. McCormick and Matthew Lewis)
AGL Energy, Australia's largest energy retailer, said on Friday it would team up with Macquarie Bank to acquire the 67% of the AlintaAGL retail business it does not own, if Macquarie makes a revised bid for Alinta.
Macquarie's first offer for energy infrastructure group Alinta was trumped in March by investment firm Babcock & Brown's A$7.4 billion (US$6.1 billion) cash and stock proposal, which was recommended by Alinta's board.
AGL said in a statement that it was also negotiating with Babcock & Brown to acquire the retail business, but stated that it has not entered an agreement with either party.
AlintaAGL, spun off in an asset swap deal between AGL and Alinta last year, is a joint venture company that holds Alinta's Western Australia retail and generation businesses.
Macquarie Bank said in a separate statement that it was still considering acquiring Alinta, which had put itself up for sale after receiving a management buyout proposal in January.
Local media reported on Friday that Macquarie was close to submitting a revised A$15.45 a share, all-cash offer for Alinta.
Macquarie's first offer in March was a A$15.45 per share cash and scrip bid. Alinta's board had rejected the proposal, saying the deal included shares in an untested new vehicle.
Under the agreement with AGL, Macquarie would sell to AGL the AlintaAGL power retailing business AGL does not already own in exchange for AGL agreeing to sell to Macquarie its interests in several Alinta generators, according to newspaper reports.
Macquarie may be planning to use the proceeds of any AGL deal, which could be about A$400 million, to fund a cash return to Alinta shareholders as part of a sweetened offer.
A source familiar with the situation said there was a Friday deadline for Macquarie to return information it had access to on Alinta, but that did not mean it had to submit an offer by Friday.
Another source said Macquarie was still working on finalizing an underwriting package for a bid.
Babcock offered Alinta shareholders A$8.50 in cash per share as well as 7.83 shares of Babcock & Brown Infrastructure, 1.30 shares of Babcock & Brown Wind, 3.31 shares of Babcock & Brown Power and 1.51 Australia Pipeline Trust units for every five Alinta shares.
In a bid to sweeten the deal, Babcock, which has teamed up with state-owned utility Singapore Power, said on April 16 it would offer shareholders with 1,000 Alinta shares or less the opportunity to receive all cash.
Raytheon and United Technologies on Sunday announced they would merge in an all-stock deal, a tie-up that would create a behemoth in the fast-growing defense and aerospace sectors.
The combination would bring together United Technologies booming aerospace business that makes everything from jet engines, cockpit controls and airplane seats with Tomahawk missile maker Raytheon.
The companies would have combined annual sales of around $74 billion, the companies said. That would make the new company, which they are planning to call Raytheon Technologies, the second-largest aerospace and defense company in the U.S. by revenue, behind Boeing.
""The combination of United Technologies and Raytheon will define the future of aerospace and defense,"" United Technologies chairman and CEO Greg Hayes said in a release. ""By joining forces, we will have unsurpassed technology and expanded R&D capabilities that will allow us to invest through business cycles and address our customers' highest priorities.""
United Technologies has reaped the benefits from searing global aircraft demand and has been beefing up its commercial aerospace business, which includes jet engine maker Pratt and Whitney. In November 2018, it closed its acquisition of Rockwell Collins.
The two companies have little overlap and may not face strong regulatory push-back to their deal, said Richard Aboulafia, aerospace analyst at Teal Group.
The new company would be headquartered in the Boston area, the two firms said in the release. Raytheon is based in Waltham, Mass., a Boston suburb.
If completed, shareholders in Farmington, Conn.-based United Technologies would own 57% of the new company while Raytheon's would own 43% on a diluted basis.
The deal, which the two companies called a ""merger of equals,"" is expected to close in the first half of 2020, they said.
Like other industrial conglomerates, United Technologies shedding businesses to focus on highly profitable units. It is the middle of spinning its Otis elevator business and its Carrier air conditioning unit into separate companies. The merger with Raytheon wouldn't affect that process and it is still on track to close in the first half of 2020, the companies said Sunday.
United Technologies' chief executive Hayes would become CEO of the combined company, and Raytheon's CEO Thomas Kennedy would become chairman. Two years after the deal closes Hayes would become chairman.
Raytheon and United Technologies have a combined market value of nearly $166 billion. Raytheon shareholders will get 2.3348 shares in the new company for each Raytheon share, the firms said.
The chairman of the House Foreign Affairs Committee on Friday blasted the Trump administration for claiming in a new report that it had authority to order the controversial killing last month of Iranian Gen. Qasem Soleimani in Iraq under Congress' authorization in 2002 for the use of military force against Iraq.
Rep. Eliot Engel, D-N.Y., the committee's chairman, argued that the administration's new report to Congress about the Jan. 3 attack on Soleimani ""directly contradicts the President's false assertion that he attacked Iran to prevent an imminent attack against United States personnel and embassies.""
""The administration's explanation in this report makes no mention of any imminent threat and shows that the justification the President offered to the American people was false, plain and simple,"" said Engel in a prepared statement.
He and other Democrats already were skeptical about President Donald Trump's legal rationale for the attack without prior authorization from Congress.
The administration's report made public Friday says that Trump ""directed this action in response to an escalating series of attacks in preceding months by Iran and Iran-back militias on United States forces and interests in the Middle East region.""
The report also said that the attack on Soleimani at Baghdad's airport was ""consistent with"" a ""longstanding interpretation of the President's authority"" under both Article II of the Constitution and the 2002 authorization of use of force in Iraq.
Engel, in his statement, called that argument ""absurd.""
""To make matters worse, to avoid having to justify its actions to Congress, the administration falsely claims Congress had already authorized the strike under the 2002 Iraq war resolution,"" Engel said.
""This legal theory is absurd. The 2002 authorization was passed to deal with Saddam Hussein,"" he said. ""This law had nothing to do with Iran or Iranian government officials in Iraq.""
The chairman added, ""To suggest that 18 years later this authorization could justify killing an Iranian official stretches the law far beyond anything Congress ever intended. I was pleased to join many of my colleagues in voting to repeal the outdated Iraq war authorization, and I hope the Senate will follow suit.""
In its report, the administration said the purpose of the attack on Soleimani was ""to protect United States personnel, to deter Iran from conducting or supporting further attacks against United States forces and interests, to degrade Iran's and [its] Qods Force-backed militias' ability to conduct attacks, and to end Iran's strategic escalation of attacks on, and threats to U.S. interests.""
At the time of his death, Soleimani, 62, was commander of Iran's Quds Force, the foreign operations wing of the elite paramilitary Islamic Revolutionary Guard Corps.
Trump administration officials said after the strike that Soleimani had been planning imminent attacks on Americans and as a result had to be stopped.
A week after his killing, Secretary of State Mike Pompeo said, ""There was no doubt that there were a series of imminent attacks that were being plotted by Qasem Soleimani.""
But Pompeo, in an interview with Fox News, added, ""We don't know precisely when and we don't know precisely where, but it was real,"" Pompeo said in an interview that aired Thursday night on Fox News.
NBC News reported in mid-January that Trump authorized Soleimani's killing seven months before he actually was killed.
""The presidential directive in June came with the condition that Trump would have final signoff on any specific operation to kill Soleimani,"" NBC reported, citing five current and former senior administration officials.
NBC News noted that the timing of that directive ""could undermine"" the administration's already publicly stated rationale for the killing.
The administration's report on Friday said that Article II of the Constitution empowers the president, as commander in chief, ""to direct the use of military force to protect the Nation from an attack or threat of imminent attack and to protect important national interests.""
""Article II thus authorized the President to use force against the forces of Iran, a state responsible for conducting and directing attacks against United States forces in the region,"" the report argued.
The report also said that under the 2002 Authorization for Use of Military Force Against Iraq, the president has the power to use American military forces ""as he determines to be necessary and appropriate"" in order to defend U.S. national security against the threat posed by Iraq.
While Iraq's late leader Saddam Hussein was the initial focus of that statute, the report notes, the statute long has been used to ""authorize the use of force for the purpose of establishing a stable, democratic Iraq and addressing terrorist threats emanating from Iraq.""
Such uses of force can address ""threats to the United States posed by militias, terrorist groups, or other armed groups in Iraq,"" the report said.
Two influential Senate committee chairmen were told they were getting special VIP deals when they applied for mortgages, an official who handled their loans told Congress in closed-door testimony.
Democratic Sens. Christopher Dodd and Kent Conrad had denied knowing they were getting discounts when they negotiated their loan terms.
Robert Feinberg, who worked in the VIP section of Countrywide Financial, testified about the loan terms before the Senate Ethics Committee, and provided the same information in an interview with Republican investigators of the House Oversight and Government Reform Committee. He could be prosecuted for making false statements.
Both senators have said that at the time the mortgages were being written they didn't know they were getting unique deals from Countrywide, a company that lost billions of dollars on bad loans and since has been purchased by Bank of America .
Dodd, D-Conn., who is chairman of the Senate Banking Committee, still maintains that he got no preferential treatment. Conrad, D-N.D., who leads the Senate Budget Committee, took that position initially, but later acknowledged he did get a special deal.
Dodd got two Countrywide mortgages in 2003, refinancing his home in Connecticut and another residence in Washington. Conrad's two Countrywide mortgages in 2004 were for a beach house in Delaware and an eight-unit apartment building in Bismarck.
The Associated Press obtained a transcript of Feinberg's House interview. An account of his Senate appearance was obtained from the attorney who accompanied him to Congress, Elana Goldstein. Both appearances were on successive days last month.
Asked by a House Oversight investigator whether Conrad, the North Dakota senator, ""was aware that he was getting preferential treatment,"" Feinberg answered: ""Yes, he was aware.""
Referring to Dodd, the investigator asked:
""And do you know if during the course of your communications"" with the senator or his wife ""that you ever had an opportunity to share with them if they were getting special VIP treatment?""
""Yes, yes,"" Feinberg replied.
The senators were VIP borrowers in the program known as ""friends of Angelo.""
Angelo Mozilo was chief executive of Countrywide, which played a big part in the foreclosure crisis triggered by defaults on subprime loans. The Calabasas, Calif.-based company was bought last July by Bank of America for about $2.5 billion.
Bryan DeAngelis, Dodd's spokesman, said Feinberg has repeatedly made allegations of special treatment that were not true.
""As the Dodds have said from the beginning, they did not seek or expect any special rates or terms on their loans and they never received any. They were never offered special or sweetheart deals and if anyone had made such an offer, they would have severed that relationship immediately.""
DeAngelis also repeated Dodd's statements from February that an independent report showed the terms received by the senator and his wife were widely available at the time.
Conrad's spokesman, Chris Gaddie, said Monday that the senator ""never asked for, expected or was aware of loans on any preferential terms"" and has ""worked overtime to set the record straight.""
""He went with Countrywide simply because they already had his financial information,"" Gaddie said.
He added that a Countrywide official had told Conrad that ""it is not unusual for them to make exceptions for good customers if they could sell the loan in the secondary market. We now know that they did sell the apartment building loan in the secondary market.""
Feinberg said in his House testimony that it was hard for ""friends of Angelo"" to fail to see their special treatment, because the loan officers identified themselves as part of the VIP unit.
""When the loan comes out of the VIP processing unit their business cards are stapled in loan packages,"" Feinberg said. ""It says 'VIP Supervisor,' VIP underwriter.' ""Everyone's VIP, so I'm just thinking human nature is to think, well, what am I getting?""
Q. So as I understand what you're saying is, it was the pattern and practice of the account executives that handled VIP loans?
A. Yes.
Q. To notify the borrower.
A. Right.
Q. Of the preferential treatment they were receiving.
A. Right.
At a Feb. 2 news conference, Dodd said he knew he was in a VIP program but insisted he was told by Countrywide, ""It was nothing more than enhanced customer service ... being able to get a person on the phone instead of an automated operator.""
The ethics committee determines whether senators violated standards of conduct. The outcome of the investigation could hinge on whether the mortgage violated strict limits on gifts to lawmakers or ran afoul of other Senate rules. The committee typically just issues a report. It could recommend a censure vote by the Senate, but that is rare.
Feinberg was questioned closely by three of the ethics committee's six senators: Democratic Chairman Barbara Boxer of California; the panel's senior Republican, Johnny Isakson of Georgia, and Republican Jim Risch of Idaho, according to Goldstein, the Feinberg attorney.
The ethics questioning was intense at times, and Boxer asked the bulk of the questions, Goldstein said. When Feinberg described a conversation he had with Dodd, Boxer demanded to know how he remembered it. Feinberg said he recalled Dodd saying he had to leave to make a speech.
Boxer asked whether Dodd and Conrad received VIP treatment because they were senators. Feinberg said that was not the case; they received breaks as other influential people in Countrywide's ""friends of Angelo"" VIP program.
Isakson, a onetime real estate executive, asked more detailed questions about the mortgage agreements' terms.
Countrywide VIPs, Feinberg told the committees, received discounts on rates, fees and points. Dodd received a break when Countrywide counted both his Connecticut and Washington homes as primary owner-occupied residences — a fraction, according to Feinberg.
Conrad received a type of commercial loan that he was told Countrywide didn't offer.
""The simple fact that Angelo Mozilo and other high-ranking executives at Countrywide were personally making sure Mr. Feinberg handled their loans right is proof in itself that the senators knew they were getting sweetheart deals,"" said Feinberg's principal attorney, Anthony Salerno.
Conrad initially said in June 2008, ""If they did me a favor, they did it without my knowledge and without my requesting it.""
The next day, Conrad changed course after reviewing documents showing he got special treatment and said he was donating $10,500 to charity and refinancing the loan on the apartment building with another lender.
He also said then it appeared Countrywide had waived 1 point at closing on the beach house.
A market expert told CNBC that the Goldilocks economic scenario is getting a little long in the tooth and is especially concerned with the financial sector, which may show cracks in the façade this week.
""The stock market is overvalued,"" said Richard Suttmeier, chief market strategist at RightSide.com. ""I'm viewing this as another opportunity for investors to lighten up on positions.""
Suttmeier said he was particularly worried about the financial sector. ""Sure, some of the financial stocks are rallying, but that's because they're coming off pretty much near 52-week lows,"" he said.
But Charles Lieberman, chief investment officer at Advisors Capital Management, said the market has a lot further to go.
""I think those sectors are actually very interesting to buy because they are at lows,"" said Lieberman. ""They haven't participated in the rally.""
Lieberman highlighted the current economic environment of moderate growth, low interest rates and ""just so much liquidity you have to use all of the fingers of your hand to count up the deals.""
'The conditions are really idyllic for a market advance,"" Lieberman said.
But Suttmeier said this ""Goldilocks"" economic outlook was no longer relevant.
""I think Goldilocks is getting wrinkles,"" he said. ""It's an old scenario, now we're in a situation where we're seeing inflation above the Fed's target range, and we're seeing that the distress in the banking system.""
Suttmeier predicted that warnings signs are likely to appear this week when more than 60 community and regional banks are set to report.
""They're going to tell us that they're having an increase in 90-day loans and noncurrent loans and that is going to be a problem,"" he said.
The Dow Jones industrial average rose sharply on Tuesday on the back of strong quarterly results from 3M and Caterpillar.
The 30-stock index closed 167.80 points higher at 23,441.76, hitting intraday and closing record highs. JPMorgan Chase shares rose 1.6 percent to break above $100 for the first time.
The S&P 500 gained 0.2 percent to finish at 2,569.13, with financials rising to their highest level in 10 years. Corning and 3M were the best performers on the index. The Nasdaq composite advanced 0.2 percent to end at 6,598.43.
""This is very much earnings-driven,"" said Michael Shaoul, chairman and CEO of Marketfield Asset Management. ""The economically sensitive sectors of the S&P 500 have seen some strong earnings and that's what we needed.""
Caterpillar reported earnings per share of $1.95 on revenue of $11.413 billion. Analysts polled by Reuters expected a profit of $1.27 per share on sales of $10.649 billion. Caterpillar shares rose 5 percent.
3M shares rose 5.9 percent after the company posted earnings per share of $2.33 on sales of $8.172 billion. Analysts polled by Reuters expected a profit of $2.21 per share on revenue of $7.927 billion.
United Technologies, another Dow component, also reported better-than-expected results; its stock rose as much as 1.98 percent before closing 0.9 percent lower.
General Motors, Eli Lilly and Polaris Industries also rose after reporting earnings.
After the bell, AT&T, Capital One, Chipotle Mexican Grill, Discover Financial, Juniper Networks and many more are set to report earnings.
""It's all about earnings right now. Can they justify valuations? That's the key question right now more so than in recent memory,"" said Phil Blancato, CEO of Ladenburg Thalmann Asset Management.
This is the busiest week of the earnings season, with about a third of the S&P 500 expected to have reported by Friday.
U.S. stocks closed lower in the previous session, with the Dow and S&P 500 breaking six-day winning streaks.
On Tuesday, President Donald Trump tweeted after the Dow hit a record: ""Stock Market just hit another record high! Jobs looking very good.""
TWEET: Stock Market just hit another record high! Jobs looking very good.
Wall Street was also hopeful that tax reform could pick up steam in Washington.
Last week, the Senate passed a budget proposal that allowed Republicans to move closer to eventually passing tax reform — a measure that was approved by a vote of 51-49. The GOP is now reportedly moving quickly to try and get tax reform before the end of the year.
Bloomberg reported Monday that House and Senate leaders laid out a schedule for drafting and releasing tax reform legislation in the next few weeks.
Elsewhere, Politico reported that an administration-backed group met on Monday to plan out a multi-million dollar tax reform campaign.
CNBC reported on Tuesday that House Republicans will unveil a tax bill on Nov. 1.
The prospects of getting tax reform by year's end provide ""an upbeat path for the stock market bulls to continue charging ahead,"" said Ed Yardeni, president and chief investment strategist at Yardeni Research, in a note. ""If it turns into a stampede, then the resulting meltup could set the stage for a correction when tax reform is actually enacted.""
In economic news, the flash U.S. Composite PMI rose to 55.7 in October, hitting a nine-month high. That release was accompanied by the Richmond Fed survey of manufacturing activity, which showed a slowdown in manufacturing activity in October.
Overseas, European stocks fell slightly, while markets in Asia finished on a relatively mixed note.
Ahead of President Obama's highly anticipated jobs package unveiled on Thursdayin front of Congress, and CEOs on CNBC this week had some tough words for the president.
An NBC/Wall Street Journal poll showed Obama's overall job approval rating at a low of 44 percent, down 3 percentage points since July, while his handling of the economy stands at 37 percent.
Donald Carty, chairman of Virgin America and former AMR chairman and CEO, noted ""there's very little expectation about [Thursday's] speech or anything that will happen in the next eighteen months.""
Lack of confidence is a result of the government's inability ""to delvelop a plan to fix these problems,"" he added. ""Demand is not going to come back in the U.S. because everybody is holding back because of this concern.""
""The uncertainty lies in the fact that we know there are fundamental problems in this economy—they're severe, they're significant,"" Cart went on to say.
John Schiller, chairman and CEO of Energy XXI, said ""if the government would get out of the way, from a regulation standpoint, and let us [XXI] do what we do good you'll see us continue to hire and grow this economy.""
""I think that's a message from across the board,"" said Schiller.
Richard Parsons, chairman of Citigroup, told CNBC there are some specific things that can be done ""in terms of moving government out of the way where its in the way of job creation.""
""The President is trying to be pro-business. He's [Obama] trying to do what he can to work with the business community,"" added Parsons.
Joe Echevarria, Deloitte's new U.S. CEO stressed that growth comes from offering incentives to the private sector ""through tax reform, regulation and responsible fiscal policy.""
But it needs to be done in a ""pragmatic"" way with a responsible government and less politics,"" he said.
Heather Bresch, CEO of Mylan Labs, said unemployment is ""tough to band-aid when it’s of such epic proportions.""
""There needs to be a real recognition of what is job creation and that there’s a difference between a government job and a private sector job...We really need to step back and live within our means,"" added Bresch. ""That’s a very tough pill for everybody to swallow and I think given the partisan of what Washington has become, they’re not putting America first.""
Liam McGee, CEO of Hartford Financial Services Group, stressed the importance of creating ""incentives for businesses and entrepreneurs to invest—hire people in their plant, equipment and grow.""
""We ought to be celebrating our entrepreneurs,"" McGee added, ""and those who are creating vibrant businesses and creating jobs.""
Jon Faraci, CEO of International Paper, told CNBC ""to create jobs what we need is demand. This economy is 70 percent consumer driven, so we need consumers spending some of their discretionary income if we're going to have demand that's gong to lead to more jobs.""
""If we get demand, we’ll put more shifts on, our employees will be working more hours, and we’ll hire more people. Without demand we can have all the certainty in the world and all the clarity about regulation, but to me it’s not so much about confidence as it is about demand,"" explained Faraci.
Indra Nooyi, chairman and CEO of PepsiCo, noted that ""anything that's done to address unemployment in terms of massive stimulus spending is going to exacerbate deficits. And anything that's done to address deficits in the short-term is going to exacerbate unemployment.""
Nooya went on to say we're in ""a bit of a policy box and it's going to require us being willing to give up one of the two, which is it's okay to take on more deficits but lets put in some massive spending. Alternatively to say, 'we're going to go through structural unemployment for a while because we want to address deficits.'""
At this point I think we are all trying to address this conundrum by saying we have to address both sides, unfortunately there is no way out of this,"" Nooya added.
Michael George, CEO of QVC, noted the importance of ""making sure that there's a tax code and an investment code that supports the formation and growth of small businesses.""
""We need a cohesive plan to grow jobs, and to restore some confidence that the government can work and make decisions"" in order to move forward, George went on to say.
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New York Gov. Andrew Cuomo is scheduled to hold a press briefing Wednesday on the Covid-19 vaccine distribution plans as the threat of another economic shutdown looms over the state.
Last week, Cuomo and New York City Mayor Bill de Blasio noted that the state might close nonessential businesses in some regions in January. For weeks, Cuomo has said that he will implement more restrictions in parts of the state where hospitals are overwhelmed to the point that they cannot care for every patient.
But he has noted that it's up to residents of New York to follow public health precautions to limit the spread of the coronavirus and avoid a shutdown.
""Of course a shutdown in January is possible,"" Cuomo said last week. ""But there's a big but,"" he said, spelling the word out one letter at a time ""B-U-T.""
— CNBC's Noah Higgins-Dunn contributed to this report.
Read CNBC's live updates to see the latest news on the Covid-19 outbreak.
Corporate insiders sell their own companies' stock for a number of reasons.
They might need the cash for a big personal purchase such as a new house or yacht, or they might need the cash to fund a charity.
Sometimes they sell as part of a planned selling program that they have put in place for diversification purposes, which allows them to sell stock in stages instead of selling all at one price.
Other times they sell because they think their stock is overvalued and the risk/reward is no longer attractive. Some even dump their own stock because they have inside knowledge that a competitor is eating their lunch and stealing market share.
But insiders usually buy their own shares for one reason: They think the stock is a bargain and has tremendous upside.
The key word in that last statement is “think.” Just because a corporate insider thinks his or her stock is going to trade higher, that doesn’t mean it will play out that way.
Insiders can have all the conviction in the world that their stock is a buy, but if the market doesn’t agree with them, the stock could end up going nowhere.
Also, I say “usually” because sometimes insiders are loaned money by the company to buy their own stock. Those loans are often sweetheart deals and shouldn’t be viewed as organic insider buying.
At the end of the day, its large institutional money managers running big mutual funds and hedge funds that drive stock prices, not insiders.
That said, many of these savvy stock operators will follow insider buying activity when they agree with the insider that the stock is undervalued and has upside potential.
This is why it’s so important to always be monitoring insider activity, but it’s twice as important to make sure the trend of the stock coincides with the insider buying.
Recently, a number of companies’ corporate insiders have bought large amounts of stock. These insiders are finding some value in the market, which warrants a closer look at these stocks.
Here’s a look at several stocks that insiders have been doing some big guying in per Securities and Exchange Commission filings.
1. IMAX
One stock that insiders are snapping up a huge amount of is Imax, which, together with its wholly owned subsidiaries, operates as an entertainment technology company specializing in motion picture technologies and presentations worldwide.
Insiders are loading up on this stock into strength, since shares are up a whopping 38 percent so far in 2012.
Imax has a market capitalization of $1.67 billion and an enterprise value of $1.62 billion.
This stock trades at a premium valuation, with a trailing price-to-earnings of 89 and a forward price-to-earnings of 22.38. Its estimated growth rate for this year is 135 percent, and for next year it’s pegged at 21.3 percent. This is not a cash-rich company, since the total cash position on its balance sheet is $21.59 million, and its total debt is $55 million.
A beneficial owner just bought 183,600 shares, or about $4.3 million worth of stock, at $22.62 to $24.11 per share. This same beneficial owner also just bought 326,400 shares, or about $7.49 million worth of stock, at $22.91 to $23.04 per share.
From a technical perspective, IMAX is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock recently bounced right off its 50-day at $22.50 a share, and it has now started enter breakout territory, with the stock moving above some near-term overhead resistance at $25.12 to $25.34 a share. That move started on Tuesday, and it was accompanied by massive upside volume of 3.34 million shares.
If you’re bullish on IMAX, then I would look for long-biased trades once it triggers its next major breakout trade above some past overhead resistance levels at $26.48 to $26.68 a share with high volume.
Look for volume on that breakout that registers near or above its three-month average action of 1.3 million shares. If we get that move soon, then IMAX could easily spike north of $30 a share.
I would avoid IMAX or look for short-baized trades if it fails to hold that near-term breakout over $25.12 to $25.34 a share, and then drops back below its 50-day at $22.50 and 200-day at $21.58 with high volume. If we get that action, then look for IMAX to trend back below $20 a share.
2. Synageva BioPharma
In the biotechnology and drugs complex, insiders are loading up on Synageva BioPharma, which is focused on the discovery, development and commercialization of therapeutic products for patients with life-threatening rare diseases and unmet medical needs.
Insiders are buying this stock into some big-time strength here, since shares are up over 80% so far in 2012.
Synageva has a market cap of $1.04 billion and an enterprise value of $903 million. This stock trades at a premium valuation, with a price-to-sales of 235.20 and a price-to-book of 6.85.
Its estimated growth rate for this year is 78.6%, and for next year it's pegged at — 51.10 percent. This is a cash-rich company, since the total cash position on its balance sheet is $138.92 million, and its total debt is zero.
A director and beneficial owner just bought 886,000 shares, or about $36.5 million worth of stock, at $41.20 per share. Another director also just bought 73,000 shares, or about $3 million worth of stock, at $41.20 per share.
From a technical perspective, Synageva is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock triggered a major breakout trade back in late June once it started to move above some past overhead resistance at $40.38 with massive upside volume.
Following that trigger, shares of Synageva pulled back briefly to around $40 a share, and then took off to hit its recent 52-week high of $49.93 a share. That move has started to push Synageva into overbought territory, since its current relative strength index reading is 80.42.
If you’re in the bull camp on Synageva, then I would wait for this stock to pullback significantly since it’s extended by almost 10 points above its 50-day moving average of $39.28 a share, and it’s almost 20 points above its 200-day moving average of $30.36 a share.
Look for a buying opportunity in Synageva once it pulls back closer to its 50-day moving average of $39.28 a share, at let’s say $42 to $40 a share if we get it.
3. Deckers Outdoor
Insiders are also snapping up a large amount of stock in Deckers Outdoor, a designer, producer, marketer, and brand manager of footwear, apparel, and accessories.
Insiders are sniffing out some deep value here, since this stock has traded down by over 35 percent so far in 2012.
Deckers Outdoor has a market cap of $1.80 billion and an enterprise value of $1.55 billion. This stock trades at a cheap valuation, with a trailing price-to-earnings of 9.79 and a forward price-to-earnings of 8.62.
Its estimated growth rate for this year is -11 percent, and for next year it’s pegged at 20.6 percent. This is a cash-rich company, since the total cash position on its balance sheet is $228.57 million, and its total debt is zero.
The CEO just bought 10,000 shares, or around $459,000 worth of stock, at $45.90 per share.
From a technical perspective, Deckers is currently trading below both its 50-day and 200-day moving averages, which is bearish.
This stock has been stuck in a nasty downtrend for the past eight months, with shares plunging from over $118.90 to a recent low of $42.16 a share. During that sharp move lower, shares of Deckers have consistently made lower highs and lower lows, which is bearish technical price action.
That said, the stock has started to reverse that trend and make higher lows and some higher highs. That move is quickly pushing Deckers within range of triggering a near-term breakout trade.
If you’re bullish on Deckers, then I would look for long-biased trades once this stock manages to clear some near-term overhead resistance at $48.41 a share, and then its 50-day moving average of $50.15 a share with high volume.
Look for volume on that move that’s tracking in near or above its three-month average action of 1.9 million shares. If that breakout triggers soon, then Deckers could easily re-test and possibly take out its next significant overhead resistance levels of $54.88 to $59.07 a share.
Keep in mind that we will need to see a high-volume trend above its 50-day to have any chance at hitting those targets.
On the flipside, I would avoid Deckers or look for short-baized trades if the stock fails to trigger that breakout soon, and then takes out its near-term support zones at $45 to $43.92, plus its 52-week low of $42.15 a share with high volume.
If we get that action, then Deckers could slide back below $40 a share if the bears gain full control of this stock. Keep in mind that it’s almost always bearish technical action when a stock continues to print new 52-week lows.
4. Verifone Systems
Another stock that insiders are finding attractive here is business equipment player VeriFone Systems, which is engaged in the secure electronic payment solutions.
It provides solutions, and services for the financial, retail, hospitality, petroleum, transportation, government, and health-care vertical markets. Insiders are finding some deep value here, since this stock is down by over 33 percent in the last three months.
VeriFone has a market cap of $3.84 billion and an enterprise value of $5.13 billion. This stock trades at a reasonable valuation, with a trailing price-to-earnings of 16.7 and a forward price-to-earnings of 10.96.
Its estimated growth rate for this year is 38.5 percent, and for next year it's pegged at 22.2 percent. This is not a cash-rich company, since the total cash position on its balance sheet is $366.40 million, and its total debt is a whopping $1.61 billion.
The CEO just bought 155,000 shares, or around $5.03 million worth of stock, at $32.50 per share.
From a technical perspective, VeriFone is currently trading below both its 50-day and 200-day moving averages, which is bearish. This stock got hammered back in April, with shares plunging from a high of $55.89 to a recent low of $30.10 a share.
During that massive drop, shares of VeriFone were constantly making lower highs and lower lows, which is bearish technical price action. The stock also flashed a number of warning signs to longs with large gap downs on heavy volume.
That said, the stock has started to find some buying interest near $30 to $32 a share, and it’s now making higher lows and higher highs.
If you’re in the bull camp on VeriFone, I would look for long-biased trades if this stock can manage to trigger a near-term breakout trade above some overhead resistance levels at $36.78 to its 50-day moving average of $36.81 a share with high volume.
Look for volume on that move that hits near or above its three-month average volume of 3.6 million shares. If we get that breakout soon, then VeriFone could start to fill a recent gap down that started near $44 a share.
Some key levels to watch for are $40 a share which is near the low of the gap down day, and its 200-day moving average of $42.25 a share. If those levels get taken out with volume, then VeriFone could re-visit some more resistance at $47.82 a share.
On the flipside, I would avoid VeriFone or look for short-biased trades if it fails to trigger that breakout soon, and then drops below some major near-term support at $34 a share with heavy volume.
If we get that action, then VeriFone could head back towards $32 to $30 a share. Any future move below its 52-week low of $30.10 a share should be consider bearish price action, since most stocks that print new 52-week lows continue to do so for some time.
5. Hudson Global
Another stock with some interesting insider buying is Hudson Global, which provides specialized professional-level recruitment and related talent solutions worldwide.
Insiders are buying this stock into some notable weakness, since shares are off by around 18 percent so far in 2012.
Hudson Global has a market cap of $143 million and an enterprise value of $113.14 million.
This stock trades at a reasonable valuation, with a trailing price-to-earnings of 18.71 and a forward price-to-earnings of 12.83.
Its estimated growth rate for this year is -147.1 percent, and for next year it’s pegged at 318.8 percent. This is a cash-rich company, since the total cash position on its balance sheet is $24.93 million and its total debt is $1.04 million.
A beneficial owner just bought 112,400 shares, or about $443,000 worth of stock, at $3.95 per share. The same beneficial owner also just bought 150,000 shares, or about $605,000 worth of stock, at $4.03 per share.
From a technical perspective, Hudson is currently trading above its 50-day moving average and below its 200-day moving averages which is neutral trendwise.
This stock took a dive off its April high of $5.98 to its recent low of $3.23 a share. During that large move lower, shares of Hudson were consistently making lower highs and lower lows, which is bearish technical price action.
That said, the stock formed a double bottom in mid-June at around $3.23 to $3.30 a share. Since marking that bottom, shares of Hudson have soared back above its 50-day moving average of $3.96 a share.
If you’re bullish on Hudson, then I would look for long-biased trades once this stock takes out its 200-day moving average of $4.61 a share with high volume.
Look for volume on that move that registers near or above its three-month average action of 107,522 shares.
If we get that move soon, then look for Hudson to trade back towards its next significant overhead resistance levels at $5.72 to $5.98 a share. It’s possible that Hudson could pull back to its 50-day at $3.96 a share before it challenges its 200-day.
I would simply avoid Hudson if it fails to trigger that breakout, and then moves back below its 50-day moving average at $3.96 and some more near-term support at $3.78 a share with heavy volume.
If we get that move, then Hudson could easily re-test its previous double bottom price levels at $3.30 to $3.32 a share. Any move below its 52-week low of $3.05 share should be considered bearish technical price action.
—By TheStreet.com Contributor Roberto Pedone
Additional News: Lights. Camera. Invest! Putting Filmmaking in the Portfolio
Additional Views: 5 Stocks Under $10 That Probably Won’t Double
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Disclosures:
TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks. At the time of publication, Roberto Pedone had no positions in stocks mentioned.
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Up to 90 percent of paper money in the United States contains traces of cocaine, according to a study by the American Chemical Society released Monday.
Scientests analyzed currency in more than 30 cities in five countries, and the US and Canada posted the highest levels of contamination, according to the study. China and Japan posted the lowest levels of contamination, between 12 and 20 percent.
On a global level, cocaine traces jumped almost 20 percent compared to a similar study conducted two years ago, said Yuegang Zuo of the University of Massachusetts in Dartmouth.
""I'm not sure why we've seen this apparent increase, but it could be related to the economic downturn, with stressed people turning to cocaine,"" Zuo said in a press release.
The scientists studied 234 bills from the US, which came from 17 cities. Money from larger cities, such as Boston and Washington, D.C., contained the most cocaine.
Although a high percentage of the money was contaminated, the amount was not significant enough to raise any health concerns, Zuo said.
""For the most part, you can't get high by sniffing a regular banknote, unless it was used directly in drug uptake or during a drug exchange,"" he said.
As Americans commemorate Martin Luther King Jr.'s contributions to the nation, Democratic presidential hopefuls are fanning out across the country to honor the civil rights leader.
Sen. Kamala Harris, D-Calif., used the holiday to launch a presidential campaign that, if successful, would make her the first woman and the second black candidate to become president.
Meanwhile, an annual rally to observe King's birthday held in the capital of South Carolina, a critical early-voting state in the Democratic primary, will feature two senators expected to seek the White House in 2020, Cory Booker of New Jersey and Bernie Sanders of Vermont.
Former Vice President Joe Biden, who's weighing his own presidential bid, is set to speak at a King holiday event in Washington alongside former New York mayor and possible 2020 rival Michael Bloomberg. Two candidates who have already opened exploratory committees — Sens. Elizabeth Warren of Massachusetts and Kirsten Gillibrand of New York — will also appear at King-centered events.
While the Democratic field for 2020 is only beginning to take shape, the year that would have marked King's 90th birthday gives the party's prominent members a valuable opportunity to address race and, potentially, draw a contrast between their own views and those of President Donald Trump, whose approach to questions of racial justice has sparked criticism from multiple minority groups since he took office.
How Democratic contenders, both those officially in the race and those still mulling campaigns, celebrated the King holiday:
Harris, a first-term senator and former California attorney general known for her rigorous questioning of Trump's nominees, opened the holiday by declaring her bid on ABC's ""Good Morning America."" She abandoned the formality of launching an exploratory committee, instead going all in on a presidential campaign.
""I love my country,"" she said when asked what qualifies her for the presidency. ""And this is a moment in time that I feel a sense of responsibility to stand up and fight for the best of who we are. And that fight will always include, as one of the highest priorities, our national security.""
Harris, 54, grew up in Oakland, California, a daughter of parents from Jamaica and India who were active in the civil rights movement.
King, she said, ""was aspirational, like our country is aspirational. We know that we've not yet reached those ideals, but our strength is that we fight to reach those ideals. And that inspires me because it is true that we are a country that, yes, we are flawed, we are not perfect, but we are a great country when we think about the principles upon which we are founded.""
Harris also cited her years as a prosecutor in asserting: ""My entire career has been focused on keeping people safe. It is probably one of the things that motivates me more than anything else.""
The senator plans a formal campaign launch in Oakland in a week and will have her headquarters in Baltimore. She's already planning her first trip to an early primary state as a declared candidate. On Friday, Harris will travel to South Carolina to attend the Pink Ice Gala in Columbia, which is hosted by a South Carolina chapter of the Alpha Kappa Alpha Sorority, which Harris pledged as an undergraduate student at Howard University. The sorority, founded more than 100 years ago, is a stronghold in the black community.
In mimicking Robert F. Kennedy's 1967 tour through impoverished American communities, John Edwards strikes a resonant chord with me. My father covered that Kennedy trip for the Washington Post. A photo from that experience hangs on the wall in the kitchen of my family home. But is he the Bobby Kennedyof the 2008 presidential race?
Certainly the former North Carolina senator would like to be--and with good reason. RFK, in a different way than his brother JFK,has become a mythic Democratic hero. He had an ability to appeal across racial and income lines in ways any thinking Democrat could want to emulate.
Some of the comparisons are apt. John Edwards has drawn flak forhis work with the Fortress Investment Group hedge fundand his $400 haircuts. Kennedy was a rich man too. Notwithstanding our sustained economic growth and booming stock market, poverty rates remain comparable to levels of a generation ago; in the most recent Census Data, from 2005, slightly more than 12 percent of the population is poor. The poverty population has become younger, as Medicare and Social Security have dramatically reduced economic deprivation among the elderly. Poverty among whites has fallen substantially, but they represent a declining proportion of the overall population.
Just as RFK was in his day, Edwards stands widely accused of political opportunism. He likes to say that he's emphasizing poverty issues against the prevailing wisdom of political consultants, since there's little political upside in appealing to the poor when middle class votes and upscale executives' political contributions drive U.S. elections. In fact, there's a very large political benefit in championing the poor among Democratic primary voters.
But Edwards has at least three big problems in trying to replicate Kennedy's political feat. One is that Barack Obama--the first African American candidate with a real shot at becoming president -- is for many voters already filling the RFK roles for many voters of both races. A second is that immigration has made Hispanic voters a growing proportion of the Democratic primary electorate, and so far Hispanic voters have flocked to Hillary Clinton.
The third is that the composition of the Democratic electorate has changed. Many of the blue-collar Democrats Kennedy appealed to are now Republicans, drawn by the GOP's appear on social issues or security concerns. That leaves Democrats more dependent than ever on both the top of the income scale as well as the bottom; Democrats nearly broke even in 2006 among voters earning more than $100,000 a year.
Edwards aims to appeal to both upscale and downscale voters at the same time. Despite his work at Fortress, he led other top Democratic candidates in embracing higher taxes on private equity and hedge fund managers. He's also pushing universal health care and a tougher line on U.S. trade policy. One early sign of the viability of his strategy will come in his third quarter fund-raising.
So far he boasts some loyal allies from American business; wealthy telecommunications executive Leo Hindery is a top economic adviser. Tune in to CNBC's ""Street Signs"" this afternoon at 2:30, and we'll explore Hindery's assessment of the top populist in the Democratic race.
Fyi: It's good to be back blogging after my vacation. However, I will be out on some family business unitil the end of the week--but new posts will be here next week.
Questions? Comments? Write to politicalcapital@cnbc.com.
Treasury yields fell on Tuesday as the massive stock rally hit a pause. Investors also awaited the Federal Reserve's monetary policy decision.
The yield on the benchmark 10-year Treasury note dropped 7 basis points to 0.81% and the yield on the 30-year bond was down 9 basis points at 1.56%. Yields move inversely to prices.
The Federal Open Market Committee (FOMC) meets Tuesday and will announce its latest monetary policy decision on Wednesday. While markets expect short-term interest rates to remain steady at near zero, investors will be watching Fed Chairman Jerome Powell's statement for clues over the central bank's next move.
Powell intimated at last month's meeting that more stimulus could be necessary to mitigate the impact of the coronavirus pandemic. The Fed has already deployed an unprecedented barrage of rate cuts and credit and lending programs which could inject around $6 trillion into the economy.
The National Bureau of Economic Research officially confirmed on Monday that the U.S. economy peaked in February, signaling the end to the longest economic expansion in American history, which began in June 2009.
Market focus is also attuned to states' efforts to reopen their economies amid the coronavirus pandemic, which has now infected more than 1.9 million Americans and more than 7 million people worldwide.
The World Health Organization (WHO) on Monday warned that the pandemic is ""far from over"" after a record number of new daily cases, and suggested that the virus has yet to peak in Central America.
On the economic data front, the IBD/TIPP economic optimism survey for June is expected at 10 a.m. ET Tuesday, along with April JOLTs job openings and wholesale inventory figures.
Auctions will be held Tuesday for $40 billion of 119-day Treasury bills, $60 billion of 42-day bills and $29 billion of 10-year notes.
CNBC's Jim Cramer on Monday reviewed and made changes to his pandemic playbook to bring more diversification to his coronavirus index.
The Cramer Covid-19 Index, a basket of 100 stocks he determined can work in a coronavirus-plagued market, has outgained the major indexes since Cramer last updated the stock catalog.
""When you look at the biggest winners in the index, they're overwhelmingly tech companies that help facilitate the stay-at-home economy, and a lot of these got hit today,"" the ""Mad Money"" host said.
Cramer dropped two health-based stocks and one packaged foods company to make room for two cloud-based names and one gold business. VMware, Fastly and Newmont Mining were substituted for Baxter International, GlaxoSmithKline and Kellogg.
Baxter, a medical supplies company, was removed because of its high exposure to voluntary surgeries delayed by the impact of the health crisis on hospitals. GlaxoSmithKline, a drug company that's working on a Covid-19 vaccine, was taken off because the stock is ""not enticing many investors,"" Cramer said. Kellogg, the cereal producing giant, was axed because the stock is lagging and the Cramer index already contains seven other similar plays.
As for the new additions, Cramer added VMware, one of his cloud king stocks, because the stock is ""cheap on an earnings basis"" and the prospect that the company could be spun off from Dell. Fastly, a cloud content delivery network whose stock price has increased sevenfold since bottoming in March, is one that in hindsight Cramer wishes he included when he created the index in April. Newmont is a gold company that can provide investors ""more insurance against economic chaos"" as the country continues to deal with fallout from the coronavirus crisis, he said.
The biggest winners on Crammer's list – Zoom Video, Spotify, Zscaler, DocuSign, Etsy, The Trade Desk, Livongo Health, Square, Peloton and Cloudflare – are among the top plays in the stay-at-home economy.
""As the pandemic flares up again, get ready after the industrial rotation ends. It's time to circle back to the blue-chip Covid stocks that are still way off their highs. That's what offers the best risk-reward,"" he said. ""I love a rotation. They throw out the good, they buy the bad and then they change their mind two days later.""
Cramer last updated his coronavirus playbook in late May when investors were growing more convinced that the economy was headed for a V-shape recovery as states eased lockdown orders. The host said then, however, that it was ""too soon to give up on the recession stocks"" as he showed 10 stocks the exit and brought 10 others onto his stock index that was designed to outperform the market through the pandemic.
""Since we adjusted the index a little over a month ago, it's rallied 6.4%. Meanwhile, the Dow [is] up 4.6%; S&P's only up 3.3%. Nasdaq Composite and NASDAQ 100, though, have both rallied 5.8%,"" Cramer said. ""Russell 2000 small-cap index has also underperformed of late, although got some good mojo today — gained 4.8% over the same period — but only after that big rally today, which is exactly what you'd expect with the pandemic once again spiraling out of control.""
COOPERSTOWN, N.Y., Oct. 1, 2012 /PRNewswire/ -- The National Baseball Hall of Fame and Museum is adding to its art collection with the donation of a portrait depicting one of the sport's most famous players. ""Babe Ruth"" by Rossin, a 72-inch x 60-inch oil on canvas, uniquely captures the athlete during his early years with the New York Yankees.
(Photo: http://photos.prnewswire.com/prnh/20121001/CL84559 )
The painting was commissioned and donated to the Hall of Fame by national lease-to-own retailer Aaron's, Inc. in commemoration of opening its milestone 2,000th store Friday in the Bronx. Joe Torre, a legendary baseball manager and Major League Baseball's Executive Vice President for baseball operations, attended the grand opening event as Aaron's special guest and officially unveiled the portrait during a ribbon-cutting ceremony. Erik Strohl, Senior Director of Exhibitions and Collections for the Hall of Fame, was on hand at the event to accept the portrait.
""We are thrilled by Aaron's donation of this extraordinary portrait, which is incredibly lifelike and unique,"" Strohl said. ""Babe Ruth is globally known as one of baseball's most popular figures that ever lived, and we always welcome new ways to pay tribute to his legacy. This portrait is especially appealing in how it portrays 'The Babe' as a young man, early in his career, in full color detail. Most photographs of Ruth are not only in black and white, but depict him later in his career. Babe Ruth comes to life in this portrait in a way we've never seen before, a testament to the wonderful work by the artist. You really have to see it to believe it.""
Aaron's commissioned the painting by internationally acclaimed portrait artist Rossin, recognized for his lifelike pieces of world leaders including U.S. Presidents, Britain's royal family and celebrities.
""On the occasion of opening our 2,000th store in New York City, we wanted to do something meaningful for the local community,"" said Ronald W. Allen, CEO and President of Aaron's. ""Yankees baseball is obviously close to the hearts of New York residents, and we wanted to give them a rare opportunity to be among the first to see this spectacular painting of Babe Ruth, up close and in person, before it finds its permanent home at the National Baseball Hall of Fame and Museum. Rossin's portraits are of the highest caliber, and we are extremely pleased the Hall of Fame is accepting our donation of the painting as the newest addition to its historic collection of baseball art.""
A replica of the painting will continue to hang in the Bronx Aaron's store located at 3254 White Plains Road. For more information on the Baseball Hall of Fame, please visit www.baseballhall.org.
About Aaron's, Inc.
Aaron's, Inc. (NYSE: AAN), the nation's leader in the sales and lease ownership and specialty retailing of residential furniture, consumer electronics, home appliances and accessories, has 2,000 Company-operated and franchised stores in 48 states and Canada. Founded in 1955 by entrepreneur and Chairman Emeritus R. Charles Loudermilk, Sr. and headquartered in Atlanta, Aaron's has been publicly traded since 1982. For more information, visit www.aarons.com.
About the National Baseball Hall of Fame and Museum
The National Baseball Hall of Fame and Museum is open seven days a week year round, with the exception of Thanksgiving, Christmas and New Year's Day. The Museum observes regular hours of 9 a.m. until 5 p.m. from Labor Day until Memorial Day Weekend. From Memorial Day through the day before Labor Day, the Museum is open from 9 a.m. until 9 p.m. seven days a week. Ticket prices are $19.50 for adults (13 and over), $12 for seniors (65 and over) and for those holding current memberships in the VFW, Disabled American Veterans, American Legion and AMVets organizations, and $7 for juniors (ages 7-12). Members are always admitted free of charge and there is no charge for children 6 years of age or younger. For more information, visit our Web site at baseballhall.org or call 888-HALL-OF-FAME (888-425-5633) or 607-547-7200.
About the Artist, Rossin
Rossin, an internationally renowned artist who has exhibited extensively in Europe and Asia, moved to Atlanta from his native Bulgaria in 2001. His focus on portraiture has gained him a reputation for his extraordinary talent. Noted commissions include a portrait of Presidents George H. and George W. Bush which hangs in the Presidential Library in College Station, Texas; a portrait of Ambassador Andrew Young which now resides in the permanent collection of the Smithsonian's National Portrait Gallery; his portrait of President Jimmy Carter is exhibited in the Carter Presidential Library and Museum; Morgan Freeman's portrait is now part of his private collection in his residence in Mississippi; a portrait of King George VI is property of Her Majesty Queen Elisabeth II and his portrait of Vivien Leigh as Scarlett is part of Ted Turner's private collection. To learn more about Rossin, visit www.RossinFineArt.com.
SOURCE Aaron's, Inc.
Finally! A constructive use for that annoying vuvuzela buzz from the World Cup — you know, those horns that sound like a swarm of bees is buzzing over the stadium.
You see, here —
Bzzzzzzzzzzzzzzzzz ….
The only downside: It’s not on all the videos — just the most recent ones.
But, sort your search by “upload date” and then decide if you want to watch the video, or—
Bzzzzzzzzzzzzzzzzz!
Questions? Comments? Write to us at ponyblog@cnbc.com or drop a comment below.
More From the Pony:
Texas Sen. Ted Cruz and Rep. Ted Poe reintroduced a controversial bill that allows governors to bar refugees from entering their state, The Hill reported.
The bill, entitled ""The State Refugee Security Act,"" was initially introduced last year, The Hill Reported on Tuesday. It would require federal authorities to notify a state 21 days before settling a refugee there, during which the governor can request ""adequate assurance"" that the refugee is not a security threat. If the federal authorities can not provide this, the refugee will not be able to settle in the state.
""The first obligation of the president is to keep this country safe as commander in chief,"" Cruz said in a statement to The Hill. ""I am encouraged that, unlike the previous administration, one of President Trump's top priorities is to defeat radical Islamic terrorism.""
The act echoes the sentiment of President Donald Trump's plan to bar Muslims from entering the United States. While he proposed this plan during the primaries, it is unclear at this time if he still supports it.
Click here to read the full story from The Hill.
The ""Fast Money"" traders gave their final trades of the day.
Tim Seymour was a buyer of XME.
Brian Kelly was a buyer of GG on his prediction the dollar could see a correction.
Steve Grasso was a buyer of CPB.
Guy Adami was a buyer of CERN.
Trader disclosure: On February 13, 2015, the following stocks and commodities mentioned or intended to be mentioned on CNBC's ""Fast Money"" were owned by the ""Fast Money"" traders: Guy Adami is long CELG, EXAS, INTC, Guy Adami's wife, Linda Snow, works at Merck. Steve Grasso is long AAPL, BA, CLVS, EVGN, FB, GDX, GOOGL, IMMR, KBH, KDUS, MHY, MJNA, NVIV, PFE, POT, SO, T, TMUS, TWTR, YHOO, firm is long FCX, NE, NEM, VALE, RIG, OXY, USO, AMZN, kids are long EFG, EFA, EWJ, IJR, SPY. Brian Kelly is long BTC=, US Dollar, GLD, CTRL calls, HYG puts, BBRY call spreads, TLT, he is short EWA, EWG, EWQ, EWZ, EWW, Australian Dollar, British Pound, Canadian Dollar, Yuan. Tim Seymour is long AAPL, BAC, BX, C, DIS, F, GE, GM, GOOGL, INTC, SUNE, Tim's firm is long BABA, BIDU, BX, CCU, DSKY, KNDI, MCD, NKE, NOK, SINA, SBUX, TSL, VIP.
President Barack Obama announced Friday he is nominating Ashton ""Ash"" Carter to be the next secretary of Defense.
""With a record of service that has spanned more than 30 years as a public servant, as an adviser, as a scholar, Ash is rightly regarded as one of our nation's foremost national security leaders,"" Obama said.
If confirmed by the Senate, Carter will replace former Republican former Sen. Chuck Hagel, who is stepping down.
Read More Hagel submits resignation as defense chief under pressure
Carter was deputy secretary from 2011 to 2013.
""I think it's fair to say that, Ash, at your one year attempt at retirement from public service, you failed miserably. But I am deeply grateful that you're willing to go back at it,"" Obama said.
A Rhodes scholar, Carter is a trained physicist and weapons expert. The president praised him as ""one of the few people who actually understand how many of our defense systems work.""
Before announcing Carter's nomination, Obama touted the better-than-expected jobs number released Friday morning.
—Reuters contributed to this report.
Kellogg is recalling about 10,000 cases of its Eggo Nutri-Grain Whole Wheat Waffles in 25 states because they could be contaminated with the bacteria listeria.
Listeria can cause serious and even deadly infections. It primarily affects the elderly, pregnant women, newborns and people with weak immune systems.
The Battle Creek, Michigan company said Monday it has received no reports of illnesses. Kellogg says it learned of the potential problem after routine tests.
The recalled waffles are available in 10-count packs with ""Used by"" dates of Nov. 21, 2017 and Nov. 22, 2017. Kellogg, which also makes Frosted Flakes and Special K, said no other Eggo products were affected.
The company says people who bought the products should throw them away and contact it for a full refund.
Spending a little too much time playing Call of Duty? Glued to Facebook? Too much Tweeting (hello, Congressman Weiner!)? Or just watching too much SportsCenter?
Some New Yorkers have started a web biz which they hope will get people out more. Can they make a lethargic nation start moving?
The site is called Blood, Sweat & Cheers, or BSC. The motto: bring back recess. Every day the site sends out emails to subscribers highlighting fun, offbeat, sometimes sweat inducing activities. This is no Groupon deal where you get half off on a massage. First, there are no coupons — yet. And BSC is trying to find the most unique, offbeat activities possible, like ""a muddy obstacle course race"", ""Marathon Training Made Fun, Social and Easy"", ""Bingo at the Standard Hotel"", or ""The Ugly Dog Pageant."" Put me down for the last one.
The site launched in April just for New York but will go national later this month.
How will Blood, Sweat & Cheersmake money? ""You bring up a good question,"" BSC's Jonathan Ages tells me. His team is selling banner ads on the website and inside the daily emails. ""By the way, in-email advertising sells at roughly ten times the rate of website advertising,"" he says. Future plans include sponsored articles which will be ""clearly labeled as such,"" and a ""group-buying arm"" like Groupon.
But not like Groupon. (Though we should all wish to be like Groupon.)
""The world doesn't need another company offering discount haircuts,"" Ages says. ""But it does need an organization that can hook you up with fun, playful experiences that you can share with like-minded people.""
How's traffic? ""We don't pay a lot of attention to site traffic,"" Ages says, which is code for ""not much."" He adds that BSC's ""more telling"" statistic is subscriber growth. ""Our subscriber base is growing by roughly 15 percent every week.""
In a world growing more crowded with new variations of the daily deal model, Blood, Sweat & Cheers might be seen as a guy's Daily Candy meets Living Social meets Men's Fitness...meets...you get the picture. One plus — if you take part in ""Marathon Training Made Fun, Social and Easy,"" you may end up with a physique worth showing off online to people you're not married to, but you'll probably be too exhausted to photograph yourself.
Questions? Comments? Funny Stories? Email
The U.K. has emerged from the Covid-19 pandemic to find itself faced with an onslaught of new economic crises that have left the country in ""a precarious position,"" experts have warned.
A perfect storm of labor shortages, skyrocketing natural gas prices and global supply chain constraints have put the country in prime position for a difficult winter. Rising demand as economies reopen has created similar problems all over the world, but economists argue that Brexit has exacerbated these issues for Britain.
A lack of workers is affecting a slew of industries across the country.
Britain has an estimated shortage of 100,000 truck drivers, which haulage organizations have largely attributed to a post-Brexit exodus of EU nationals. The lack of truck drivers has disrupted deliveries, leading to empty store shelves, backlogs at ports and dry gas stations, which sparked a panic buying frenzy in September that lasted weeks.
Other sectors have also warned of deepening labor shortages that are expected to damage the availability and price of goods in the runup to Christmas.
Britain's National Pig Association has warned that up to 120,000 pigs face being culled within weeks because of a lack of butchers and abattoir workers.
In a statement on Friday, the vice president of the U.K.'s National Union of Farmers said labor shortages across the food supply chain remained acute, while the CEO of the U.K. Warehousing Association said in September that industries including warehousing, engineering and transport were all experiencing severe worker shortages.
At the end of September, the Confederation of British Industry — which represents 190,000 businesses — said its latest data showed 70% of companies were planning pay rises in a bid to tackle labor shortages.
The U.K. government has issued thousands of temporary visas for truck drivers, butchers and agricultural workers, but some critics have argued that this is insufficient to lure foreign workers.
Riccardo Crescenzi, a professor of economic geography at the London School of Economics, expressed some skepticism about the solutions being offered by the government.
""Offering three-month [visas] might not work while the rest of the EU is booming because of the injection of resources allowed for its recovery plan,"" he told CNBC in a phone call. ""And there is not really an unemployment problem in the U.K., so I struggle to see where drivers would come from in the domestic economy.""
Crescenzi said it was hard to know if the issues were temporary. ""Some of these shortages could become structural, and this is a problem that can seriously constrain future growth.""
Sam Roscoe, senior associate professor in operations and supply chain management at the University of Sussex, warned that shortages would persist in the U.K. unless there were fundamental changes to the country's immigration system.
""Brexit was sold as a vote on immigration independence, the U.K. labor market and making sure that everybody in the U.K. had jobs to go to, but the issue is we have 5% unemployment,"" he said via telephone. ""We've lost access to 27 member countries and the labor pool that was once available there, especially in terms of so-called low-skilled labor. I think that definitely puts us in a precarious position.""
Roscoe said it would take years to get enough Brits trained and licensed to drive heavy goods vehicles. ""In the meantime, the reality is we're going to have labor shortages unless the visa rules change.""
In a note on Thursday, Credit Suisse economists warned that U.K. consumers ""face headwinds in the next few months,"" including elevated inflation, supply shortages and the tightening of monetary policy.
""We think real disposable incomes for the U.K. consumer can fall by about 1.5% in 2022, the biggest fall since 2011,"" the note's authors predicted.
Helen Dickinson, head of the British Retail Consortium, told ITV News Thursday that three in five CEOs said they would have to raise prices by the end of the year due to supply chain problems. Some 10% said they had already done so.
Charalambos Pissouros, head of research at JFD Group, said he believed panic buying and supply shortages in the U.K. might also impact spending power by damaging sterling's value.
""I see the risk surrounding the future of the British pound as tilted to the downside,"" he told CNBC. ""How severe any further tumble may be depends on how long the situation stays unresolved. Quick responses like the involvement of the British military could restore economic performance sooner than thought and halt sterling's fall, and this could also allow the Bank of England to proceed freely with its tightening plans.""
It comes as Britain also faces an energy crisis. Several U.K. energy suppliers have collapsed since September as wholesale gas prices climbed to record highs. While the problem has affected markets worldwide, the U.K. is particularly vulnerable because of its reliance on gas; more than 22 million households are connected to the British gas grid.
Meanwhile in Europe — which is also battling rising prices — the European Commission on Wednesday published a ""toolbox"" that member states could use ""to address the immediate impact of current [gas] price increases, and further strengthen resilience against future shocks.""
Crescenzi told CNBC that the EU can count on the strength of its single market, ""which means global shocks like the gas price crisis can be dealt with more effectively with significantly more room for manoeuvre.""
""Following Brexit, the U.K. could still coordinate its response to the crisis with its most important trade and investment partner to ensure the best possible protection for its firms and citizens,"" he added. ""However, measures put out by the U.K. government remain unclear, let alone a strategy to coordinate with external partners. This is alarming.""
EU-U.K. relations have been under strain in recent weeks amid disputes over the Northern Ireland protocol, a special trade deal introduced to avoid a hard border between Northern Ireland and the Republic of Ireland. Officials have publicly argued on Twitter over the proposals — dubbed the ""biggest source of mistrust"" between both sides by U.K. Brexit Minister David Frost — and met to discuss proposed changes in Brussels on Friday.
One of the hottest trades of the year is about to get even hotter.
Mining stocks have struck gold since the start of 2016, rallying more than 17 percent and shooting to their highest level since late October. The move has sparked a flurry of bullish activity this week.
"" and gold miners is where the options action was this week, … with the top two stocks being Freeport McMoRan and Newmont Mining,"" Mike Khouw told CNBC's ""Fast Money"" on Thursday. Freeport and Newmont were up a respective 16 and 27 percent in the last week, while the broader gold miners ETF, the GDX, has rallied 6 percent in the same period.
The options activity in the gold miners comes amid an influx of money piling into the ETF. Tom Lydon, CEO of ETFTrends.com, told CNBC producers this week that more than $2 billion has come into the GDX in the last month.
Read More This could be the ultimate bull trap
One trade that stuck out to Khouw on Thursday was a hefty bet that the GDX could reach a new 52-week high by midyear. Specifically, that trader purchased 50,000 of the June 22 strike calls for 32 cents each. Since one call option accounts for 100 shares of stock, this is a $1.6 million bet that the GDX would be above $22.32 by June expiration. That's nearly 40 percent higher than where the ETF is currently trading.
""It appears this trader is rolling out and up of a bullish position, basically betting on continuing and substantial gains in the gold miners over the next five months,"" said Khouw, co-founder of Optimize Advisors and a CNBC contributor.
The move in the miners this year is largely fueled by a surge in gold prices. The commodity has rallied 9 percent in 2016, but curiously enough it saw a similar rise in the first five weeks of 2015, only to sell off sharply as the year progressed.
Europe has come a long way since the height of the economic crisis that shook the region three years ago but it has a way to go to become ""shock-proof,"" Eurogroup President Jeroen Dijsselbloem told CNBC.
""A little bit more self-confidence (is what is needed). There's been a lot of criticism about how the euro works, how the monetary union works and over time, since we started the monetary union we've built it up, we've strengthened it and so I think we're coming into a new phase now,"" the euro zone politician who played a key role in bringing Greece back from the brink of collapse this summer, told CNBC.
He said the euro zone's current phase was about stability and broadening the economic and political perspectives, the importance of which had been demonstrated by Greece's volatile summer before Prime Minister Alexis Tsipras agreed, albeit reluctantly, to a third bailout program.
""Europe is coming out of a crisis. Growth has returned to all but one of the euro zone countries and it's picking up and becoming broader. I think we should use this current stage to become more shock-proof,"" he told CNBC in Lima, where the International Monetary Fund/World Bank's annual meeting was being held.
""In order to do that we need to extend and complete the banking union, build a capital markets union to diversify the way finance comes to our economy and we need to push forward with the structural reforms to become even more competitive.""
Read More Europe's crisis of confidence
""So for Europe, it's about getting more growth, increasing potential growth and making sure we become more shock-proof,"" he added.
Dijsselbloem's comments come as data point to a modest recovery in the 28-member European Union. In the second quarter of 2015, for instance, the EU and the 19-member euro zone grew at 1.6 percent and 1.2 percent percent respectively, from the same quarter in 2014.
Still, some of the region's biggest economies, Germany and France, have recently shown cause for concern, with lackluster manufacturing and service sector output and growth data. While in the second quarter, France had no growth at all from the previous quarter, Germany grew a meager 0.4 percent.
Dijsselbloem appeared optimistic, however, saying that current growth rates in Europe were ""defying the pessimists"" and that several countries such as Ireland, Spain, the Netherlands and Baltic countries were experiencing strong levels of growth.
In order to make those growth rates sustainable, however, Europe needed to deal with the ""hindrances"" in its economy, he said.
""We need to cut red tape, open up markets, make sure it's easier for people to start businesses and easier to get finance. If we deal with all these small, structural issues in our economy then I'm sure we can increase that potential growth with four percentage points.""
Greek Prime Minister Alexis Tsipras said on Saturday that he sought no rift with Europe after his cash-strapped country submitted a list of reforms to its lenders in a bid to secure much-needed funds.
Tsipras' leftist government agreed an extension to its 240-million euro bailout fund in February, albeit with aid frozen, and now must agree on a set of reforms which it sent to its EU-IMF creditors on Friday in order to stave off bankruptcy.
The austerity-weary nation will run out of money by April 20, a source told Reuters on Tuesday, if it does not unlock much-needed funding.
""The liquidity problem is naturally hampering the situation but I believe that will be tackled immediately once we reach an agreement over reforms,"" Tsipras said in an interview with Sunday's Real News newspaper.
After answering a question regarding government attempts to deal with corruption, Tsipras was asked whether he wanted a rift or a solution with Greece's partners: ""My view has always been the same: a break from corruption, a solution with Europe.""
Read More Fitch downgrades Greece to 'CCC' from 'B'
Earlier Energy Minister Panagiotis Lafazanis, one of Tsipras' most left-wing ministers, hit out at a ""Germanised European Union.. for tightening week by week the noose around the Greek economy.""
Athens says its reforms will boost state revenues by 3 billion euros ($3.3 billion) in 2015, partly by tackling tax evasion, but that it will oppose any new ""recessionary measures"" such as further wage or pension cuts.
As talks unfold, Finance Minister Varoufakis told Vima newspaper on Sunday that the reforms would not include a rise in VAT, which had been a concern on Greece's islands where rates are lower, but changes to tax collection would be made.
Varoufakis was the centre of speculation on Friday following a report in the German newspaper Bild that a Greek government source had said it was only a matter of time before he resigned. But Tsipras said Varoufakis was ""one of the key members of the government"".
China and Russia
As Greece races to agree to raise funds, Deputy Prime Minister Yannis Dragasakis told China's official Xinhua news agency that Athens will sell its majority stake in the port of Piraeus within weeks, a flip-flop from its previous position.
Speaking during a visit by Greek officials to China, Dragasakis hinted that Chinese firm Costco Group - short-listed in a process launched by the previous centre-right government - was a front runner for the state's 67 percent stake.
And as Greece seeks to fill its state coffers, the Russian ambassador to Athens told Kathimerini newspaper that Moscow would examine any loan request from Greece, were it to be made.
Tsipras is due to visit Moscow on April 8 for talks with Russian President Vladimir Putin but the Greek government has stressed it is not seeking funding from the Kremlin.
On Saturday, Greece's energy ministry said Lafazanis will meet Russian Energy Minister Alexander Novak and Gazprom Chief Executive Alexei Miller on Monday in the capital, a week before Tsipras is due to arrive.
The previous centre-right government had planned to accelerate the sale of a 65 percent stake in gas utility DEPA, after an initial attempt to sell to Gazprom in 2013 failed. Within days of Syriza taking power in January, Lafazanis said he would scrap the sale.
DEPA has previously negotiated with Gazprom in a bid to get cheaper gas supplies and was one of the first European companies to obtain a rebate in 2011.
The two countries, which are both Orthodox Christian, have traditionally had good relations and Athens has never strongly supported sanctions against Russia over the conflict in Ukraine.
(Adds comment, details, updates prices)
* Spain seen requesting bailout, but uncertainty weighs
* Worries on 3rd-quarter earnings dog stock markets
* Gold holds near highest level of the year
* Aussie dollar slips as RBA cuts rates
By Wanfeng Zhou
NEW YORK, Oct 2 (Reuters) - The euro rose against the dollaron Tuesday on expectations that a request by Spain for a bailoutis imminent, but major stock markets fell on uncertainty of whenMadrid will make its request and growing uneasiness overthird-quarter earnings.
European officials said on Monday that Spain is ready tomake the request for a euro zone bailout as early as nextweekend, although Germany has signaled that it should hold off.
A request for a bailout is viewed as positive for financialmarkets because it would trigger Spanish bond buying by theEuropean Central Bank, which would lower the country's borrowingcosts. It would also remove another layer of uncertainty in theregion's three-year old debt crisis.
""Spain being rescued would be good for risk assets andultimately global growth, but while the benefits are largelypriced in, we're still getting conflicting signals thatunderstandably have investors apprehensive,"" said Brian Barish,president of Cambiar Investors LLC in Denver, who helps oversee$7 billion.
""Until we get some kind of clarity, we should expect a lotof volatility and difficulty holding onto gains,"" Barish said.
Adding to the confusion about when aid could arrive, SpanishPrime Minister Mariano Rajoy said on Tuesday that a request forEuropean aid was not imminent.
The MSCI global stock indexslipped 0.1percent to 332.84.
Wall Street stocks surrendered early gains and turnednegative. The Dow Jones industrial average
dropped 68.46points, or 0.51 percent, to 13,446.65. The Standard & Poor's 500Index
dropped 3.21 points, or 0.22 percent, to 1,441.28.The Nasdaq Composite Indexdropped 4.41 points, or 0.14percent, to 3,109.12.
The Dow was pressured by stocks closely tied to the pace ofgrowth, including heavy machinery maker Caterpillar Inc
and plane maker Boeing Co
. A major headwind for theglobal economy has been falling demand from Europe, which hasbeen drifting toward recession.
Weaker-than-expected results from fertilizer producer Mosaic
added to worries about the third-quarter earningsseason, which will kick off in earnest next week. Mosaic sharesslid 4.7 percent and were the biggest percentage decliner on theS&P.
The FTSEurofirst-300 index of pan-European shares
fell 0.3 percent to end at 1,101.89 points, also weighed bydoubts over third-quarter results and weakness in basicresources stocks.
""The real key to create confidence is positive earningssurprises, positive economic data surprises,"" said PhilipIsherwood, European strategist at Absolute Strategy Research.
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GRAPHICSEuro debt crisisItaly, Spain market overview
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INVESTORS ON EDGE
The euro rose 0.3 percent to $1.2927
, notching asecond straight day of gains against the greenback, while thedollar gained 0.2 percent against the yen to 78.10 yen
.
But uncertainty over the timing of Spain's request for aidkept investors on edge, with many selling the euro at higherlevels. Another risk factor is rating agency Moody's soon-to-beannounced review of Spain's rating, which could see it cut tojunk status.
Joe Manimbo, senior market analyst at Western Union BusinessSolutions in Washington, said worries about euro zone growthwould keep the European Central Bank in easing mode, capping anyeuro upside.
Investors also awaited a number of central bank meetingslater this week. The European Central Bank, the Bank of Englandand the Bank of Japan all meet this week, although none isexpected to change benchmark interest rates.
Earlier on Tuesday, Australia's central bank cut its mainrate by a quarter point to 3.25 percent. The Australian dollar
fell to a one-month low of $1.0291 and last traded down0.9 percent at $1.0297.
U.S. Treasuries prices reversed early losses to edge higheras stock losses boosted the bid for safe-haven U.S. debt. Thebenchmark 10-year U.S. Treasury note was up 1/32, with the yieldat 1.6146 percent
.Brent crude
slipped 31 cents to $111.88 a barrel asinvestors weighed a weaker outlook for fuel demand and sluggisheconomic growth. U.S. crude
fell 16 cents to $92.32.Gold prices
remained close to their highest level ofthe year. Gold is seen as a safe-haven asset. Spot gold was lastat $1,772.99 an ounce.
(Additional reporting by Marc Jones in London and GertrudeChavez-Dreyfuss and Ellen Freilich in New York; Editing byLeslie Adler)
((Wanfeng.Zhou@thomsonreuters.com)(+1 646 223 6304)(ReutersMessaging: wanfeng.zhou.reuters.com@reuters.net))
((To read Reuters Global Investing Blog click on
;
for the Macro Scope Blog click on
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((For the state of play of Asian stock markets please click on:
))Keywords: MARKETS GLOBAL/
Cryptocurrencies are nearing the end of the road, and it's time to do away with the digital coins, UBS Gobal Wealth Management's chief economist said.
UBS Paul Donovan, who has never been a fan of cryptocurrency, wrote earlier this week: ""I come to bury Bitcoin, not to praise it.""
""These things were never going to be currencies. They're not going to be currencies at any point in the future,"" he said Thursday on CNBC's ""Fast Money."" ""They're fatally flawed.""
Bitcoin received lots of love during the 2017 holiday season when it began rallying to nearly $20,000. But Donovan was skeptical then, warning that it could be ""destructive"" in the long term.
""Right from the start of the hike in late last year, it was fairly obvious that this was going to end badly, unfortunately, for some of the people who weren't protected by any kind of regulation and got sucked into the process,"" he told CNBC.
After peaking, bitcoin is now trading around $4,330. Overall, the cryptocurrency market has lost about $700 billion since reaching highs in January.
Donovan thinks the cryptocurrency could be in its ""death throes"" because losing 80 percent value ""is not healthy."" Government, he said, is ""one of the main obstacles"" to bitcoin, adding the idea of digital currency replacing the dollar ""is quite a leap.""
""The main problem with these things, the absolute fundamental flaw, is that they're never going to be a store of value,"" he said. ""Every economist knows the store of value is about balancing supply and demand, and with cryptocurrencies, you cannot control the supply in response to the drop in demand.""
WATCH: When bitcoin hit $100 for the first time in 2013
It's been 351 days since Jon Stewart sat behind the desk of a late-night talk show and delivered jokes about US politics and the day's headlines.
In the time since Stewart left The Daily Show (on August 6, 2015), his many proteges have spread far and wide across the TV landscape. Samantha Bee is on TBS. John Oliver has reached new heights on HBO. Trevor Noah took over The Daily Show. And Stephen Colbert has landed at CBS's Late Show. (Stewart himself has a deal with HBO that he'll presumably start producing content for one of these days.)
But something else happened in those 351 days: Donald Trump became the Republican party's nominee for president. And in all that time, doesn't it seem like Stewart would have some pretty great jokes to share about a man he dubs an ""angry groundhog""?
More from Vox:
Why Hillary Clinton, not Donald Trump, was the unifying figure at theRNC
Donald Trump gave Bernie Sanders a shout-out andSanders was not amused
Ted Cruz played Donald Trump's reality TV game — and won
As it turns out, he did! After he popped up on the latest episode of Colbert's show (where he's been turning in appearances all week), the host ceded the floor to his old boss, and Stewart proceeded to lay into Fox News's praising of Trump — for the exact same things they've criticized for over the course of his presidency.
(If you're wondering where Colbert was this whole time, he was crouching just behind the desk, so he could pop up for the occasional joke, as you'll see from this Tweet he shared.)
Stephen Colbert tweet
It was a nice taste of vintage Jon Stewart, for all those who've enjoyed the many, many shows his Daily Show spawned but wanted something from the man himself. He performed a quick tune from Hamilton. He dubbed Sean Hannity ""Lumpy."" He learned the hard way that he was on live TV.
It was all a fun bit, made even more fun by Stewart's obvious rustiness when it came to hosting a TV show. But the best part was its conclusion: a lengthy, vintage rant from Stewart that deserves to be quoted (mostly) in full.
You [Hannity and Fox News hosts] feel that you're this country's rightful owners. There's only one problem with that. This country isn't yours. You don't own it. It never was. There is no real America. ... I see you. You've got a problem with those Americans fighting for their place at the table. You've got a problem with them because you feel like the — what's Representative Steve King's word for it? — subgroups of Americans are being divisive. Well, if you have a problem with that, take it up with the Founders. ... Those fighting to be included in the ideal of equality are not being divisive. Those fighting to keep those people out, are.
Stewart clearly stopped by Late Show to offer his old pal a boost in the ratings — creatively, the show is finally coming close to the heights of The Colbert Report, so this was a good time for viewers to sample the program — but it was also fun to watch him shake off the cobwebs and deliver jokes to a camera again. Here's hoping the next time isn't another 351 days from now.
Stock markets have taken such a beating over the past few months that they are now more resilient to any upheavals, apart from a complete breakdown of the euro zone, an analyst told CNBC Thursday.
""We've managed to get through all of these bond auctions in all of these markets with some measure of success.
A failure would be a setback but even then it's not too critical,"" Richard Harris, CEO at Quam Asset Management.
""Equity markets have been really beaten down over the last six months to a year and they now look reasonably resistant to anything but utmost catastrophe,"" he said.
However, he conceded that there was still a long way to go before Europe's debt crisis was resolved with the situation more like being 'one step up and two steps down'.
""We have to jump through a lot of hurdles over the next three or four months, we have the bond auctions today, the Spanish elections will be very interesting, which might not be conclusive on Sunday, you have a whole bunch of technocrats and I am sure the French triple A (rating) is going to go sometime and that will be another blow to markets,"" he added.
Both Spain and France held unimpressive bond auctions Thursday - some bond yields hit euro-era highs -as fears that the crisis would engulf the bigger euro zone economies persisted.
He said that it was now likely that the euro would survive with the worst case being the loss of a few countries despite European leaders adopting the 'sticking plaster' over the wound method rather than seeking an outright fix.
Steven Bell, chief economist at GLC, disagreed saying the situation in Europe was now so serious it threatened even Germany, whose ""economic miracle"" Bell said was now at an end.
""The end game for this may be Germany shouldering the financial responsibility for this, yet every time a crack appears in Spain or Italy or anywhere else people buy Bunds.
Now the only thing you can hold in Europe is Bunds. That is a ridiculous situation,"" Bell told CNBC.
He said German banks and companies were suffering to the point where Germany was now in a recession.
""This is entirely and completely a result of failing to sort out this European crisis. I'm not optimistic about the ability of Europe's many and varied political leaders to come to that solution quickly,"" Bell added.
President Joe Biden said Friday that he plans to visit Texas next week as millions of residents there continue struggling with power outages after a major winter storm.
Biden also said he will ask the administration of the Federal Emergent Management Agency to accelerate a request for a declaration of a major disaster in Texas, which would free up federal funds to aid in relief efforts there.
""As I said when I ran, I'm going to be a president for all Americans,"" said Biden, who was defeated last fall in Texas' presidential election by then-President Donald Trump.
""I'm, going to sign [that] declaration once that's in front of me"" which ""God-willing will bring relief to a lot of Texans,"" the president said.
Biden said he had planned on traveling to Texas in the middle of next week, but cautioned that ""I don't want to be a burden.""
He said that ""if I can do it without creating a burden for folks, I plan on going.""
""I'll make that decision beginning of next week,"" Biden said.
U.K. retail sales grew at a slower pace than expected in July after a fall in the amount spent on food for the first time in 25 years when compared to the previous year, official data show.
Read MoreSupermarket wars hit UK retail sales
Retail sales increased by 2.6 percent compared with July last year and were up 0.1 percent on the previous month, according to the Office for National Statistics (ONS).
Economists polled by Reuters had expected retail sales to grow 0.4 percent growth on the month, with weakness largely down to lower petrol and food sales.
Read MoreBank of England: Ranks finally broken on rates
The ONS said July 2014 marked the first fall in consumer spending in food stores since the food stores series began in 1989.
Figures for July follow a strong reading for the second quarter, when sales volume jumped 1.6 percent quarter- on-quarter, the fastest growth for a quarter in 10 years.
The weaker data is likely to ease concerns of a Bank of England interest rate rise, after minutes from the Monetary Policy Committee showed two members of the bank's interest rate-setting committee voted to raise interest rates in August.
—By CNBC's Jenny Cosgrave: Follow her on Twitter @jenny_cosgrave
Homes today are selling in about 40 days on average, almost two weeks faster than a year ago. But it is taking a lot longer for shoppers to find a home to buy.
Two-thirds of buyers are shopping for more than three months before signing a deal, according to a new survey from the National Association of Home Builders. Why so long? They can't find a home they can afford.
Forty-two percent of buyers surveyed said prices were out of reach for the homes they wanted. Home prices have been rising at a fast clip in the past year – faster than income growth and inflation. The primary reason is a lack of homes for sale, especially lower-priced homes.
""It's the inventory problem that we're having out there that is causing these long delays in pulling the trigger,"" said Rose Quint, assistant vice president for survey research at the NAHB. ""It's lack of affordability, although the other problems are serious as well.""
About a third of those surveyed said they couldn't find a home with features they wanted or in a neighborhood they wanted. Back to prices though, 27 percent said they kept getting outbid on their offers. Bidding wars are now the rule, not the exception, in most major U.S. markets.
Home prices rose in 92 percent of the nation's measured housing markets at the end of last year, according to the National Association of Realtors. Twenty-six markets (15 percent) saw double-digit increases in prices. That was more than in the third quarter.
""These consistent, multiyear price gains have certainly been great news for homeowners, and especially for those who were at one time in a negative equity situation,"" said Lawrence Yun, chief economist for the Realtors. ""However, the shortage of new homes being built over the past decade is really burdening local markets and making home buying less affordable.""
The lack of supply should benefit the homebuilders, and it may be already. Mortgage applications to purchase a newly built home jumped 18 percent in January compared with a year ago, according to the Mortgage Bankers Association.
""This complements other positive news on U.S. job growth suggesting that economic fundamentals are strong,"" said Lynn Fisher, MBA vice president of research and economics, in a release. ""Based on applications, we estimate that new home sales were running at a pace of 700,000 on a seasonally adjusted annual basis – the highest such estimate in our survey which began in 2013.""
The jump in demand is sizable, but the number of new homes for sale is still below historical averages and far below the number needed to satisfy both new and pent-up demand. The largest generation, millennials, are now moving into their homebuying years in force, but clearly not finding what they can afford.
""The whole industry has been clamoring for builders to increase their production, but they're trying,"" said Quint. ""The prices of lumber and labor and land are increasing so fast, they're constrained at the bottom, at how low a price they can really achieve.""
The NAHB is predicting a 5 percent increase in new home construction in 2018 compared with 2017. The market could absorb far more, not just in major metropolitan areas, but across the nation.
MOSCOW, Oct 8 (Reuters) - Russia's second-largest mobilephone operator MegaFon , in which Russia's richest manAlisher Usmanov took control in April, said on Monday it plansto launch an initial public offering on the London StockExchange.
The IPO, to be completed in the fourth quarter, will giveinvestors the chance to buy into a Russian telecoms company thatis outpacing its peers in a growing home market, but unlikerivals is shielded from tricky overseas operations and complexcorporate disputes.
MegaFon said it plans to use the proceeds of the offering ofits treasury stock to repay debts.
(Reporting by Megan Davies; Editing by Maria Kiselyova)
((megan.davies@thomsonreuters.com)(+7 916 391 8262))
Keywords: RUSSIA MEGAFON/IPO
Stocks held their own Monday, even after the shocking demise of Bear Stearns. But the market no doubt benefited from the view of many investors that the Fed will deliver a hefty rate cut when it meets Tuesday.
Right now, traders are betting on a full point rate cut by the Fed, which would take the target Fed funds rate to 2 percent. Just Friday, the Fed funds futures showed traders believed the Fed would cut by 0.75 percent. But the weekend rescue of Bear Stearns in a Fed-engineered buyout by JP Morgan and other extraordinary moves by the Fed changed that view.
Two investment banks report earnings before the bell Tuesday, and that news will also be key in setting the course for markets. Other important news includes producer price inflation data, due at 8:30 a.m., and housing starts, also reported at 8:30 a.m.
One of the most encouraging events for stocks in recent sessions is the pricing Tuesday afternoon of the giant $18 billion Visa IPO. The offering is expected to price after the bell Tuesday, and start trading Wednesday. There has been some real investor excitement about the offering, which is expected to price between $37 and $42 per share.
Earnings Central
Goldman is expected to report first quarter earnings of $2.58 per share, a decline of 61 percent, on revenues of $7.47 billion, a 41 percent decline. Lehman is expected to report earnings per share of $0.72, a 63 percent decline, on revenues of $3.351 billion, a 34 percent decrease.
The shares of financial institutions were under pressure Monday after the Bear Stearns news, with Wall Street's investment banks particularly hard hit. The S&P financial sector was down 1.5 percent.
Lehman stock was the most tattered of all the firms as an uncomfortable level of rumors swirled around its shares. The stock at some points during the day was down more than a third, and it traded on volume of 224 million shares, nearly eight times its 10 day average of 33 million shares.
Lehman battled back. CEO Richard Fuld said in a statement that the Fed's announcement Sunday that it would allow investment banks to use its discount window takes the liquidity issue ""off the table for the entire industry."" Previously, commercial banks were the only institutions that could use the Fed's short term borrowing window. Traders said the Fed's rule change was a big reason why stock trading was so orderly Monday.
Lehman's CFO Erin Callan is expected to appear on ""Closing Bell"" Tuesday.
Chop, Chop
Deutsche Bank chief U.S. economist Joe LaVorgna is one who changed his view on the Fed and rate cuts over the weekend. He now expects a full point rate cut when the Fed announces its decision at 2:15 p.m. ""The only way I could see the Fed not going 100 (a full point) is if they accompany the 75 cut with their intention to purchase GSE debt, Fannie and Freddie debt,"" he said.
Speaking of Fannie Mae and Freddie Mac , the Wall Street Journal was reporting late Monday that the Office of Federal Housing Enterprise Oversight is close to reducing capital requirements for the two companies, a move that would give the firms more flexibility in buying mortgages.
""Look at the Fed's action. They basically are telling you they are going to do something dramatic. I don't think 0.75 is particularly dramatic anymore. I think it has been priced into the market,"" he said.
LaVorgna said the Fed's statement will likely note that there's still downside risk. ""The Fed is not going to worry about inflation. It's going to worry about growth...we're not out of the woods yet,"" he said.
Market Mayhem
The Dow finished 21 points higher at 11,972, after a nearly 200 point swoon. The Dow is now down 9.9 percent since the start of the year and 2.1 percent from a year ago. The Nasdaq though was bloodied in Monday's trading, scoring a 1.6 percent, or 35 point decline. Nasdaq is down 18 percent year-to-date and is off 9.1 percent in the past 52 weeks. The S&P 500 slipped 11 points to 1276, a level 13 percent below where it started the year.
The Bear Stearns story ratcheted up anxiety about risk in the market, despite equities relatively tame reaction. Treasury yields fell as buyer moved into the safety of Treasurys. The 10-year was yielding 3.314 percent, and the yield on the two-year slipped to 1.333 percent, its lowest level since July, 2003.
The dollar continued its weakening trend, losing 0.5 percent against the Euro and 2 percent against the yen .
Some of the real action though was in the commodities markets where sellers dumped energy, grains and metals (with the exception of gold). Gold finished at $1001.40 per troy ounce, up 0.3 percent.
Crude oil fell 4.1 percent to $105.68 a barrel. Gasoline fell 6.9 percent and natural gas fell 7.8 percent. Silver fell 1.7 percent, copper fell 3.5 percent. Soybeans, corn and wheat all fell sharply and sugar and coffee fell more than 10 percent.
Joseph Terranova, partner at Thelogicaltrader.net, said commodities prices could get a lift from the Fed's rate action Tuesday, but watch out Wednesday and Thursday.
""When market conditions get like they did this morning, you need to pare back and take a fresh look,"" said Terranova. He said it's time to reduce some risk from portfolios, but investors should look to add to positions heading into the second quarter. He expects commodities to be flattish for a while.
""I'm going to wait and see what Bernanke gives the street. I'll come back a week from today and we'll be putting stuff back in place ... But the oil story is not over,"" he said.
Econorama
8:30 Producer prices, expected +0.3 percent
8:30 Housing starts, expected 999,000
8:30 Building permits
Questions? Comments?
IN THE RED FOR '07
The headline: Stock Market Rolls Over Today on Credit Crisis, Erasing S&P 500's Gain For the Year.
Dylan Ratigan explains that the S&P 500 is down 6.1% over 5 days. It’s the biggest drop since January 2003. Also, he says, with the Dow below 13,000; it’s down more than 1,000 points from a record high set in July.
Jeff Macke says the last hour of trading has become a dangerous hour lately, because traders don’t want to hold stocks overnight.
COUNTRY FRIED FINANCIAL:
The headline: Countrywide (CFC) Plummets 13% On Merrill Downgrade, Bankruptcy Speculation;
Pete Najarian says the Countrywide sell-off worsened on reports of a significant jump in its borrowing costs. Pete also says options volume suggests to him that CFC has further to drop. Pete tells the panel he’s short CFC.
On a related note, Pete Najarian says the bank stocks rolled over Wednesday as countrywide plummeted. If Goldman Sachs and Morgan Stanley are having problems, it will likely ripple through the entire space, says Pete. He sees a lot of put buying in the Financial Select Sector SPDR(XLF).
Finally, Pete recommends investors buy the volatility. In other words if you buy stock in this environment, buy a put spread as protection.
Guy Adami adds that Warren Buffett sees something in Bank of America (BAC). Guy suggests that BAC might not have much exposure to the subprime slime.
Tim Seymour reveals he bought materials companies today. He also says that as liquidity dries up, the dollar benefits. Consequently, he recommends buying CurrencyShares Canadian Dollar Trust (FXC).
AFTER HOURS ACTION: AMGEN AFTER HOURS:
The headline: Amgen (AMGN), the Biggest Biotech, Rises After Hours On Job Cut Plans;
Pete Najarian explains that the pop stems from an announcement that Amgen intend to reduce its work force by as much as 14%. On a related note, Pete doesn’t feel the stock will move until late 2008.
DEERE IN THE SPOTLIGHT:
The headline: Ag Trade Still Going Strong As Deere (DE) Reports 23% Surge In Profit;
Guy Adami says Deere & Co. beat earnings, but the news was swept under the carpet because of the distress in the market.
BUFFETT'S DOW WOW:
The headline: Berkshire Hathaway (BRK) Bought 3% Stake In Dow Jones (DJ) In Winning Bet On News Corp. Takeover;
Dylan Ratigan corrects an error made on the show Tuesday. He says a 2-for-1 stock split caused Berkshire's Nike (NKE) holdings to double; Buffett may not have changed his stake. He adds that Buffett did not disclose his stake in Union Pacific.
______________________________________________________
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to .
Trader disclosure: On Aug 152007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money Macke Owns (EMC), (JWN) Najarian Is Short (CFC), (GS), Seymour Owns (X), (EEM), Seymour Is Short (LEH), Red Star Asset Management Owns (MBT), Red Star Asset Management Is Short (EEM)
Tired of plucking all the marshmallows out of your Lucky Charms cereal? Then this could be your lucky day.
General Mills is giving 10 people the chance to win a box of its ""magically delicious"" cereal without the toasted oat pieces.
The company devised the sweepstakes after receiving countless emails, tweets, posts and calls from fans begging for a box of just the hearts, stars, horseshoes, clovers, blue moons, pots of gold, rainbows and red balloons.
Social media users who post a photo of themselves holding an imaginary box of the cereal on Facebook, Twitter or Instragram between Oct. 14 and 18 using the hashtag #Lucky10Sweepstakes will be eligible for the grand prize.
""Lucky Charms is one of the most Instagrammed cereals and these platforms are the right place to ignite and connect to the passion we hear about,"" Amanda Hill, associate marketing manager of Lucky Charms, said in a statement.
The company tapped rapper Biz Markie for the social media advertising campaign. The entertainer remixes his 1989 hit ""Just a Friend"" with new marshmallow-themed lyrics.
General Mills is one of several companies that has recently released—or re-released—products to appease social media users. Coca-Cola reintroduced it's citrus-flavored soda Surge to the market last month and Viacom-owned Nickelodeon launched a new TV channel devoted to show from the '90s in early October.
It's not just investment analyst Ken Fisher who hates annuities. On the list of financial products that fiduciary advisors love to bash, annuities — particularly variable annuities — are somewhere near the top.
They are an easy target. The insurance contracts are expensive, difficult to understand (for both consumers and financial advisors), hard to get out of and arguably not in the interests of the millions of consumers who have bought them. Indeed, the sale of high-commission annuities has been flagged as one of the more egregious ways that financial advisors fail to act in their clients' best interests.
Since the Department of Labor finalized its fiduciary rule (now in limbo) last year, annuity sales have fallen dramatically as brokerage firms and advisors anticipate that the products may not pass muster under a tighter regulatory standard.
""Companies have been canceling products left and right because they don't live up to the standard of meeting clients' best interests,"" said Ric Edelman, executive chairman and founder of Edelman Financial Services. Like many advisors, Edelman helps clients undertake tax-free Section 1035 transactions that allow consumers to switch out of high-cost annuity contracts into less costly ones. ""With that exception, I never advise clients to purchase annuities,"" he said.
Most fee-based financial advisors regulated as fiduciaries appear to feel the same way. David Yeske, managing director of registered investment advisory firm Yeske Buie, said that variable annuities have fallen out of favor with the fee-based advisors he regularly surveys for the Financial Planning Association.
""The use of variable annuities has been declining for years, and that's probably representative of the fiduciary side of the advisory world,"" said Yeske.
More from Investor Toolkit:
How to set up a special needs trust
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5 risks that can crack your nest egg
For his part, Yeske is not categorically against fixed or immediate annuities that guarantee income streams for investors, but he has never used them for his own clients. He thinks the adverse tax treatment of variable annuities — the gains in all distributions from the contracts are taxed as ordinary income — makes them a bad idea for savers.
""Variable annuities are a perfect machine for converting capital gains to ordinary income,"" he said. While the gains within a variable annuity portfolio are tax-deferred, they are ultimately taxed at up to 39.6 percent, versus the 15 percent capital gains tax rate. ""It's hard to find scenarios where the benefits of tax deferral justify getting taxed at the higher rate.""
Not all fiduciary financial advisors pan annuities, however. Harold Evensky, head of Evensky & Katz and a trailblazer in the RIA industry, believes that low-cost immediate annuities offered by companies such as Vanguard will be crucial for retirees at risk of outliving their assets.
Mark Cortazzo, senior partner of fee-based advisor Macro Consulting Group, thinks there are situations where annuity products are an effective solution for risk-averse consumers. While he has steered very few of his clients toward annuities recently, because of low interest rates and higher prices since the financial crisis, he thinks advisors who ignore all annuity offerings are failing their clients.
""We have to get past the rhetoric,"" said Cortazzo. ""If you're a fiduciary and you don't consider annuity solutions, you're not doing your job.""
There is currently about $2 trillion invested in variable annuity products alone, according to research firm Morningstar. With the oldest baby boomers now in retirement, those numbers may rise much higher. Like all investment product offerings, annuities have positive and negative aspects to them. Here are a few of the more prominent pros and cons.
Guaranteed income. In their simplest form, annuities guarantee an income stream for buyers either now (immediate annuities) or beginning at a later date (deferred annuities). While diversified investment portfolios have a potential for higher growth and cost far less to create, there is no guarantee that the assets will retain their value.
""Strategies to manage risk are not guarantees against catastrophes,"" said Cortazzo. ""If a portfolio account goes to zero, the insurance company still keeps sending out the checks.""
Protection against longevity risk. People are living longer and there's a good chance that many people will outlive their investment portfolios. What's more, retirees who are drawing on their investments to support themselves run a market ""sequence of return risk.""
In adverse markets, it can be very difficult to recover from losses if you're withdrawing from your account. Cortazzo points out that an investor who put $1 million into the at the beginning of 2000 and began taking $5,000 out per month ran out of money this year.
""If I'm drawing out 6 percent of my portfolio annually and the market drops 50 percent, I'm suddenly withdrawing 12 percent,"" said Cortazzo. ""An annuity takes the sequence risk and the longevity risk off the table.""
Market upside participation with downside protection. Variable annuity contracts offer the insurance component of an income guarantee with the possibility of increasing the payout if markets do well. Most of the products have a reset provision that allows payouts to increase if markets go up.
The terms of the contract reset to higher values but do not decrease if the market subsequently drops. Since the financial crisis, insurance companies have been paying customers billions to walk away from guarantees they priced prior to the crisis.
High cost. Annuity products can be expensive. Simple immediate annuities and deferred-income annuities generally have upfront commission rates that range from 1 percent to 4 percent. More complicated products, such as variable annuities and fixed index annuities, can have upfront commissions of 7 percent or more.
Between insurance charges (also called mortality and expense fees), underlying sub-account fees for variable contracts and administrative fees, overall annual costs can be more than 2 percent.
Hard to understand. While immediate annuities are easy enough to understand, more complicated variable annuity contracts or fixed index contracts that offer the potential for participation in market upside can get very complicated. Contract riders that offer additional benefits at additional costs make things more confusing still. Disclosures have improved but are still difficult to fathom.
Limited investment options. Variable annuity contracts limit the options you have for investing the portfolio. That can handicap your ability to grow the account and your payouts. The fees charged for the underlying investments — usually mutual funds — can be high.
Surrender penalties. Annuities are long-term contracts, and it can be very costly to break the terms of the deal. Buyers of annuities have to wait until they are 59½ years old before they can withdraw money without a 10 percent penalty.
They also have to wait six, eight or even 10 years after entering the contract before they can withdraw money from the account without additional surrender charges. The surrender charge period typically mirrors the commission level on the product: the higher the commission, the longer the surrender penalty period. While many insurers now offer contract terms that will allow for early withdrawals from annuities without surrender penalties, it will cost you up front.
Tax hit. While the investment gains in a variable annuity are tax-deferred, when the money is eventually withdrawn, the gains are taxed as ordinary income, not capital gains. For most people, that will result in a bigger tax hit. Withdrawals that are not part of a planned annuitization of the account per the terms of the contract will also be fully taxed as ordinary income until all the gains from the portfolio are distributed. Normally, annuity payments are comprised of taxable gains and non-taxable return of the principal invested.
— By Andrew Osterland, special to CNBC.com
Sears Holdings is taking its relationship with Amazon one step further.
The department store chain announced Wednesday at its annual shareholders meeting in Hoffman Estates, Illinois, that it will offer full-service tire installation for orders from all tire brands on Amazon, including its own DieHard.
News of the partnership sent Sears' stock soaring as much as 22 percent in early trading. The shares were last up 24 percent.
The rollout will begin in the coming weeks for those customers who live within range of 47 Sears Auto Centers in eight metropolitan areas: Atlanta, Chicago, Dallas, Los Angeles, Miami, New York, San Francisco and Washington, D.C. The service will eventually go live at Sears' more than 400 Auto Centers across the U.S., to reach more of Amazon's customers.
The checkout process will look something like this, a Sears spokesman explained to CNBC:
- A customer selects the tires he or she wants, from any brand, on Amazon.
- He or she selects ""Yes, I want these tires shipped to and installed at Sears Auto Center."" (The shipment of the tires to the Sears Auto Center would be handled by Amazon, not Sears.)
- The customer then provides three appointment times that are convenient for the installation.
- The chosen Sears Auto Center will then match the customer's schedule preferences with its appointment openings.
- Sears Auto Center then emails a confirmation through Amazon to the customer ahead of the appointment, which can still be altered.
With any appointment, there will be a ""standard installation fee"" paid to Sears that covers installation, balancing, under hood/under car evaluation, a road safety test and other precautionary steps, the spokesman said.
Sears kicked off its relationship with Amazon last summer when it announced it would begin selling Kenmore-branded appliances on Amazon, some of which are integrated with Amazon's Alexa platform. Shares of the department store chain had surged more than 25 percent on the news.
Then, in December, Sears said it would begin selling merchandise from its DieHard brand on Amazon, including car batteries and now tires.
""Kenmore is now distributed nationally on Amazon with over 250 products and we are exceeding customer service level expectations,"" Tom Park, president of Kenmore, Craftsman and DieHard brands at Sears Holdings, said in a statement.
The company said it has about 2,100 technicians at its Auto Centers across the country to perform tire installations.
Sears is meanwhile looking for ways to monetize other assets, as its sales are in a steep decline overall and the company has more than $1 billion of debt coming due within the year, according to financial statements.
Sears CEO Eddie Lampert's hedge fund, ESL Investments, has made a proposal to buy Kenmore, Sears' home improvement business, its PartsDirect division and some of the chain's real estate. Lampert has said he's been shopping some of those assets for years, but hasn't been able to find a serious buyer.
In a blog post Wednesday, prior to Sears' shareholders meeting, Lampert said: ""We're still not where we need to be, and Sears continues to face significant challenges in a tough retail environment. ... The reality is transformation is an ongoing process and we are not done. I still firmly believe that, together, we can transform this company.""
Sears Holdings shares are down nearly 70 percent from a year ago.
A deal between Republicans and Democrats on Capitol Hill to avert a government shutdown is ""pretty much done,"" Sen. Heidi Heitkamp, D-N.D., told CNBC on Thursday.
""They're putting pen to paper, and it's just a matter of how long it will take to get the deal kind of finalized,"" she said in an interview with ""Power Lunch.""
Earlier Thursday, Sen. Mitch McConnell said the Senate expects to pass a short-term funding bill ahead of the late Friday deadline to keep the government open.
Heitkamp said after a couple of big concessions were made, the path for a deal become clear.
""Once … the Democrats were willing to do more on defense and the Republicans were willing to fulfill the commitment under the Affordable Care Act and not waste money throwing something at a border-security provision that wasn't actually going to enhance security — I think those were the two big things that needed to happen,"" she explained.
On Wednesday, the Trump administration dropped its opposition to an Affordable Care Act subsidy for low-income people. The White House previously stopped insisting on funding for a wall on the southern border as part of a bill to keep the government funded.
While the solution right now is expected to be a short-term extension, Heitkamp is optimistic about a long-term solution.
""If we didn't think that we were there with a negotiated deal, I don't think we'd be agreeing on an extension. It's just a matter of getting the paperwork done so that all the t's are crossed and the i's are dotted,"" she said.
—CNBC's Jacob Pramuk contributed to this report.
Eurozone leaders meet in Brussels tomorrow with Greece in the spotlight given its massive debt problems.
So how do you play it from the FX perspective?
Get all the details from Amelia Bourdeau of Westpac Institutional Bank. Watch the video now!
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Ted Cruz essentially gave a career-ending speech at the GOP convention on Wednesday night.
Cruz's speech was a slap in the face to GOP nominee Donald Trump. This whole business about ""vote your conscience"" — that's a wonderful-sounding phrase. But we all know what he meant: Don't vote for Donald Trump.
I was in the convention hall and the crowd's reaction was unbelievable. It started out as a few hands waving in the air and some booing and then it just grew and grew throughout the entire convention hall. And then boom! It was absolute bedlam.
I've been to most of the GOP conventions since 1980, and I've never seen anything like it. These people stood on their feet and booed. These are Republicans! They don't do this. They don't know how to stand up and boo! And yet, Cruz so divided them and worked them into such a frenzy that it happened.
Cruz tried to pass it off as just the New York delegation acting up. But that is wrong. The whole hall was in an uproar. You couldn't even hear the last two paragraphs of Cruz's speech because the booing had reached such a crescendo!
Cruz left an absolute disaster in his wake when he finished that speech. Everyone was dispirited — as you might expect.
And then came Trump running mate Mike Pence.
Pence delivered a terrific speech. He touched on all the major themes — the economy, shaking up Washington and Trump being an outsider. He talked about how Trump understands that middle class wage earners have been hurt — they haven't had a raise in 15 years. That's something that Cruz, in all of his years of political experience, still doesn't understand!
Really, in the space of about 10 or 12 minutes, Mike Pence turned a demoralized, dispirited, depressed, negative convention into an upbeat, optimistic, united convention. He hit all the right notes and had a lot of optimism in his speech. The Cruz disaster, that had left the convention hall spinning just moments before, was suddenly swept away.
The entire hall started applauding Pence. Then they started cheering for Pence. And they got on their feet and cheered for Pence. Amazing.
Trump couldn't have made a better choice. Mike Pence single-handedly pulled that convention back together and united them with an optimistic message. He gave great support to Donald Trump and the ticket. He basically snatched victory from the jaws of defeat. He turned destruction into positive hope.
I've never seen anything like that.
Ted Cruz will never politically recover from this. His delegation from Texas wanted him to play ball with Trump — and he wouldn't. He was freelancing in that speech. And that is why his political career is over. He's finished.
But Donald Trump and Mike Pence are just beginning.
We have to wait and see what Trump does tonight in his speech — it could make or break his presidential campaign. I personally hope that he puts a lot of focus on optimistic, positive changes for America. I want to see a lot of growth in that speech. I want to hear him talk about lowering taxes and curbing regulations.
But here's what I want to see most of all: a follow-through from what Pence started. One of Pence's messages on Wednesday night was that we, meaning the ticket, can turn this nation around. It's an American malaise right now — from the economy, to civil unrest, violence and the threat of terrorism. And that is what Trump must prove to the nation and the world — that he can turn it around. He's got to convince them.
It's kind of like Reagan redux. Ronald Reagan was able to do this. He proved that he could do the job. That's what Trump needs to do.
That's huge. That's more important than any policy detail.
That's the spirit that Pence started on Wednesday night. Let's hope Trump does the same.
Commentary by Larry Kudlow, a senior contributor at CNBC and economics editor of the National Review. He is also an unofficial economic advisor to GOP presidential nominee Donald Trump. Follow him on Twitter @Larry_Kudlow.
For more insight from CNBC contributors, follow @CNBCopinion on Twitter.
Anyone running a small business knows that one of the most difficult challenges is effective publicity. If people don't know the business exists, they won't walk through the doors—and a business location, staff and start-up capital become irrelevant points.
Publicity can be acquired with billboard space or TV commercials, but many small businesses just don't have that kind of money. For mom and pops, a little creativity and a flair for the theatrical can go a long way. In short, they need to rely on good old-fashioned, attention-grabbing publicity stunts.
Some businesses have seen stunts become catalysts that take them to the next level. Others see efforts fizzle out, and in some cases turn into horrific disasters. But while there's no guarantee a publicity stunt will accomplish what it's designed to do, many businesses take that route anyway, always hoping for the best.
Here's a list of businesses that engaged in noteworthy plays for the public's attention. Some of these businesses used promotions that exceeded expectations. Other businesses made headlines and were soon forgotten, and others were unmitigated calamities. But whatever the case, all these businesses deserve credit for trying to do something a little different.
Read ahead to see our list of outrageous publicity stunts engaged in by small businesses over the years.
By Daniel Bukszpan
Updated 06 June 2013
Every January, select New Yorkers brave the elements to participate in the No Pants Subway Ride, an event staged by the Improv Everywhere prank collective. Participants board the subway in the middle of winter sans pants, to the great amusement of surprised onlookers.
This event presented the hair removal salon Shobha with a unique opportunity to publicize their service. In January, The Manhattan-based salon sent a team of pants-free participants to the event in underwear proudly bearing the Shobha name.
Many small businesses promote their services with prizes and giveaways. Dating services are no exception, including Gotham Dating Partners, which offers a unique promotional item to new clients purchasing an annual membership—a handgun.
""We direct them to online sites and pay for the purchase,"" Gotham Dating Partners CEO Aaron Fraser said in an e-mail. While clients are required to pass background checks in order to be eligible for weapons, the site proudly matches gun enthusiasts.
Rotterdam tattoo artist Dex Moelker caused a stir in 2011, when she gave a client a unique tattoo. The client got the profile pictures of all 152 of her Facebook friends tattooed on her right arm, a process documented in a YouTube video that went viral.
Disappointingly, it was revealed by the Dutch newspaper Telegraaf to be nothing more than a temporary tattoo. ""It is a try out tattoo, a transfer that washes off in a couple of days,"" Moelker told the Telegraaf. However, the video has been viewed more than 3.7 million times and is linked to from Moekler's website, a testament to its publicity value two years after the fact.
One of the most profitable movies ever made is 1999's ""The Blair Witch Project,"" which had a production budget of $60,000 and a worldwide box office take of over $248 million, according to Box Office Mojo. The film was a fictional account of three film students' experience investigating a centuries-old tale about a witch.
""The film was intended to be a fake documentary,"" co-director Daniel Myrick told Entertainment Weekly. The movie was publicized a year in advance by its website, which featured faked police reports and staged interviews with ornery townsfolk. The advance publicity fueled a widespread public perception and confusion that the film was comprised of real footage, which only led both horror fans and curiosity-seekers to purchase tickets in droves.
Cashtomato.com was a short-lived Internet video site whose founder allegedly intended that it compete with YouTube. A tall order, and one that was addressed in a 2008 publicity stunt. It involved dressing up three representatives as tomatoes and having them distribute $4,000 in cash to a packed mid-afternoon crowd in Manhattan's Union Square. What could go wrong?
The representatives were besieged by a seething mob of 100 people, who grabbed at the cash, injuring someone in the process, according to the New York Daily News. Ultimately, the publicity stunt did not have the desired effect, and the Cashtomato.com domain name is available for purchase today.
The German publishing house Eichborn Verlag performed an attention-getting stunt at the 2009 Frankfurt Bookfair. Their logo features a housefly, and the company harnessed the power of the insect by attaching promotional banners to real live ones and letting them loose in the venue.
A video of the publicity event can be seen on YouTube. Witness the looks of simultaneous delight and irritation among attendees.
LifeLock is an identity theft prevention company that used an audacious tactic to publicize its services in 2007. It ran television commercials in which CEO Todd Davis disclosed his real social security number, a dare to identity thieves to try their luck against the company.
One year later, ABC News reported that criminals did exactly that by taking out a $500 payday loan in the CEO's name. It wasn't the only time either. In 2010, the Phoenix New Times reported that his identity had been stolen a whopping 13 times.
Half.com is an online seller of new and used goods founded in 1999 and purchased in 2000 by eBay. Unlike its parent company, Half.com is not the place to outbid others for rare collectibles, but rather a place to buy goods outright at fixed prices.
In order to attract attention during its pre-eBay days, the company paid the city of Halfway, Ore. $100,000 to change its name to Half.com for one year. It also donated 20 new computers to the city to sweeten the deal for its 362 citizens.
Syracuse, N.Y. is home to an ice hockey team known as The Crunch. In December 2011, the team offered a spot on their roster to NBA player Kris Humphries, who is perhaps best known as the man who was Kim Kardashian's husband for all of 72 days.
As a tribute to Humphries' recently collapsed nuptials, the team offered fans the chance to buy six tickets for $72, and Syracuse Crunch General Manager Vance Lederman made a statement on the team's official website to make the athlete feel welcome. ""Being from Minnesota, Humphries will surely enjoy the hockey and feel right at home in the cold, gray, dismal weather we experience this time of year in Central New York,"" he said.
Tune in to """" on CNBC Prime, Tuesdays at 9 p.m. ET
When Marcus Lemonis isn't running his multi-billion dollar company, Camping World, he goes on the hunt for struggling businesses that are desperate for cash and ripe for a deal. In the past 10 years, he's successfully turned around over 100 companies. Now he's bringing those skills to CNBC and doing something no one has ever done on TV before … he's putting over $2 million of his own money on the line. In each episode, Lemonis makes an offer that's impossible to refuse; his cash for a piece of the business and a percentage of the profits. And once inside these companies, he'll do almost anything to save the business and make himself a profit; even if it means firing the president, promoting the secretary or doing the work himself.
The Profit on CNBC Prime premieres Tuesday, July 30 at 10p ET/PT.
Tens of thousands of demonstrators marched Sunday to the outskirts of the presidential residence in the capital of Belarus, calling for the country's authoritarian leader to resign as protests against President Alexander Lukashenko entered their fifth week.
Protests also took place in major cities throughout Belarus, said Interior Ministry spokeswoman Olga Chemodanova. Crowd sizes for those protests were not immediately reported, but Ales Bialiatski, head of the Viasna human rights organization, said the demonstration in Minsk attracted more than 100,000 people.
The protests, unprecedented in Belarus for their size and duration, began after the Aug. 9 presidential vote that election officials said gave Lukashenko a sixth term in office with 80% support. Protesters say the results were rigged, and some have explained to Associated Press journalists exactly how the fraud took place in their districts.
Lukashenko has ruled the country with an iron fist since 1994, regularly repressing dissent and press freedom.
Police violently cracked down on demonstrators in the first days of the protests, arresting some 7,000 people and beating hundreds. Although they have scaled back, detentions continue; Viasna reported scores of people were arrested in Minsk and in the city of Grodno on Sunday.
Police and army troops blocked off the center of Minsk on Sunday, but demonstrators marched to the outskirts of the Palace of Independence, the president's working residence 3 kilometers (2 miles) outside the city center. The palace grounds were blocked off by phalanxes of shield-bearing riot police and water cannon.
""This sea of people cannot be stopped by military equipment, water cannons, propaganda and arrests. Most Belarusians want a peaceful change of power and we will not get tired of demanding this,"" said Maria Kolesnikova, a leader of the Coordination Council set up by the opposition to try to arrange a dialogue with the 66-year-old Lukashenko about a transition of power.
She spoke with The Associated Press by telephone.
Lukashenko has rejected any discussion with the council and some of its top members have been jailed. One of them, Olga Kovalova, was expelled from the country over the weekend, driven to Poland by police.
Despite the stalemate between Lukashenko and the opposition, protesters say they are determined not to tire. Some of the placards they carried Sunday showed a lively sense of humor.
""Lukashenka, start building a house near Yanukovych,"" read one, referring to former Ukrainian President Viktor Yanukovych who fled to Russia in 2014 after months of anti-government protests.
""The collective farm went bankrupt,"" said another, evoking Lukashenko's former position as a collective farm director and his retention of largely state-controlled Soviet-style economy for Belarus, an Eastern European nation of 9.5 million.
Authorities also have revoked the accreditation of many Belarusian journalists and deported some foreign journalists, including two Moscow-based Associated Press journalists. AP's Belarusian journalists were among those told their press credentials had been revoked.
The European Central Bank (ECB) is likely to hold off on making any announcements on its stimulus program when it meets this week, instead opting to push new developments to October in the face of a strong euro.
President Mario Draghi said at the last ECB press conference that the Governing Council would discuss the future of its QE (quantitative easing) program in ""the fall"" - prompting many to speculate that he could detail a reduction of stimulus in September.
However, with the fall technically only starting only at the end of September, these market participants may have gotten ahead of themselves.
""The stronger euro could lead to such a heated debate that the ECB could postpone fall until the Indian summer period in late October,"" said Carsten Brzeski, chief economist for Germany and Austria at ING Diba, in a research note.
""Either way, the big question for this week's meeting is whether Draghi will shed some light on the ECB's game plan for tapering,"" he added.
The euro has appreciated by around 2.4 percent against the greenback since the last meeting of the bank in July and concerns are growing that the strong euro might dampen the recovery and weaken inflation prospects. The higher the euro, the more expensive products and services get for non-euro customers, which might affect exports from the currency union. At the same time it dampens inflation as imported goods get cheaper.
""Putting more effort into explaining why the euro is rising on it and on how the balance sheet will continue to deliver stimulus even after tapering could allow for gradual tapering,"" said ECB watcher Anatoli Annenkov of Societe Generale in a note.
""(The) core inflation forecast for 2019 is thus crucial,"" he added.
On Thursday the ECB also will publish a new round of forecasts for inflation and growth. Given the higher euro, there could be a downward correction for inflation with possible market-moving effects.
""Between the June and September projections, the euro has appreciated by some 4.2 percent, implying that the 2018 headline inflation forecast could be cut by some 0.2 percentage points to around 1.1 percent,"" said Annenkov.
So it will be up to ECB President Mario Draghi to explain why the ECB, despite the inflation outlook, thinks it is right to taper (gradually reduce stimulus).
A poll conducted by Reuters among 66 economists says that the majority expect the ECB to announce a scaling back of its QE program in October and to shut down the program altogether by the end of next year.
""Tapering is (almost) unavoidable. In the discussion on the game plan, let us not forget that, due to bond scarcity, some kind of tapering in 2018 is almost unavoidable,"" added Brzeski.
A shift in economic growth from the West to emerging markets over the past decade has led to the emergence of new business hubs across the world.
Regions such as Asia, the Middle East and South America have seen rapid economic growth, coupled with improved infrastructure, and in some cases, lighter regulation. Multinational organizations have rushed to capitalize on this, increasing the number of people they hire in these countries and setting up new offices in emerging markets. For example, banks including HSBC and Barclays have said they will increase hiring in Asia, while cutting staff in developed markets. GE, for example, has moved the headquarters of its X-ray business to Beijing from the U.S.
The emergence of these new business centers has sometimes come at the expense of the traditional centers such as New York, Frankfurt and London. But it hasn't always been smooth. Dubai, which experienced huge investments in real estate over the past decade, faced a property bust in 2009.
We decided to look at the top business hubs in the world based on research by global real estate firm CB Richard Ellis, which surveyed 300 of the world's largest companies, including Fortune 500 firms and other non-listed entities, such as law firms. The ranking is based on what percentage of these companies have offices in these cities.
We've matched that with the cost of renting office space in the central business districts (CBDs) of these hubs from real estate firm Cushman & Wakefield. Office rent cost is measured in square meter per year.
The results might surprise you with some of the largest North American cities absent. So which cities are the world's most popular business hubs? Click ahead to find out.
By: Rajeshni Naidu-Ghelani(Posted: August 16, 2011)
Companies Present: 55.7 percent
Office Rental Cost: $1,093 per sq. meter
Paris, one of the world's major cultural centers, is one of only three Western European cities to make the list of the world's top 10 business centers. France comes in third among European countries with the most international companies present.
Paris, like its other Western counterparts, plays host to offices of many front-office business functions because of its advanced economy and high skills base. Professional services and the insurance sector have a large representation in Paris, while automobile and mining firms are the least represented. The city is home to French banking giant BNP Paribas and insurer AXA. In fact, the Paris region accounts for almost 30 percent of France's economy.
Rents for office space rose 9 percent in 2010, despite ongoing economic debt worries in France and the wider Euro region. That's because a lack of new supply pushed commercial rents higher.
Companies Present: 56.1 percent
Office Rental Cost: $524 per sq. meter
Dubai is the top business hub in the Middle East and African region, reflecting the success of its government's strategy to promote it as a regional center. The city has also benefited as a ""safe haven"" for foreign companies amid political unrest in the Arab world.
Dubai attracted more than 70 percent of the firms polled by CB Richard Ellis in the industrial goods and services sectors. Given its strategic location—halfway between Europe and Asia—it often serves as the head office for higher-level decision-making.
Incentives such as tax breaks and a more liberal attitude toward Western culture, such as women not having to cover their heads in public, have made Dubai a popular city for expatriate staff. The Dubai International Financial Centre, the firm running the emirate's tax-free business park, said 64 companies joined its free zone in the first half of 2011—an 8 percent increase from last year.
But, there are some government restrictions that make it difficult for international companies to operate in the local market. For example, businesses must be 51 percent owned by a citizen of the United Arab Emirates.
Dubai's property market has still not fully recovered from the Gulf state's property bust and debt crisis in 2009. In 2010, the Middle East and Africa were the only regions in the world that saw a continuing decline in office rental costs. Dubai saw rents go down by as much as 20 percent, as significant oversupply and high vacancy rates plagued the domestic market.
Companies Present: 59.6 percent
Office Rental Cost: $484 per sq. meter
Madrid is home to more than 75 percent of companies in the media, technology and telecommunications sector, about the same level as New York, giving Madrid equal bragging rights as a media capital. The city is also home to Telefonica—Europe's second-largest phone company.
Madrid is the third largest city in the European Union (EU) after London and Paris, and accounted for more than 12 percent of Spain's gross domestic product in 2009. The city has held up better than the rest of the country, which has been facing a property bust and debt crisis. Its unemployment rate was 4.5 percentage points lower than the national average of 21.3 percent in the first quarter of 2011. Office rental prices have suffered though, dropping 7 percent in 2010 due to low demand.
As the capital of the country, Madrid also benefits from Spain's popularity among foreign companies. In fact, Spain is among the top five countries in the world when it comes to attracting international companies. In all, Europe accounts for five of the top 10 nations in terms of hosting offices of the biggest international firms. A big draw for these companies is the size of the European consumer market and the ease with which companies in the EU can expand into neighboring countries.
Companies Present: 60.4 percent
Office Rental Cost: $735 per sq. meter
Beijing is one of the world's most heavily populated cities, with nearly 20 million residents. It's among five Asian cities that make the Top 10 list.
The city has a high concentration of mining, construction, and agricultural companies. Firms that have a high level of interaction with government agencies and state-owned companies, as well as those in highly regulated sectors such as energy and mining, tend to set up an office in China's political center.
Companies trying to access the growing local consumer markets also have a big presence in the city. Beijing's automobile sector has boomed in recent years, as China has become the world's largest car market by volume sales. German automaker Daimler opened a Mercedes-Benz design center in the city last month, while U.S. carmaker General Motors runs ventures with state auto groups SAIC Motor and FAW Group.
Beijing has been rapidly developing prime office space following a government push to develop the central business district. Office rents went up by a whopping 48 percent in 2010 because of increased domestic demand for high-quality office space and limited supply.
Companies Present: 60.7 percent
Office Rental Cost: $850 per sq. meter
Moscow's ranking as the sixth most popular business hub, and the second most popular in Europe, shows Russia's importance as an emerging market.
International firms find it difficult to do business in Russia without a domestic office, given high levels of bureaucracy and corruption, which is one reason why the city is so important for foreign companies. The fact the Moscow has better infrastructure and much higher levels of development than other large cities is another reason.
The city of 13 million has a high concentration of companies in the professional services sector given its highly skilled labor force and the fact that it often acts as a hub for operations in Central and Eastern Europe.
A redevelopment of Moscow's city center and the construction of the Moscow International Business Center have also helped cement the city's reputation as a hub.
Companies Present: 61.4 percent
Office Rental Cost: $812 per sq. meter
Shanghai is home to China's major financial institutions and mainland stock exchange, receiving significant capital inflows from Hong Kong.
Its position on the Yangtze River Delta also gives companies easy access to China's large manufacturing base, research and development, and back office operations in the region. These factors have resulted in a concentration of mining, construction, and commodity companies being based in the city. Many firms are starting to move west, however, to access cheaper labor.
Government initiatives to reduce economic disparity between cities has led to better infrastructure in other regions, with the plan that Shanghai and Beijing will likely become service-based cities and the inland markets will manage the manufacturing and distribution functions.
Shanghai has also becoming a key regional center in Asia. U.S. technology and manufacturing firm Honeywell moved its Singapore-based Asia-Pacific headquarters to the city in 2003, while German chip giant Infineon relocated its Hong Kong-based regional head office to Shanghai. As a result of growing demand, the city saw annual office rents rise by as much as 28 percent in 2010.
Companies Present: 63.2 percent
Office Rental Cost: $1,683 per sq. meter (West End) or $974 per sq. meter (City)
London has a long history as one of the world's top business centers, but in recent years a number of emerging markets have challenged its global ranking.
The city still attracts the highest number of international companies in Europe and dominates in the banking, financial, and professional services sectors worldwide. London has more than 480 overseas banks and is home to multinational heavyweights such as Rio Tinto. The city has the most international visitors in the world and accounts for over 20 percent of the U.K.'s economy.
Prime rents rebounded in London in 2010 after the global financial crisis. The city's West End saw annual rental growth top 27 percent due to limited supply of new construction. In comparison, rents in Ireland, Spain, and Greece fell by 19 percent, 7 percent, and 3 percent, respectively, in the same period.
Companies Present: 63.9 percent
Office Rental Cost: $20,469 per sq. meter
Tokyo is home to 47 Japanese Fortune 500 companies, including Honda, Sony, and Mitsubishi. The city is also headquarters to several of the world's largest investment banks and insurance companies. It is also known as one of the three command centers of the world economy, along with New York and London. Often at the top of the world's most expensive cities list, Tokyo has faced several setbacks in recent years with stagnant economic growth and natural disasters crippling the Japanese economy.
Tokyo slipped two places in 2010 to number three from being the most expensive office location in the world in 2009. Rents fell by more than 11 percent from the previous year as the city became a ""tenants market"" with vacancy rates rising and rental levels decreasing.
Companies Present: 67.5 percent
Office Rental Cost: $850 per sq. meter
Singapore is the highest ranked Asian city on the list. It has become a gateway for businesses and investors trying to access to world's fastest growing consumer markets in China.
Being in the same time zone as key Asian markets, such as mainland China, Hong Kong, Malaysia, and Indonesia, has been a major factor. The city is also home to two Fortune 500 companies—contract electronics manufacturer Flextronics and commodities trader Wilmar International.
The island nation's high-quality infrastructure, efficient administration, low taxes, as well as its busy shipping port and airport, have made it a top choice for many international companies and their expatriate employees.
The city is also home to many companies in the banking and financial services sector, and comes in fourth behind London, New York, and Hong Kong in terms of the number of financial services firms with offices there.
Office rents went up as much as 16 percent in 2010, with further increases expected this year as corporations expand and demand continues to rise.
Companies Present: 68.2 percent
Office Rental Cost: $2,297 per sq. meter
Hong Kong is the world's most popular city for international businesses, reflecting a shift in economic power to Asia in recent years.
Hong Kong holds a unique position because of its location and lack of foreign ownership restrictions, which allow companies to operate globally and still have access to a highly skilled and low-cost workforce. Cities such as Hong Kong and Singapore are seen as key business hubs, with access to the anticipated growth in surrounding emerging markets. Leading financial multinationals headquartered in Hong Kong include Morgan Stanley, Deutsche Bank, and Credit Suisse.
Annual rents for office space jumped 51 percent in 2010 from the year before, and high demand and limited supply is expected to push up rents by a further 15 to 20 percent this year.
Trump administration officials are considering a tax cut package as part of the White House's economic response to the coronavirus outbreak, The Washington Post reported Friday, citing five people with knowledge of the planning.
Those people also discussed whether the White House should ramp up pressure on the Federal Reserve to cut interest rates, according to the Post.
Fears about the spread of the deadly virus have sent the stock market spiraling downward in recent trading sessions.
Federal Reserve Chairman Jerome Powell said in a note Friday that the central bank is monitoring the coronavirus for risks it poses to the U.S. economy and pledged it would take action if necessary. He offered no specifics on whether the Fed was considering a rate cut.
Vice President Mike Pence's office is involved in the discussions about the possible economic responses to the coronavirus, according to the Post.
The White House didn't immediately respond to CNBC's request for comment.
The newspaper reported that the economic proposals were not intended to stop the spread of the virus, but rather to ease the economic fears that have gripped global markets.
The administration's ideas for an economic response are in the early stages, the Post reported.
White House officials, including President Donald Trump himself, have worked to inject some calm into the economy, which is in the midst of a massive sell-off.
The fast-spreading disease has killed more than 2,800 people around the world and infected more than 83,000. But only 61 cases have been confirmed in the U.S., and no U.S. deaths have been reported.
National Economic Council Director Larry Kudlow said in a television interview Friday that investors should not ""rule out more optimistic options.""
""Stocks look pretty cheap to me,"" Kudlow added.
Read the full report from The Washington Post.
This is breaking news. Please check back for updates.
Over the years, when the market has gotten really wacky, tense and emotional, I have tended to always check in with the king of momentum investing: William O’Neil — or at least his organization, which includes Investors Business Daily.
I’ve actually never talked to O’Neil, but I’ve often been surprised to hear they were long gone from (or certainly cautious on) some of the biggest momentum names when the market — or at least a cluster of names — has appeared to have gotten out of control.
That’s when companies go from being just companies to being stocks.
With that in mind, what’s the current state of momentum?
Depends when you ask.
“The first thing we always look at is the direction of the market, and it’s unclear at this point.” Chris Gessel, executive editor of IBD, has worked with O’Neil for 15 years and serves as the front man to people like me.
We were talking late Tuesday morning — and at that point he was saying:
- It’s a good time to be cautious buying stocks. “There are some opportunities, but we’re heading into a market that isn’t as clear as we’d like.” But that shouldn’t be surprising: Historically, according to the O’Neil archives, the third year of a recovery after a major bear market tends to be choppy.
- Growth stocks tend to be more exaggerated in their ties to the market. If the market is down 10%, they’ll be down 20% and 30%. (And vice-versa.)
- This is a very news-driven market, but even that statement is confusing. “In a strong bull market, no matter what the news, the market goes higher.” Yet in the world of O’Neil, the market is in an intermediate correction. “Historically, you would expect to see choppy sideways action, and that’s what we’re getting.”
- The indexes are not looking well – certainly not as good as the leading stocks. “Either the market has to catch up or the stocks have to give up gains.”
- Looming earnings adds another dimension of uncertainty. “If the market were much stronger, you wouldn’t have to worry about earnings, but we have the mixed message of the market indexes and leading stocks. You don’t see leading stocks run for prolonged periods without the market supporting them.”
Enter later in the afternoon, after the market closed. I checked back with Gessel and (surprise!) he had an update – proving just how unpredictable this market has become:
“We’re changing our outlook back to an uptrend because of the action of the leaders,” he said.
Does that mean the choppy and unclear nature of the market — with indexes in conflict with the leaders — is moot?
“It’s not entirely resolved” Gessel said. “But the leaders are acting very well and the market is okay. Today’s positive reversal and close right near the high after last week’s positive action is getting hard to ignore.”
What about the hottest stocks? Some of the big movers like Netflix, OpenTable, Chipotle and Apple are at points where Gessel says the O’Neil model might not commit new money “at this point.” (It tends to wait for the stock to start moving again with confirming volume.) ""The big easier gains have passed and a lot more diligence and disciplined trading is required. You need to buy at the right point.""
On the other hand, AthenaHealthis starting to show up on the O’Neil radar, thanks to accelerating sales and earnings. “It’s a fairly new stock for us,” Gessel says. “But it had been going sideways for four years.” Even though it’s nearly double its summer lows, Gesssel says, “You wouldn’t look at this and call this a momentum stock.”
Not yet, at least.
My take: Never forget the part about growth stocks and their exaggerated ties to the market. The markets may come and go but that never changes – both ways!
Questions? Comments? Write to HerbOnTheStreet@cnbc.com
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""I'll take the S&P, but hold the energy.""
A new set of exchange-traded funds offered by ProShares allows investors to get exposure to the entire , save for one or another given sector. Specifically, the company now offers ETFs tracking the S&P 500 ex-energy (trading under the ticker symbol SPXE), ex-financials (SPXN), ex-health care (SPXV) and ex-technology (SPXT).
In a Thursday interview with CNBC's ""Trading Nation,"" ProShares' head of investment strategy, Simeon Hyman, highlighted two anticipated uses for the ETFs: diversification and tactical decision-making.
Hyman provides the example of an investor who already has high exposure to a given sector—such as an executive compensated in a company's stock, or an inheritor who has received a large number of shares—and does not want to take on excess exposure.
""Previously you'd have to maybe call up a trust company or find someone to run a custom strategy for you to avoid that sector, and here it's just very straightforward: Buy an ETF. The sector's out, it's redistributed across the other names on a market-cap-weighted basis, you don't have to worry about it,"" Hyman said.
Second, the ETFs are designed for those who believe a given sector, such as energy, is set to underperform the rest of the market. ""If you have that conviction, this is a very straightforward and easy way to effect that view,"" he said.
Read More Stocks setting up for big upside reversal: Technician
Yet given that retail investors are often considered to be best served by buying into the overall market and avoiding tactical calls, some say these ETFs might be an inferior play compared to, say, SPDR's popular S&P 500 ETF (SPY).
""As a core holding, you are far less diversified,"" Eric Mustin, vice president of ETF trading solutions at WallachBeth Capital, wrote to CNBC. ""You are implicitly overweight the other sectors versus the S&P 500 weightings.""
The expense ratio, at 0.27 percent, also irks Mustin.
""You are paying nearly 200 percent to 300 percent the management fees"" compared to a product like the (SPY), he pointed out. ""I think it's a product that may find some success among a retail audience, but sophisticated investors probably won't have an appetite for it.""
Still, that extra 0.18 or so percent would have been a small price to pay for avoiding energy over the past year, as the sector has lost a third of its value.
When there is a ""pronounced discrepancy in attractiveness,"" such as the clear unattractiveness of energy at the beginning of the year given dismal earnings expectations and high valuations, ""it would seem logical to exclude that sector,"" S&P Capital IQ's equity chief investment officer, Erin Gibbs, wrote to CNBC.
""However, these clear-cut unattractive sector events do not happen that often, and therefore these products could have limited appeal,"" she added.
Yet on the bright side, ""the risk of making a really bad bet isn't as large as compared to, say, I simply took a narrow short position in that sector compared to nothing else,"" Hyman said. ""Simply excluding a sector is an opportunity to perhaps make some reasonable outperformance without betting the farm.""
And for those who are already overexposed to a given sector, finding a way to invest in most of the market while increasing diversification does indeed seem prudent, even if it means a slightly higher expense ratio.
Read More Bummer: Stocks badly missing strategists' mark
For its stock to perform once again, Apple needs to provide investors with some level of confidence in its future, BTIG analyst Walter Piecyk said Tuesday.
""I'm a little surprised by the lack of capital allocation,"" he said. ""A lot of people were expecting something to happen in March, and when it didn't, then the fear started to creep in.""
On CNBC's ""Fast Money,"" Piecyk issued a ""buy"" rating for Apple on March 14 with a price target of $540 per share.
Piecyk said that the upgrade was based on a belief that Apple was en route to grow its earnings nominally.
""They've got all these people staring at these screens on their iPhones, and there's a lot of ways to monetize that, whether it's through payment systems or ecommerce,"" he said.
""I think the problem with Apple right now is people are just questioning whether they can ever return to growth, whether they had a peak earnings year last year that they'll never get back to. If you can just return some level of confidence that they can return to growth, then the stock will do very well, very quickly.""
Piecyk took a balanced view of Apple's performance.
""What we're looking for is a bad March quarter, frankly, that's below where the consensus is now, even though you've had massive cuts continually. Every week, you've got a different cut,"" he said. ""But more importantly, the June guide is the real risk here, and that June guide is going to be a down revenue quarter, perhaps earnings under 8. Consensus is still over 9 for earnings for the June quarter.""
Trader disclosure: On April 9, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's ""Fast Money"" were owned by the ""Fast Money"" traders: Brian Kelly is long TREASURIES; Brian Kelly is long GOLD; Brian Kelly is long SILVER; Brian Kelly is short SPX; Brian Kelly is short DAX; Brian Kelly is short CAC40; Brian Kelly is short COPPER; Steve Grasso is long AAPL; Steve Grasso is long ACI; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long BAC; Steve Grasso is long GDX; Steve Grasso is long HPQ; Steve Grasso is long LF; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long PXD; Steve Grasso is long NVIV; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is funds long AAPL; Steve Grasso is funds long MSFT; Steve Grasso is funds long T; Steve Grasso is funds long HPQ; Steve Grasso is funds long ZNGA; Steve Grasso is funds long PG; Steve Grasso is funds long UAL; Dan Nathan is long GS MAY 145/135 PUT SPREAD; Dan Nathan is short XHB MAY 28/30 CALL SPREAD; Dan Nathan is long FB APR 26 WEEKLY PUTS; Dan Nathan is long MSFT APR 28 PUTS; Dan Nathan is long AMZN APR 240/200/160 PUT FLY; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU.
Banks worldwide may lose as much as $400 billion from subprime mortgages, as at least one in four of the risky home loans go into default, analysts said on Monday.
Mike Mayo, an analyst at Deutsche Bank Securities, estimated $150 billion to $250 billion of losses based on $1.2 trillion of U.S. subprime loans, and an additional $150 billion of losses on derivatives linked to subprime debt.
David Hilder, a Bear Stearns analyst, also estimated a $150 billion to $250 billion loss on subprime home loans, in what he called a $2 trillion market.
""Given our fundamental outlook, which is for rising inflows of non-performing loans in both mortgage and commercial loan portfolios, we believe the odds are in favor of the write-downs getting worse, rather than better,"" this year, Hilder wrote.
Banks including Citigroup,Merrill Lynch and Wachovia have announced more than $40 billion of write-offs this year as U.S. foreclosures set records and after investors stopped buying many kinds of risky debt.
Mayo said large banks and brokerages may suffer $100 billion to $130 billion of the subprime losses. He said this could include $60 billion to $70 billion by year end, including $43 billion already reported.
In the fourth quarter alone, he said Barclays, HSBC Holdings, Royal Bank of Scotland Group and UBS might each need to write off $5 billion, while Merrill Lynch might write off $4 billion and Bank of America Corp $1 billion.
Mayo's forecast assumes a 30 percent to 40 percent default rate and 40 percent to 50 percent loss rate. Hilder assumes a 25 percent to 30 percent default rate and 30 percent to 40 percent loss rate.
WASHINGTON – Former New York Mayor Michael Bloomberg stumbled in Wednesday night's Democratic debate in response to a question about when he planned to release his tax returns.
""It just takes us a long time,"" Bloomberg said.
""Unfortunately, or fortunately, I make a lot of money and we do business all around the world, and we are preparing it. The number of pages will probably be thousands of pages. I can't go to TurboTax,"" Bloomberg added.
The remarks, which gave the impression that he was bragging about his wealth, drew boos from the audience in Las Vegas. Nevada holds its Democratic caucus on Saturday. He was already taking a beating from his rivals, including Sens. Elizabeth Warren and Bernie Sanders.
""But I put out my tax return every year for 12 years in City Hall,"" he said. ""We will put out this one, it tells everybody everything they need to know about every investment that I make and where the money goes and the biggest item is all the money I give away.""
Bloomberg is the wealthiest candidate in modern times to mount a viable campaign for president, and has so far spent more than $400 million of his own fortune on ads, despite not appearing on any ballots so far. He is worth about $60 billion.
But the question of his taxes is one that could haunt Bloomberg if he were to be the Democratic nominee in a general election. President Donald Trump long vowed to release his tax returns, but has yet to do so, claiming that he is under a constant state of audit that prevents him from making the returns public.
In 2016 Trump was the first major party candidate in nearly 50 years not to release tax returns to the public.
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The International Finance Corporation (IFC) has set up a financing package to fund the construction of a wind farm in Jordan, it announced Tuesday.
The package, of up to $80 million, will support the 51.75-megawatt (MW) Arbour Wind Farm in the south of the country. The facility is being built by the Abour Energy Company, a joint venture between Xenel International and AMEA Power.
A development institution that focuses on the private sector in emerging markets, the IFC is a sister organization of the World Bank and a member of the World Bank Group.
To date, it has invested over $300 million in Jordan to support clean energy. The financing package for the Arbour facility is made up of a $28 million loan for the IFC's own account and mobilized parallel loans from the Islamic Development Bank.
""Jordan's energy sector has been on a steady path of reform,"" Mouayed Makhlouf, the IFC's director for the Middle East and North Africa, said in a statement Tuesday. ""Supporting renewable energy projects and opening the sector to private investments is a pillar of our work in Jordan and the region,"" Makhlouf added.
The IFC said it had structured the deal in the form of an Islamic finance Ijara transaction. According to the World Bank, an Ijara transaction involves a bank purchasing an asset on behalf of a client, and then allowing use of that asset for a fixed rental fee.
The Bank adds that ownership of the asset ""remains with the financier but may gradually transfer to the client who eventually becomes the owner.""
The director general of Jordan's National Electric Power Company, Amjad Rawashdeh, said in a statement Tuesday that its focus was on continuing to diversify energy sources. ""IFC's work and investment has been crucial in helping the development of... renewables in the country,"" Rawashdeh added.
In April, GE Renewable Energy announced it would provide turbines for the development of a 100 MW wind farm in Jordan. The Mass Wind project is due to be operational by the end of 2019 and will meet the power needs of more than 150,000 homes.
Take a look at some of Monday's midday movers:
Momentum continued to favor winners today with 299 stocks on the S&P 500 in the green and 196 lower.
The financial sector was the best performing S&P large cap sector.
In that group, Genworth Financial was the leader, hitting its 52-week high after a Barron's article Sunday suggested that the mortgage insurer's stock could almost double in the next year.
Citigroup also hit a 52-week high.
Johnson & Johnson, United Technologies and Walt Disney were among Dow stocks at historic highs.
Coinstar continued to build on its gains from last week as the automated retailer of Redbox kiosks seeks to evolve beyond DVDs.
Zynga rose sharply on heavy volume.
Electronic Arts gapped higher to hit a 52-week high on hopes that connectivity issues related to the launch of its online game, ""SimCity"" will be resolved.
Michael Kors traded lower on analysts concerns about slowing momentum at the retailer.
And the CBOE Market Volatility index, better known as the VIX traded with an 11-handle, its lowest level since April, 2007.
—By CNBC's Lori Spechler
Questions? Comments? Email us at marketinsider@cnbc.com
JPMorgan retained its place at the top of the global investment bank rankings in the first half of this year despite a fall in revenues, while Deutsche Bank's troubles ensured the top five were all U.S. banks, new data on Friday showed.
JPMorgan's revenue from trading, mergers and acquisitions and other investment banking activity was $12.5 billion in the six months to June, down 5.3 percent from the same period a year ago, according to data compiled by industry analytics firm Coalition.
Deutsche has warned it may need deeper cost cuts to turn itself around after revenue fell sharply in the second quarter due to challenging markets and low interest rates. It fell to sixth place from third, allowing Bank of America Merrill Lynch to move up into the top five.
Investment banks suffered their worst first half year performance since the 2008 financial crisis as revenues for the top 12 players fell 15 percent from the same period a year ago, the data showed.
Looming U.S. elections, Britain's vote to leave the European Union in June, near-zero interest rates and worries about China's economy have spooked markets this year and curbed investors' appetite to take risks.
Last week, Citigroup said it expects to post better results in fixed income trading for the third quarter compared with a year ago.
Most of JPMorgan's revenue, some $6.9 billion, was accrued on its home turf but the $3.9 billion generated in its Europe, Middle East and Africa (EMEA) operations was enough to dislodge Deutsche from the top place in that region.
In the same period last year, Deutsche was number one in EMEA with revenue of $4.3 billion. Its slide to number two, even on its home turf highlights how difficult a year it has been for Germany's biggest lender.
JPMorgan also dislodged Deutsche Bank in the Asia Pacific (APAC region) to take top spot with revenue of $1.7 billion in the first half of the year. That was 15 percent lower than the $2 billion Deutsche Bank earned in the same period last year in the region.
JPMorgan retained its crown in fixed income, currencies and commodities (FICC) trading, its position solidified by its dominance in G10 rates and foreign exchange trading. The U.S. bank slipped a place to third in the equities ranking, however.
Coalition tracks Bank of America Merrill Lynch, Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan, Morgan Stanley, Societe Generale and UBS.
Here are the most important news, trends and analysis that investors need to start their trading day:
U.S. stock futures were under some pressure Thursday after the Dow Jones Industrial Average and S&P 500 closed lower for the third straight session. Investors get another report on the labor market before the bell that could go into the Federal Reserve's thinking about when to start tapering Covid-era bond purchases. Rising inflation and the delta variant are also wildcards. The Nasdaq, which had been on a run of record closes, broke a four-session winning streak on Wednesday as tech stocks faltered.
Chinese stocks that trade in the U.S. were lower in premarket trading after Chinese regulators called NetEase and others for an interview to remind them of video-game restrictions on kids.
The U.S. government reported Thursday 310,000 initial jobless claims for the week ending Sept. 4. That's lower than estimates and a pandemic low all the way back to the week ending March 14, 2020, when new claims totaled 256,000. That was just before Covid caused historic business closures and job losses, leading to a rush for unemployment benefits. For the week ending Aug. 28, new claims were revised higher to 345,000.
The European Central Bank kept interest rates unchanged Thursday but opted to slow down the pace of net asset purchases under its pandemic emergency purchase program.
Shares of GameStop, the original meme stock, lost 7% in Thursday's premarket, the morning after the video-game retailer reported its second-quarter loss narrowed on a year-over-year basis. GameStop, whose stock was still up more than 900% in 2021, did not provide an outlook for the coming quarters or take questions during its post-results conference call. The company also said the SEC has requested additional documents for a probe into GameStop and other companies' trading activity, which the company had disclosed in May.
Lululemon shares soared roughly 12% in the premarket after the athletic and leisure apparel maker late Wednesday reported second-quarter profit and revenue that topped expectations. The company has benefited from consumers buying its clothes for their stay-at-home wardrobes. But now, many people are also seeking out stretchy pants and other comfort pieces for their return to the office. Lululemon offered a better-than-expected outlook for the third quarter and fiscal 2021.
United employees granted exemptions to the company's vaccination mandate for religious reasons will be put on temporary unpaid leave starting next month, the airline told staff Wednesday, citing the recent rise in Covid cases. United also said that if an employee's request for a religious exemption is denied, they must be vaccinated within five weeks of the denial notice and get the first shot by Sept. 27, or they will be terminated. Airline approaches to boost staff vaccination rates have varied. Delta Air Lines, for example, is imposing a $200 per month surcharge on unvaccinated employees' company health-care premiums.
President Joe Biden is set to outline a six-pronged federal effort Thursday to boost Covid vaccinations and curb the surging delta variant, which is killing thousands in the U.S. each week and jeopardizing the nation's economic recovery. Biden is expected to push vaccine mandates for workforces and schools. He'll talk about new ways to increase testing and promote mask requirements. The president will emphasize steps to help the economy as well as moves to improve treatment for those with Covid.
Bitcoin was steadier Thursday after Ukraine became the fifth country in as many weeks to lay down some ground rules for cryptocurrencies, a further sign governments around the world are realizing that digital coins are here to stay. In a nearly unanimous vote, the Ukrainian Parliament adopted a law that legalizes and regulates crypto. The bill, set in motion in 2020, goes to the desk of Ukraine's president. Bitcoin was trading around $46,200 on Thursday, two days after a flash crash ended up knocking it down 10%. Bitcoin hit an all-time high over $64,000 in April but sold off in June and July, even falling briefly below $30,000. But since mid-July, bitcoin has largely moved higher.
— The Associated Press contributed to this report. Follow all the market action like a pro on CNBC Pro. Get the latest on the pandemic with CNBC's coronavirus coverage.
The federal government’s main weather forecasting agency warns of an “above average” hurricane season this summer.
Yet, the energy market yawns.
That's because the pre-season hurricane forecasts are too early, too broad and do not indicate where a storm will actually hit, according to traders.
The National Oceanic and Atmospheric Administration dialed back its Atlantic hurricane season forecast a little from last year. NOAA is predicting there will be 12 to 18 named storms, and six to 10 hurricanes. Three to six of those will be major hurricanes — Category 3, 4 or 5 — with winds of 111 miles per hour or more. The Atlantic hurricane season typically lasts from June 1 to November 30.
NOAA is predicting this season we’ll see one less storm than last year. But so did Colorado State University in their 2011 forecast that was released in the beginning of April. CSU predicted the 2011 Atlantic Hurricane season would see 16 named storms, including five major hurricanes (Category 3 or higher). So NOAA’s forecast wasn’t much different.
Energy traders also point out that while there were five major hurricanes — in line with NOAA’s range of forecasts — none of them made landfall near any key U.S. oil or gas facilities. But that’s not the only reason this year’s NOAA forecast hasn’t had any immediate impact on energy prices today.
NOAA's pre-season hurricane forecasts are much broader than the closely watched outlook's from Colorado State University and some private forecasters. As a result, these hurricane forecasts have a greater chance of making their mark. Last May, NOAA forecast there would be a 70 percent chance that we'd have between 14 and 23 named storms and three to seven would be major hurricanes. That's a huge range. It’s hard to miss that. The season ended with a total of 19 named storms and five reached hurricanes of Category 3 or higher.
The real impact, of course, comes when a storm or hurricane makes landfall in a major metro area or near a key refinery complex. Last year was the third most active on record and no storm made landfall on the continental U.S. Unlike some private forecasters, NOAA does not issue forecasts on how many storms will make landfall or where they could make landfall in its pre-season outlook.
So what more do traders know today about this year’s hurricane season than they did yesterday? Not much.
Forget about cash—start banking your body.
Using a technology that echoes science fiction movies, a French company is offering people a ""bank"" to store their own stem cells for years in a bet that those cells may be used to grow replacement organs and possibly save their lives someday.
""It's a personal deposit of your cell,"" said Dr. André Choulika, CEO of the biotech company Cellectis, which is launching the stem-cell bank known as Scéil this month.
Given the rate of developments in stem-cell research and their potential for curbing health costs, Choulika thinks Scéil's model of creating and storing stem cells one day will become so cheap that it will become mandatory for people with medical insurance.
""This pace of science currently goes so fast, probably in a few years, less than 10 years, everyone will have their own cell backup, and it will be a requirement,"" said Choulika, whose company is named after the Gaelic word for ""story,"" and is pronounced ""sail"" by Choulika.
""We believe that regenerative medicine is the future,"" he said.
In the present, though, it is anything but cheap. Scéil's services cost $60,000, Choulika said, adding that it is ""a one-time payment, for your life.""
(Read more: Hot biotech IPOs)
Choulika said he expects enthusiastic adoption by wealthy clients, as has been seen with other new technologies. Then, system improvements and competition could drive the initial price down considerably.
""It's expensive, or it seems expensive, for one reason,"" Choulika said. ""We don't know how many people are going to sign up, and it's a very complex and sophisticated technology,"" he said. The number of people now who could both afford the process and be interested in trying it might top 1 million.
The company says it has already signed customers, though it doesn't wish to reveal details about them. Those clients will be putting down a hefty sum on a bet that that outlay will be more than offset by the benefits realized from scientific breakthroughs in coming decades.
A depositor at Scéil will make an appointment with a dermatologist, who will take ""a small puncture out of your skin, under the arm, 3 millimeters in diameter,"" Choulika said. ""Then the sample is shipped to our treatment center, which is located in Singapore."" (He was visiting Scéil's facility there when he spoke to CNBC.com in a phone interview.)
(Read more: We Americans are healthy, really!)
The skin cells are grown in the lab and genetically manipulated with enzymes in a way that reverts them to a stem-cell state.
""It's like a computer that you want to reboot, and you want to rewrite the hard drive all in zeros,"" Choulika said. ""The cells totally forget what they are, and go back to 'stage zero' in life.""
Then those stem cells are themselves grown in ""a very large sample,"" he said. Afterward, the cultivated stem cells are split into three ""very large"" batches and stored in Scéil locations in Singapore, Switzerland and Dubai. The separation acts as a fail-safe measure.
Because of the accumulation of mutations in a person's DNA, the earlier a deposit in a stem-cell bank is made, the better, though ""it's never too late,"" Choulika said.
The technology that Scéil uses is based on research that won Japanese physician Shinya Yamanaka the 2012 Nobel Prize for Medicine.
(Read more: High medical bills drive bankruptcy)
For years, scientists believed that embryonic stem cells—the cells that can generate all the types of cells in a person's body—could be obtained only from embryos or blood in the umbilical cord. That meant that unless umbilical blood was collected at birth, there was no way to use existing cells to cultivate new ones that later technologies might be able to grow into full organs, blood or bones.
""That was the paradigm,"" Choulika said. ""You could never go back to the stage of stemness, like an embryonic cell, the first stage of life,"" ""The stem cell, from the beginning of life, gives you any kind of tissue. However, you can never go back from there. ... Once you have a skin cell, the skin cell remains a skin cell.""
But Yamanaka shattered that paradigm when he discovered in 2006 that ""intact mature cells in mice could be reprogrammed to become immature stem cells"" when a cocktail of several genes were introduced into the mature cells, the Nobel Committee noted in announcing the award last year.
""With any cell of a person, then, you can rebuild any kind of tissue,"" Choulika said. ""You can rebuild neurons; you can rebuild blood. You can rebuild anything.""
At the moment, the technology of building tissue on a large scale is in its infancy, and years away from being able to grow so-called pluripotent stem cells into full organs for transplant into their donors.
Movement toward that goal was seen earlier this month, when the Japanese government approved the world's first clinical trials using such stem cells for treating age-related blindness.
That conjures images of the 1982 dystopian cult classic ""Blade Runner,"" in which a memorable scene involves a scientist working in a lab where human eyes are grown.
The cultivated stem cells also could be used to test drugs' efficacy and risks.
—By CNBC's Dan Mangan. Follow him on Twitter @_DanMangan.
Ratings agency Fitch affirmed its sovereign rating on Turkey at 'BBB-', the lowest investment grade, on Friday but lowered its outlook to negative from stable in a review after last month's attempted military coup.
Investors have been rattled by both the failed July 15 putsch, when a group of rogue soldiers attempted to overthrow the government, and the widespread crackdown that has followed, with the arrests or dismissals of tens of thousands of people.
""An unsuccessful coup attempt in July confirms heightened risks to political stability,"" the Fitch statement said, saying a purge of some 70,000 public sector workers ""generates uncertainty over capacity and continuity.""
""Political uncertainty is expected to impact economic performance and poses risks to economic policy,"" it added.
Both Fitch and Moody's rate Turkey at the lowest investment-grade rung, allowing its bonds to be bought by more conservative funds that require a country to be classed as investment grade by at least two agencies.
Moody's said on July 18 it was putting Turkey's credit rating on review for a possible downgrade to junk status.
Standard & Poor's cut its unsolicited rating on Turkey further into junk territory last month and changed its outlook to negative, also citing concerns following the coup.
In Friday's statement, Fitch said the overwhelming public opposition to the coup attempt and subsequent unity of most political parties could lessen political fractures.
But security conditions have worsened, it said, referring to militant attacks which it said were having a material impact on the tourism sector.
It did not expect the fiscal stance to weaken in response to the coup attempt, though ""the central bank and commercial banks are facing renewed political pressure on interest rates,"" it said.
A downgrade could be triggered by prolonged or deepened political instability, insecurity or geopolitical stresses that undermine economic performance or economic policy credibility, it added.
WASHINGTON – Democratic presidential nominee Joe Biden visited South Florida on Tuesday, seeking to shore up support among Hispanic voters in this crucial swing state.
Biden's trip came after a poll of Florida voters was released last week that sent shockwaves through the Democratic Party. The poll, by NBC News and Marist, found President Donald Trump leading Biden among Latino voters by four points, 50-46.
Four years ago, Democrat Hillary Clinton won Hispanic voters in Florida by 25 points, 60-35, although she lost the state overall. According to the NBC poll, Biden is underperforming Clinton by 29 points with a key demographic in a key state.
Historically, Republicans tend to do better with Hispanic voters in Florida than they do elsewhere, owing to the state's large concentration of Cuban Americans who lean Republican.
Nonetheless, the NBC survey results coming just 50 days before Election Day set off alarm bells at the Biden campaign.
On Saturday, the Biden campaign unveiled a trio of new Spanish-language ads that will run in Florida, each one directed at a specific group of Hispanic voters.
On Sunday, aides to billionaire Michael Bloomberg announced that the former Democratic primary candidate will spend $100 million to support Biden in Florida, essentially freeing up the campaign to put money allocated for Florida into other battleground states such as Pennsylvania.
Tuesday night was Biden's first major speech aimed directly at Hispanic voters in Florida. But not just any Hispanic voters: Puerto Rican voters.
The former vice president delivered his speech at a Hispanic Heritage month celebration in Kissimmee. While there were no crowds, the location reflected his campaign's effort to court Puerto Rican voters. Kissimmee is the seat of Osceola County, the only county in America where Puerto Ricans outnumber all other ancestral groups.
Before he took the stage, Biden was introduced by two world-famous Puerto Rican performers, Ricky Martin and Luis Fonsi, and by Hispanic American actress and activist Eva Longoria.
In prepared remarks, the former vice president ripped Trump's approach to the U.S. territory.
""Even after being president for four years, Donald Trump does not seem to grasp that the people of Puerto Rico are American citizens already,"" he said.
""I'm running to be president of all Americans, including 3 million American citizens living in Puerto Rico. I'm not going to steal the money that is desperately needed to reconstruct the island, in order to build a wall that does nothing to keep Americans safe. I'm not going to suggest that we sell or trade Puerto Rico. I'm not going to throw paper towels whose lives have been devastated by the hurricane,"" said Biden.
Last fall, Trump shifted $300 million away from cash-strapped disaster relief agencies to fund border security projects, including his ""wall"" project on the southern border. In the aftermath of Hurricane Maria in 2017, Trump allegedly wondered aloud whether the United States could ""sell"" the island or ""divest"" from it. And during a rare visit to Puerto Rico shortly after the hurricanes, Trump tossed rolls of paper towels into a crowd of survivors at a relief center.
Biden also said Tuesday that while he personally supports adding Puerto Rico as a state, he will work with both sides of what is a bitter debate on the island, and let voters there ultimately decide their course.
Along with Biden's visit, the campaign released a multi-pronged plan Tuesday afternoon to help rebuild and revitalize Puerto Rico, which is home to 3 million American citizens. Two devastating hurricanes in 2017 left millions of Puerto Ricans without power for months, prompting more than one hundred thousand to move to the mainland.
Today, Florida is home to more than a million people who identify as Puerto Rican. Nationwide, Puerto Ricans represent the second largest pool of Hispanic voters in the country, after Mexican Americans. In Florida, more than one in four Latino voters identifies as Puerto Rican.
Key elements of Biden's Puerto Rico plan:
- Provide direct federal investment in infrastructure projects and forgive federal disaster aid
- Offer Puerto Ricans more access to community-based health care and SNAP food assistance
- Ease Puerto Rico's massive debt burden by reversing austerity measures and restructuring some of the debt
In a statement accompanying the new plan, the Biden campaign criticized Trump's response to the 2017 hurricanes in Puerto Rico.
They also brought up the account of Elaine Duke, a former top official at the Department of Homeland Security. Earlier this year Duke told The New York Times that in the aftermath of the Hurricane Maria, Trump mused about whether the United States could sell Puerto Rico.
Taken together, Biden's plan for Puerto Rico and his direct appeal on Tuesday to Puerto Rican voters represent the best example so far of what the Biden campaign says is an ultra-targeted strategy with Hispanic voters.
In response to the concerns raised by the NBC poll last week, Biden campaign aides over the weekend emphasized that their outreach to Hispanic voters has expanded dramatically in recent weeks, and now includes full-time Hispanic-focused mobilization efforts in Arizona, Colorado, Florida, New Mexico, Nevada and Texas.
""The pathway to victory includes winning key battleground states and we're going to do that by building a culturally competent campaign that targets states with heavy Hispanic populations,"" senior political adviser Jorge Neri said on a conference call with reporters Sunday.
Biden aides also stressed how carefully targeted their Spanish language outreach is, up to and including using different Spanish accents in multiple versions of each campaign ad, accents that are tailored to the geographic origins of the Hispanic population in different markets.
Below is one of the Spanish language ads Biden launched over the weekend.
Currently, Biden ads appearing in the Miami and Tampa media markets are voiced with Cuban-accented Spanish. In and around Orlando, voters hear a Puerto Rican accent. And in West Palm, Fort Myers, and across Arizona, the narrator has a Mexican accent.
""That is indispensable because we know that our communities, we share a language, but we have a tremendous diversity of experiences and from those experiences we have similar priorities, but we also have many unique interests,"" Democratic National Committee chairman Tom Perez told reporters.
It's impossible to tell at this stage whether Biden's play for Puerto Rican voters will bear fruit. But already this week there are signs that perhaps the NBC/Marist poll was merely an outlier, and that Biden is actually doing better with Latino voters in Florida than it seemed he was last week.
On Tuesday, Monmouth University released a new poll of Florida that showed Biden winning Latino voters 58 to 32 over Trump, a number that's much closer to Clinton's 2016 margin.
Chinese retailer JD.com plans to aggressively expand its brick-and-mortar reach— aiming for a network of 5 million physical stores in the next 3 years — as China's e-commerce companies sharpen their competition for consumers in smaller Chinese cities.
Xu Lei, chief executive of JD Retail, said the company is ""aware that China's retail market is huge."" But he added that JD's business model can have limitations and he therefore wants to ""build offline stores on our own and partner with existing players.""
The company's online model ""can only service certain number of consumers. We want to apply our years of experience, including logistics, merchandising and technology to a much wider context,"" Xu told CNBC's Arjun Kharpal. ""Therefore, last year, we determined to position JD as an all-channel retail platform.""
""In addition to our centralized online app, we also have a lot of de-centralized offline platforms. The offline market is very important to us,"" Xu said, speaking to CNBC as part of the annual East Tech West conference, which is being held this year both remotely and in Guangzhou, China.
As part of the strategy to build its retail presence, JD opened its biggest physical store, called the JD E-Space, on Singles Day in Chongqing in November last year. But the company does not plan to build 5 million stores itself.
""What's more important is to make good use of our partner stores,"" Xu said. ""So far we have linked up with over 2-and-a-half million stores, including our own stores. In three years, our projection is to have a network linking up to five million stores.""
This year JD put $100 million of backing into appliance store operator Gome Retail Holding — one of China's largest appliance chains. The joint venture lets customers examine items at Gome's roughly 2,600 stores and then purchase the products through JD.com.
JD's moves underline the fierce competition among China's leading e-commerce retailers to get more consumers in the country's smaller cities. Alibaba – JD's biggest rival — recently acquired a 19.9% stake in Suning.com, with the intention of boosting its market share in China's smaller cities.
Small cities are important not only for internet-based merchants, but also traditional retailers across China, which is the world's second-biggest economy.
""What happens to consumers from fourth- to sixth-tier cities, when they want to buy some big-branded products, they either find out that the products are not available locally or they are sold at a much higher price than those in the upper-tier cities,"" said Xu. ""JD is providing consumers in lower-tier markets the same kind access to products and pricing through our nation-wide logistics network. ""
Going forward, the company intends to work with popular brands to tailor products from region to region.
""Many brands have come to realize the huge size of the Chinese market, so they customize products for lower-tier cities by leveraging JD's data and our supply chain capabilities,"" he said. ""They have had great results. We've seen sales orders from lower-tier markets growing by over 100% so far this year.""
— CNBC's Arjun Kharpal contributed to this report.
""Maui No Kai Oi"" is a popular Hawaiian saying that means Maui is the best. Mike Sweeney recently moved to this idyllic island from Denver and was hit with the other side of living in paradise with his first visit to the gas pump: Maui is also No. 1 in gas prices.
""After seeing the total, I won't be smiling,"" Sweeney said as he watched the numbers on the Chevron pump spin faster than a slot machine.
The pump finally stopped at $97.20, which put 24.5 gallons in his Chevrolet Avalanche.
He was elated about living on Maui and being reunited with his black, super-size pickup truck, which just arrived from Colorado, but he wasn't so thrilled about paying nearly $4 for a gallon of regular.
While the price of oil climbs above $110 a barrel, most Americans dread the day they will have to pay $4. On this tropical island and a few stations in California, $4 gas has already arrived, straining the pocketbooks of residents and businesses.
Maui is on the verge of becoming first area in the nation to average $4 for a gallon of regular. The average price in Wailuku reached $3.934 on Thursday, the highest price in AAA's Daily Fuel Gauge Report. At several stations, it was a penny shy of $4. In the remote coastal town of Hana, it was around $4.40 a gallon.
""Outrageous. Completely outrageous,"" said Janet Carone, of Wailuku.
The high price to get around has hurt many families, like the Carones. They're coping by driving less, carpooling or working more.
""It has a big effect because our housing is high, our food is high, and the gas prices just make it worse,"" she said.
Other than AAA, perhaps no one on Maui tracks local gas prices better than Deok Lee, owner of Airport Taxi. He maintains a detailed record of gas expenses using Excel spreadsheets on his laptop.
In just nine days, Lee had spent $300 to fuel his Toyota Sienna van. Like his drivers, the more Lee pays for gas, the less money he brings home. His pay shrinks by the day -- and by the gallon.
""Crazy,"" he said about the prices. ""Ridiculous.""
Fuel cost has more than tripled since he took over the business in 1999, and it's forcing him to consider trading his van, which costs $80 to fill, for a smaller four-cylinder car.
""Unfortunately, it's going to take away some comfort for the customers. But you gotta do what you gotta do,"" he said.
Lee expects many cabbies will be forced out of business if fuel prices keep rising.
Chuck Gamarata, who operates the only limousine taxi on the island, is forced to work longer hours to compensate for the gas prices. He's still taking home about $10 less each day.
""You add that up over a year's period, that's thousands of dollars,"" he said. ""It hurts. It hurts bad.""
Other businesses are also feeling pinched.
Todd Winn, co-owner of North Shore Explorers, has been hit hard since launching the tour company in September. It takes 150 gallons of diesel, at $4.20 a gallon, to fill up his 30-foot rigid hull inflatable boat, which gets about a mile per gallon. It also costs more than $100 to fill up the Ford F-350 to tow it.
While the new company is trying to build up clientele, it may be forced to raise rates or add a fuel surcharge.
""It's been dramatic enough that we've actually seen our original business model blown out the window,"" Winn said. ""It's been quite costly and we've had to cut costs in other areas to make it work.""
He shakes his head when hearing about people in other states complaining about gas prices. Maui residents remember the good ol' days of $3 gas.
""It's just the price of living here,"" Winn said. ""I'm not sure it's fair. But at the same time, it's not going to get me to move back to the mainland to pay a buck less for a gallon of gasoline.""
Hawaii is the most oil-dependent state in the nation, with more than 90 percent of its energy coming from imported oil. The state's economy is also extremely sensitive to oil prices globally because it depends on airplanes and ships to bring in tourists and all of its goods.
Marie Montgomery, spokeswoman for AAA Hawaii, said it's a little comfort for islanders that gas prices haven't risen as fast as in other states, such as California.
On Thursday, California hit another record with an average of $3.609, overtaking Hawaii ($3.587) for the nation's highest gas prices. Meanwhile, the national average has risen to a record $3.267, according to the auto club.
But Maui, which doesn't have a major public transportation system, now has all the California cities beat by at least a quarter a gallon.
Residents here have long wondered why gas prices on the island are so much higher than on neighboring Oahu, where Honolulu gas is about 50 cents less.
""It's like we work just to pay gas,"" resident Yolanda Ellis said. ""Funny how our gas goes up but our pay stays the same.""
Hawaii, which imports most of its crude oil from Alaska and Indonesia, has two refineries on Oahu operated by Chevron and Tesoro Hawaii .
Both companies blame the Maui price on higher transportation costs, even though islands further away, such as the Big Island, have lower prices. They also cite several other factors, such as volume, competition and higher local taxes on Maui.
Chevron spokesman Albert Chee said the price, in most cases, is set by the station operators and owners. The company sets the retail prices for only six stations it owns out of the 63 Chevron-branded outlets in Hawaii.
The company wouldn't disclose the difference in wholesale price between Maui and Oahu. However, Chee said: ""It's not 50 cents. It's not even half.""
""The difference between Oahu and Maui of 50 cents is not flowing into my pocket,"" he said.
Chevron noted that the cost of crude oil has spiked 20 percent in the past 30 days, while gasoline has increased 9 percent nationwide and only 5 percent in Hawaii.
Not everyone seemed upset with the pump prices on Maui. Tourists, who pay an average close to $300 a night for a hotel room, don't seem to mind.
""If the gas would've been higher, we still would've gone,"" said Jack Glisson, of Jacksonville, Ill. ""It didn't make any difference.""
The European Union has prolonged for six months until Sept. 15 a blacklist of Russian and Crimean individuals and firms accused of undermining Ukraine's integrity and independence, an EU statement said on Monday.
""The assessment of the situation did not justify a change in the sanctions regime,"" the statement said. The sanctions were introduced in March 2014 following Russia's annexation of Crimea and its involvement in the revolt in eastern Ukraine.
The list includes advisers and aides of President Vladimir Putin, parliamentarians, defense and intelligence officials, army and navy commanders, as well as Crimean separatists and rebels in east Ukraine.
Two people were removed from the list because they have recently died, the statement said. The updated list covers 150 persons and 37 companies which remain subject to visa bans and an asset freeze in the EU.
Investors are barreling toward the bond market as inflows look to break a new monthly record.
Inflows to U.S. high-grade funds and exchange-traded funds have averaged $846 million per day in March, ahead of the $800 million average during the record month last year, according to research from Bank of America Merrill Lynch.
The previous record for corporate bond inflows was $38.4 billion in January 2018.
""Based on daily fund and ETF inflows, March is on track to set a new monthly record,"" Bank of America credit strategists Yuri Seliger and Yunyi Zhang wrote Wednesday.
""Inflows this year have been delayed relative to earlier periods of strong bond price appreciation,"" the strategists added. ""Given the more stable macro conditions currently flows catching up to the historical trend could provide another catalyst for stronger inflows.""
The iShares iBoxx Investment Grade Corporate Bond ETF, just one of many such funds, has alone seen inflows of more than $600 million in the past month and about $440 million since the start of March.
The pivot into investment-grade debt comes as a growing number of economists and investors believe the U.S. economy is poised for a slowdown in the next year. Yields of ranging quality have been under pressure ever since the Federal Reserve downgraded its forecast for the American economy last week, when it decided to leave its overnight lending rate unchanged.
Some investors may view corporate debt as a somewhat safer bet over a volatile equity market despite sharp gains in the S&P 500 this year. Though the broad, large-cap index is up more than 11 percent this year, fund flows have not kept pace. The SPDR S&P 500 ETF, one of the largest in the world with over $260 billion under management, has seen outflows of more than $10 billion since the year began.
""Data arriving since September suggest that growth is slowing somewhat more than expected,"" Fed Chairman Jerome Powell said last week. ""While the U.S. economy showed little evidence of slowdown through the end of 2018, the limited data we have so far this year have been somewhat more mixed.""
The yield on the benchmark 10-year Treasury note is down more than 25 basis points since last Monday, falling under the rate on the 3-month Treasury bill. On the corporate side, companies in the U.S. have taken advantage of low interest rates both to grow business and reward shareholders, ballooning their own debt sums.
""Flows follow returns and the drop in interest rates since Monday of last week should encourage potentially even stronger inflows in April,"" Seliger and Zhang added.
While companies have thus far been able to find buyers for their debt, many market participants are keeping a close eye for changes in the economy and confidence. Both February payrolls data and March consumer confidence disappointed investors recently, pressuring investors out of equities and into safer markets like debt.
Total corporate debt has swelled from nearly $4.9 trillion in 2007 as the Great Recession was just starting to break out to nearly $9.1 trillion halfway through 2018, quietly surging 86 percent, according to Securities Industry and Financial Markets Association data.
Happy Tuesday. Hangover anyone? Then have a little hair of the Irish dog that bit you in the form of a Morning Six-Pack.
Wall Street sees something it likes in the words of Vladimir Putin, which is just weird. (New York Daily News)
Gearing up for March Madness? Purely for amusement only, here are a few tips to help you fill out your brackets and win Warren Buffett's money. (Bleacher Report)
European stocks closed higher Friday, as market participants monitored a flurry of corporate results and key economic reports.
The pan-European Stoxx 600 closed provisionally up by 0.29 percent, with most sectors and major bourses in positive territory.
Household goods stocks were among the top gainers, led by Sweden's Electrolux. The home appliances maker surged close to the top of the European benchmark after posting stronger-than-anticipated quarterly results and forecast easing cost headwinds over the coming months. Shares of the company were up over 10 percent.
Europe's banking index led the losses amid earnings news. Deutsche Bank reported its first full-year net profit in four years on Friday. However, shares came under pressure, losing 0.59 percent as Germany's largest lender continues to face growing merger speculation and a series of uphill struggles.
Germany's Wirecard, meanwhile, plummeted 25 percent after a Financial Times report said an external firm commissioned by the payments firm to investigate its Singapore office found evidence indicating ""serious offences or forgery and/or of falsification of accounts."" Wirecard called the report ""inaccurate, misleading and defamatory.""
On the data front, euro zone inflation slipped as expected last month. Official data published Friday showed inflation in the 19 countries sharing the euro slowed to 1.4 percent in January, from 1.6 percent a month earlier. It provides another reason for the European Central Bank to ease off removing stimulus, as inflation falls further away from its target.
On Wall Street, the Dow Jones Industrial Average rose 160 points while the and Nasdaq Composite also saw gains.
Market focus was largely attuned to the latest jobs numbers out of the U.S. Non-farm payrolls released by the Labor Department Friday showed that the U.S. economy added 304,000 jobs in January, beating an expected 170,000.
Analysts had been unsure what to expect in the wake of the recent government shutdown but stronger-than-expected jobs growth pointed to underlying strength in the U.S. economy.
Sentiment was shaken by concerns over global trade developments, especially after a survey on Chinese factory activity fell to its lowest level since February 2016.
The downbeat data exacerbated fears of an economic slowdown and dented optimism over a possible U.S.-China trade deal.
China's trade delegation reportedly said Washington and Beijing had made ""important progress"" after two days of trade negotiations.
President Donald Trump also said he would soon meet with Chinese premier Xi Jinping to try to reach a comprehensive trade deal. Stocks had taken heart from the possibility of top-level trade talks over the coming weeks, but the upbeat mood soon cooled when the White House insisted it sees March 1 as a hard deadline for a deal.
The political and economic ""noise"" created by the U.K.'s decision to leave the European Union is masking a ""large number"" of risks in Europe, according to the region's political experts.
""A large number of material political risks in southern and core Europe are being masked by the noise emanating from Brexit,"" Mujtaba Rahman, managing director of Europe at political risk consultancy Eurasia Group, said in a note Thursday.
He and his team were not alone, with other political risk consultancies remarking on the fact that Brexit could in fact be the least of Europe's worries. Here's CNBC's collection of Europe's top ten upcoming risk events, according to analysts.
Greece's economic crisis reached a peak in the summer of 2015 when it was forced, by impending bankruptcy, to accept a third 86 billion euro ($96.9 billion) bailout package from international lenders.
A year on and Greece is facing an uphill struggle to meet the conditions of its latest bailout. ""The economic and political challenges across southern Europe continue to increase,"" according to Eurasia Group's Rahman. (103880026) ""While Greece will of course struggle, the debate between (main political party) Syriza and its creditors is no different to the one that took place last year. As such, Greece is in something of a Groundhog Day.""
Spain's economy might be booming compared to its euro zone peers (it expanded more than Germany, France and Italy in the second quarter of this year). However, an ongoing political impasse in the country threatens to derail that growth, with the country potentially facing a third general election in 12 months by the end of the year.
""A third round of elections remains the most probable scenario (55 percent probability),"" according to Antonio Barroso, deputy director of research at political risk consultancy Teneo Intelligence. ""Short of an internal revolt within the PSOE (Socialist party) or a deal between the ruling People's Party (PP) and Basque nationalists (which would allow a government to be formed).""
Aside from national political deadlock in Spain, the question of Catalonia's independence movement rumbles on. The separatist movement in the wealthy north Spanish state has long been a thorn in the side of Madrid and that clash is set to continue, Teneo's Barroso warned.
""Catalan authorities will likely approve again further measures to advance towards the creation of an independent state, which will promptly be challenged legally by Madrid. Therefore, the clash between Madrid and the Catalan authorities is likely to intensify in the coming months,"" he said.
Italy's banking system seems to have avoided going into meltdown this summer despite fears over the estimated 360 billion euros worth of non-performing loans on its banks' books. But it's the country's political system that is now at risk with Prime Minister Matteo Renzi facing a referendum on reforms in October which, if he loses, could see him resign. This would leave the country in limbo in terms of leadership and economic reforms which Eurasia Group said had ""lost momentum"" ahead of the referendum.
""For now, we continue to believe the referendum will pass (with 60 percent confidence). But this means there's a non-negligible risk it will not. In this case, the government would collapse, despite Renzi's recent protestations to the contrary, paving the way for an ineffectual caretaker government,"" Eurasia Group said.
As Eurasia Group said in its note Thursday, ""political mess in Athens, Lisbon, Madrid and Rome carry implications for Berlin and Frankfurt."" German Chancellor Angela Merkel – seen widely as the euro zone's strongest leader -- can ill-afford problems in the rest of the single currency area given her own increasingly fragile grip on power.
Her handling of the region's refugee crisis (in sum, allowing over 1 million migrants into Germany in 2015 alone) has prompted a drop in her approval ratings, criticism from rivals both within Germany and the wider EU. Her own party, the Christian Democratic Union, has been pummeled in local and state elections, leading to questions over whether Merkel can stand for election again in 2017.
Like most of Europe, far-right parties (like the National Front in France or Pegida in Germany) have been gaining a foothold in the political scene, worrying the mainstream political establishment. Austria is no exception, Eurasia Group noted, stating that a presidential election on October 2 looked certain to ""hand power to the EU's first far-right head of state - (Norbert Hofer).""
""While his powers as president would be limited, Hofer will use every opportunity to facilitate a victory for his party in 2018 or before, if any crisis (refugees, euro zone) gives him an excuse to dismiss the government. As Austria's main representative abroad, Hofer will seek to strengthen ties with central eastern European governments which are most critical of Brussels and Berlin. That would represent a particular challenge for Merkel,"" the group noted.
Europe's migrant crisis has exposed challenges in the region not only in terms of its ability to respond to a humanitarian crisis but also its political cohesion and ambitions. Overwhelmed by the influx of desperate migrants, the EU struck a deal with Turkey that would see it preventing migrants from reaching the continent, in return for money, visa liberalization for Turkish citizens visiting the EU and fast-tracked EU membership.
That deal was struck before Turkish President Recep Tayyip Erdogan led a crackdown on the opposition following a failed coup attempt, putting him at odds with EU values on freedom of speech and the rule of law, leading the EU to delay its part of the deal (in terms of visa liberalization). Eurasia Group noted that ""in the aftermath of the failed coup attempt in Turkey, risks to the EU-Turkey refugee deal have increased"" and although it thought the deal would stick the analysis firm said this would depend on Erdogan's reaction to the delayed visa liberalization.
The EU's deal with Turkey has not been enough to assuage the concerns of certain eastern European nations over migration to the EU. Hungary and its ruling, right-wing Fidesz government has been one of the more vociferous opponents of the EU's migrant policy response and it is holding a referendum on October 2 on whether it should reject the EU's migrant quota system (which would see the country have to accept a certain quota of migrants).
""Although the urgency of the refugee crisis has subsided, the government' hard and effective campaign will boost turnout and likely result in a rejection of the (European) Commission's scheme … This result will strengthen Fidesz domestically and cause more friction across Europe, since Hungary will now be pushed to take an even more vocal stance against the commission's current plans,"" Eurasia Group's team noted.
Terrorism has yet to be mentioned in the long list of risks facing Europe but France has had more than its fair share of terrorism-related events in the last year. After the Paris massacres last spring (on the Charlie Hebdo offices) and last November to the recent Bastille Day attack in Nice, the country has been forced to do some soul-searching over its policies towards migrants, integration and assimilation – and the government's response to the terrorism threat.
French President Francois Hollande's approval ratings are at a low ebb (around 18 percent as of the last Ipsos Mori poll for Le Point magazine in mid-August) and he has yet to say whether he will run for the presidency in elections in 2017. The dwindling of Hollande's authority – and resignation of Economy Minister Emmanuel Macron - has left the future of economic reforms in doubt.
Since Russia's annexation of Crimea in March 2014 and the alleged support for a pro-Russian uprising in Ukraine, the country has been on a collision course with its European neighbors with reciprocal sanctions now in place between the two bodies.
Despite its economic isolation, however, Russia has seen something of a resurgence on the global stage recently, particularly as a key part of the Western alliance fighting Islamic State in Syria – leaving the EU out in the cold, according to Marc Pierini from think tank Carnegie Europe.
""The Syrian war has left the EU in a second-tier position among international actors,"" Pierini said in a note last month.
""The EU's internal divisions have given the union little influence on the course of events in Syria. Yet the brunt of the war's humanitarian, economic, and security consequences falls on EU countries. The EU's future role in Syria will be a litmus test of a genuine common foreign and security policy.""
Against such a minefield of potential problems in Europe, suddenly Britain's decision to leave the folds of the EU doesn't look too bad – not least of all because nothing has actually been done since the vote. Britain has yet to trigger the now-legendary ""Article 50"" of the Lisbon Treaty which would set in motion the formal process of leaving the EU, and could wait until mid-2017 to do so.
Europe's institutions and leaders have expressed their exasperation with the U.K. for its delay in starting the exit process but given the other issues on its plate, Brexit could be the least of its worries – especially if leaders like Germany's Merkel, France's Hollande and Italy's Renzi are soon faces of the past. As Eurasia Group concluded its note: ""While Brexit is indeed serious, little or no substantive political risk is likely from this through year-end. But Brexit's noise seriously masks meaningful political and market risks in Portugal, Italy, Greece, Austria, Hungary and Turkey.""
Peloton shares climbed more than 9% Friday as investors realized the financial hit from the company's treadmill recall isn't as bad as some had feared.
The exercise equipment maker said demand for its high-end cycles remains strong, despite people increasingly breaking free of stay-at-home routines and gyms seeing pandemic restrictions ease.
Peloton is also still planning to launch in Australia later this year, and is ramping up marketing spending to try to reach new customers.
""While the recall will hit financials in the short term, and push back Tread financials a quarter or two, we think this was the prudent decision in the long term,"" Barclays analyst Mario Lu said in a note to clients. ""We continue to view Peloton as the leading company in connected digital fitness.""
When Peloton reported its fiscal third-quarter results on Thursday, it said fourth-quarter sales will be $165 million lower due to the recall. That puts fourth-quarter revenue at about $915 million, short of analysts' estimates for $1.12 billion, according to Refinitiv data.
The projected $165 million impact consists of a roughly $105 million dent from a lack of treadmills sales during the period, since all sales are halted, Peloton said. The company is also assuming about 10% of current treadmill owners will ask for a refund for their machines, which cost $4,300 apiece, and that would lower sales by an additional $50 million.
Telsey Advisory Group analyst Dana Telsey had expected the recall to have a larger impact. She maintained her outperform rating on stock, but lowered her price target to $120 from $150, due to ""uncertainty around the ultimate financial impact of the recalls and on Peloton's brand name.""
She noted, though, that demand for Peloton's Bike and Bike+ machines is still solid. And the more expensive fix will be for Peloton's Tread+ machine, rather than the less expensive Tread version, which represents a much smaller revenue stream overall, Telsey said.
Peloton shares closed Thursday at $83.78. The stock is down about 45% year to date, bringing the company's market cap to about $24 billion. Shares had tumbled nearly 15% on Wednesday, the day the company announced its voluntary recall, wiping $4.1 billion from Peloton's market value.
On a call, Chief Executive John Foley walked through the steps the company is taking with the U.S. Consumer Protection Safety Commission to launch the Tread in the United States later this year. It had been scheduled for May 27, but is being pushed back until Peloton and the CPSC can work on new safety protocols.
That could potentially happen as early as July, Foley said.
According to Telsey, that's also earlier than many people were anticipating.
""Somewhat lost amidst the Tread/+ recalls discussion was a very strong third quarter,"" JPMorgan analyst Doug Anmuth said. ""Peloton beat across all metrics.""
—CNBC's Michael Bloom contributed to this reporting.
In Europe, the pan-European Stoxx-600 index was around 0.63 percent lower on Monday. In Asia, the Shanghai Composite in China closed 0.31 percent higher, while the Nikkei in Japan closed 0.51 percent lower.
In oil markets, prices were dragged lower as investors grew increasingly concerned that rising production in the U.S. would offset output cuts pledged by OPEC and other producers.
Brent crude traded at around $55.43 a barrel on Monday, down 0.16 percent, while U.S. crude was around $53.16 a barrel, down 0.02 percent.
Every day India’s cities hum with the sound of hundreds of motorcycles precariously weaving their way through traffic. For most riders the two-wheeler is the cheaper and more flexible alternative to a car but for a growing band of more affluent Indians owning a customised superbike has become the ultimate symbol of the country’s new-found wealth.
Sales of premium bikes made by the likes of Italy’s Ducati, Japan’s Suzuki and Harley-Davidson of the U.S. have grown steadily over the past few years after New Delhi in 2007 agreed to permit the import of bikes with a more than 800cc engine as long as they met certain emissions standards.
Foreign brands say they are attracted by India’s rising income levels, growing demand for luxury goods and evidence of an organic motorcycle culture.
Germany’s BMW recently started selling superbikes through two of its dealerships. And last month Triumph, the iconic British motorcycle manufacturer that collapsed in the 1980s and was later resuscitated by a property tycoon, said it would move into India. The group has tapped Ashish Joshi – the former European head of Royal Enfield, the British motorcycle marque that was revived by India’s Eicher Motors – to lead its Indian charge.
Fans of the Rocket III and Daytona 675 have been urging Triumph to enter the Indian market for some time but the group says its focus has been on increasing sales at home and in developed markets such as the US and Italy.
Triumph, which produces just 50,000 bikes a year, last year launched in Russia and says moving into India now is about “getting a toehold” in a market with lots of potential.
Analysts say that while India’s broader bike market has seen double-digit growth over the past few years, the premium segment is still just a niche market.
Foreign companies are required to pay hefty import taxes that in effect double the cost of the bikes, although some manufacturers have sought to reduce costs by assembling bikes in India. And with prices starting from $9,000-$20,000, they say performance bikes are still out of the reach of many middle-class professionals.
“We have entered the Indian market at a time when leisure riding is at a nascent stage and feel we can shape that,” says Anoop Prakash, managing director for Harley-Davidson India. “I’m quite bullish. In 2010 the market for premium bikes stood at 1,000 units a year. My view is that the market could see a 10-fold increase over the next five to seven years in India.”
Ducati, meanwhile, says it expects to double the number of bikes sold in India to 200 in the next 12 months.
The units sold may be low but auto experts calculate that the high profit margins on each bike mean premium manufacturers are making money out of India. They often reap extra sales from merchandising or from customers who just want to soak up the super bike experience in cafés connected to the showrooms or at sponsored rock concerts.
But analysts say foreign brands cannot expect a smooth ride. Mr Prakash says India’s regulatory environment is not always easy to predict. On the one hand the government was very “encouraging” about Harley’s initial investment. But he says the industry was surprised when the government decided to raise the duty on completed knocked down (CKD) kits for car and bike manufacturers, based on a revision of the definition of CKD in India, from 10 per cent to 60 per cent in the April Union Budget. The government settled on a 30 per cent rise but Mr Prakash says the move “caught everyone off guard”.
Harley absorbed the rise in duty and remains committed to the market. But Mr Prakash says such moves “may give some of our peers pause for thought”
Expedia fell in extended trading Thursday after its quarterly release.
The online travel booking site posted a 67% drop in revenue to $920 million in the three months to December, below analysts' estimates for more than $1 billion. A loss of $2.64 a share was wider than an expected $1.94.
The company blazed into its earnings in comeback mode, though. The stock had rallied 268% from its March low, hitting its highest level since 2017 on Thursday, even with the travel industry still struggling amid the coronavirus pandemic.
But, that performance still pales in comparison to Airbnb. Since going public on Dec. 10, that stock has surged more than 200%. Airbnb's market cap of $130 billion is larger than all the other online travel booking sites including Expedia, Booking and TripAdvisor.
Katie Stockton, founder of Fairlead Strategies, broke down the Airbnb chart for CNBC's ""Trading Nation"" on Thursday.
""It's in an intermediate-term uptrend already just with history back to December, and with limited price history we don't really have any ways to discern how overbought the stock is, but there are no real signs of upside exhaustion as we come into [Airbnb] earnings,"" she said.
Airbnb is scheduled to report earnings on Feb. 25 for the first time as a publicly traded company. While Airbnb has benefited from a consumer preference for vacation rentals over hotel chains during the pandemic, it has still suffered from lockdowns – analysts surveyed by FactSet anticipate a net loss of $8.42 a share for its December-ended quarter.
""If you look at Expedia on the other hand, that uptrend still very much has positive momentum across time horizons and I'm not really one to fight that. But what I would say is that the risk reward is not great from a technical perspective,"" Stockton said.
She highlights a band of support at $135 and resistance at $161, level with its 2017 high. The stock closed at $149.91 on Thursday.
""That creates a bad imbalance between the downside and upside potential here in terms of those levels so I don't think it's very compelling especially with the broader market showing some signs of short-term upside exhaustion,"" she said.
Expedia's next stock move depends on how well its investments in its vacation rental brand Vrbo have paid off, according to Boris Schlossberg, managing director of FX strategy at BK Asset Management.
""The market is really betting on a very, very specific type of travel which is that when we are released from the pandemic, most of us are going to go either to the beach or to the lake. We're not going to go to the cultural centers, the cities, the museums, the restaurants, the theaters. ... Airbnb excels in urban centers and Vrbo excels much more in vacation spots,"" Schlossberg said during the same interview.
Expedia generates 11% of its total revenue through Vrbo.
Disclaimer
It's the basic question when investing in a stock: is it on the way up or down?
The street has developed numerous ways of attempting to predict what will happen, estimating various attributes tied to stock performance in order to determine what the future holds for a company's valuation.
After dissecting the data, analysts following a particular stock produce a price target of where they believe the stock is headed. With data from Thomson Reuters, CNBC.com grouped stocks in the S&P 500 with average consensus estimates farthest below their stock prices.
At the current levels, only 25 stocks have surpassed their respective target estimates by 4 percent or more. The prices and analysts’ estimates presented here are as of the market close on January 10, 2012.
So, which stocks are analysts expecting to have the biggest drops? Click ahead to find out!
By Giovanny Moreano & Paul Toscano
Posted 10 Jan 2012
Potential to Drop: 5.25%
Mean Price Target: $73.50
Closing Price (1/10): $77.57
Number of Analysts: 6
High Estimate: $82
Low Estimate: $55
Get DNB Real-Time Quote
Potential to Drop: 5.38%
Mean Price Target: $37.56
Closing Price (1/10): $39.70
Number of Analysts: 8
High Estimate: $50
Low Estimate: $27
Get VMC Real-Time Quote
Potential to Drop: 5.45%
Mean Price Target: $90.61
Closing Price (1/10): $95.83
Number of Analysts: 23
High Estimate: $245
Low Estimate: $45
Get NFLX Real-Time Quote
Potential to Drop: 5.81%
Mean Price Target: $55.89
Closing Price (1/10): $59.34
Number of Analysts: 14
High Estimate: $63
Low Estimate: $50
Get ED Real-Time Quote
Potential to Drop: 6.23%
Mean Price Target: $38.54
Closing Price (1/10): $41.10
Number of Analysts: 13
High Estimate: $44
Low Estimate: $34
Get HCP Real-Time Quote
Potential to Drop: 6.27%
Mean Price Target: $32.19
Closing Price (1/10): $34.34
Number of Analysts: 8
High Estimate: $37
Low Estimate: $24
Get AN Real-Time Quote
Potential to Drop: 6.43%
Mean Price Target: $23.92
Closing Price (1/10): $25.56
Number of Analysts: 12
High Estimate: $29
Low Estimate: $13
Get MOLX Real-Time Quote
Potential to Drop: 6.50%
Mean Price Target: $124.94
Closing Price (1/10): $133.63
Number of Analysts: 17
High Estimate: $140
Low Estimate: $103
Get PSA Real-Time Quote
Potential to Drop: 6.54%
Mean Price Target: $20
Closing Price (1/10): $21.40
Number of Analysts: 13
High Estimate: $28
Low Estimate: $16
Get SWY Real-Time Quote
Potential to Drop: 6.57%
Mean Price Target: $37.68
Closing Price (1/10): $40.33
Number of Analysts: 14
High Estimate: $43
Low Estimate: $34
Get LLY Real-Time Quote
Potential to Drop: 7.33%
Mean Price Target: $50.54
Closing Price (1/10): $54.54
Number of Analysts: 13
High Estimate: $57
Low Estimate: $43.5
Get PGN Real-Time Quote
Potential to Drop: 7.37%
Mean Price Target: $81.67
Closing Price (1/10): $88.16
Number of Analysts: 6
High Estimate: $93
Low Estimate: $75
Get OKE Real-Time Quote
Potential to Drop: 7.84%
Mean Price Target: $31.44
Closing Price (1/10): $34.12
Number of Analysts: 9
High Estimate: $46
Low Estimate: $25
Get LXK Real-Time Quote
Potential to Drop: 8.04%
Mean Price Target: $6.75
Closing Price (1/10): $7.34
Number of Analysts: 16
High Estimate: $8
Low Estimate: $4
Get PHM Real-Time Quote
Potential to Drop: 9.25%
Mean Price Target: $57
Closing Price (1/10): $62.81
Number of Analysts: 4
High Estimate: $62
Low Estimate: $53
Get GPC Real-Time Quote
Potential to Drop: 9.28%
Mean Price Target: $40.83
Closing Price (1/10): $45.01
Number of Analysts: 6
High Estimate: $44
Low Estimate: $33
Get FAST Real-Time Quote
Potential to Drop: 9.75%
Mean Price Target: $29.14
Closing Price (1/10): $32.29
Number of Analysts: 7
High Estimate: $32
Low Estimate: $23
Get AEE Real-Time Quote
Potential to Drop: 10.60%
Mean Price Target: $28
Closing Price (1/10): $31.32
Number of Analysts: 5
High Estimate: $31
Low Estimate: $25
Get CINF Real-Time Quote
Potential to Drop: 12.47%
Mean Price Target: $10.03
Closing Price (1/10): $11.46
Number of Analysts: 8
High Estimate: $14
Low Estimate: $7
Get MAS Real-Time Quote
Gold slipped on Wednesday, adding to its deepest monthly losses in over three years as strong U.S. economic data buoyed the dollar and further cemented the case for hiking rates in December.
U.S. private employers stepped up hiring in November much more than expected and consumer spending increased last month, giving more ammunition to the Federal Reserve for a rate increase.
The data helped the dollar climb half a percent against a basket of major currencies after last week touching the highest levels for almost 14 years.
Gold is highly sensitive to rising rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
Spot gold had dropped 1.1 percent to $1,174.96 an ounce by 3:06 p.m. EDT while U.S. gold future for December delivery settled at $1,170.80.
Gold has shed nearly 8 percent in November, the biggest monthly fall since June 2013, hurt by a rally in the U.S. dollar on surging Treasury yields as investors believed President-elect Donald Trump's policies would invoke faster inflation.
""Recently there's been a perfect storm against gold with higher risk appetite, rising stock markets and bond yields, massive ETF (exchange traded fund) outflows and the withdrawal of speculative financial investors,"" said analyst Daniel Briesemann at Commerzbank in Frankfurt.
""We don't think this is over yet. Normally lower prices should attract higher demand, but the Indian situation is putting the brakes on gold buying.""
The shock withdrawal of high-value notes to fight ""black money"" in India, the world's second biggest consumer of gold, has hit gold demand there during the peak wedding season.
Silver fell 0.7 percent to $16.48 an ounce while platinum shed 0.8 percent to $910.
Palladium climbed to an intraday high of $772.70 an ounce, its strongest since June 2015, paring gains to $770.25, up 1.3 percent.
Palladium has risen over 23 percent this month, its best since February 2008, outperforming other metals.
That rise has been mostly driven by speculators, overshooting levels that are supported by supply/demand fundamentals, and so the metal was likely to see a correction of over $100, Briesemann said.
— Follow CNBC International on Twitter and Facebook.
The stakes are high for this Saturday's 150th running of the Belmont Stakes — and not just for Justify, the undefeated horse that may ride take the Triple Crown, something only 12 horses have ever managed to do.
The average television viewership for the last three non-Triple Crown races was about 5.9 million, according to NBC Sports Group, which owns the broadcast rights. Compare that with 19.6 million, the average number of viewers in 2014 and 2015 when a Triple Crown was a possibility.
The Triple Crown is the very elusive title given to a 3-year-old thoroughbred horse that manages to win three races: The Kentucky Derby, the Preakness Stakes and the Belmont Stakes. Saturday's race is being held at Belmont Park in Elmont, New York.
If Justify wins it will be No. 13.
In May, the colt won the 144th Kentucky Derby by 2½ lengths in just more than 2 minutes. Justify also won the Preakness Stakes in May by a half-length.
Bob Baffert, the legendary horse trainer who won the Triple Crown in 2015 with the horse American Pharoah, and who also trains Justify, can still remember the intensity of when American Pharoah won.
""It's that kind of electricity in the air, when you're so glad you were there and part of it,"" Baffert said Wednesday on ""Squawk on the Street.""
""That's why everybody goes out there,"" he said. ""That's why it'll be packed, because you want to feel that excitement.""
According to the The New York Racing Association, betting on the race will also likely increase. In 2015, when American Pharaoh was up for the Triple Crown, wagers on the race were about $75 million. The numbers fell to about $47 million the following year when there was no Triple Crown possibility.
Baffert said he'll have a front-row seat Saturday: in a box near the wire.
""I'm the guy that looks nervous as hell,"" he said.
""All you hope for is that the horse breaks cleanly and gets out there,"" Baffert said. ""You don't want him to break poorly and be behind.""
Watch the race Saturday at 2 p.m. ET on NBC Sports, or 4 p.m. ET on NBC.
Disclosure: CNBC parent NBCUniversal owns NBC and NBC Sports.
Local retailers around the country are hoping the biggest shopping day of the holiday season won't end up being Black Friday, but the day after—what's known as Small Business Saturday.
About 3,000 neighborhoods already have signed up to support the day, which resulted in about $5.7 billion in consumer spending with independent merchants last year, according to data from American Express.
Entrepreneurs—both established and aspiring—are eager to capitalize on this interest. But opening your own bakery, clothing boutique or furniture store can be a daunting task without the passion and perseverance to weather the ups and downs.
Being prepared well before opening the doors to your brick-and-mortar store can help you avoid some potential pitfalls. Here are five steps that can help you start out strong.
Just because an area of town or a local strip mall has significant foot traffic doesn't necessarily mean it is the right location for the type of customer you'll want.
""It's all about location, location, location,"" said Melinda Emerson, founder of SucceedAsYourOwnBoss.com. Before getting locked into a standard five- to 10-year lease, ""you want to understand where the foot traffic is coming from,"" she said.
Read MoreRise in freelancers a boon to entrepreneurs
Knowing who your buyers are and identifying a target audience will help in finding the best location for your store.
Emerson's suggestion: Test your idea with a ""pop-up"" location, which allows you to rent short-term space. The online start-up Storefront, for example, connects store owners and landlords with retail spaces in New York, Chicago, Los Angeles and San Francisco for $150 to $1,500 a day.
Developing a three-year business plan can help you (and potential lenders) know what costs to expect. Go to the U.S. Small Business Administration website or talk to a counselor at a local Small Business Development Center for free help in writing your plan.
""Identify available capital and set a budget,"" recommends Nicole Leinbach Reyhle, founder of the online publication Retail Minded. Allocate some money to cover any surprise expenses, but make sure you cover the basics too. Consider how much money you'll need to rent or lease the location as well as the cost of inventory, staff, merchandising and display fixtures, a computer or point-of-sale provider, and marketing and advertising.
First, be prepared to put a good chunk of your own money in your business. Lenders want to see that you're willing to bank on your store before they do. Next, contact friends and family. If they've invested, you may be more reluctant to lose their money than your own. Getting a bank loan can be tough since many lenders won't loan money to small start-ups with no track record. But there are other options.
Read MoreWave of 'accidental' entrepreneurs on the rise
Talk to other businesses that have been successful using peer-to-peer lenders, such as crowdfunding platforms, where people lend money to a business and get paid back over the course of the loan. A $5,000 or $10,000 loan can make a big difference for a small business, said Jill Johnson, founder and CEO of the Institute for Entrepreneurial Leadership (IFEL) in Newark, New Jersey. ""It may allow you to do a pilot or get a piece of equipment to operate more efficiently.""
A big chunk of the budget of a new store often goes to marketing and advertising to get those first customers in the door. ""Social media is extremely valuable,"" and much less expensive than traditional advertising, Reyhle says. Check out some of the free marketing resources at ShopSmall.com, a website from American Express to help independent retailers promote their businesses.
A few more tips: ""Word of mouth far outweighs any media you can buy. Think of three things that you do that your competitors don't do and put that on your business card and website,"" said Marc Wilson, a retail consultant with the Virginia Small Business Development Center network.
Put effort into making sure your business secures search traffic too. ""Make sure your business is the first listing that comes up when some searches for it on Google.""
""Having a support team in place is so important,"" said IFEL's Johnson. ""Too often entrepreneurs are making decisions in a vacuum. You need people with real expertise who will give you honest feedback.""
An attorney, accountant, business and/or financial advisor will likely see potential challenges to the business before you do, Johnson said, from permits and licenses that may be required to a practical legal structure for your business.
Nonprofit organizations like IFEL, as well as local SBA offices, and Small Business Development Centers also offer free counseling and training programs to help you get your store up and running–and help it continue to grow.
Democratic presidential nominee Joe Biden is still leading President Donald Trump in the polls, though averages of national surveys show a trend toward a slightly tightening race with less than seven weeks until Election Day.
But Biden continues to hold his edge over the incumbent in a handful of crucial swing states, including some that Trump won in 2016.
Individual polls of the race for the White House show a much wider variance. National surveys released this week from The Economist/YouGov and Reuters/Ipsos both put Biden up 9 points on Trump among likely voters. But Rasmussen — the president's favorite pollster, which has consistently found higher levels of support for him than other outfits — on Wednesday gave Trump his first-ever polling lead over Biden, by 1 point, which falls within its margin of error of plus or minus 2 percentage points.
But national polls are only part of the story, as any number of anxious Democratic voters will be quick to point out. In 2016, Democratic nominee Hillary Clinton trounced Trump in the popular vote by more than 2.8 million votes, but still lost the Electoral College.
That race came down to a series of upset victories by Trump in key swing states, including Michigan, Wisconsin, Pennsylvania and Florida. Trump walked away with 306 electoral votes to Clinton's 232.
RCP's swing-state tracker, however, shows Biden leading to varying degrees in all of those battleground states, as well as in North Carolina and Arizona, which Trump also won in 2016.
That polling tracker now gives Biden an overall spread of 3.7 points over Trump — a wider lead than it showed at the start of the month.
That shift appears to be driven by recent surveys of voters in Wisconsin and Arizona, both of which show Biden furthering his gains over Trump since the end of August.
In Arizona, RCP shows Biden with a 4.7-point lead over Trump, who in 2016 beat Clinton in the Grand Canyon State by about 3.5 percentage points.
The Trump campaign appears to be taking notice, announcing Thursday that it would air a new ad, featuring a business owner praising the president and attacking Biden's record, specifically in Arizona.
Still, the race in Arizona remains tight, according to a survey of the state released Thursday morning by the Monmouth University Polling Institute. While Biden in that poll holds a 4-point lead among all registered voters in the state, 48%-44%, the gap shrinks to just 2 percentage points under a model of likely voters with high turnout, with Biden at 48% and Trump at 46%. In a low-turnout model, Monmouth finds Trump and Biden tied at 47% among likely voters.
Monmouth surveyed 420 registered voters in Arizona by phone between Friday and Tuesday. The poll has a margin of error of plus or minus 4.8 percentage points.
Cook Political Report, meanwhile, moved Arizona's election rating from ""Toss Up"" to ""Lean Democrat"" earlier Thursday morning, citing in part Biden's support among Latinos in the state.
The same can't be said for Florida, where recent polls showed Biden underperforming among Latinos.
The Biden campaign has reacted quickly. The former vice president himself visited South Florida on Tuesday, and his campaign over the weekend announced new ads in the state targeting different groups of Hispanic voters.
The shifting polls come as the economy, health care and the coronavirus pandemic take center stage in the campaign messaging for both Trump and Biden.
More than 6.63 million Covid-19 cases and at least 196,831 deaths from the disease have been reported in the U.S., according to Johns Hopkins University.
Trump, eager to recover the devastating economic losses from the pandemic before the election, has proclaimed that his administration has done a ""great job"" on the crisis and has repeatedly floated the possibility of a vaccine being developed and distributed before Election Day. His own health experts, however, have suggested the timeline would be much slower.
Biden, meanwhile, describes the U.S. response as being tragically mishandled.
The president in recent weeks has also weathered a series of potentially damaging news stories related to the coronavirus, including revelations from veteran journalist Bob Woodward that Trump admitted downplaying the dangers of the virus.
The polling averages, however, don't reflect any dramatic change following these reports, offering further evidence for the view among political watchers that Trump's core base of support is simply unshakable.
But that's a blessing and a curse, analyst Charlie Cook noted last week:
""There is nothing that could be said or written, nothing that Trump can say or do, that would crack his base. Those expecting Trump to drop at the next negative story forget that it is hard to take a drop if you've never risen in the first place,"" Cook wrote.
""But this is also why those who are convinced that he will make a spectacular comeback are likely to be wrong as well. His standing is impervious to events.""
Despite chatter last week that the market was overbought, again the bulls pushed the S&P 500 even higher on Monday after solid earnings combined with a flurry of merger news boosted investor appetite for equities.
Take a look at some of the big deals that went down:
Company Target Industry
Danaher Corp. Beckman Coulter Medical Devices
Ensco Pride International Offshore Drilling
AOL Huffington Post Media
Investors take the deal activity to mean Corporate America views stock valuations as attractive.
In fact the tone of the Street has changed from negative to positive and instead of an impending correction, investors are now chattering about a meaningful breakout with the S&P above the high end of its recent range.
Technically, it's considered a sign of strength; a sign that stocks could go much higher.
What should you make of it? How should you position now?
Instant Insights with the Fast Money traders
Jon Najarian is impressed by all the deal-making. “A lot of folks who thought the market was overextended are now saying if smart guys are stepping in a committing billions, it’s a positive sign. I take it as one more reason not to fight this tape.”
Although Brian Kelly has been bearish, he says “you just can’t fight this market.” In fact, he’s hearing a lot of investors are throwing in the towel on the short side. “A lot of money is being put to work and there’s probably value in the market if you believe the economy is getting better,” he says.
Yes, he's been looking for a correction too, but Guy Adami admits that he wouldn't fight the tape. ""The market doesn't typically give investors this long to sell the highs,"" he says. ""It probably means we go higher.""
Tim Seymour thinks the market action may be a positive sign for blue chips. GE , Pfizer , Exxon , Alcoa, Chevron, DuPont, Caterpillar and Disney are all at or near their 52-week highs. “I think big cap should continue to work if you believe the economy will continue to work,” he says.
Steve Grasso feels the riots in Egypt were a bullish ‘tell’ because events could have been a much more negative for stocks than they were. “Egypt showed us point blank what the support is in the market. And its 1275.” In other words, despite the negative catalyst stocks didn’t slip lower than 1273 and Grasso thinks that makes investors more confident.
Zach Karabell thinks recent strength in the market should be put in context. “The strength comes off a decade that has been a big fat zero. I think we could still have a significant move higher but remain in the context of a very middling period of time.”
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IS THE OIL TRADE OVER?
With oil closing lower for the third straight session, how should you trade oil?
Dennis Gartman suggests watching the contango in oil which, he says “has been widening everyday for weeks. It’s saying there’s more than enough oil above ground.""
He also suggests keeping an eye on geo-political concerns. ""Now that Egypt has moved to page 7 from page 1 it’s no surprise that crude comes down.""
So what's next? When asked if he had to choose between $75 and $100 as oil's next stop he replies ""that crude will probably print $75 before it prints $100.""
Check out the entire interview. Watch the interview now.
______________________________________________________
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Activist investor Jana Partners has held ""constructive discussions"" with Qualcomm about potentially spinning off its chip unit from its patent-licensing business, Jana founder and managing partner Barry Rosenstein said on Monday.
""We are convinced that the board and the management recognize their issues. We are convinced that they're trying to do the right thing, and we're optimistic that they're going to,"" he said during an interview on CNBC's ""Squawk on the Street.""
Rosenstein emphasized that Jana is only asking Qualcomm to consider a spinoff at this point.
""What we think they ought to do is just a transparent review of the client businesses, and determine whether or not it makes sense to do either a partial or full split. So we are not definitely saying that they should split it up,"" he said.
Read MoreWhy rise of activist investors is bad for bonds
The Wall Street Journal reported earlier that Jana had addressed the possible split as a means of boosting the chipmaker's sagging stock price, citing a quarterly letter that will be sent to Jana investors on Monday.
Shares of Qualcomm, which has a market capitalization of $115.4 billion, have fallen about 6 percent since the beginning of this year. The stock was trading nearly 1 percent higher on Monday.
Jana, one of Qualcomm's largest shareholders, is also calling on the company to cut costs, accelerate stock buybacks and make changes to its executive pay structure, financial reporting and board of directors, the newspaper said.
Qualcomm said last month it would buy back up to $15 billion of shares and raise its quarterly dividend. The company also said it would continue to return at least 75 percent of its free cash flow to shareholders annually.
Rosenstein acknowledged that Qualcomm has already announced a $10 billion advanced share repurchase, but said he believed the company could return an additional $5 billion within four to six months.
In the letter, Jana said the buyback is a positive step but Qualcomm needs to do more to capitalize on its strong position in the chip market. Rosenstein told CNBC Qualcomm's chip business is essentially worthless at the company's present market value.
""Obviously, it's not worth negative value, it generates $3 billion of EBIT annually and has tremendous strategic value,"" Rosenstein said. ""So we think they need to look at it, they need to figure out what they can do to close the value gap.""
Read MoreThe young & the restless: Activism's rising stars
While the majority of Qualcomm's revenue comes from selling so-called baseband chips that enable phones to communicate with carrier networks, most of its profit comes from licensing patents for its widespread CDMA cellphone technology.
Qualcomm's longtime customer Samsung Electronics opted this year to use an internally developed processor for its new Galaxy S6 smartphone rather than Qualcomm's latest Snapdragon mobile chip.
Reuters contributed to this story.
Debt-crippled euro zone countries could see the yields on their sovereign bonds fall dramatically if they used their gold reserves as collateral for that debt issuance, according to Sylvester Eijffinger, professor of financial economics at Tilburg University.
Funding costs have risen to unsustainable levels for several euro zone countries, forcing them to seek financial aid from their fellow euro partners.
If governments were to use gold as collateral, sovereign credit risk would be reduced and the European Central Bank would no longer have to buy up debt from struggling euro zone members, Eijffinger told CNBC.
The ECB's plan to buy unlimited amounts of short-dated government debt, known as Outright Monetary Transactions or OMT, has been heavily criticized. Although the scheme eased investors' nerves, many analysts argue it will be equivalent to the ECB printing money to finance governments.
Using gold as collateral would pose fewer risks to the ECB's balance sheet than the ECB's recently launched bond-buying program, Eijffinger said.
Of all euro zone countries struggling with high debts, Portugal and Italy would benefit most from the method because they hold large reserves of gold. Spain, Ireland and Greece would not gain as much.
Italy holds 2450 metric tons of gold, and Portugal has 383 metric tons of gold. This compares to Spain's 282 metric tons of gold, and Greece's 112 metric tons of gold, according to the World Gold Council.
Italy holds gold reserves of 24 percent of its two-year funding requirements, for Portugal this is 30 percent, according to the World Gold Council.
A recent EU study titled ""A More Effective Euro Area Monetary Policy than OMTs -Gold-Backed Sovereign Debt"" also recommended that the central banks of euro zone countries use gold as collateral for highly distressed bonds to allow the euro area to reduce financing costs, like it did in the past.
The study, authored by Professor Ansgar Belke University from the Duisburg-Essen university in Germany shows that in the 1970s Italy and Portugal employed their gold reserves as collateralfor loans from Germany's Bundesbank, the Bank for International Settlements (BIS) and other institutions like the Swiss National Bank.
""Italy received a $2 billion bail-out from the Bundesbank in 1974 and put up its gold as collateral. More recently, in 1991, India applied its gold as collateral for a loan with the Bank of Japan and others. And in 2008, Sweden's Riksbank used its gold to raise some cash and provide additional liquidity to the Scandinavian banking system,"" the study said.
""It would be more transparent, would not be inflationary and would foster reforms,"" the study said.
Restrictions
There are some restrictions to using gold as collateral however.
Central banks of euro zone countries along with the Swedish Central Bank and the Swiss Central Bank signed a contract in 2009 which stated they would not put more than 400 tons of gold on the market over the course of the five years that followed.
Since the euro zone was formed, all of the gold that euro zone member states hold has been pooled by the ECB. Member states' central banks are not allowed to make decisions over these holdings without getting approval from the ECB.
""This may limit the options until 2014, but a country will only have to sell if [it defaulted on its debt] they do not live up to all the conditions that are being set ,"" Eijffinger said.
Dr. Moorad Choudhry, treasurer at RBS corporate banking, told CNBC that the option ""is not a solution to the euro zone's structural problems.""
""It would just be kicking the can down the road and wouldn't solve anything in the long term,"" he said.
""It holds troubled euro zone countries back from taking any critical decisions. The structural problems of these countries need urgent attention, and an ability to borrow cheaper than what they are paying now doesn't address these problems. As a technical option the idea works, but for more emotional reasons it probably won't happen ,"" Choudhry said.
The ECB declined the comment on the possibility of using gold as collateral.
The euro area holds 10,792 tonnes of gold, which is about 6.5 percent of all gold that has ever been mined and worth some $590 billion, according to the European Parliament study.
—By CNBC.com's Liza Jansen; Follow Her on Twitter @lizajansen
As Covid-19 surges across the country, the American Foreign Service Association on Friday criticized large indoor holiday events scheduled at the U.S. State Department.
AFSA, whose members include active-duty and retired Foreign Service officers and specialists at the State Department and other federal agencies, said in a statement that it is ""very concerned to see reports of plans to host holiday parties with hundreds of invitees at the Department of State.""
Secretary of State Mike Pompeo and other State Department officials have planned several indoor holiday parties, including one with at least 900 guests invited, The Washington Post reported.
The scheduled events fly in the face of a Nov. 25 notice from State Department leadership that instructed employees to avoid hosting non-mission critical events in person and ""opt for virtual events,"" NBC News reported.
""We urge the Department to reverse course and model responsible behavior in accordance with its own guidelines,"" AFSA said.
""We've taken every precaution to thin out the number of individuals in all spaces at one time, and plan to keep outdoors space open and available to attendees, weather permitting,"" a State Department spokesperson said in an email in response to AFSA's statement, adding that the department plans to follow health precautions including requiring masks, social distancing and temperature checks.
The spokesperson did not provide guidance on how the State Department will enforce mask-wearing while food and beverages are provided at the events.
The Centers for Disease Control cautions against indoor gatherings, which it says poses more risk of coronavirus spread than outdoor gatherings.
The White House also plans to host at least 20 indoor holiday parties, according to NBC News, including one held Tuesday night featuring an appearance from President Donald Trump. Pictures from the event show several attendees not wearing masks.
Several White House events, including the confirmation of Justice Amy Coney Barrett and an election night celebration, have resulted in dozens of coronavirus cases. In all, at least 45 people connected to the White House, including Trump, first lady Melania Trump and White House chief of staff Mark Meadows have tested positive for the virus.
When asked during a press conference Wednesday whether the White House is setting a good example for Americans by hosting in-person holiday parties, press secretary Kayleigh McEnany said, ""You can celebrate the holiday of Christmas, and you can do it responsibly...We will engage in the celebration of Christmas."" McEnany tested positive for Covid-19 in October.
A report from the White House's own coronavirus task force obtained by NBC News on Wednesday warned ""the COVID risk to all Americans is at a historic high.""
The report urged Americans to avoid social gatherings and said, ""It must be made clear that if you are over 65 or have significant health conditions, you should not enter any indoor public spaces where anyone is unmasked due to the immediate risk to your health.""
The U.S. reported a record number of daily new Covid-19 cases, current hospitalizations and single-day deaths on Thursday, indicating that the national virus crisis is only accelerating.
Twitter has suspended a group of fake accounts pretending to be owned by Black supporters of President Donald Trump and his re-election campaign.
The micro-blogging platform said Tuesday the accounts breached its policies on spam and platform manipulation. The news was first reported by The Washington Post.
Multiple fake accounts posted the same bogus language including the phrase: ""YES IM BLACK AND IM VOTING FOR TRUMP!!!""
Darren Linvill, an associate professor studying social media disinformation at Clemson University, worked with journalists at The Post on the story. He wrote on Twitter that trolls ""are out there trying to influence our conversations before November.""
Offending accounts appeared to use stolen photos of real people including military veterans and members of law enforcement in their profile pictures.
Collectively, the accounts had 265,000 retweets or Twitter mentions. Some of them had amassed over 10,000 followers.
Linvill told Reuters that most of the accounts were set up in 2017 and that they had become more active in the last couple of months.
A Twitter spokesperson told CNBC: ""Our teams are working diligently to investigate this activity and will take action in line with the Twitter Rules if Tweets are found to be in violation. Presently, we've taken action on some Tweets and accounts for violations of our policies on platform manipulation and spam.""
Twitter is yet to say how many accounts it has suspended or who is behind them.
Twitter writes on its website that it does not allow users to ""to artificially amplify or suppress information or engage in behavior that manipulates or disrupts people's experience on Twitter.""
We all get choices that take us in completely different directions: career in one industry v. another; entrepreneur v. employee; stay-at-home parent v. career outside the home.
These decisions encompass so many variables that it is hard to consider each tradeoff on its own (i.e., compensation, career growth, work/life balance).
Rather, these choices lead to other choices that can impact our entire lives.
Instead of reviewing each option in light of what it offers now, imagine taking each option from start to finish. Write competing biographies based on each choice that you have, and choose the life you want.
Write about the trials you will face. If you are choosing between industries (e.g., journalism v. law), research each industry’s typical career path, growth trajectory, and professional requirements. Write a biography for yourself in each industry based on what is realistically required for what you want to achieve. Once you write down all the work that will go into each career, do you still want both of them? Which of these paths resonates with you? Which of these journeys do you want to take?
Write about the upside and the downside. If you are thinking of starting your own business or taking a job, your biographies should include your business and your target career at its highest and lowest points. How do you feel when you “make it”? What do you lose when things don’t work out? Which of these risks do you want to take?
Write about the legacy you wish to leave. If you are conflicted about work/ life balance, write about what would happen if you took time off now or later or not at all. What is your ideal day in each scenario? What obstacles come in your way and how do you solve them? Do you have regrets? Which dreams do you want to pursue?
It is tempting to make a decision for its short-term value without considering the path it clears for us in the long term. If we make each decision for the short term, we risk combining a haphazard series of events, rather than crafting a life of meaning and purpose.
If we write our biographies now, we write a roadmap for our future and make a conscious decision on where we go.
________________________________
Caroline Ceniza-Levine is co-founder of a career coaching firm for Gen Y professionals. Formerly in corporate recruiting and retained search, Caroline has recruited for Accenture, Booz Allen, Citibank, Disney ABC, Oliver Wyman, Pfizer, and Time Inc. She currently writes career columns for Portfolio.com and Vault.com and teaches Professional Development at Columbia University School of International and Public Affairs.
Comments? Send them to executivecareers@cnbc.com
Investors should buy Grubhub due its market dominance, first-mover advantage and future growth potential, according to Wedbush Securities, which initiated coverage of the internet food ordering company with an outperform rating.
""GRUB is the market leader in the growing online restaurant ordering and delivery space and will continue to benefit from its early lead and superior size and scale,"" Wedbush's Aaron Turner wrote in a note to clients Thursday.
""We believe recent delivery initiatives and strategic acquisitions coupled with continued diner adoption of mobile-based restaurant take-out and delivery methods should drive robust revenue and earnings growth for the foreseeable future.""
The Standard & Poor's 500 Index has returned more than 200 percent since March 2009, the start of what's now the second-longest bull run in history.
Yet retirement savers and mom-and-pop investors haven't seen such big gains. While 401(k) plan balances have bounced back since their lows seven years ago, most Americans still fall woefully short of the savings they'll need to last them through retirement.
Back in 2007, people in their 60s had average 401(k) balances of about $120,000. That figure plunged to about $90,000 in early 2009, and climbed back to more than $150,000 by the end of 2015, according to data from Fidelity. For most, that's still significantly short of the recommended account balance for people on the brink of retirement: Eight to ten times your final salary.
""Frankly, if you have only about $100,000, you aren't going to be able to retire,"" said Brooklyn, N.Y.-based financial planner Mark Sallinger. ""While some expenses will wane, and you might no longer have kids or a mortgage to pay for, health and medical costs are going through the roof.""
Indeed, although Americans of all ages have seen their retirement accounts recover since the financial crisis, average balances suggest even younger people are behind on reaching the recommended targets of one times salary by age 30 and three times salary by age 40.
Figures from other sources look even lower: The average account balance for 401(k) plans in 2009 was about $51,000 — compared to about $76,000 in 2014, according to Department of Labor data provided to CNBC by retirement plan research firm Brightscope.
Now, most retirement savers don't invest exclusively in the S&P (nor should they, necessarily) and fees and contribution levels are an important part of the story when it comes to paltry retirement savings. But it's clear that the downturn set savers back.
One problem is that many small investors tend to get fearful as stocks fall, and sell — locking in losses. And as gains return, missing just a couple good days of market performance can actually wipe out the majority of your returns.
""Some individual investors got spooked in 2008 and sold low,"" Sallinger said. ""So not everyone has been able to partake in the bull market. For the investors who are dipping a toe back in now, it's late in the cycle.""
Even those investors who got back into stocks relatively early in the bull run have trailed the index: The average investor in a U.S. equity fund saw annualized returns of about 9 percent over the last 5 years — a period during which the S&P 500 returned nearly 12 percent annualized, according to Morningstar data. Investors often lag the very funds they hold because of poorly-timed trading.
But the case that mom and pop missed out on the bull market shouldn't be overstated, said Sean Collins, senior director of industry and financial analysis at Investment Company Institute, which represents the fund industry.
""Money in 401(k)s and IRAs tends to be pretty steady coming in month in and month out,"" Collins said. ""While there's no doubt that investors do respond to returns, that response tends to be pretty muted.""
More significant has been the trend of investors moving toward global equity funds and domestic exchange traded fund, Collins said.
While certain companies have especially outperformed since the 2009 low — like consumer discretionary stocks, up more than 400 percent — the bull market has buoyed all sectors, said S&P Dow Jones Indices senior index analyst Howard Silverblatt.
Unfortunately, that means it's getting harder to find bargains, he said.
""Overall we have come back well,"" Silverblatt said, ""but the market looks expensive whether you're looking at P/E or price to cash flow.""
What was Wall Street saying about earnings season, Googlehitting an all-time high, Facebook’s1 billion users and European bank stocks? Find out in this week’s CNBC.com Stock Blog Roundup.
Third-quarter earnings season unofficially gets underway with Alcoa’searnings report on Tuesday. David Bianco, the chief U.S. equity strategist at Deutsche Bank, is expecting disappointment for the quarter overall given weakening global growth. Bianco is “overweight” technology and financials, and likes Microsoft and International Business Machines in technology, and Goldman Sachs and Citigroup in financials.
WASHINGTON — Former Vice President Joe Biden unveiled a roadmap of policy proposals Tuesday that are aimed at narrowing the generational wealth gap that persists between White Americans and their Black, Latino, Asian and Native American neighbors.
Biden's racial economic equity plan is the fourth plank in the presumptive Democratic presidential nominee's ""Build Back Better"" economic platform. Biden announced the plan at a speech in Wilmington, Delaware.
There, Biden drew a sharp contrast between his view of the national reckoning underway on racial justice and the ongoing protests in major cities, and the views of his opponent, President Donald Trump.
""Every instinct Trump has is to add fuel to the fire,"" said Biden. ""It's the last thing we need. We need leadership that will calm the waters and lower the temperature. That's how to restore peace in the streets.""
Biden's economic equity plan is largely a repackaging of dozens of his existing proposals from across the campaign's platforms, such as his plan to offer a one-time student debt reduction of $10,000 per student and his call for a $15 hourly minimum wage.
It also contains a separate section focused on criminal justice reform, which includes Biden's plan to eliminate cash bail and to guarantee that formerly incarcerated people are provided temporary housing upon release from prison.
It will take all of these policies working together, he said, to begin to achieve economic equality for people of color.
""How do we break the cycle? In good times, communities of color still lag. In bad times, they get hit first and the hardest. And in recovery, they take the longest to bounce back. This is about justice ... it's also about jobs, good-paying jobs. And financial stability, building wealth for families of color and passing it down to their kids.""
Here are some of the key proposals in Biden's economic equity plank:
- Create a new Small Business Opportunity Fund and seed it with $30 billion of Biden's proposed $300 billion domestic innovation funding.
- Expand the New Markets Tax Credit to $5 billion yearly and make it permanent.
- Pass legislation to require the Federal Reserve to report data and trends on racial economic gaps and commit the Fed to a ""real-time"" payment system aimed at eliminating the time it takes for checks to clear.
The New Markets Tax Credit program awards tax credits to investors who provide capital for community development entities, which finance projects in qualified low-income communities. Created by Congress in 2000, the NMTC has supported more than 5,300 projects in the past two decades, but it is scheduled to expire at the end of this year.
Unlike the previous three planks in Biden's economic platform, the racial equity plan does not initially include demands for more federal spending. Instead, it is centered on the ways that funding Biden has already proposed in his first three planks is allocated.
Speaking to reporters Tuesday morning, senior Biden campaign advisors said more details about the costs and the funding of these proposals are forthcoming, although they did not specify when to expect the numbers.
One thing the plan does not contain is any reference to the word ""reparations,"" despite a growing movement on the left in recent years to quantify and compensate Black Americans for centuries of slave labor and for the subsequent Jim Crow laws that denied them access to the same opportunities to build wealth that White families were given.
Grouping all of these policy proposals together under the umbrella of racial economic equity is one way for Biden's campaign to codify the former vice president's commitment to addressing the deep-seated racial injustice that has sparked massive civil unrest across the country this summer.
Biden said his plan is ""about rising to this moment of crisis. Understanding people's struggles, and building a future worthy of their courage and their ambition to overcome.""
Read the entire plan below.
Russia has laid the groundwork for a likely veto on Monday of a British, U.S. and French bid for the United Nations Security Council to call out Iran over its weapons falling into the hands of Yemen's Houthi group.
The 15-member Security Council has to renew its targeted sanctions on Yemen on Monday.
Russia has proposed a rival resolution that would simply extend the mandate of the regime for one year and not mention Iran.
The United States has been lobbying for months for Iran to be held accountable at the United Nations, while at the same time threatening to quit a 2015 deal among world powers to curb Iran's nuclear program if ""disastrous flaws"" are not fixed.
Britain drafted a resolution in consultation with the United States and France that initially wanted to condemn Iran for violating an arms embargo on Houthi leaders and include a council commitment to take action over it.
The latest British draft drops the condemnation and instead expresses concern that U.N. experts monitoring the sanctions reported Iran had violated a targeted arms embargo by failing to stop missiles and unmanned aerial vehicles reaching the Houthis.
A proxy war is playing out in Yemen between Iran and U.S. ally Saudi Arabia.
A Saudi-led coalition intervened in Yemen in 2015, backing government forces fighting Iran-allied Houthi rebels. Iran has denied supplying the Houthis weapons.
A U.N. Security Council resolution needs nine votes in favor and no vetoes by Russia, China, the United States, France or Britain to pass.
Both resolutions seek to renew a U.N. ban on the supply of weapons to Houthi leaders and ""those acting on their behalf or at their direction."" It can also blacklist individuals and entities for threatening the peace and stability of Yemen or hindering aid access.
U.S. Ambassador to the United Nations Nikki Haley took her Security Council colleagues to Washington in January to view pieces of missiles fired by the Houthis at Saudi Arabia in a bid to boost the U.S. case against Iran.
Russian U.N. Ambassador Vassily Nebenzia said after the visit that he does not believe there is a case for United Nations action against Iran. Iran has described the arms displayed in Washington as ""fabricated.""
The French spend the least amount of time at work, a new survey of 73 cities around the world by Swiss bank UBS shows, while the most hours are worked in Cairo and Seoul.
On average, people in the cities surveyed worked 1,902 hours per year, but in Lyon and Paris they worked 1,582 and 1,594 hours respectively. In Cairo, they worked 2,373 hours, while in Seoul they worked 2,312 hours.
The richest workers are in New York and Zurich, where they would have to work nine hours to buy an iPod nano, while workers in Mumbai needed to work 20 nine-hour days – nearly one month's salary – to buy the gadget.
Copenhagen, Zurich, Geneva and New York were the cities where employees had the highest gross wages.
In terms of the most expensive cities, London fell from the top of the list to the 21st place because of the pound's devaluation, the survey showed.
Oslo is the world's most expensive city now, followed by Zurich, Copenhagen, Geneva and Tokyo, while New York was on the list at number 6.
—An earlier version of this story misstated New York's rank as an expenisve city.
In a filing with the SEC on Friday, Chipotle announced that a portion of future CEO compensation will be tied to the company's share price performance.
The move comes as health concerns have continued to plague the stock over the past year--it is now down 23%. According to the filing, shares will have to stay above $700 for 30 consecutive days in order to trigger new stock awards for executives.
The ""Halftime Report"" experts and guest host, Rich Pzena, debated the potential merits--and pitfalls--of tying CEO compensation to share price.
The desk is in agreement that such a policy can create negative incentives for CEOs. Rather than focus on metrics like growth and dividends, CEOs might instead exercise measures to artificially inflate stock price. While a higher price in the short term would benefit the individual, it might come at the expense of long term growth.
""I think it's well intentioned since there's been a tremendous amount of money lost in the stock,"" Josh Brown said of the burrito maker's plan.
But intention aside, Brown doesn't think it's a good idea. ""I'm not sure it's so great because you set up a lot of perverse incentives when you try to get mangers focused on stock price,"" he said.
From a different standpoint, Steve Weiss believes such a policy is also bad for the CEO since ""the one thing you can't predict is the market and stock price."" While he believes that there are very few ""bad actor"" CEOs out there who would intentionally try to manipulate stock price, he thinks compensation should be determined by ""operating metrics"" alone.
""Halftime Report"" guest host Rich Pzena perhaps summed up the current debate best, saying ""the best way is to have them [CEOs]...own a significant chunk so you care about the long-term performance and it hurts if it is bad.""
More than $40 billion has flowed into equity exchange-traded funds since the election, according to recent Thomson Reuters Lipper data.
And that could signal upside for the market, according to strategists who don't yet see a market ""top"" in sight.
""The overall health [of the market] is an A plus,"" Chad Morganlander, portfolio manager at Stifel Nicolaus, said Friday on CNBC's ""Trading Nation.""
Morganlander, bullish on equities at these levels, cited analysts lifting growth and earnings forecasts for next year and beyond. He and his firm have upgraded long-term returns to anywhere from 6 to 7 percent, up from about 5 percent, and have upgraded their 2017 GDP outlook to 3 percent from 2.75 percent as well.
Since the election, the major indexes have surged; the , Dow Jones industrial average and Nasdaq Composite have gained over 5 percent, nearly 8 percent, and 4 percent in that time, respectively. Analysts see several forces at work pushing the markets to record highs in recent weeks.
""This rally is tied to Trump's business-friendly campaign promises of lower corporate taxes, less regulation and a bump in infrastructure spending,"" Pat Keon of Thomson Reuters Lipper wrote in a recent report on U.S. fund flow data.
What's more is that, according to Thomson Reuters Lipper data, last week marked the fourth straight week of net inflows for equity ETFs.
Indeed, the prospect of infrastructure spending has Phillip Streible, senior market strategist at RJO Futures, bullish on equities at these levels.
""When you see infrastructure spending being promoted … you also see tax cuts on businesses. … You're going to see that expansion across the board here, and that flow of funds is going to happen,"" Streible said Friday on ""Trading Nation.""
Alas, these gains have come at the expense of the global bond market, which in November saw record outflows.
""So it was a reallocation of funds, and I wouldn't be surprised if we see a continuation back to the upside,"" Streible said.
Fast Retailing's Uniqlo clothing chain said on Monday that it was expanding its collaboration with Walt Disney to offer a wider range of products and that it would open a flagship store at the Florida Disney World's shopping complex next spring.
The Japanese apparel retailer, which now offers T-shirts featuring Mickey and Minnie Mouse, will extend its Disney-themed lineup to offer at stores worldwide items ranging from its Ultra Light Down collection and flannel shirts to umbrellas and toys.
It will also use characters from the blockbuster movies ""Star Wars,"" ""Toy Story,"" ""Avengers"" and ""Frozen.""
The move could add to awareness of Uniqlo's brand as its global expansion gathers pace, with Fast Retailing expecting to have more Uniqlo outlets overseas than in Japan by this autumn.
NEW YORK, Nov 12, 2010 (BUSINESS WIRE) -- Fitch Ratings assigns an 'AA' rating
+to the following New York Local Government Assistance Corporation (LGAC) bonds:
+
+--$202,550,000 series 2010B refunding bonds (subordinate lien).
The bonds are being issued for refunding purposes.
In addition, Fitch affirms the 'AA' rating on approximately $3.4 billion of
+outstanding LGAC senior and subordinate lien bonds, including the underlying
+rating on the series 2003A-4V bonds for which liquidity is being substituted and
+insurance removed.
Fitch does not make a rating distinction between the senior and subordinate
+liens due to the strong coverage and impoundment provisions.
The Rating Outlook is Stable.
RATING RATIONALE:
+
+--The designated source of payment, a portion of the state sales tax, is
+broad-based and provides generous coverage of debt service.
--Although bond payments require annual legislative appropriation, there are
+strong protective provisions for insufficient funding and non-appropriation.
Fitch believes that these features effectively eliminate the risk of
+non-appropriation.
--The state's economy is broad, with substantial wealth and resources, although
+the health of the state's economy and finances is closely linked to the cyclical
+financial services industry.
--Strong financial planning and reporting practices, including quarterly
+financial plan updates, allow the state to stay abreast of changing conditions.
This credit strength is offset by the state's historical tendency to rely on
+nonrecurring measures rather than sustainable budget solutions to address
+revenue weakening in downturns.
--New York's debt burden is above average but still in the moderate range, and
+pensions are well funded.
KEY RATING DRIVERS:
+
+--Changes in New York State's general obligation (GO) rating, to which this
+rating is linked.
--The state's GO rating will be driven by its continued ability to address
+budget shortfalls and protect its cash position.
---Further driving the state's rating would be any meaningful change to the
+shape of the financial services industry, which would have significant
+implications for the state's economy and finances.
SECURITY:
+
+LGAC's bonds are general obligations of the corporation, payable, subject to
+annual state legislative appropriation, from the yield of one cent of the
+four-cent state sales and use tax required by statute to be deposited in the
+local government assistance tax fund.
CREDIT SUMMARY:
+
+The strength of the state's incentive to appropriate for the LGAC bonds results
+in a rating equal to that assigned to New York's GO debt despite the
+appropriation requirement for payment of debt service. In the event of
+non-appropriation, the state would be unable to receive revenues held by the
+LGAC tax fund, which receives one cent of the state's sales tax and contributes
+more than $2 billion to the state general fund. Security strengths include the
+broad sales tax base, the consistently high level of coverage (about 6.3 times
+(x) maximum annual debt service based on fiscal 2010 revenues), and the
+structural protections in place. Fitch does not make a rating distinction
+between the senior and subordinate liens due to the strong impoundment
+provisions and coverage.
LGAC was created in 1990 as a means of financing $4.7 billion of the state's
+accrued general fund deficit, replacing the annual spring borrowing for local
+aid payments. The entire $4.7 billion authorization has been issued and
+additional debt can only be issued for refunding purposes.
New York's 'AA' GO rating is based on the state's substantial wealth and
+resources and broad economy, and also recognizes concerns regarding the outsized
+role that the financial services industry plays in the state's economy and
+revenue system. State net tax-supported debt levels have been relatively stable
+as a percentage of personal income and are expected to remain above average but
+still in the moderate range. Pensions are well funded.
The state's financial position has been strained. Revenue estimates for fiscal
+2010, which ended on March 31, were revised downward repeatedly over the course
+of the year, primarily reflecting reduced expectations for the personal income
+tax. Despite gap-closing measures taken, fiscal 2010 ended with a deficit of
+$1.65 billion that was carried over to fiscal 2011. The budget for fiscal 2011
+was not finalized until early August, more than four months into the fiscal
+year, although the debt service appropriation bill was passed before the start
+of the fiscal year. A fiscal 2011 gap of about $9.2 billion including the
+carried-over fiscal 2010 deficit ($8.5 billion after factoring in budget
+measures taken in December 2009) was addressed through spending control,
+particularly in the area of local aid, temporary and permanent revenue actions,
+including a suspension of the sales tax exemption for clothing and a cigarette
+tax increase to $4.35 per pack, and limited one-time measures. Deficit financing
+was not part of the gap-closing plan; however, the budget includes a substantial
+amount of federal stimulus funds. New York, which spends a larger than average
+amount on Medicaid, garners particular benefit from the increase in the federal
+Medicaid matching percentage included in the federal stimulus package.
In contrast to prior downturns, recovery is expected to be slow, and the state
+is projected to confront significant outyear budget gaps as federal stimulus and
+temporary tax increase monies roll off. Earlier this month, the state reduced
+its revenue forecast and increased expenditure expectations. The current fiscal
+year (which ends on March 31, 2011) is now reported to have a $315 million
+shortfall to be addressed. The fiscal 2012 shortfall estimate has increased to
+$9 billion from $8.2 billion, with the large gap reflecting the phase-out of
+federal stimulus monies. The gap forecast for fiscal 2013 is now $14.6 billion,
+with the expiration of both stimulus funds and the temporary personal income tax
+rate increase. Fitch believes that downside risk to the forecast remains.
With steep revenue declines, the state's cash position has been strained. The
+state has taken proactive measures to ensure cash adequacy, and continued focus
+on cash management measures will be necessary. The LGAC bonds are protected from
+the cash flow issues by the flow of funds.
New York's employment decline in the recession was less severe than that of the
+nation. Nonfarm employment did not start to fall, year-over-year, until November
+2008 and was down 2.7% in 2009 compared to a 4.3% drop for the U.S. In September
+2010, jobs in New York were flat to the prior year while national figures were
+up 0.2% year-over-year. Unemployment remains below that of the nation in
+September 2010, at 8.3%, 86% of the U.S. level. Personal income performance has
+been meaningfully weaker than that of the nation, down 3.1% in 2009, almost
+double the national loss and the fourth worst of the states. The state's
+personal income per capita was the sixth highest among the states in 2009, at
+117% of the U.S. average.
New York's net tax-supported debt is above average but still in the moderate
+range at 5.6% of personal income. Most of New York's debt has been issued by
+state public authorities and secured by appropriations; only about 7% is GO.
While this results in a diffuse debt structure, there is strong centralization
+and oversight in the budget division, and approval by the public authorities
+control board is required for many of these bond issues.
Additional information is available at 'www.fitchratings.com'.
In addition to the sources of information identified in the report
+'Tax-Supported Rating Criteria', this action was additionally informed by
+information from IHS Global Insight.
Applicable Criteria and Related Research:
+
+--'Tax-Supported Rating Criteria', dated Aug. 16, 2010;
+
+--'U.S. State Government Tax-Supported Rating Criteria', dated Oct. 8, 2010.
For information on Build America Bonds, visit 'www.fitchratings.com/BABs'.
Applicable Criteria and Related Research:
+
+Tax-Supported Rating Criteria
+
+http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=548605
+
+U.S. State Government Tax-Supported Rating Criteria
+
+http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=564546
+
+ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS.
PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:
+HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING
+DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S
+PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND
+METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF
+CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE
+AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF
+CONDUCT' SECTION OF THIS SITE.
SOURCE: Fitch Ratings
+
+
+CONTACT:
+Fitch, Inc.
+Primary Analyst
+Laura Porter, +1-212-908-0575
+Managing Director
+One State Street Plaza
+New York, NY 10004
+or
+Secondary Analyst
+Douglas Offerman, +1-212-908-0889
+Senior Director
+or
+Committee Chairperson
+Ken Weinstein, +1-212-908-0571
+Senior Director
+or
+Media Relations
+Cindy Stoller, +1-212-908-0526
+cindy.stoller@fitchratings.com
+
+
+Copyright Business Wire 2010
+
+-0-
+
+
+KEYWORD: United States
North America
New York
+INDUSTRY KEYWORD: Professional Services
Banking
Finance
+SUBJECT CODE: Bond/Stock Rating
At this hour, as crude oil futures are trading below $50 per barrel for the first time since May 2005, the U.S. House of Representatives is voting on a controversial bill that targets the oil industry with higher taxes, fees and royalties. The bill is expected to pass the House with ease. “Power Lunch” covered all the bases of the proposed legislation, hosting a debate between Sterling Burnett of the National Center for Policy Analysis and Karen Wayland of the Natural Resources Defense Council.
Before we get into the debate – a few notes on the proposed bill: first: it would effectively prohibit oil companies from receiving an income tax deduction – one that was enacted in 2004 for the domestic manufacturing sector. It also requires Big Oil to renegotiate leases issued in error in 1998 and 1999 for drilling rights in the Gulf of Mexico. If they refuse to renegotiate, they must instead pay a fee. The bill imposes another fee on all non-producing oil and gas leases in the Gulf of Mexico.
Also in the bill is $14-15 billion earmarked for the exploration and development of alternative energy.
Burnett believes we should actually “put the brakes” on alternative energies like ethanol, corn and soy diesel because of the collateral damage it creates for the poor. He points to the doubling of the price of corn in the last year as an example of how this can hurt consumers – especially the lower class.
Wayland countered that there is no guarantee any of the money that is earmarked for alternative energy is going to ethanol or corn initiatives. Although those monies have not yet been appropriated, she says there is a specific criterion that must be met before the cash is doled out. An example would be enacting energy efficiency tax credits and an increase in tax incentives for people buying hybrid cars. She also expects that a huge chunk of the $14-15 billion, if passed, will be given toward the financing of clean energies like solar and wind.
Consumers don’t care how much profit the oil companies are making “if gas is selling for $1.50 per gallon,” and nothing in the proposed bill will help the price at the pump,"" Burnett says. He believes the focus should be turned to more domestic production instead and says the bill, as it stands now, will leave the U.S. with a competitive disadvantage as obviously none of the fees or royalties would have an effect on international oil companies or oil-rich countries.
As for the portion of the bill that aims to take away the tax breaks that were enacted in ’04 – Burnett says it’s simply unfair as they were designed for the entire domestic manufacturing sector, not just oil. He says the Democrats are just targeting Big Oil because it’s an industry they love to hate.
The bill will likely need some tweaking to pass the Senate, but Wayland says regardless of the nuances, it shows that Congress is thinking on the right track. She says the taxpayer dollars that will be used will be well spent because they will “send a market signal” that the U.S. must wean itself off its oil addiction by no longer investing in the oil industry.
The U.K. is not ready for how artificial intelligence (AI) will ""fundamentally reshape"" the way we live and work, lawmakers warned in a report on Wednesday.
U.K. members of parliament (MPs) have called for the creation of an artificial intelligence (AI) commission to examine the effect new technologies will have on society.
""Artificial intelligence has some way to go before we see systems and robots as portrayed in the creative arts such as Star Wars,"" Tania Mathias, interim chair of the U.K. parliament's science and technology select committee, said in a statement.
""But science fiction is slowly becoming science fact, and robotics and AI look destined to play an increasing role in our lives over the coming decades.""
Mathias added that it was ""too soon"" to set up sector-wide regulations for such a nascent field of technology, but ""it is vital that careful scrutiny of the ethical, legal and societal ramifications of artificially intelligent systems begins now.""
The world's largest technology companies, including Google and Facebook, have been investing heavily in artificial intelligence, which is set to power new technologies from driverless cars to personal assistants. But it is also being used in the medical profession to help diagnose illnesses.
British MPs said that such breakthroughs raise ""a host of questions for society, including ethical issues about the transparency of AI decision-making as well as privacy and safety"".
They propose setting up a commission that can examine the social, ethical and legal implications of developments in AI.
The U.K. has been a hotbed of AI start-ups, some of which have been acquired by U.S. technology giants. Microsoft acquired London-based Swiftkey earlier this year for $250 million, while Google bought DeepMind in 2014. Still, Mathias argues that the government has not taken any leadership on AI developments.
Experts predict that AI could have a huge impact on the workforce. AI will take 6 percent of jobs by 2021, according to a study last month by Forrester Research.
Mathias called on the government to make sure education in schools and training systems are up-to-date to deal with the workforce change.
""It is conceivable that we will see AI technology creating new jobs over the coming decades while at the same time displacing others. Since we cannot yet foresee exactly how these changes will play out, we must respond with a readiness to re-skill and up-skill,"" Mathias said.
Here's what's up on Wednesday's Squawk on the Street:
--Big name retailers are set to report. We're talking about BJ's Wholesale, Costco and Staples. See how these guys did in the quarter that was... and see how the stocks will react.
--It's also Widely Held Wednesday, a day we set aside each week to talk about the big cap stocks, stocks like Microsoft, Bank of America and Citigroup.
--Also on our radar, tobacco stocks. Several of them are really burning it up these days, stocks like Philip Morris and British Tobacco.
--We have the CEOs of two up and coming tech companies. Ansys makes engineering software. Qlick Technologies helps data communicate with other kinds of data. Both stocks have really been moving recently.
--Also on the big show, do you think we really need corporate boards? What do they really do? We're debating it with two people with some real inside knowledge about what it's like to be on the board. This after former Goldman Sachs board member Rajat Gupta is accused of insider trading. We want to hear from you on this one. Share your opinion.
The fun starts live from the NYSE at 9am sharp, don't miss a minute of Squawk on the Street.
Rep. Anthony Weiner is asking for a temporary leave of absence from the House while he seeks professional treatment in the wake of his Twitter scandal.
A spokeswoman for the New York Democrat says he has left for professional treatment and will focus on ""becoming a better husband and healthier person.""
Spokeswoman Risa Heller says Weiner wants the leave of absence so he can be evaluated and work out a course of treatment.
The statement doesn't say what Weiner would be treated for.
Just before the statement, leading Democrats demanded that Weiner step down.
Mobile addicts are multiplying at an alarming rate, as an increasing number of teens, college students and middle-age parents fall victim to the problem.
A ""mobile addict"" is defined as a user that launches apps more than 60 times a day, according to mobile analytics firm Flurry, six times more than the average user.
The number of mobile addicts has grown by 123 percent over the past year, according to Flurry, which looks at data from 500,000 apps across 1.3 billion mobile devices.
As of March 2014, there were 176 million addicts, up from 79 million in the same period last year. Females accounted for 52 percent of addicts, while the rest were males.
It comes as no surprise that teens and college students are part of this group as their youth has coincided with the mobile revolution.
Read More5 ways to kick your 24/7 tech addiction
""[Teens] are not just accustomed to mobile, they expect their mobile device to handle nearly every type of task and communication,"" Flurry said.
""The same is true for college students who are noticeably avid users of messaging and gaming apps. They have just entered the workforce, are predominantly single and are likely out and about more often than older and younger segments,"" it added.
What's interesting is the number of middle-aged consumers (aged 35-54) that have exhibited obsessive-compulsive behavior with their mobile devices.
Middle-aged consumers constitute 28 percent of mobile addicts, but account for just 20 percent of the average mobile consumer. Female middle-aged addicts fell into categories such as mothers, gamers and sports fans. Meanwhile, male addicts were parents, car enthusiasts, gamers and catalog shoppers.
Read MoreInstagram passes Twitter in race for US smartphone users
Researchers, however, noted that part of the high usage amongst middle-aged users could be because their devices are shared among multiple family members including their children.
""The picture we formed is a family of four, with two phones, one tablet, and all three devices shared by the family for education, entertainment and more utilitarian functions as well,"" Flurry said.
Gadget addiction – or nomophobia – has become a growing concern in Asia-Pacific, the region that is leading mobile phone sales growth globally.
In the ultra-wired South Korea, where the average smartphone owner spends over four hours a day on the device, the government is looking to take matters into its own hands by possibly introducing a curfew on smartphone use, according to GlobalPost.
Three years ago, the government implemented a curfew to block users under 16 years old from accessing online computer games after midnight in an effort to curb video game addition among the youth.
Early adopters of wearable devices
With mobile addicts launching apps over 60 times a day, they are effectively wearing the devices.
To date, most applications for wearables have focused on fitness and health. But, developers should think about the other experiences that will appeal to the people who need to be connected all the time, Flurry said.
Read MoreTablets are the new smartphones
""This includes teens, college students and middle-aged parents who are interested gaming, autos, sports and shopping, and who may have a constant need to entertain or educate their children. After all, the people who we consider ""mobile addicts"" are already essentially wearing their devices 24/7/365,"" it said.
They are supposed to be the smart money—the best of the best—yet they can’t even beat a basic Treasury bond fund.
Hedge fundsas a group are badly underperforming this year, which could lead to a series of redemptions, closings and rethinking of the lofty fee structures the managers of these alternative vehicles enjoy.
The Bank of America Merrill Lynch global diversified hedge fund composite index returned just 1.3 percent in the first half of 2012, well below the S&P 500’s 8.3 percent gain.
Funds that focus on betting against stocks performed the worst, falling 7.1 percent as a group, according to the report.
Perhaps even worse than their underperformance of the S&P 500 was that the group trailed the iShares Barclays Treasury Bond ETF, which is up almost six percent on the year.
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SEEKING RETURN? Click here for Fast Money's Favorite Dividend Yielders
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“If you’re a fundamental stock picker, good luck earning your 2 and 20 in this environment,” said Gina Sanchez, director of equity and asset allocation strategy for Roubini Global Economics. “Macro risk hasn’t been this high since the Asian crisis.”
It seems that yet another global credit crisis—this time inEurope—is causing the kind of herd behavior that makes it hard for hedge funds to identify stocks and other securities that will deliver return above and beyond that of the market.
Goldman Sachs noted in a report to clients—many of them hedge funds—that correlations among individual stocks have increased significantly since March, meaning they move in lockstep with one another. Goldman expects expect that to continue, making it even harder for hedge funds to reverse this trend in the second half.
“We continue to expect a slow recovery in the stock-picking environment as macro growth concerns and event risks dominate the investment environment,” wrote Goldman’s Stuart Kaiser, in a note.
Funds from notable hedge fund managers such asJohn Paulson, Daniel Loeb and David Einhorn underperformed the market in the first half.
Einhorn, in an interview with CNBC, implied that the Federal Reserve’s policy of zero interest rates is making it difficult for everybody.
“I think it is actually counterproductive having very low zero rates,” said the manager of Greenlight Capital. “It is sort of just depressing to people. I think it deprives savers of reasonable incomes and the ability to forecast.”
It also pushes investors out the risk curve into alternative investments like hedge funds, a losing proposition so far this year.
“This shows that investors need a mixed basket of investments, some fixed income, some long stock and some alternative investments,” said Brian Stutland of Stutland Volatility Group.
For the best market insight, catch 'Fast Money' each night at 5pm ET, and the ‘Halftime Report’ each afternoon at 12:00 ET on CNBC. Follow @CNBCMelloy on Twitter.
______________________________________________________
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! If you'd prefer to make a comment, but not have it published on our Web site, send your message to .
Former Homeland star Damian Lewis is now among the front-runners to become the next James Bond, The Hollywood Reporter said Tuesday.
The report said that British bookmaker William Hill raised Lewis' odds of taking the mantle of the fictional MI-6 spy from 25/1 to 3/1, just behind Idris Elba's odds of 5/2.
""This is an unprecedented gamble, as for no apparent reason we have seen bets of up to £200 [$312] on Damian Lewis being named as the next Bond. This could well be significant and might herald the end of Daniel Craig as the world's most famous spy,"" a William Hill spokesperson told the publication.
Read More Why and how 'Jurassic World' broke records
Craig has been playing Bond since 2006. His fourth movie as the character, titled ""Spectre,"" will be released in November.
Click here to read the full report.
CORRECTION: This story was updated reflect that Daniel Craig will have played the James Bond character in four movies, including ""Spectre.""
S&P 500 futures drop about 6 points as August durable good orders were well below expectations: down 2.4 percent vs. consensus of up 0.4 percent.
The dollar rallied, as it did yesterday on the disappointing existing home sales report.
Elsewhere:
1) KB Home down 5 percent despite posting a narrower-than-expected Q3 loss as better margins and smaller writedowns. The homebuilder's revenues fell 33 percent as home deliveries fell 20 percent and average prices declined 15 percent. However, new orders soared 62 percent from the year-ago quarter, but were down 27 percent sequentially from the prior quarter.
Weighing on the shares is CEO Jeff Mezger's cautious comments: ""it will likely be some time before we see meaningful improvement in the economic conditions that are essential to our industry's future growth.""
2) Sara Lee rises 7 percent pre-open after Unilever agreed to buy its soap and personal care units for $1.9 billion dollars. The acquisition allows Unilever to diversify its portfolio of consumer product brands, while the deal will help Sara Lee repurchase $1 billion in stock and ""invest for growth"" in core businesses. The companies expect the deal to close next year.
3) Another IPO: The busy week for IPOs continues today. Shanda Games (GAME) priced its Nasdaq-listed shares at $12.50 - at the high end of the previously announced range of $10.50-$12.50. The Chinese online video game operator raised $1 billion and becomes the biggest IPO in the U.S. this year.
4) We're growing, but not as much as you wanted. Hewlett Packard down 1 percent pre-open as CEO Mark Hurd said the magic words: ""We expect the IT industry to return to growth in 2010 and believe that HP will outpace the market,"" but their guidance was not as strong as expected. Diluted EPS in the range of $4.20 to $4.30 was near analyst estimates of $4.23, while revenue of approximately $117.0 billion to $118.0 billion is below consensus of $118 billion.
5) Airlines trading up about 2 percent pre-open as UBS upgrades airlines including AMR , Continental, US Air, with United its top pick. UBS says that ""Thanks to the recent flurry of capital raises the balance sheets of several of US airlines will be flush with new cash.""
6) Goldman Sachs upgrades refining sectorm including Holly, Occidental and Sunoco.
7) The two-day decline in stocks (less than 2 percent on the S&P 500), has some again wondering about the long-sought correction. Bears point out that we have moved over 50 percent since the March lows and are due for a correction, but Laszlo Birinyi (quoted in Morningstar) notes that there is little evidence for an imminent correction: ""Give me the evidence...in 1982 we went 424 days before we had a correction. In 2000, we went seven years before we had a 10% correction. In 2002, we went three or four years.""
8) Short interest continues to decrease. Traders have bitterly complained that shorting the market has been a recipe for disaster in the past several months; many have told me they have been shorting much less.
We continue to get evidence that shorting is indeed down. From August 31st to September 15th, the total amount of securities on the S&P 500 sold short dropped by 7.3 percent.
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_____________________________
Questions? Comments? tradertalk@cnbc.com
Pro-Moscow separatists in eastern Ukraine ignored a public call by Russian President Vladimir Putin to postpone a referendum on self-rule, declaring they would go ahead on Sunday with a vote that could lead to war.
The decision,which contradicted the conciliatory tone set by Putin just a day earlier, caused consternation in the West, which fears the referendum will tear Ukraine apart.
U.S. Deputy Secretary of State William Burns said Russia was heading down a ""dangerous and irresponsible path"" and the situation in Ukraine was ""extremely combustible"".
Denis Pushilin, a leader of the self-declared separatist Donetsk People's Republic, expressed gratitude to Putin but said the ""People's Council"" had voted unanimously on Thursday to hold the plebiscite as planned.
""Civil war has already begun,"" he told reporters. ""The referendum can put a stop to it and start a political process."" A man holding a Kalashnikov stood behind him.
The announcement coincided with a sharp change of tone from Moscow, which had signalled a pullback from confrontation on Wednesday with Putin's call for the vote to be delayed and a declaration that troops were withdrawing from Ukraine's border.
Russian markets sank after surging on Wednesday. In Kiev, officials promised to press on with their ""anti-terrorist campaign"" to retake control over the eastern regions of Donetsk and Luhansk regardless of the rebels' decision on the vote.
Political analysts said Putin may have expected the rebels to go ahead with the referendum, showing that they were not under his orders. By distancing himself from a process that will not be recognised by the West, Putin may also hope to avoid further sanctions as earlier measures begin hitting the economy.
Putin's spokesman said the Kremlin needed more information about the rebels' decision. He said the rebel statement came only after the Western-backed government in Kiev had declared it would press on with its military operation, implying that Ukraine was to blame for the rebels' refusal to heed Putin.
NATO and the United States have both said they have seen no sign of a Russian withdrawal from the frontier despite Putin's announcement he had pulled back troops.
When NATO Secretary General Anders Fogh Rasumussen tweeted as much, the Russian Foreign Ministry tweeted back that ""those with a blind eye"" should read Putin's statement.
NATO has accused Moscow of using special forces in the separatist takeover of mainly Russian speaking eastern Ukraine after annexing Crimea from Ukraine in March.
Putin acknowledged his troops were active in Crimea after initially denying any role there but says they are not involved in eastern Ukraine, a densely-populated steel and coal belt responsible for roughly a third of Ukraine's industrial output.
Read MoreMeet the beneficiaries of the crisis in Ukraine
Kremlin script?
Putin's unexpected call to delay the referendum, followed so quickly by the rebel decision to go ahead with it, have complicated U.S.and European efforts to agree a common policy that might lead to tighter economic sanctions on Russia.
The European Union said shortly before the announcement that it was waiting to see whether Putin's words would be followed by deeds and that the plebiscite ""would have no democratic legitimacy and could only further worsen the situation"".
At the same time, the Russian ambassador to Paris said Putin, who had been shunned by Western leaders since the Crimean takeover, would join them in a ceremony to mark the 70th anniversary of the Normandy landings in World War Two.
A Western diplomat in Moscow gave voice to the view that events were still being scripted by the Kremlin.
""Taking everything into account, I am somewhat surprised with the separatists' decision. Wasn't Putin supposed to be like the pope with his dogmatic infallibility?"" the diplomat said.
The referendum has become seen as a vital step by many in Ukraine's industrial east, fired up over what the rebels, and Moscow, call the ""fascist"" government in Kiev that took over after street protests ousted a pro-Moscow president in February.
""You have no idea how many armed people there are in Donetsk right now,"" Roman Lyagin, the 33-year-old head of the self-proclaimed republic's election commission, told Reuters at his headquarters behind barricades of tyres and car bumpers in the occupied regional administration in Donetsk.
""There is no man who can move this referendum,"" he said.
Ballots, printed in Donetsk, have been distributed across the rebel zone, smuggled through Ukrainian army checkpoints. Lyagin says more than three million people are eligible to vote.
Artyom, a rebel at a roadblock in the rebel-held eastern town of Slaviansk, said of the referendum decision: ""This is great news. We need to have our say.""
While many Russian speakers in Ukraine fear discrimination under the new leadership, quite how many support the separatists, many of whom say their ultimate aim is to join Russia, is not so clear. Recent opinion polls say a majority wish to remain within Ukraine, but with a far greater degree of autonomy.
Putin said his call for the vote's postponement would open the way to negotiations on cooling down a crisis that has led to dozens of deaths in clashes between troops and separatists in eastern Ukraine and rival groups in the southern port of Odessa.
Read MoreAs Ukraine crisis deepens, risk-off mood grows
On Thursday he again pointed the finger at Kiev, whose ""irresponsible politics"" had caused the crisis.
Maria Lipman, an expert at the Carnegie Center think-tank in Moscow, said Putin would have known that his request for the referendum to be postponed would be rebuffed.
""But this can be used to show that the people in Ukraine's east are not Russians, take no orders from Russia, that Russia exercises no control over them because they only do what they want to do,"" she said.
""He has also distanced Russia from the referendum, which has a completely unclear status and will not be recognised by the West.""
In a further shift from reconciliation, Putin oversaw test launches of military rockets during training exercises held across Russia on Thursday, the day before celebrations of the anniversary of its World War Two victory.
The West has accused Russia of using previous military exercises to build up forces along the border with Ukraine after its Moscow-backed president Viktor Yanukovich fled to Russia in February.
In the rebel-stronghold of Slaviansk, target of a Ukrainian military advance that began last week, self-declared mayor Vyacheslav Ponomaryov said a new offensive by Kiev was coming.
""We have enough fighters, enough weapons, the support of the people and we have our land,"" he said. ""God is with us.""
Stocks closed slightly higher as a mostly positive start to earnings season was offset by the air quickly coming out of a rally in bank stocks.
Financials surged Monday following a bullish call from noted analyst Meredith Whitney, but the sector was the market's biggest drag on Tuesday even though Goldman Sachs reported earnings that blew past Wall Street's expectations.
Investors were wary after economic data showed larger-than-expected gains in producer prices and retail sales—but both readings came largely on the backs of auto and energy sales. With the two volatile areas stripped out, the numbers reflected anemic consumer growth that has been exacerbated by rising unemployment.
The economic reports triggered expectations of inflation, and at least some of the late-morning pop in stocks was attributed to short-covering.
""All the inflation bonds are acting very well today because it feels like the market is building in some inflationary expectations,"" said Dave Lutz, managing director of trading for Baltimore-based Stifel Nicolaus.
Still, housing stocks showed surprising resiliency as analysts slowly warm to the group.
Dow component Home Depot gained more than 2 percent and home builder Hovnanian Enterprises moved up more than 5 percent. The SPDR S&P Homebuilders ETF posted solid gains as the market clawed to positive ground.
The iShares Barclays TIPS ETF edged higher though it was off its peak. The fund is up about 5 percent in 2009.
Hotel stocks, including Starwood, helped push the market higher.
""We basically have a consumer reflation trade coming out right now,"" Lutz said. ""This is typical of a short-covering move.""
Earnings season kicked into full gear as both Goldman and Dow component Johnson & Johnson posted numbers that surprised to the upside.
Johnson & Johnson reported earnings of $3.2 billion that beat expectations, while also affirming its full-year outlook, sending shares higher.
Goldman shares wavered following the company's earnings report, even though the numbers easily beat analyst estimates. The company reported net income for common shareholders of $2.7 billion, or $4.93 a share, compared with $2.05 billion, or $4.58 a share, in the closest year-earlier quarter.
Huawei has begun research on 6G — the successor to 5G mobile networks which are not yet widespread, according to its CEO Ren Zhengfei.
5G is the name of next-generation mobile networks that promises super-fast data speeds and the ability to underpin new technologies like driverless cars. These networks are slowly rolling out in places such as South Korea, the U.K. and soon China. However, they are not yet available on a large scale.
However, Huawei's founder Ren is already talking about 6G.
""We have parallel work being done on 5G and 6G, so we started out 6G a long time ago,"" Ren said during a CNBC-hosted panel on Thursday. He said it's in an ""early phase"" and there's still ""a long way to go"" before commercialization, according to an official translation of his Mandarin comments.
Ren said the technology is still ""ten years out.""
A number of things need to take place before 6G becomes a reality.
For any new mobile network generation, standards need to be set by the industry. This has taken place for 5G and initial discussions have happened regarding 6G, but standards could take years to form.
Another issue is that it's still not clear what 6G will be needed for.
Huawei is currently focusing its efforts on 5G, however. The company has signed over 50 commercial 5G contracts, more than its closest competitors Nokia and Ericsson.
The Chinese tech giant is facing continued pressure on the U.S. which has accused it of being a national security risk, saying that it could build backdoors into its networking equipment to allow the Chinese government to spy on Americans. Huawei has repeatedly denied those allegations.
U.S. stock index futures signaled a marginally higher open on Thursday, with European and Asian shares boosted after Federal Reserve Chairman Ben Bernanke reiterated his support for ultra-easy monetary policy on Wednesday.
In his second day of testimony on Capitol Hill on Wednesday, Bernanke said loose monetary policy was boosting employment.
""We believe the monetary policies we have conducted have helped get stronger recovery and more jobs than we otherwise would have had,"" he said, according to Reuters.
Bernanke forecast it would take three more years for unemployment to decline to 6 percent, further diminishing concerns the Fed might tighten policy sooner than expected. Previously, Bernanke has said he will keep interest rates low until unemployment falls to around 6.5 percent.
U.S. gains may be capped however by uncertainty about whether a last-minute deal can be struck to avert the $85 billion of spending cuts, known as the ""sequester"", due to hit on Friday.
In his testimony, Bernanke warned Congress of the dangers of failing to reach an agreement on how to combat sequestration.
""I think there is some cost to the economy of these repeated, I won't say 'crises,' but these repeated episodes where Congress is unable to come to some agreement and therefore some automatic thing kicks in. I think that is on the whole not a good thing for confidence,"" Bernanke said on Wednesday, according to Reuters.
Meanwhile, a heavy day for economic releases will get underway with the government's release of its latest estimate of fourth quarter Gross Domestic Product (GDP) at 8:30 a.m. New York time. Economists polled by Reuters forecast a sharp rise on the previous estimate, to 0.5 percent annualized growth, after the previous forecast suggested GDP declined by 0.1 percent in the fourth quarter.
""This upward revision is likely to be a result of both exports and consumption being higher than previously thought,"" wrote Paul Dales, a U.S. economist at independent research firm Capital Economics, in a note on Wednesday afternoon.
""What's more, despite the expiry of the payroll tax cut in January, the early evidence suggests that GDP growth accelerated in the first quarter of this year.""
Hopes for upbeat first quarter growth figures were boosted by Wednesday's release of durable goods data for January from the Commerce Department. Core orders, excluding transportation, posted their biggest gain since December 2011, rising 1.9 percent month-on-month.
In a note on Wednesday, Peter Newland, a U.S. economist at Barclays, said that taking into account the durable goods data numbers, he forecast 1.3 percent growth in the first quarter.
Other economic data out on Thursday includes the Labor Department's weekly initial jobless claims at 8:30 a.m. Economists polled by Reuters forecast there were 360,000 new claims in the week ending February 23, down from 362,000 in the previous week.
The Chicago Purchasing Managers Index (PMI) of manufacturing activity is due at 9:45 a.m. Analysts polled by Reuters predict a reading of 54.3 for February, down from 55.6 percent last month. PMI index readings above 50 signal an increase or improvement on the prior month, while readings below 50 indicate a decrease.
Also, the Energy Department will issue its weekly look at natural gas inventories across the U.S. at 10:30 a.m. on Thursday. Inventories fell by 127 billion cubic feet in the prior week.
On the corporate front, Thursday will be a busy day for retail earnings, with Best Buy, Kohl's, and Barnes & Noble posting results before the start of U.S. trade.
Barnes & Noble's results will be eyed with interest after stakeholder Liberty Media said on Wednesday that it had the power to block a sale of the bookseller, and is waiting to hear if Barnes & Noble Chairman Leonard Riggio will make an offer.
Sears Holdings reported forecast-beating earnings for the fourth quarter early on Thursday.
Groupon shares will also be watched, after the discount voucher provider lost a quarter of its market value on Wednesday when it revealed it had started taking a smaller commission on deals during the holidays, in order to retain merchants.
- By CNBC's Katy Barnato
The Middle East, source of much of the world’s hydrocarbons, is one of the most volatile regions on earth, where energy issues impact international relations. From Iraqi oil output, still struggling to reach its 2003 pre-invasion levels through Iran’s sanctioned nuclear program, the region focuses the world’s attention like nowhere else.
Now another issue is complicating the mix, Israeli natural gas production.
Like Turkey, Israel is a net energy importer — according to the CIA, in 2010 Israel produced a mere 4,029 barrels per day of oil, but imported 238,000 bpd.
Natural gas? In 2009, Israel produced 1.55 billion cubic meters, but consumed 3.25 bcm. Israel imports all of its oil and coal and 70 percent of its natural gas needs, leaving the government deeply interested in developing indigenous alternatives, especially as the “Arab Spring” led to Egypt halting its natural gas exports.
Which is why for the last several years Israel has been so excited about potentially huge natural gas discoveries.
But the bad news is that they are in the eastern Mediterranean, in contested waters claimed by not only Israel, but the Palestinian Authority, the Republic of Cyprus and Turkey. At issue is each country's claim to its Exclusive Economic Zone (EEZ) under the Third United Nations Convention on the Law of the Sea (UNCLOS), which came into force in November 1994. Under UNCLOS III, a nation can claim an EEZ of 200 nautical miles from its coastline.
In March 2010 the U.S. Geological Survey released its survey of the Levant Basin, which concluded that the waters of Israel, Lebanon and Republic of Cyprus potentially contained at least 50,000 billion cubic feet of natural gas yet to be discovered and that in total the Levant Basin could contain as many as 227,430 billion cubic feet of natural gas and 483 million barrels of oil. Accordingly, it is no less a question of what lays beneath the waves, but whom it might belong to.
[ More From Oilprice.com: Argentina's Shale Gas Dilemma ]
Companies are already moving to exploit the reserves. In February Israel's Delek Group announced that it has discovered what it estimated to be close to 1.3 trillion cubic feet of natural gas in Israeli waters near the Lebanese border. Delek is working in cooperation with the U.S. company Noble Energy . Israel is attempting to press forward to the swift development of its Mediterranean offshore natural gas assets, the Tamar field, discovered in 2009 and Leviathan, discovered the following year. In June 2011 an Israeli company announced the discovery of two new natural gas fields, Sarah and Mira, about 45 miles off the city of Hadera, while Noble Energy announced that drilling in the 125 square-mile Israeli Leviathan-1 offshore Mediterranean natural gas field had “the potential to position Israel as a natural gas exporting nation.” Initial prospecting estimates of the Tamar and Leviathan fields off Haifa, concluded that the two sites between them could hold as much as 688 billion cubic meters of recoverable natural gas.
Accordingly, the Israeli Cabinet is about to undertake the thorny issue of how to defend the country’s Mediterranean EEZ, a mission that will vastly extend the traditional purview of the Israel Defense Force well beyond its traditional nautical frontiers to up to 100 miles from Israel’s coastline.
[ More From Oilprice.com: Saudi Arabia's Attempts to Control Oil Prices Continue]
Will it be patrol aircraft? More surface vessels? Submarines? Whatever form it takes, the sticker shock is already in, as the projected cost of the new equipment necessary for defending the offshore hydrocarbon reserves is estimated at $718 million, with estimated annual operating expenses of roughly $123 million.
Given regional volatility, the reluctance of foreign energy investors to enter conflict zones, the significant cost of protecting any energy facilities, while it is at best rash to make predictions about the Middle East, it does seem safe to say that Israel’s dreams of energy autonomy remain exactly that for the moment – dreams.
—This story originally appeared on Oilprice.com. Click here to read the orginal story.
The media industry's current mantra is ""content is king"" but for analysts watching Netflix this week, subscribers are king — more specifically international subscribers.
When Netflix reports third-quarter results Wednesday evening, it's expected to post a 43 percent decline in earnings per share, while sales are forecast to rise 24 percent, but the real story about the state of its global expansion.
The streaming giant has laid down roots in hosts of new markets, most recently Japan in the third quarter, and it plans to expand further into Europe during the fourth quarter. Wall Street will undoubtedly be looking for signs that the expansion is gaining traction.
Analyst are bullish on second-half subscriber growth and the company is widely expected to surpass its guidance of 3.55 million net additions — consisting of 2.4 million additional international subscribers and an additional 1.15 million domestically.
In a research earlier this week, Michael Nathanson, media analyst at MoffattNathanson, said Netflix could add 4.2 million new subscribers, including 1.5 million domestic and 2.7 million international, which would bring the company's total paid subscriber base to a record 67 million.
On average, Wall Street is looking for 1.19 million U.S. net additions and 2.46 million net additions internationally, according to StreetAccount estimates.
""The U.S. has always gotten the focus, in terms of subscriber growth, but we're seeing international starting to become more and more of a factor,"" said Tuna Amobi, senior media and entertainment analyst at S&P Capital IQ. ""I think international is really starting to pay off, especially since they've ramped up the launches in the last 18 to 24 months.""
Read MoreAnalysts love the Netflix price hike
Netflix's international business has been drag on its profitability as it has increased spending on original content. The company said it expects to generate material profit on the global front in 2017 following ""peak international losses"" in 2016. The company hopes to be fully global by the end of 2016.
Analysts surveyed by Thomson Reuters expect the Los Gatos, California-based company to post net income of 8 cents a share, a decrease of 43 percent from the same three-month period last year, while revenue is forecast to rise 24 percent to $1.75 billion.
Notably, the company's DVD-by-mail segment, a relic of its original business model, is projected to contribute $74 million in profit, nearly making up for the $77.7 million loss expected from its international streaming business, according to StreetAccount. The dwindling U.S. DVD business served 5.3 million members in the second quarter and provided about $78 million in contribution to profit, while the international steaming segment lost $77 million.
""We've seen more spending on content and I think [earnings] expectations are tempered due to the losses related to the international business,"" Amobi said, ""I think it's going to pay off in terms of viewing hours ... they don't break out viewing hours, but every time they have the trends have been very strong.""
Read More Will this become the 'Netflix of sports'?
In a note Tuesday, Nomura pointed to Netflix's recent price increases in Europe and the U.S. as evidence of the company's confidence in the ""inelasticity of Netflix demand.""
""We believe the decision to raise prices in the U.S., Canada and parts of Latin America in 4Q were in part motivated by 3Q's success in Europe and management's overall confidence in the subscriber growth trajectory,"" Nomura said.
Last week, Netflix increased the price of its most popular streaming plan for new members by $1 to $9.99 per month.
Investment firm Wedbush said the price hikes reflect increasing content costs — as opposed to pricing power.
Netflix is inarguably the streaming market leader, taking about 38 percent of the U.S. video-on-demand market, followed by Amazon with 14 percent and Hulu with 7 percent, according to NPOWER and Nielsen research, which excludes broadband-only subscribers.
The company's growing domination of the streaming market has some traditional media outlets re-evaluating their licensing partnerships with Netflix — which could be a threat to its library of content down the line.
Read MoreBattle for pay-TV subscribers hits the playground
""Already during the September conference circuit, we have heard some media executives, most notably at 21st Century Fox and Time Warner, become more vocal against selling content to Netflix, which now has 42 million subscribers in the U.S. and has been labeled the main culprit behind TV ratings declines,"" Nathanson wrote in a note earlier this week.
Media stocks were battered in August as investors appeared to lose faith as fears intensified about customers scaling back on traditional cable packages after Disney trimmed its forecast for TV subscriber-fee profit growth because of subscriber losses at its flagship ESPN sports network.
Traditional cable companies are still worried about cord cutting, but a big pop in Netflix's third-quarter subscriber growth doesn't necessarily mean that cord cutting has accelerated, according to S&P's Amobi.
""Cord cutting is definitely an issue; however I don't think it's such an issue right now to become overly concerned that somehow Netflix is going to dominate the overall television landscape, Amobi said.
Read MoreWhy cable companies' streaming plans might hurt them
Netflix shares have largely outpaced the wider market, gaining about 125 percent year to date as of midafternoon trading Tuesday, versus a 2 percent gain in the Nasdaq and 2 percent decline in the .
The company will report third-quarter 2015 financial results Wednesday after the bell. A conference call with Reed Hastings, its CEO, is planned for 5 p.m. ET.
Disclosure: Hulu is a joint venture between Disney, 21st Century Fox and NBCUniversal (CNBC's parent company).
China’s downturn is spreading to the sectors and companies that were expected to withstand the slowdown and drive growth in the region.
Financial Times analysis shows that a third of publicly listed Chinese companies suffered cash outflows in the quarter to the end of June as the combined effect of the , a build-up in stocks and tightening local government finances begins to bite.
Cash balances at a tenth of 1,700 companies analyzed by the FT using data from S&P Capital IQ have turned negative in the past two quarters.
For a further 6 percent of companies that normally report an outflow, the outflows were worse than last year.
The results highlight that even the companies that are expected to help rebalance China away from an investment-driven economy – such as consumer and retail businesses, healthcare, pharmaceuticals and electronics companies – are being affected by the slowdown, along with construction, real estate, industrial machinery and chemicals.
Increasing numbers of hedge funds and analysts are looking closely at cash flow data as sustained poor cash flows would have a big impact on companies’ ability to service their debt and hence on the health of China’s banking sector.
There are some signs that the cash crunch has already been felt by banks during the first half of the year.
While non-performing loans grew by just 1 percent across the sector, overdue loans leapt by 29 percent, according to Mike Werner of Bernstein Research in Hong Kong.
Among the 574 companies with negative cash flow from operating activities in the FT analysis, the results of 175 – or 30 percent – appeared to be non-seasonal because patterns over the past two quarters were completely different from those seen in the periods a year before.
Another 18 percent showed some seasonal similarity with last year, but their results were worse over the first half of this year. Sixty-nine of the 574 had negative cash flow for both of the past two quarters.
U.S. prosecutors on Monday asked a judge to reject a motion by China's Huawei seeking information on the grounds for a government request to disqualify the company's lead defense lawyer in a criminal case alleging bank fraud and sanctions violations.
Last month, prosecutors argued Huawei lawyer James Cole's prior position as the No. 2 official in the U.S. Department of Justice created conflicts of interest that necessitated his removal.
The prosecutors said Cole, who served as deputy attorney general (DAG) until 2015, represented the government in a related investigation, without disclosing details. Huawei asked the court to review ""overbroad"" redactions in the U.S. motion seeking his removal.
Huawei wants prosecutors to reveal ""the very information it is trying to prevent the new client from learning,"" the prosecutors said in a letter to Judge Ann Donnelly in U.S. District Court in Brooklyn, New York.
""The conflict presented here is unprecedented,"" the prosecutors argued. The government was not aware of any other senior DOJ official who had sought to represent a client that had been part of his government work, ""let alone when the former representation involved classified information,"" they said.
A spokesman for Huawei Technologies, the world's largest telecommunications equipment maker, declined to comment, and Cole did not respond to a request for comment. Cole entered a not guilty plea on behalf of Huawei in March.
In a court filing two weeks ago, the Washington lawyer said that he had ""no recollection"" of what the government referenced as the basis for his disqualification in meetings.
In its letter Monday, prosecutors said what Cole remembers is irrelevant.
The Brooklyn case against Huawei was cited last month in a decision to add the company to a U.S. trade blacklist that makes it extremely difficult for the telecom giant to do business with U.S. companies.
Huawei has been involved in activities contrary to the national security or foreign policy interests of the United States, the order said.
The case and blacklisting have escalated tensions between Beijing and Washington amid a trade battle.
The indictment accuses Huawei and its chief financial officer Meng Wanzhou of conspiring to defraud global banks by misrepresenting Huawei's relationship with a company that operated in Iran, putting the banks at risk of processing transactions that violated U.S. sanctions laws.
Meng, daughter of Huawei's founder, has said she is innocent and is fighting extradition from Canada to the United States.
Doug MacKay of Broadleaf Partners and Bill Spiropoulos of Corestates Capital Advisors agree: The March bottom will hold — and you want to be in equities now.
The strategists offered CNBC what they like and ""hate"" in the market now.
""I still think the bias through the end of the year remains to the upside,"" said MacKay. ""You can have a 10 to 15 percent correction, but overall it looks positive.""
""You want to focus on cyclicality.""
Spiropoulos agreed on both points: ""After the first chapter, a 10, 12, 13 percent correction is not out of the ordinary."" But ""the March lows are in place.""
Recommendations:
Spiropoulos:
Spiropoulos rejects government bonds outright: ""I hate Treasury-anything, I hate fixed-anything.""
His portfolio's weighting:
55 percent equity
8 percent managed futures
8 percent currencies
remainder: cash and equivalents
""We use a long-short strategy in every category.""
- Picks & Pans: Trade with CNBC's Expert Guests
MacKay:
MacKay notes that health care is ""starting to perform better,"" perhaps a sign that the Obama administration ""won't get all they want.""
But his main focus is technology: ""Tech has some cyclicality, it'll recover when the economy does. But there's some secular there, too. Tech is the biggest weighting in our portfolio.""
The only bonds he'd consider: corporate paper from Cisco Systems and Goldman Sachs. ""You could argue that Cisco is in better shape than the U.S. government,"" MacKay joked.
""But I still think your best bet is equities,"" he added.
______________________________
CNBC Slideshows:
______________________________
______________________________
CNBC's Companies in the News:
AIG
General Motors
Bank of America
______________________________
Disclosures:
Disclosure information was not available for MacKay, Spiropoulos or their respective companies.
Disclaimer
Check out which companies are making headlines before the bell:
— The online retail giant reported quarterly profit of $1.54 per share, 19 cents a share above estimates. Amazon's revenue came in below Street forecasts, however, and the company also gave weaker-than-expected current-quarter revenue guidance.
— The household products maker reported adjusted quarterly earnings of $1.25 per share, 3 cents a share above estimates. Revenue was very slightly below forecasts. Clorox also cut its full-year 2017 outlook, although the company said its core business remains strong.
— The car retailer earned an adjusted 95 cents per share for its latest quarter, a penny a share below Street forecasts. Revenue was slightly below consensus estimates, but AutoNation posted record earnings for both the fourth quarter and for all of 2016.
— The chocolate maker beat estimates by 9 cents a share, with adjusted quarterly profit of $1.17 per share. Revenue was slightly below forecasts. Sales were higher compared to a year earlier, with strengthening demand in the United States.
— The automaker's stock was upgraded to ""overweight"" from ""equal weight"" at Barclays, which said Ford is better positioned than its competitors to withstand a potential border tax.
— Amgen came in 10 cents above estimates, with adjusted quarterly profit of $2.89 per share. The biotech company's revenue also beat Street forecasts. Amgen's full-year earnings and revenue guidance came in below Street forecasts, however. Additionally, Amgen announced positive results for a study involving its cholesterol drug Repatha, saying it reduced the risk of heart attacks, strokes, and death in a study of patients with heart disease.
— Visa reported quarterly profit of 86 cents per share, 8 cents a share above estimates. Revenue also beat forecasts. Visa's results were helped by strong payment volume growth, as well as more cross-border transactions.
— Chipotle fell 2 cents short of Wall Street forecasts with quarterly earnings of 55 cents per share, while the restaurant operator's revenue was essentially in line. Chipotle did see sales rise for the first time in five quarters, but comparable store sales were down 4.8 percent.
— GoPro beat Street estimates by 7 cents a share, with adjusted quarterly profit of 29 cents per share. The high-definition camera maker's revenue fell short, as well. GoPro also gave weaker-than-expected profit margin guidance for the current quarter.
— Deckers reported adjusted quarterly profit of $4.11 per share, shy of the consensus $4.24 estimate. The footwear maker's revenue also fell short, as does the Uggs maker's 2017 full year guidance.
— FireEye lost an adjusted 3 cents per share for its latest quarter, smaller than the 16 cent loss expected by analysts. The cybersecurity software maker's revenue fell short of Street forecasts, as does its current quarter revenue outlook. The company also said its chairman and chief financial officer would leave the company.
— Tableau doubled estimates with adjusted quarterly profit of 26 cents per share, and the business software maker also saw revenue exceed estimates.
— The company fell 5 cents a share short of consensus forecast, with adjusted quarterly profit of 53 cents per share. The underwear maker's revenue also fell short of estimates. The company also gave worse than expected full-year guidance for 2017, despite seeing an improvement in profit margins and international sales.
— Lockheed denied a report that it sought help from former Donald Trump campaign manager Corey Lewandowski in navigating a dispute with the president over the cost of its F-35 fighter jet.
— Square senior executive Francoise Brougher is resigning from the mobile payments company today after four years of leading the company's sales and marketing efforts. Brougher will be replaced by Square chief marketing officer Kevin Burke.
Ireland's High Court on Thursday ruled that a 850 million euro ($1 billion) data center planned by Apple in the west of Ireland may proceed, dismissing an environmental challenge made by three people.
Apple announced plans to build the data center in 2015, but the project has been delayed by planning objections. A similar Apple center announced at the same time in Denmark is due to begin operations later this year.
Go behind the headlines and get the latest word on today's hot trades -- this kind of info comes straight from buyers and sellers on the trading floor. You won't find straight talk like this, anywhere else.
ALL EYES ON TOMORROW'S PPI:
The news: The markets moving Producer Price Index or PPI number is released tomorrow morning.
The word: Eric Bolling says PPI doesn’t matter. CPI on Friday is more important.
GM SPUTTERS TO PROFIT:
The news: Shares of General Motors (GM) fall despite the fact that the automaker is reporting the largest quarterly profit in more than 2 years.
The word: Jeff Macke says GM made money selling cars! This could be a turn around story and they might be one to watch, maybe.
LEHMAN BROTHERS GRIMM:
The news: Lehman shares fall as much as 5.5% despite Lehman reporting a record quarterly profit.
The word: Guy Adami says Goldman Sachs (GS) beat EPS earnings by 36% yesterday and Lehman (LEH) beats it by a penny, yet they both trade with a 9.5 multiple. It makes no sense to him, though Guy says it’s neither an indictment of LEH or an endorsement of GS.
H&R BLUES:
The news: H&R Block (HRB) hits a 4-year low as sub-prime crisis worsens quarterly loss.
The word: Tim Strazzini says their Options One mortgage business lost $50 million dollars and they’ve’ set aside another $100 million– with management doing everything they can to get this under control. Tim says the smart trade is selling puts out into April or June or buying the stock although it’s going to be flat for a while.
OIL'S STEADY FLOW:
The news: At a meeting tomorrow, OPEC is expected to announce current output levels will remain unchanged
The word: Eric Bolling says it doesn’t matter. That’s priced into the market already.
J. CREW LOOKING GOOD?
The news: J. Crew (JCG) shares fall despite better-than-expected earnings
The word: Jeff Macke says J Crew has high inventory. He likes the name but says give it time before buying, don’t jump in tomorrow.
AMR ROUGH LANDING?
The news: AMR Put Buying Picks Up
The word: Guy Adami says traders are buying $30 puts (a bet the stock will go down) with the stock trading at $31.25. (That might be because last summer the airlines got crushed although Guy isn’t worried about that, yet.) However, Guys admits he will be keeping a close eye on the put buying in the sector.
Trader disclosure:
On MAR 14, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Bolling owns (PMI) Put Options, Gold, Silver, Soybeans,(DIS) is Short Corn Strazzini Owns (YHOO), (VZ), (BRCM)
NEW YORK -- Oppenheimer Holdings Inc. reported Friday that its third-quarter net income rose 10 percent, as lower expenses helped make the best of flat revenue.
Albert Lowenthal, CEO of the New York investment firm, said that while the economy remains uncertain, the U.S. equity markets have continued to perform remarkably well. But he said a ""consistent drumbeat"" of negative economic news has held down investor activity and the company's revenue during the period.
Oppenheimer reported net income of $2.3 million, or 17 cents per share, for the quarter that ended Sept. 30. That's up from $2.1 million, or 15 cents per share, earned in the 2011 third quarter.
Revenue was basically flat at $231.8 million, compared with $231.6 million last year.
Oppenheimer also said Friday that its board declared a quarterly cash dividend of 11 cents. The dividend is payable on Nov. 23 to shareholders of record as of Nov. 9.
Shares increased 14 cents to $15.21 by midday. Its shares remain in the middle of its $12.47 to $19.69 52-week trading range.
What's Apple really worth? At more than $700 billion, Apple is currently the world's most valuable company. Activist investor Carl Icahn sees it's worth even more. Based on Icahn's share valuation that he made in February, Apple would be a $1.3 trillion company.
Morningstar senior analyst Brian Colello disagrees. ""You get cannibalization, I think you see the iPhone growing really well but the iPad is not and so if the Watch grows really well, maybe iPhone growth slows. I think you have a more stable revenue base but for the growth to get to a trillion, I think it would be difficult, I'm not seeing that,"" Colello told CNBC on Wednesday.
Colello has a fair value estimate of $120, below the current $126 trading level.
Watch: Are investors becoming too bullish on Apple?
The iPhone continues to be Apple's driver of growth. He wrote in his research note that the 99 percent customer satisfaction rate for the iPhone 6 and 6 Plus keeps the devices as the most important, and lucrative, in Apple's expanding product portfolio.
The expanding portfolio of course includes the Apple Watch. ""We continue to view Apple Watch as a product category that will drive incremental revenue for Apple, but more important, will offer especially strong stickiness to the iOS ecosystem that will enable Apple to make repeat sales of high-margin iPhones to these customers over time,"" Colello wrote in his note.
""The easy money's been made at this point. There could be upside in the near term,"" he told CNBC's ""Tech Bet."" ""But in general when you look at the smartphone market, two, three years out, once all the China mobile customers get their hands on it, now you have the larger screen, it's harder to see a lot of growth. The smartphone market is going to grow but most of it will be at the low end, not where Apple plays. So it will be interesting to see how much growth Apple gets on the high end. We think that will be relatively limited.""
2011 isn't looking much better than 2010 or 2009 for retail sales of video games.
Despite comparing with weak numbers from a year ago, game software sales were down 5 percent last month versus 12 months earlier, coming in at $576 million, according to NPD Group, which tracks the industry. Overall, the industry was down 6 percent, dragged lower by continued weakness in the hardware category.
The news isn't quite as bad as it might appear, though. January's decline was far better than some analysts had predicted. Wedbush Securities had forecast software sales to be down as much as 11 percent.
Hardware sales, while light, also defied expectations — falling 8 percent versus the expected 31 percent. Given that January is always a light month for hardware sales as people tend to buy game machines during the holidays, the decline is far from troubling. Peripheral sales, meanwhile, which included Microsoft's Kinect and Sony's PlayStation Move controller, were up 6 percent.
Year to date, the industry is 4 percent off of last year's anemic pace, with overall sales of $1.14 billion.
It was catalog sales that topped the sales charts in January. Activision-Blizzard's ""Call of Duty: Black Ops"" was the month's best-selling game, while Ubisoft's ""Just Dance 2"" came in and number two. The months' two new releases — Electronic Arts' ""Dead Space 2"" and Sony's ""Little Big Planet 2"" — took the number three and four spots.
While the retail numbers continue to decline, it's important to note that brick and mortar stores like GameStop continue to lose market share to digital forms of distribution. In today's gaming market, in fact, they represent just 60 percent of the overall revenue in the video game industry. Used games, game rentals, subscriptions, digital full game downloads, social network games, downloadable content and mobile game apps all contribute to the bottom line of publishers — and are a growing force.
Many analysts are expecting retail sales to continue their decline versus previous years in 2011. Some, like Wedbush's Michael Pachter, however, think new hardware products, such as Nintendo's 3DS handheld system, could spark a rebound, and that patient investors could be rewarded.
""We think that consecutive sales declines in 2009 and 2010 position the industry for a rebound,"" wrote Pachter in a note to investors. ""However, while we expect a rebound in 2011, we think that the first two or three months face difficult comparisons, and do not expect sales growth to commence until late March, when the Nintendo 3DS launches.""
In addition to the 3DS, which is generating advance buzz among players eager to experience 3D games without having to wear special glasses, most analysts expect 2011 will bring hardware price cuts to the industry, which will further boost sales.
No console manufacturer reduced their retail prices last year (though each did offer their machines bundled with games and/or peripherals for the same price). Most analysts feel a $50 across-the-board price cut will come before the end of the year.
LONDON — The U.K. government has intervened in Nvidia's proposed $40 billion takeover of chip designer Arm on national security grounds.
Britain's Digital Secretary Oliver Dowden issued a Public Interest Intervention Notice (PIIN) on Monday. It's not clear what the national security grounds are but the Department for Digital, Culture, Media and Sport said Dowden ""considered advice received from officials across the investment security community.""
Dowden said he has written to the U.K. competition watchdog and asked them to start a ""phase one"" investigation into the transaction, which was announced in September.
The Competition and Markets Authority has been instructed to compile a report for Dowden on the competition and national security aspects of the deal before July 30. Dowden could then approve the deal, permit it on certain conditions, or ask for a more detailed inquiry.
""Following careful consideration of the proposed takeover of Arm, I have today issued an intervention notice on national security grounds,"" said Dowden in a statement. ""As a next step and to help me gather the relevant information, the U.K.'s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions.""
He added: ""We want to support our thriving UK tech industry and welcome foreign investment, but it is appropriate that we properly consider the national security implications of a transaction like this.""
A spokesperson for Nvidia said: ""We do not believe that this transaction poses any material national security issues. We will continue to work closely with the British authorities, as we have done since the announcement of this deal.""
Arm is being sold by SoftBank, which acquired the firm for £24 billion ($33 billion) in 2016 without any major issues. The new sale, however, has raised concerns that Nvidia could relocate Arm's headquarters to the U.S. and reduce competition in the semiconductor industry.
The ongoing global chip shortage has also highlighted how important semiconductors are in today's world. They're used in everything from smartphones and cars to fighter jets and other weapons systems. As a result, nations are keen to become more self-reliant when it comes to chip production, which is currently dominated by China.
Set up in the 1980s, Arm licenses its chip designs to manufacturers around the world and it's been referred to as the ""Switzerland"" of the chip industry due to its neutrality. Chipmakers including Qualcomm have expressed concerns that Nvidia may look to close off access to Arm's technology, but Nvidia insists that such a move isn't planned.
Nvidia CEO Jensen Huang has pledged to keep Arm's headquarters in Cambridge and expand the company's footprint in the city.
The deal is also being probed by regulators in the U.S., China and the European Union and some question whether it will be allowed to go through. Five industry sources, including two tech investors, told CNBC in February that they think the deal has a very high chance of being blocked by one or more of the regulators.
Merrill Lynch'sdecision to name John Thain as its new chief executive came after the firm's first choice, BlackRock CEO Larry Fink, demanded that Merrill make a full accounting of its subprime exposure, CNBC has learned.
Thain, who has been CEO of NYSE Euronext for nearly four years, will succeed Stanley O'Neal, who stepped down in late October after Merrill reported huge writedowns from subprime-related losses.
Merrill's selection of Thain was a surprise because the firm had recently indicated to Fink that the job was his if he wanted it. CNBC has learned that Fink said he would take the job but only if Merrill did a full accounting of its subprime exposure. At that point, Merrill, which owns 49% of BlackRock , moved in a different direction and decided to go with Thain instead.
A Merrill spokesman told CNBC that ""Merrill Lynch can confirm that Laurence Fink was not offered the job of CEO at Merrill Lynch.""
Replacement for Thain
The NYSE will name Duncan Niederauer, the current chief operating officer, as Thain's replacement.
Merrill ousted CEO Stan O'Neal after posting an $8.4 billion write-down for the third quarter. The write-down resulted in a $2.3 billion loss, the largest quarterly loss in the company's 93-year history.
Thain has a blue-chip Wall Street resume, with credentials sharpened by running NYSE and his time as a former co-president at Goldman Sachs.
Thain took over the NYSE in January 2004 after longtime CEO Richard Grasso was forced to resign over his $188 million pay package. Thain sought to present a new image for the exchange and pushed through some major structural changes, including the move to electronic trading.
Thain had also been rumored to be a possible CEO candidate for Citigroup , whose chief executive Chuck Prince also stepped down following big subprime-related losses. No replacement for Prince has been named.
Created Global Exchange
Thain, who is credited with remaking the NYSE into the world's first truly global exchange, is no stranger to the investment world. He started out on the bond desk at Goldman Sachs and left the firm as its chief operating officer.
Many say he's also exactly what Merrill Lynch needs after last month's ouster of Stan O'Neal. The former CEO was not well liked by Merrill's army of some 16,000 brokers, and lost their confidence after the company recorded its biggest loss since being founded 93 years ago.
Merrill Lynch ratcheted up a $2.24 billion loss during the third quarter because of investments in subprime mortgages and other risky types of debt. It joined dozens of other major financial institutions who are getting squeezed as investors steer away from riskier securities, causing credit markets to tighten significantly.
There is also speculation by a number of analysts that Merrill may take a $3 billion fourth-quarter writedown. That would be besides the $7.9 billion charge taken last quarter. Merrill originally said it would write down only $4.5 billion because of the credit crisis.
Faces Daunting Task
Thain faces a daunting task of cleaning up those investments, and reviving morale at a firm badly bruised during the past few months. There has been speculation that a new CEO would be forced to turn around Merrill's fixed income division, a department that he once ran for Goldman in the 1990s.
Meanwhile, Fink may be a possible replacement for Prince, who left the helm of Citigroup less than a week after O'Neal stepped down from Merrill. Thain was also said to be considered to run the nation's biggest bank.
Prince was forced out of his job after Citi's profit fell 57 percent in the third quarter after it booked $6 billion in asset markdowns and other credit-related losses. The night Prince resigned, the company estimated it would need to write down another $8 billion to $11 billion in the fourth quarter.
Thain leaves behind a transformed exchange now locked in competition with rival Nasdaq Stock Market. His first task after taking over in 2004 was the acquisition of electronic trading platform Archipelago Holdings. It was the first step in bringing NYSE into the 21st century, which ultimately led to the creation of a mostly electronic market last year.
He also shepherded the NYSE's April acquisition of European rival Euronext, which operated bourse's in Paris, Amsterdam, Brussels and Lisbon.
The Associated Press contributed to this report.
The Centers for Disease Control and Prevention recommended Tuesday that fully vaccinated people begin wearing masks indoors again in places with high Covid-19 transmission rates. The agency is also recommending kids wear masks in schools this fall.
Federal health officials still believe fully vaccinated individuals represent a very small amount of transmission. Still, some vaccinated people could be carrying higher levels of the virus than previously understood and potentially transmit it to others.
""This pandemic continues to pose a serious threat to the health of all Americans,"" CDC Director Rochelle Walensky told reporters on a call. ""Today, we have new science related to the delta variant that requires us to update the guidance regarding what you can do when you are fully vaccinated.""
The updated guidance comes ahead of the fall season, when the highly contagious delta variant is expected to cause another surge in new coronavirus cases and many large employers plan to bring workers back to the office. In mid-May, the CDC said fully vaccinated people didn't need to wear masks in most settings, whether indoors or outdoors.
""In areas with substantial and high transmission, CDC recommends fully vaccinated people wear masks in public, indoor settings to help prevent the spread of the delta variant, and protect others. This includes schools,"" Walensky said. The CDC recommends that everyone in grade schools wear masks indoors, ""including teachers, staff, students and visitors, regardless of vaccination status.""
Walensky said new data shows the variant behaves ""uniquely differently from past strains of the virus,"" indicating that some vaccinated people infected with the delta variant ""may be contagious and spread the virus to others.""
Read More: Americans will need masks indoors as U.S. heads for 'dangerous fall' with surge in delta Covid cases
Health experts fear delta, already the dominant form of the disease in the U.S., is hitting states with low vaccination rates. Those states are now being forced to reintroduce mask rules, capacity limits and other public health measures that they've largely rolled back in recent months.
White House chief medical advisor Dr. Anthony Fauci said Sunday that the CDC was considering whether to revise mask guidance for vaccinated Americans, saying it was ""under active consideration.""
""It's a dynamic situation. It's a work in progress, it evolves like in so many other areas of the pandemic,"" Fauci, also the director of the National Institute of Allergy and Infectious Diseases, told CNN. ""You've got to look at the data.""
The CDC's guidance is only a recommendation, leaving it up to states and local officials on whether to reintroduce their mask rules for certain people. But even before the CDC's anticipated guidance Tuesday, some regions were reintroducing mask mandates and advisories as Covid cases began to spike again.
Walensky said a majority of the hospitalizations and deaths in the U.S. are occurring among unvaccinated people, pointing to vaccines she said worked well in protecting against severe illness and death. ""But the big concern is that the next variant that might emerge, we're just a few mutations potentially away where it could potentially evade our vaccines,"" she said.
President Joe Biden said the CDC's updated guidance was necessary to defeat the virus, and that he will lay out ""next steps"" to get more Americans vaccinated on Thursday.
""Although most U.S. adults are vaccinated, too many are not. While we have seen an increase in vaccinations in recent days, we still need to do better,"" he said in a statement. ""More vaccinations and mask wearing in the areas most impacted by the Delta variant will enable us to avoid the kind of lockdowns, shutdowns, school closures, and disruptions we faced in 2020.""
Several counties across California and Nevada were already advising all residents to wear masks in public indoor settings — whether they are vaccinated or not. In Massachusetts, officials in Provincetown advised all individuals to resume wearing masks indoors after Fourth of July celebrations led to an outbreak of new cases.
Experts say Covid prevention strategies remain critical to protect people from the virus, especially in areas of moderate-to-high community transmission levels.
The CDC defines ""substantial transmission"" as counties that have 50 to 100 cases per 100,000 residents over a seven-day period and ""high transmission"" is more than 100 cases per 100,000 people over seven days, Walensky said.
""We have places and counties and states here that are now reporting over 300 cases per 100,000 over a seven day period. So really an extraordinary amount of viral transmission, which is what we're concerned about,"" she added.
Dr. Paul Offit, a pediatrician and vaccine advocate who has served on advisory panels for both the CDC and the Food and Drug Administration, told CNBC earlier this month that the U.S. was still ""undervaccinated,"" with about half of the population not fully inoculated.
Even people who are fully protected have cause for concern when it comes to Covid variants, Offit said. While the vaccines protect well against severe disease and death, they may not protect as well against mild disease or spreading Covid to others, he said. No vaccine is 100% effective, he noted.
""It is not a bold prediction to believe that SARS-CoV-2 is going to be circulating two or three years from now. I mean there are 195 countries out there, most of which haven't been given a single dose of vaccine,"" Offit said. ""Will it still be circulating in the United States? I think that would be very, very likely.""
Israel released preliminary data last week that showed the Pfizer vaccine is just 39% effective against the virus there, which officials attributed to the rapidly spreading delta variant. Its effectiveness against severe disease and death remained high, the data showed. U.S. and world health officials said they are looking at the Israeli research, which was not peer-reviewed and was scant on details.
Executives from Pfizer, Moderna and Johnson & Johnson have said they expect Americans will need booster shots, and Pfizer has said it plans to ask the FDA to authorize boosters as it sees signs of waning immunity. Federal health officials say booster doses of the vaccines are not needed for otherwise healthy people at this time, although they may recommend it for the elderly or people with compromised immunity.
– CNBC's Meg Tirrell and The Associated Press contributed to this report.
Aetna and Humana have announced a $35 billion cash and stock agreement to merge, one day after Centene indicated it planned to buy its Medicaid-focused rival Healthnet for $6.8 billion.
Should Anthem and Cigna eventually reach a deal to combine their businesses, it will mark one of the most significant eras of consolidation in the history of the health insurance sector.
Yet the question remains whether regulators will embrace the deals as quickly as these rivals have embraced one another. Four of the largest U.S. insurers will combine to form two health-care powerhouses, and the competition may spur more mergers among smaller players.
""The effect is going to be very specific to markets,"" said Christopher Koller, the president of the Milbank Memorial Fund, a health policy research foundation that advises states.
Read More
""What the [Federal Trade Commission] will want to determine is, does an insurer have a big enough market share in a particular market so as to eliminate or reduce competition,"" asked Koller, who served as Rhode Island's health insurance commissioner from 2006-2013.
Still, Koller argues that when it comes to insurance the bar has been set fairly high by federal regulators.
""I regulated a market where a domestic, local, non-profit (Blue Cross plan) had 60-70 percent of market share. And I certainly didn't have the FTC marching in there trying to take it apart,"" he said.
Yet current Rhode Island Health Insurance Commissioner Kathleen Hittner said these new large insurer deals should be carefully scrutinized because it could hurt the burgeoning consumer market.
""People want consolidation for efficiency, which is what (insurers) promote,"" said Hittner. ""If you have competition, they look at the other plans and they try to have similar plans,"" she said.
""I think if you take away that competition, we will see higher rates and we will see less ability for the states to adjust those rates,"" she added.
With nearly 5 million members, Humana's dominant position in Medicare plans is one of the factors that attracted Aetna to purchase its smaller rival. If the deal is approved, the combined firm would have greater than 50 percent market share in Medicare in more than half a dozen states, according to a recent analysis by Susquehanna Financial Group.
That would make one area where regulators may raise concerns, which some analysts say could be solved by either company selling off chunks of its business.
""We expect the deal will close with divestitures in pockets to address anti-trust scrutiny,"" wrote Ana Gupta, a health-care analyst at Leerink in a note to clients. Gupta raised her price target on both Aetna and Humana following Friday's announcement. However, she noted that regulatory approvals for the merger would take time, as would expected cost savings.
""The deal is expected to generate cost synergies of $1.25 billion in 2018 and estimated closing in second half of 2016,"" Gupte wrote.
Aetna's chairman and CEO Mark Bertolini said in a statement that the combined company will be able to reduce overhead costs and pass on better rates to their customers.
""This combination will allow us to continue to invest in excellent service for our members and strengthen our partnerships with providers to deliver high quality care at an affordable price,"" he added.
That may be easier said than done, advocates say, and is largely dependent on how robustly regulators look at the deal's impact on consumers.
""Greater consolidation could lead to improved efficiencies,"" said Elizabeth Imholz, director of special projects and advocacy at Consumers Union, but only ""if we had a really effective rate review and antitrust system in place that could look at the antitrust considerations and also closely scrutinize rate filings by insurance companies.""
While the Affordable Care Act triggers government review for rate increase requests of more than 10 percent, insurance regulatory scrutiny at the state level varies widely, Imholz said. She hopes federal regulators will watch the proposed deals closely.
""I don't see how the FTC could look the other way if these big insurer [deals] are proposed, because it's of great public import,"" Imholz said. ""Even one big one would be important for them to look at.""
One of the arguments insurers make for consolidation is to counter the wave of deal-making in the hospital and medical provider sector, which has given some players tremendous concentration and market power.
Over the last 10 years, the number hospital deals have outpaced insurance acquisitions by six to one on average, according to data from S&P Capital IQ.
Insurance industry consultant Robert Laszewski said he expected strong pushback from doctors and hospitals against the large insurer mergers.
""I think there'll be huge opposition from the provider industry. I think that's what the analysts are missing,"" said Laszewski, president of Health Policy and Strategy Associates.
""There would be so much market clout gain that I think it would concern people from a competition standpoint, and raise the ire of the hospital and physician lobby,"" he added.
Consumers will want to be vocal, as well, said Imholz. ""It is very dynamic out there in marketplace,"" she said. ""We have to, from the consumer side, be vigilant about what's happening.""
(CORRECTION: An earlier version of this story misstated Elizabeth Imholz's name.)
Yesterday's Big Tech Congressional hearing featured something that's exceedingly rare in Washington: bipartisan agreement.
Sure, there was the expected grandstanding about hypothetical conservative bias, and weird questions about emails going into spam folders and when HBO Max would be on Amazon Fire TV. But there was also a strikingly consistent belief among the 15 members of the U.S. House of Representatives' Antitrust Subcommittee that Apple, Amazon, Facebook and Google have too much power.
Both Republican and Democratic Congressmen laid out instances where companies have stifled competition, including Amazon using data from third-party sellers against them and Facebook's internal discussions about how buying startups Instagram and WhatsApp could choke off eventual threats. While the CEOs ""respectfully disagreed"" with many characterizations, years of deflection around touchy issues may have undermined their overall credibility with both lawmakers and the public.
So Congress thinks there's a real problem here. But we didn't learn anything about what they plan to do about it. And that's probably because the members simply don't know. It's likely all four companies will be highly scrutinized for any market pivots or strategic acquisitions moving forward. But scrutiny doesn't equal action.
This isn't a new American problem. It's easy to diagnose problems: Rising health care costs, growing inequality, electoral college unfairness, and so on. Doing something about them takes bold leadership and, sometimes, fumbling legislation. It would have been nice to hear some ideas about how the companies would respond to potential legislative or regulatory solutions, such as spin-outs of divisions (Google and YouTube, Facebook and Instagram), restrictions on future strategic acquisitions, or laws around Apple's App Store policies.
There's not going to be a one-size-fits-all legislative or regulatory fix for the four companies. Each company has its own dominance issues, making it unfeasible to create a single broad law that applies to all of them.
But it was notable that representatives both sides of the aisle basically came to the same conclusion.
- House Judiciary Committee Chairman Jerrold Nadler, D-N.Y.: ""There is growing evidence that a handful of corporations have come to capture an outsized share of online commerce and communications.""
- House Judiciary Antitrust, Commercial and Administrative Law Subcommittee Chair David Cicilline, D-R.I.: ""Many of the practices used by these companies have harmful economic effects. They discourage entrepreneurship, destroy jobs, hike costs, and degrade quality. Simply put: They have too much power.""
- Ranking member of the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law Jim Sensenbrenner, R-Wis.: ""Since the tech investigation began, we have heard rumblings from many who are quick to say your successful companies have grown too large. Since this hearing was announced, it seems that those complaints have gotten even louder....As the business landscape evolves, we must ensure that our existing antitrust laws are applied to meet the needs of our country and its consumers. I share the concern that market dominance in the digital space is ripe for abuse.""
This type of basic agreement -- even at the lowest levels of ""there seems to be a problem here"" -- is increasingly rare in high-profile Congressional hearings, which often degrade into political showcases where Democrats take one side and Republicans argue the opposite. While Sensenbrenner did note that bigger companies aren't necessarily problematic, there were few, if any, comments echoing what Morgan Stanley Vice Chairman Robert Kindler told CNBC earlier this week:
""I think companies like Amazon have been absolutely terrific for the economy and for the consumer,"" Kindler said. ""What would we have done during this pandemic if we didn't have companies like Amazon? I just can't imagine that people don't think that these are fantastic things that all of these huge companies have brought.""
Even if Congress can't figure out the next steps, Amazon, Apple, Facebook and Google may have to approach future acquisitions very carefully to avoid regulatory pushback. Even small deals could be at risk to be blocked, especially in a Democratic administration, given the committee's attention to CEO Mark Zuckerberg's emails about how buying Instagram could stifle future competition. Facebook only paid $1 billion for Instagram -- peanuts from today's perspective, where Facebook has a $662 billion market valuation and earned more than $18 billion in profit last year. While Facebook was much smaller in 2012, the committee highlighted several instances of Zuckerberg saying in emails that it was easy to acquire startups, suggesting Facebook could use its market power to throw cash at entrepreneurs who may be tempted by big payouts.
Indeed, a revealing back-and-forth between Zuckerberg and Instagram CEO Kevin Systrom highlights this point. Systrom tells Zuckerberg that ""I'm not coming back at you to change the offer (then $500 million) because I don't think that's what drives us. Of course there's a limit to that logic.""
Sure enough, Zuckerberg raised the offer to $1 billion and Systrom sold. Further, Systrom told Zuckerberg he had concerns about Facebook limiting his independence to run Instagram as he pleased. Zuckerberg responded, ""You reference flexibility and things you'd like to do independently that you couldn't do at Facebook. I'm curious what you think you couldn't do at Facebook, given that what I offered was for you to keep building out Instagram as a separate product and brand. I actually think you'll be able to do all the same things with Instagram at Facebook.""
Six years later, Systrom left Facebook after butting heads with Zuckerberg over how he was integrating Instagram with Facebook. Even if you take Zuckerberg at his word at the time that he had no plans to mess with the company's operations, he knew in the back of his mind that, ultimately, he was the boss. This is true for any acquisition. But with Apple, Google and Amazon all over $1 trillion in market capitalization and Facebook near $700 billion, the ability of these companies to throw money and equity at startups is unrivaled and nearly risk-free when purchase prices are so relatively small.
While Kindler may be correct that consumers have benefited from the immense growth of big technology, a continual stream of start-ups merging into four or five big companies may not only limit technological innovation but also thought innovation. If the same leaders are controlling companies, the same ways of thinking will continue to dictate corporate policy. That's a bipartisan concern. And, in this political environment, that's a rarity.
WATCH: Former DOJ antitrust chief: Google, Amazon face the biggest antitrust threat
Italian Prime Minister Enrico Letta made clear on Wednesday he had no intention of resigning and said that if the center-left leader Matteo Renzi wants to replace him he must state it openly.
(Read more: Italy's latest risk to stability: the 'Renzi Factor')
Letta spoke to reporters amid widespread speculation that Renzi, the leader of the Democratic Party (PD) that both men belong to, will push for the PD to withdraw its support from Letta at a leadership meeting Thursday.
""Anyone who wants to take my place must spell out their intentions,"" Letta said after an hour-long meeting with Renzi in which neither man was willing to back down, according to sources.
Letta said he was proud of his government's record and that he was motivated by a spirit of service to the country, not by personal ambition.
Progress continues toward integrated standards for DC microgrids in buildings
SAN RAMON, Calif.--(BUSINESS WIRE)-- The EMerge Alliance – an open industry association leading the rapid adoption of safe direct-current (DC) power distribution standards for commercial buildings – today announced it has updated the EMerge Alliance Occupied Space standard, the first application platform model for the utilization of low-voltage DC power in commercial interiors.
The EMerge Alliance Occupied Space standard creates an integrated, open platform for power, interior infrastructures, controls and a wide variety of peripheral devices to facilitate the hybrid use of AC and DC power within commercial buildings. Version 1.1 includes several important updates to voltage limits, recommended cable sizes and other requirements to assist companies developing products when using the standard. These changes are backwards compatible and maximize the interoperability and efficiency of EMerge Alliance Registered products.
According to Alliance Chairman Brian Patterson, the Occupied Space standard version 1.1 allows for better connectivity with the forthcoming EMerge Alliance Task Level/Furnishings standard and contributes to the organization’s push to deliver a portfolio of integrated standards that increase building flexibility and sustainability, while lowering operating costs. These standards also facilitate the direct use of on-site power generation and storage, which eliminates the need for many inefficient power form conversions in buildings.
“The standards we’re creating for DC microgrids are the keys to unlocking unprecedented efficiency, flexibility and sustainability in buildings,” said Patterson. “The latest advancements in the EMerge Alliance Occupied Space standard demonstrate that the Alliance is committed to driving the continued development and expansion of standards that will deliver DC power throughout buildings.”
The EMerge Alliance Occupied Space standard has been well received by both product manufacturers and the early adopters of the building community. There are more than 50 EMerge Alliance Registered products available for use today, representing everything needed to implement the platform. The EMerge Alliance Occupied Space standard version 1.1 is available exclusively to Governing, Participating and General Members of the Alliance, and a free public overview is available at http://www.emergealliance.org/Standard/RequestStandard.aspx. To join the Alliance, please visit http://emergealliance.org/Join/HowtoJoin.aspx.
The EMerge Alliance’s Growing Standards Portfolio
The EMerge Alliance continues to work toward completing new DC power standards to achieve net-zero energy buildings. The soon-to-be-released Data/Telecom Center standard will provide a practical guide for the hybrid use of DC power in data centers, offering better efficiency, a smaller footprint, improved reliability and lower capital and installation costs. Currently in development, the Campus Microgrid standard will focus on establishing a standard for the integration of DC microgrids throughout whole buildings. Also in progress, the Task Level/Furnishings standard connects DC power to desktop technologies and applications. Moving forward, the Alliance will continue its vision by developing future standards for building services, such as HVAC, and outdoor applications, such as electric vehicle charging. All EMerge Alliance standards include consideration of power, infrastructure, peripheral device and control applications required to operate a building application platform using DC power.
About the EMerge Alliance
The EMerge Alliance is an open industry association leading the rapid adoption of safe DC power distribution in commercial buildings through the development of EMerge Alliance standards. These innovative standards integrate interior infrastructures, power, controls and devices in common microgrid platforms to facilitate the hybrid use of AC and DC power throughout buildings for unprecedented design and space flexibility, greater energy efficiency and improved sustainability. The nonprofit Alliance is accepting new members at various levels. For more information, please visit www.EMergeAlliance.org.
LONDON — Nadja Swarovski, chair of the Swarovski Foundation, said that the luxury sector had effectively embraced the challenge of operating and reaching consumers amid the coronavirus pandemic.
Swarovski, the first female executive board member for her family's luxury jewelry brand, was speaking at CNBC's Evolve Global Summit on Wednesday. She told CNBC's Tania Bryer that the ""luxury sector, to a certain extent has been incredibly resilient and I think those companies who have been digitally savvy have absolutely embraced this opportunity to communicate with their customers on a digital scale.""
In addition, Swarovski said it had been ""fantastic to see how the fashion industry has embraced this dilemma,"" with non-essential retail businesses in many countries having been temporarily closed due to lockdowns and other Covid-19 public health restrictions for most of the past year.
Swarovski pointed to the use of digital fashion shows, in place of physical events, as well as fashion designers ""communicating directly"" more with the consumer.
For instance, fashion label Alexander McQueen invited fans to take on various design challenges and share their creations on Instagram by tagging the brand, along with the hashtag #McQueenCreators.
Danish brand Ganni also launched a challenge inviting fans of the label to create and send in images or artwork around the theme of ""Home is where the heart is,"" to be selected for a place in an exhibition in Copenhagen and potentially win gift cards.
Swarovski believed that more direct dialogue with consumers would help designers become more tailored to customer demands and hoped that would help reduce waste in the fashion industry.
She pointed out that a quarter of all clothing produced last year went unworn, or even touched, before ending up in waste disposal sites.
Data from the U.S. Environmental Protection Agency, showed that on average each American produces about 75 pounds of textile waste a year.
""I think with this direct communication and also further transparency in the supply chain, that will be certainly mitigated,"" Swarovski said.
Swarovski also discussed how sustainability had been built into the Swarovski brand, that was created 125 years ago by her great-great-grandfather, Daniel Swarovski.
She said that it had been ""special, as a female I can say, my great, great-grandfather certainly had the mission to make every woman know what it feels like to wear a diamond but make it affordable.""
Swarovski had established itself on offering ""affordable luxury,"" she said, though the brand made the transition into ""conscious luxury"" in recent years.
Swarovski launched its lab-grown line Swarovski Created Diamonds in 2017. It then entered the colored lab-grown diamond market last year.
An increased appetite for emerging markets has grown in recent months, with global investors moving on following excitement over U.S and then European equities.
The MSCI Emerging Market Index has soared almost 24 percent since 2017 began. But with dollar weakness - and consequently a strong euro - set to hurt European companies, investors appear to be slowly shifting elsewhere.
""I actually think that it's more likely that investors will shift towards emerging markets … Where valuations are much more attractive,"" James Butterfill, head of research and investment strategy at ETF Securities told CNBC, noting that U.S. stocks are too expensive.
Interest for European equities spiked in the first half of the year with the dissipation of the populist threat across Europe, the election of Emmanuel Macron in France, and the economic improvements seen in the euro zone. But recently there's been some patchy earnings reports and a strong euro is likely to further impact profits. As of August 1, 156 companies in the pan-European STOXX 600 had reported earnings for the second quarter. Of these, 49.4 percent reported results exceeding analyst estimates, according to Reuters. In a typical quarter 50 percent beat analyst estimates.
U.S. equities have also been on the rise on expectations of big infrastructure investments and tax cuts by the new administrations. However, President Donald Trump has yet to fully concrete any of these proposals and asset managers are still wary of valuations on Wall Street. As such, emerging markets might become the next sweet spot for money managers.
""Investors are starting to see fundamentals way more attractive in emerging markets,"" Butterfill noted.
""We're not going to see the taper tantrum that we saw 2013,"" he added, saying that emerging markets no longer have current account deficits. These indicate the value of the goods and services a country imports exceeds the value of the goods and services it exports. The ""taper tantrum"" refers to when the U.S. Federal Reserve announced it was winding down its bond-buying program in 2013, which acutely impacted by emerging markets (EM).
The U.S. central bank is continuing to tighten its monetary policy - now with rate hikes - but analysts note that EMs are at a stronger position than they were in 2013 and the markets have also priced in the expected Fed moves.
""Even with tightening in the U.S., interest rate differentials are still positive for emerging markets,"" Zsolt Papp, EMD client portfolio manager at JPMorgan Asset Management, told CNBC.
""Emerging market economies are well placed to absorb the higher U.S. rates. Fed tightening comes in the context of stronger domestic U.S. and EM growth conditions and with EM economies in a substantially better fundamental position versus 2013's taper tantrum episode,"" he explained.
Apart from stronger current accounts, analysts have mentioned higher growth and lower inflation as other positive factors in EMs.
According to data compiled by Pictet Asset Management, strong investment spending and exports have boosted growth in EM countries in the first quarter of this year. Gross domestic product reached an average 4.3 percent across these countries, in comparison with 4 percent in the previous quarter.
""EM growth has reached its fastest pace since the third quarter of 2014. The one concern for investors could be private consumption growth, which was flat over the first quarter,"" Pictet Asset Management said in a research note. However, it added that it sees this metric moving higher given stronger consumer confidence, lower unemployment rates and nominal wage growth.
Consumer confidence is at its highest level in these countries since December 1993, Pictet also noted.
Papp from JPMorgan added that the situation for EM corporates has also improved as recent earnings showed. However, analysts also warned that protectionist policies and some geopolitical risks need to be monitored when assessing investments in the EM world.
""Emerging markets have returned 18 percent year-to-date so investors may be questioning whether there is more mileage and returns in this asset class,"" Emily Whiting, client portfolio manager at JPMorgan Asset Management, told CNBC.
Attractive returns, reasonable valuations and softening in U.S. dollar strength ""are three reasons why it is not too late to invest in emerging markets,"" Whiting added.
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U.S. regulators, retailers and manufacturers are growing increasingly concerned that a surge in the number of products being recalled is resulting in ""fatigue"" by the public — increasing the chance that consumers could ignore or miss a recall that could ultimately endanger their health.
Consumers last year were deluged with 2,363 recalls, or about 6.5 recalls each day, covering consumer products, pharmaceuticals, medical devices and food, according to data from the U.S. Food and Drug Administration, the Department of Agriculture and the Consumer Product Safety Commission. The recalls announced mark a nearly 14 percent increase from 2,081 in 2010 and compare with about 1,460 in 2007.
Experts say the increase is the result of a combination of greater oversight by regulators, better testing procedures and the use of social media where consumers can quickly point out and discuss problems with other people.
""We're experiencing recall fatigue in my mind at the consumer level and also perhaps at the business level, and we all have to worry about that,"" said Mike Rozembajgier, vice president of recalls for Stericycle ExpertRecall, an Indianapolis-based firm which has provided advice and helped major U.S. companies, including Merck, General Electricand Wendy's, carry out recalls.
""We have this growing concern for safety, but with there being so many recalls going on (is the public) paying attention to them and responding to them in a manner that is necessary for the recalls to be handled effectively?"" he said.
This year alone hundreds of recalls have already been announced. Pfizerrecalled birth control pills after it was found there may have been an inexact number of pills that also could have been out of sequence, increasing the chance of an unintended pregnancy. asked its customers to return about 169,000 high chairs because the restraint buckle could open unexpectedly. And Dole warned the public not to eat a lettuce salad mix because of a possible health risk from salmonella.
Retailers and government regulators are increasingly struggling to reach people who may not know about a recall, or choose to ignore it despite the potential dangers. A 2009 study conducted by Rutgers found 12% of Americans ate food they knew had been recalled and 40% admitted never having looked for recalled products in their homes.
Increasingly, retailers and government agencies are expanding the methods they use to communicate with the public — from social-media technologies such as Twitter and Facebook to more traditional methods such as phone calls and postings within their stores. But the same methods that prove successful in reaching one customer could just as easily be ignored by another.
""We don't feel that our members are getting bombarded but certainly the general public is and sooner or later you don't know what to believe,"" said Craig Wilson, vice president for quality assurance and food safety at the warehouse giant Costco .
The 602-store warehouse chain uses data supplied from its estimated 60 million members and notifies them within 24 hours if they've purchased a recalled item. It then follows up with a letter. The result is that customers return about 90% of recently recalled products and, in the case of major recalls such as when a food product could cause serious health problems or death, Costco gets ""the majority of everything that was sold back.""
But Wilson says the national recall system ""doesn't work as designed"" and that consumers and retailers alike would benefit from a single, uniform network. He says the CPSC, USDA and FDA each have a different recall system with unique requirements, making it more difficult for companies like his to make sure they are complying with the rules.
At Rochester, New York-based Wegmans, the grocery chain has a detailed recall plan that can require hundreds of people to carry out. The 81-store East Coast chain follows a recall protocol increasingly common among retailers: posting recall information on its web page and within stores for customers, notifying its followers using social media tools and, when possible, calling individuals who may have used a store card for the purchase.
""We do what we can to protect our customers but then our customers have to protect themselves and they can't do that unless they have the information,"" said Jeanne Colleluori with Wegmans. Last year alone, Colleluori said Wegmans participated in about 40 recalls, and the retailer was ahead of that pace in 2012 with about 16 recalls as of early May.
Businesses can ease the burden of a recall on their reputation and bottom line by being honest and upfront with their customers and crafting a response plan before any recall occurs that outlines what they will do with the public, media and regulators, industry watchers say.
""Many companies are being criticized not because they are not doing the right thing but because they are taking too long,"" said Sophie Ann Terrisse, chief executive of STC Associates, a brand-management firm.
She said some firms fail to estimate the work needed to conduct a recall and quickly become overwhelmed, leading to slow responses or poor customer service from representatives who don't have the time or know how to respond properly. ""Things can get out of hand very quickly and it's hard to recover from that"" for the brand and the company's core audience, said Terrisse.
Companies involved in recalls all say their primary concern is protecting the public — but they also have a business interest as well. ""Our concern is for our customers but we have to protect our name as well, and we are very much aware that when there is a recall if it is a Wegmans brand product our reputation is at stake,"" said Wegmans' Colleluori.
Some businesses have managed to take a recall and turn it into a marketing bonanza that benefits the company. Two years ago McDonald's took the unusual step of paying customers a premium to return Shrek glasses to the restaurants following concerns that paint used to depict characters on the glasses contained cadmium — a carcinogen known to cause kidney problems.
""Mistakes can be made, but the way they are dealt with is by being completely open and letting the customer become part of the recall,"" said Terrisse.
For Stericycle ExpertRecall's Rozembajgier, the recall surge has turned into a lucrative business for his company, the largest U.S. firm handing consumer product, food and pharmaceutical recalls. The firm has its hands in nearly every stage of the process from storing a recalled product, helping warehouses and stores remove the item from shelves, dealing with customers and ensuring the company conducting the recall is complying with guidelines set out by U.S. regulators.
At its five warehouses in Indianapolis totaling 700,000 square feet (about 12 football fields), the firm collects and stores recalled items — everything from household appliance components to sporting/recreational equipment to jewelry.
In fact, eight years after Merck voluntarily recalled Vioxx, Stericycle ExpertRecall still has a full side of a warehouse stacked floor to ceiling with cases of the arthritis drug. There are still a number of lawsuits pending, and Stericycle ExpertRecall must keep the drug under lock and key until the FDA says it can be destroyed.
""Recalled products come here to die,"" said Rozembajgier, whose firm has been involved in nearly 3,000 recalls during the last decade. ""If they come to Indianapolis they're not getting back into the supply chain.""
The firm has started to recycle some of the recalled items. For example, it has recycled the batteries and plastic components from recalled medical devices; copper from the wiring in electrical products; and sugar has been extracted from liquid medication.
The government operates a recalled website, http://recalls.gov/, which offers the public information on all recalls including cars, boats, food, consumer products, medicine and cosmetics.
The U.S. Agriculture Department's Food Safety and Inspection Service improved its recall system in March by rolling out a Twitter feed that targets consumers only if their state is impacted. In the past, FSIS would send out a Tweet to the 250,000 people who follow everything that happens at the agency.
USDA Secretary Tom Vilsack downplayed the number of recalls that are announced considering the number of products that are produced, items that are sold and meals consumed each day.
""I think people want to know and need to know and have a right to know if there is a problem with a particular product,"" said Vilsack. ""We're going to look at ways in which we (communicate) and constantly improve how we communicate but we're not going to stop communicating.""
This story first appeared in USA Today.
It will take six years to bring US employment back from pre-recession levels, President Bill Clinton told CNBC Thursday.
“There's a lot of money in America that could be reinvested,” said Clinton, speaking from the World Economic Forum in Davos, Switzerland, about the US job situation. The former president has organized a jobs forum in June in Chicago. He said there are people and companies all over the world who are willing to invest in America.
Clinton had praise for Germany, which has maintained an unemployment rate two points below that of the US, in part because Germany has been successful selling to China and other growth markets.
The former president also said that the federal government’s stimulus programs, such as TARP and the bailout of automobile companies, have been successful, because companies were saved and taxpayers got their investment back.
Which dating match will be more successful? Someone who is similar to you or different?
""Opposites do attract,"" says Dr. Neil Clark Warren, an expert of sorts in dating. ""There's something fascinating about finding someone who likes you who is very different from you.""
But in an interview with CNBC's ""On The Money,"" the founder and CEO of the eHarmony online dating site warns that, over time, ""opposites attract, and then they attack.""
Read MoreTinder not just for singles: Report
After 35 years of counseling married couples, Warren says he's learned that ""if the right person doesn't marry the right person, you've got real problems ahead. It's tough to bend people after they first get married.""
Warren is a clinical psychologist and has written eight books on love and marriage. Fifteen years ago, he launched eHarmony, the site that helped pioneer the electronic dating era. The privately held company claims that 600,000 married couples have met on the site, which—if accurate—accounts for nearly 4 percent of all U.S. marriages.
The dating service business is a $2.4 billion industry, according to market research firm IBISWorld, while eHarmony has a nearly 14 percent market share among online dating sites. The leader in the category with a 21.8 percent share of the market is IAC/InterActiveCorp, which runs dating sites such as match.com, OKCupid and Tinder.
The eHarmony site charges up to $60 a month and requires users to fill out a lengthy questionnaire. Warren says: ""We ask every question we can think to ask ... and we match them so carefully on 29 dimensions. We call it broad-based compatibility and it's what you have to have.""
When asked what the most important characteristic is in successful relationships, Warren tells CNBC that ""Intelligence is really important"" when it comes to matching people for marriage.
The dating guru added that, ""We have to ask the questions that get at intelligence so we can pair people up so they won't find themselves feeling hurt because the other person is saying things they don't understand.""
The Internet has brought many a couple together. More than 1 in 3 couples met through an online dating site, among 19,000 couples that married between 2005 and 2012, according to a 2013 National Academy of Sciences study.
Yet an undeniable characteristic of the Internet dating age is that scores of potential partners are not out for commitment. Users that flock to eHarmony rival Tinder are notoriously uninterested in marriage—but that may be because they already are married. A recent study found about a third of the users of the fast-growing location-based app are already hitched.
""Tinder is in a different business than we are,"" Warren said. ""Tinder is a hookup site. EHarmony takes things very seriously. We take a great interest in the fact that so many of our people get married.""
Warren also says that over a 10-year period, the divorce rate of couples who met through eHarmony is 3.86 percent—far lower than a widely quoted statistic that half of all U.S. marriages end in divorce.
Within the eHarmony site are subgroups for specific ethnic or age groups. Christian, Jewish, Black, Hispanic or Asian singles have separate demographic groups, along with singles in their 30s and in their golden years.
However, same-sex singles are directed away from eHarmony to another site it owns called ""Compatible Partners.""
Warren called the same-sex marriage debate ""the most contentious single subject in America"". He told CNBC the company has tried to ""weave our way through that in a careful way, and we think we've done a pretty good job.""
Read More 'Let's not get crazy' about Tinder: Diller
While the site is separate, Warren says the algorithms used by eHarmony and Compatible Partners are ""similar.""
Compatible Partners was launched in 2009 as part of a settlement in a New Jersey discrimination case. Warren says there is a disclaimer at the same-sex site ""worked ... out with the attorney general of New Jersey.
He explains: ""I didn't see a lot of same-sex people in therapy. So we don't know that area as well as we know the more conventional area."" However, ""We take those people very seriously and we want them to be have long-term relationships that are good.""
The eHarmony founder's own marriage has lasted 56 years. He and his wife Marylyn met at Pepperdine University, married in 1959 and have been a match ever since.
""On the Money"" airs on CNBC Sundays at 7:30 p.m. EDT, or check listings for airtimes in local markets.
One of the best performing sectors in the market last week may not be the best investing idea.
The S&P 500's financial sector showed a 2.3 percent gain last week. But according to Ari Wald, head of technical analysis, only certain types of financial companies are worth buying. That is why he's not keen on the ETF that tracks the financial sector as a whole (trading under the ticker symbol XLF).
""I like financials selectively, but I don't think the XLF is the best way to play it,"" Wald said.
Though the XLF broke above a key resistance level last week and made new highs, Wald believes there are some signals the recent rally is not all in the sector as a whole.
(Read: )
""Only a net 17 stocks of the 84 that are in the sector made a new 52-week high with it,"" Waldsaid. ""So it's a very selective move, not broadlybased. A little bit of a closer look will show that the capital markets industry and the REITs industry were the big drivers of this trend. These are the industries that we want to buy.""
Wald, however, is worried about the banks. ""I think XLF has too much exposure to the banks,"" he said. ""I would rather be a little more selective and concentrate on the industries rather than the sector.""
Gina Sanchez, founder of Chantico Global, is on the same page as Wald when it comes to the XLF's exposure to banks.
(Read: Citigroup facing restrictions on sales of hedge fund investments: Report)
Banks make up about 36 percent of the XLF's holdings. ""That's a huge driver of how it will do,"" said Sanchez, a CNBC contributor. ""To the extent that we don't have a constructive view on banks, it's hard to get really excited about the XLF.""
Though banks have had good earnings results in the second quarter of 2014, Sanchez thinks that already has been priced into the stocks.
""Performance has really been bid up over the last several months,"" Sanchez said. ""At this point you're looking for even more performance than they've already given, and I'm not sure that's possible. So if you have a bad view on banks, you probably don't have a great view on XLF.""
To see the full discussion on the XLF, with Wald on the technicals and Sanchez on the fundamentals, watch the above video.
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Murphy Oil : “I like Murphy Oil.”
VeriFone : “Ever since that accounting debacle, I don’t want to get near that darn thing.”
Otter Tail : “Use the weakness to buy. Wind power’s real.”
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Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
Sachin Solkhan, a veteran software engineer who works with Fidelity Investments, has thought a lot about how technology can help people with dementia recognize their loved ones.
So when Amazon launched its DeepLens camera in November 2017, he got the idea to use its artificial intelligence software to do just that. Ahead of the device's official launch later this week, he attended a hackathon on his own time to build a system that records a user's experiences and recognizes the person right in front of them.
""I wanted to find a way to use the device to help out someone who is struggling,"" he said.
DeepLens is Amazon's equivalent of Google's Clips ""smart"" camera, but it's targeted to developers instead of consumers. The idea is to use artificial intelligence technology to make it easier for the camera to do things like recognize objects or characters that appear in a video stream.
Solkhan is hoping that people experiencing memory loss will someday carry around the camera with them wherever they go.
Here's how it would work: The DeepLens system would store photographs and names of a user's family and friends in Amazon's cloud service. The camera would then record interactions. And if it all goes right, the AI would then recognize the person and issue a verbal prompt.
Solkhan is testing it out with friends and family members as a side project.
In recent years, Amazon has increasingly been looking for ways to use tools like artificial intelligence in health care for people with complex medical needs.
The company isn't alone. Apple and Alphabet also see opportunities in health, a $3 billion sector that lags far behind other industries in adopting technology.
""We see a lot of usage for machine learning from primary care to medical screening,"" Amazon's machine learning and AI general manager, Matt Wood, said in an interview with CNBC.
Wood said the camera literally put Amazon's advanced technology, like machine learning and artificial intelligence, into the hands of developers.
He described some of the first applications as ""fun,"" like recognizing species of pet dogs. But others are targeted to helping seniors and people with serious medical problems, like Solkhan's device.
""We're motivated to use it (machine learning) to improve elder care, and care in general,"" he said.
Just when Jim Cramer thought the market was done worrying about the drama of foreign lands, suddenly China brought the focus right back to where it was with Greece a few weeks ago.
""Yes, the idea that there is big trouble in not-so-little China, based on some very weak Chinese factory orders and a stock market that is being proper up by the Communist party, lay behind today's carnage,"" the ""Mad Money"" host.
The complete rollover of the commodity sector has investors thinking that something evil lurking in China might take the whole world down with it. This was evident when the breathtaking collapse of raw goods on Friday had things falling apart all over the place.
All over the place... except for the United States. In fact, Cramer suspects that the confluence of the robust economy in the U.S. with problems overseas will really hit home next week. (Tweet This)
On Wednesday, the Federal Reserve will be making its decision on interest rates. Due to the very robust job growth currently in the U.S., the Fed is widely expected to confirm that it will raise interest rates in September.
Cramer gives the Fed some credit, as it held off tightening earlier because it was worried about the impact of a Greek-related disaster in Europe. But now that the Greek drama is over, should the bulls hope that the Fed will hold off again because of China?
Or will it decide that growth without commodity inflation is a good thing and not do anything? Or will it say that the U.S. has wage inflation, so it is time to raise rates?
The ""Mad Money"" host does not know the answers to these questions. The one thing he does know, though, is that Friday's selloff was directly correlated to fears that the Fed will be too hawkish. Cramer did not like that the market refused to rally, even after receiving some stunning earnings from companies.
At this point if the Fed were to raise rates, Cramer thinks it would send the dollar soaring, which would prompt U.S. based international companies to do poorly, which would then result in negative earnings in the future.
""In short, I think there is a heightened risk of a further rollover, but as I always say, this kind of a selloff will give you an opportunity to buy high-quality stocks at bargain basement prices,"" Cramer said.
It doesn't take a genius to realize that the near-term investing world is looking pretty bleak. Cramer can see the combination of lack of market leadership, too few stocks going higher, a general feeling of teetering all add up to the notion that we have topped out for now.
""Here's how I want you to think about it: China is the new Greece, and the market is not done discounting the possible woes of the most populous country on Earth,"" Cramer said.
With this in mind, Cramer geared up for earnings next week. Here is what he will have his eye on:
- Monday: , Baidu
- Tuesday: DR Horton, DuPont, Gilead, Twitter
- Wednesday: Facebook
- Thursday: Procter & Gamble, Mondelez
- Friday: Exxon Mobil & Chevron. ""The worst stocks in this market, perhaps the worst I've seen in ages, are the oils. How fitting that Exxon and Chevron both report,"" Cramer said.
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Read more from Mad Money with Jim Cramer
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The ""Mad Money"" host is looking to hear what both companies say about the long-term view of oil. Will it be a V-shaped recovery? Are things going to get worse before they get better? Oil is in a free-fall, and these two companies can make sense of it.
At the end of the day, Cramer doesn't like it when good earnings mean so little in the market, like they did on Friday. Right now, the market is all about Chinese pain and Fed worries. Cramer says to keep all eyes on longer term opportunities that could present themselves, that have little to do with the Fed or China.
Stocks start the week on a nervous footing, with traders looking for signals from both China and the Fed to turn the tide.
While stocks could see a reflex pop after last week's nearly six percent decline in the S&P 500, traders see the potential for the first double digit decline in the S&P in four years and a possible rocky period ahead.
S&P/Capital IQ strategist Sam Stovall said the S&P 500, in fact, could see its first negative year since 2011, if it does fall into a true correction of 10 percent or more.
""Should the S&P slip into a long overdue correction mode, it will likely take longer than year end to get back to break even,"" said Stovall. In 2011, the S&P was just very slightly lower, down much less than 1 percent. Before that it was last lower in 2008. As of now, it is down 4.3 percent for the year.
Markets have been spooked by a slowing China and traders are watching for signs of further stimulus from China as well as clarity from the Fed on whether a September rate hike is still possible.
""China's the big one. They've got to step in and do something. I think the Fed is an issue but it's not the biggest deal. They're damned if they do, damned if they don't,"" said Robert Doll, Nuveen Asset Management chief equity strategist and senior portfolio manager.
China Sunday allowed pension funds managed by local governments to invest in its stock market for the first time. Shanghai stocks were down nearly 12 percent last week. The Wall Street Journal also reported that China is planning to announce more steps to add liquidity to banks in the next several weeks, including cutting the deposits banks are required to keep in reserve.
Stocks fell Friday in a second day of heavy selling, with the Dow's 530-point drop the biggest one-day decline in four years. That index is now in a 10 percent correction for the first time since October 2011. The S&P 500 also fell sharply, blasting through key support levels to 1970, for a one-week decline of 5.8 percent. It is now 7.7 percent off its May highs.
Markets have been worried that China's will weaken further, and the ripple effects will continue to spread into other emerging markets and commodities. Emerging market currencies were lower in Asian trading early Monday, after a sharp drop in the past week. The Mexican peso last week was down 3.8 percent, the Malaysian ringgit was down 2.6, and the Russian ruble was down 6.6 percent, to name a few. Those markets have also been hit hard by the prospect of a rising dollar and higher U.S. rates, which would also be a setback for commodities and their currencies.
U.S. stock futures were lower Sunday. Since Tuesday, the S&P 500 fell about 130 points, with 64 of those points on Friday alone. Selling accelerated Wednesday, after the Fed released the minutes of its last meeting. The markets took those minutes as dovish and immediately began pricing out a rate hike for September, even though the Fed indicated it was still undecided at its July meeting. Traders say the next downside target for the S&P 500 is now around 1950.
While stocks were slammed in the past week, buyers moved into Treasurys, but the move in bond yields did not keep pace with the sharp sell off in stocks.
Nomura rate strategist George Goncalves says bonds are not yet exhibiting a big flight to quality trade.
""I think the bond market into the end of next week is going to operate on its own devices. There are some technical things with the end of the month. It's also the end of the summer…People don't want to get involved at these levels,"" said Goncalves.
Goncalves said Nomura expects the Fed to tighten in December but the odds of 2016 are rising, and the odds of September are waning.
""You need another day or two of this volatility for people to throw in the towel,"" he said. It would take another big swoosh down in stocks for a major flight to quality trade to come into the Treasury market. ""If financial conditions continue to worsen, driving equity declines and credit widen, then the market is doing the tightening for the Fed.""
Goncalves said market expectations for action by China may be too high. ""There are a lot of things the Chinese could do but not in the short run. We're talking about an area of the world that has a slowing economy. Their equities market has been volatile and now they've changed their FX regime. They're doing a lot. We can't fault the Chinese for not trying to arrest these market changes. I think that it has to get worse for them to do more,"" he said.
Read MoreS&P strategist: Possible negative year for stocks
Yields move inversely to prices, and the yield on the 10-year yield was at 2.04 percent late Friday.
Oil futures were trading lower Sunday night, after eight weeks of declines, the longest weekly losing streak since 1986. West Texas Intermediate futures temporarily fell below $40 per barrel Friday but closed at $40.45 per barrel. WTI was down 4.8 percent for the week. The VIX, the CBOE's fear index based on put and calls in the S&P 500, shot up to 28.03 Friday, a 47 percent jump in one day.
""It's hard to know how much of the (S&P) decline, at the end of the day, was options expiration,"" said Peter Boockvar, chief market strategist at Lindsey Group. ""You have a Friday in the summer where nobody's going to understand what's going to happen Sunday night in China. The market is worried about global growth."" Traders speculated the Chinese government would intervene with a liquidity injection or some other stimulus. The Shanghai market, falling for weeks, was down more than 4 percent Friday after a weak Chinese manufacturing report.
Boockvar said stocks reflect both softer global growth and shrinking U.S. corporate earnings growth. ""The market is adjusting to this…. The fundamental story for the U.S. market has changed because of the Fed, the end of QE (quantitative easing) and the potential rise in interest rates. The major tailwinds over the last couple of years has become headwinds. I think this correction is the beginning of something more. Could we have violent rally? Sure, but we could also be on the cusp of a bear market. This bull market has gone on for six years. People should be more worried about playing defense than picking bottoms,"" said Boockvar.
But Doll expects the market to come through the downturn and react much like it has after all of the pullbacks since the bull market began. ""I think the selloff is more than half way in terms of points, but less than halfway in terms of time,"" said Doll.
Jonathan Golub, chief U.S. market strategist at RBC Capital Markets, said the market focus will really be on the markets in the week ahead. ""Do I think there will be some government officials around the world who speak and that become news headlines? Yeah, but the market becomes its own story,"" he said. ""What we will be talking about in the absence of a big data week and because we're not in earnings season, is really going to be where the dollar is, oil, volatility and the 10-year and that interaction is going to basically dominate what happens to the market. That's going to be far more important than what happens at the company level,"" said Golub.
Economists polled by CNBC mostly still believe the Fed will raise rates in September, even though the market now expects it to be later. There are several Fed speakers in the week ahead and the important Jackson Hole, Wyoming, Fed symposium begins Thursday. Fed Chair Janet Yellen is not attending the conference, but Fed Vice Chairman Stanley Fischer is attending, and he speaks Saturday.
Ahead of that, New York Fed President William Dudley, viewed as closely allied to Yellen, speaks on the regional economy Wednesday, but he will take questions from the media. Atlanta Fed President Dennis Lockhart speaks Monday, and his recent comments have been viewed as hawkish since he said he saw no reason for the Fed not to raise rates in September.
There is some important data in the week ahead, with the most important release the personal income and spending data Friday. There is also the revision to second quarter GDP on Thursday and economists expect growth to increase to 3.4 percent.
Monday
9:45 a.m.: Manufacturing PMI
3:55 p.m.: Atlanta Fed President Dennis Lockhart
Tuesday
9 a.m.: S&P/Case-Shiller home prices, FHFA home prices
10 a.m.: New home sales, Consumer confidence
1 p.m.: $26 billion 2-year note auction
Wednesday
8:30 a.m.: Durable goods
9:45 a.m.: Services PMI
10 a.m.: New York Fed President Dudley on regional economy, Q&A
1 p.m.: $35 billion 5-year note auction
Thursday
Jackson Hole Fed symposium begins
8:30 a.m.: Initial claims
8:30 a.m.: Real GDP Q2 (second)
10 a.m.: Pending home sales
1 p.m.: $29 billion 7-year note auction
Friday
8:30 a.m.: Personal income
10 a.m.: Consumer sentiment
Saturday
12:25 p.m.: Fed Vice Chairman Stanley Fischer at Jackson Hole; topic U.S. inflation
--updates with correct name of Jonathan Golub's firm
Despite the gloomy budget headlines from Washington and the tragic events in Manchester, England, new records were set this week by both the Nasdaq and the .
Both have posted gains for seven consecutive sessions, matching seven-day win streaks for each that ran through Feb. 15. The Nasdaq last had an eight-day win streak in February 2015, while the S&P's most recent eight-day win streak happened in July 2013.
Kourtney Gibson, president of Loop Capital Markets, told CNBC's ""On The Money"" this week that ""I think the market is somewhat desensitized a little bit from some of these things. I think the good news is that we are actually focused on economic data and actually focused on the earnings that we are seeing coming out of the market right now""
Recent earnings winners included Wal-Mart and Home Depot, signs of life in the dismal retail sector. Last week, HP, Medtronic and Best Buy all posted better-than-expected earnings. On the data front, a fresh reading on gross domestic product showed a better number than the first estimate. Manufacturing PMI for May also saw better-than-expected numbers with new orders at their best level of the year and employment improving.
Looking ahead to next month's two-day Federal Reserve meeting, where a rate rise is expected, Gibson says a hike could ultimately be good news for savers.
""For the average American raised interest rates obviously mean higher mortgage rates potentially on the long end of course, auto loan rates will go up. Hopefully we will begin to see some of those savings rates increase for the consumer,"" Gibson said. ""I'd love to see some of the larger bulge-bracket investment banks and commercial banks begin to raise the savings rates for the average consumer as well.""
Gibson warns this week's big market headlines shouldn't throw a monkey wrench into your investment strategy. Just stay the course.
""Hopefully you are investing for the long term and your financial advisor or whoever is helping you with determining your asset allocation is positioning you for the time horizon which you currently have, in which you'll actually need the money,"" she said. ""So, changing something based just on this week is probably not advisable for most.""
Meanwhile, all three major indexes posted gains for the week, breaking two-week losing streaks for the Dow and S&P 500.
""On the Money"" airs on CNBC Saturdays at 5:30 am ET, or check listings for air times in local markets.
Business messaging service Slack briefed investors on Monday, as the company expects to go public with a direct listing on the New York Stock Exchange on June 20.
Slack provided updated information in an amendment to its initial public offering filing ahead of its pitch to investors. For the quarter ending April 30, Slack brought in revenue estimated between $133.8 to $134.8 million, up from $80.9 million in the same period a year ago. Slack's net loss expanded to about $39 million in the quarter, from $26.3 million.
The service, which primarily caters to businesses, said it has more than 10 million users as of January. In its briefing to investors, Slack said it will release first quarter earnings and host a conference call on June 10, as well as give a second quarter forecast.
Stewart Butterfield, co-founder and CEO of Slack, made the case that replacing email with Slack changes the way employees of a company communicate.
""This shift is inevitable. We believe every organization will switch to Slack or something like it,"" Butterfield said in a presentation.
He also pitched Slack as a software-focused company that believes the world is ""only at the beginning"" of its reliance on software. In that essence, Butterfield likened Slack as eventually becoming a utility, similar to the internet or electricity.
""The world is going to continue to use more and more software and we deliberately try to put ourselves in a position where Slack the company gets more valuable as the world uses more software because Slack the product becomes more valuable for our customers as that customer uses more software,"" Butterfield said.
Slack is the latest in a string of large technology companies coming to the public markets. But rather than a traditional IPO, the service will list its shares directly on the NYSE. It's the second major tech company over the last year to opt for a direct listing, following Spotify. Slack's ticker symbol will be SK.
Slack, similar to the recent IPOs of Lyft and Pinterest, will offer two classes of shares, to consolidate voting power among its top shareholders. Slack's Class A common stock will receive one vote per share, while Class B will be entitled to 10 votes per share.
Disclosure: Comcast Ventures, the venture arm of Comcast, is an investor in Slack. Comcast owns CNBC parent company NBCUniversal.
When Electronic Arts bought social games maker Playfish for $300 million—plus a $100 million buyout—in 2009, it sent shock waves throughout the videogame industry. Spurred by growing speculation about the value of then-private Zynga, some tech pros say it was the beginning of a bubble for developers who specialize in Facebook games.
On Monday, EA once again surprised the tech world – this time by announcing plans to axe several games on the social network, including The Sims Social, SimCity Social and Pet Society. When those titles shut down on June 14, Playfish may not have any active games—thus raising questions about its fate. (EA declined to discuss the future of Playfish, saying it was ""not commenting on individual teams."")
The Sims Social was once one of the most popular games on Facebook, with daily active users topping 10 million. It has fallen off of those highs, though, in a big way: Today, the game boasts just 500,000 daily players, according to App Data – and may soon fall out of the Top 100 Facebook titles; it's currently ranked 98th.
(Read More: EA Puts Faith in 'Next Gen Consoles')
EA is just the latest videogame maker to distance itself from social network (though games from its PopCap division will continue to be playable there). Zynga, once the king of Facebook games has been steadily shifting its focus to mobile games and real world gambling to increase revenues.
(Read More: Gaming Industry's Latest Idea: Free Games)
While Facebook officials have recently begun talking up games as part of the company's strategy, analysts note the site has failed to find a way to handle notifications without them appearing spam-like, causing players to lose some interest and developers to move elsewhere. A Facebook spokesman has disputed this, recently telling Gamasutra game installs are up 75 percent compared to a year ago.
While EA won't confirm the shutdown, Playfish staffers seemed to hint at the situation on the Playfish forums. The developer encouraged players to use their Playfish cash cards—gift cards bought at retail stores that can be used to purchase in-game items in any of the developer's titles—before The Sims Social sunsets. ""After that date, you will need to contact customer service regarding your Playfish cash cards,"" the developer said—indicating no future games were forthcoming.
The apparent end of Playfish games is just the latest in a series of recent misfortunes for EA. In March, CEO John Riccitiello announced his resignation (chairman Larry Probst is filling the position in a temporary basis now). In the weeks leading up to that, the launch of a much anticipated reboot of ""SimCity"" was marred by online server problems that prevented many players from being able to access the game, which required an Internet connection.
And just last week, EA laid off an undisclosed number of employees as part of a streamlining movement to become more efficient and sharpen its focus. And that action came days after EA was named the ""Worst Company in America"" by consumer watchdog website The Consumerist for the second year in a row. (In an open letter to gamers last week, EA chief operating officer Peter Moore said the company could do better, but added the label of ""worst company"" was undeserved.)
Analysts say Playfish appears to have been a bet that just didn't work out for the company. ""In the final analysis, Riccitiello probably didn't manage the company's cash well enough,"" says Michael Pachter of Wedbush Securities. ""They made a lot of acquisitions that, in 20/20 hindsight, weren't worth it—including Playfish.""
The Playfish acquisition was the spark that led to enormous valuations and takeover prices of social gaming companies. Soon after EA's purchase, Disney laid out $563 million for Playdom—a company which, at the time, had a much smaller reach than Playfish. And in 2011, EA paid $750 million for PopCap Games.
Facebook, though, has become a less important platform for games in recent years as mobile games have shown a significantly stronger growth pattern. Playfish never really made that transition. ""The perception was Facebook would grow unabated,"" says Pachter. ""There's still money to be made, but it's hard to stand out. The opportunity for growth is much smaller than people thought.""
""There have been a lot of [developers and publishers] pulling out of Facebook,"" adds Billy Pidgeon, an independent market research analyst. ""But I would have like to have heard [EA is] keeping some other aspect of social. Certainly, they can keep it going to some degree with PopCap, but most other people are moving aggressively toward mobile and away from social.""
Despite the recent move, Pachter remains bullish about EA's future. He rates the stock an ""outperform,"" and recently raised his target price on the company from $23 to $25 to reflect improving industry outlook ahead of the launch of next generation consoles. ""They will have huge earnings growth next year,"" he says. ""They'll be fine.""
Others area bit more cautious, noting the company seems to be at a crossroads. ""EA faces a number of crucial decision points regarding resource allocation and franchise planning in the hit-driven video game business,"" said Baird Equity Research's Colin Sebastian in a note to investors. (Sebastian is neutral on EA.)
And Pidgeon notes that the company needs to become more realistic with its projections. ""Activision has always done better at maintaining expectations to the point where they were projecting growth for each quarter and they were able to under promised and over-deliver,"" he says.""With EA, it's been the other way around. And that's not the way to keep investors happy.""
SAN MATEO, Calif.--(BUSINESS WIRE)-- CCGroup announced in April 2012 the release of a free download version of the Cave Grouper™ software known as CaveGrouper-Lite™. This is the first public grouper of medical condition episodes-of-care. CaveGrouper-Lite™ builds longitudinal episodes of care for acute conditions (e.g., upper respiratory infections, sinusitis) and for chronic conditions (e.g., diabetes, asthma).
The Cave Grouper™ is the oldest and most established grouper of episodes-of-care in the market today. The first article was published in 1992 based on work formed since 1989. Over the past 22 years, derivations of the Cave Grouper™ have been applied and validated using a wide variety of study populations totaling over 90 million individuals and 705,000 physicians. CCGroup has invested significant time and effort to determine and develop the most appropriate methods to build episodes-of-care and to obtain reliable, stable provider efficiency scores, especially the method on using a predefined set of medical conditions for a specialty type.
“CCGroup is proud to be the first company to release a free grouper of medical condition episodes to the public,” stated Dr. Douglas G. Cave, President of CCGroup. “This is a key phase to allow all of CCGroup’s methods and algorithms to be 100% transparent for public use – including health plans, health systems, and the Federal and State governments.”
CaveGrouper-Lite™ has been successfully downloaded a significant number of times – and the downloads continue. Dr. John Rootenberg, SVP of Clinical Strategy, affirmed the following percentage breakdown by entity type. “20% of downloads were from health plans; 16% from healthcare consulting firms; 15% from physician groups; 14% from hospital-based health systems; 14% from academic universities and research organizations; 9% from healthcare software vendors; 4% for State and Federal Government agencies (such as the Centers for Medicare and Medicaid Services); 4% from pharmaceutical/biotech companies; 2% from potential competitors to CCGroup; and 2% from all other.”
A main reason stated for downloading CaveGrouper-Lite™ continues to be the new Accountable Care Organization (ACO) and Patient Centered Medical Home (PCMH) legislation. “The CaveGrouper-Lite™ is essential for consistent episode-of-care analytics and performance measurement,” stated Dr. Cave. “For resource planning purposes, clinical leaders need to gain a complete view of the medical condition prevalence of their covered population base. In this manner, healthcare resource needs may be adjusted with changes in the condition-specific prevalence rates.”
Other common reasons stated for downloading CaveGrouper-Lite™ included the following. Clinical leaders stated they need to track medical condition episodes-of-care to physicians and compare their average costs and utilization patterns to one another and to CCGroup’s national comparative database. Also, under the CMS Bundled Payments initiative, the episodes-of-care may be used by clinical leaders to examine possible bundled payment models.
Dr. Cave stated, “A key foundation for accountable performance measurement is the CaveGrouper-Lite™ because the methods and algorithms are 100% transparent, free to the public, and tested and validated on all study populations.”
Download the CaveGrouper-Lite™
About Cave Consulting Group, Inc.
Cave Consulting Group, Inc. is a software and consulting firm located in San Mateo, California. The company is focused on improving the efficiency (cost-of-care) and effectiveness (quality-of-care) in the healthcare delivery system. Senior management of CCGroup has assessed the performance of physicians and hospitals for over 23 years for health plans, HMOs, TPAs, employers, and the Federal Government.
Markets might be too optimistic on the euro zone's prospects, according to the Christine Lagarde, the managing director of the International Monetary Fund (IMF), who has warned that large amounts of debt, unemployment and low inflation could hit growth in the region.
Speaking at an event in the Robert Schuman Foundation in Paris, she said that Europe continues to face important challenges concerning its long-term future and markets might be at risk of being too complacent.
""The good news is that the European economy is recovering from the crisis. Confidence is improving and financial markets are upbeat. Perhaps too upbeat,"" she said.
Read MoreIMF calls on the US to hike its minimum wage rate
Following the financial crash of 2008, nations across the globe were forced to restructure and rebalancing their economies. Substantial sovereign and bank debt led the euro zone to fall back into recession in 2011. The bloc's economy managed to expand again – just - in the summer of 2013, but has failed to build on that with growth of just 0.2 percent in the last quarter compared to the previous period.
Read MoreDraghi: Strong euro is a risk to recovery
Lagarde added that a ""vicious cycle"" could hit the flickering signs of recovery in the region and called upon the European Central Bank and euro zone leaders to encourage the perfect economic environment for the euro zone to recover.
Among the measures they should take, Lagarde recommended the region's governments should remove the structural roadblocks that hurt innovation, job creation, and productivity. Monetary policy from the central bank should also be supportive until demand has picked up, she said, also calling upon governments that had the availability to spend more on public investment. She also called for the completion of a banking union in the bloc and the repatriation of bank balance sheets.
Read MoreEuro zone stalling? Barclays downgrades growth
""More developed and diversified regional capital markets can support innovation, investment, and long-term growth,"" she added. ""Deeper integration with world markets would improve productivity and plug countries into global supply chains.""
OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has assigned a debt rating of “bbb+” to the $1.35 billion 2.75% senior convertible debentures due 2042 recently issued by WellPoint, Inc. (WellPoint) (Indianapolis, IN) [NYSE: WLP]. The rating has been placed under review with negative implications, which is consistent with the under review status of the existing ratings of WellPoint and its insurance subsidiaries. (See A.M. Best’s press release dated July 10, 2012 for further information.)
The securities are being sold to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933. If the initial purchasers exercise their over-allotment option in full, the net proceeds from the offering would approach $1.5 billion. WellPoint intends to use up to $400 million of the net proceeds for common share repurchase and the remainder for general corporate purposes, including, but not limited to additional share repurchase and debt repayment.
Although WellPoint’s pro forma financial leverage—as well as its goodwill and intangibles to equity ratio—is somewhat higher than similarly-rated peers, A.M. Best views somewhat favorably the financial flexibility afforded by the convertible debentures. Additionally, the issuance is consistent with A.M. Best’s expectations with respect to WellPoint’s capital structure incorporating the financing for the previously announced $5.0 billion (approximate) acquisition of AMERIGROUP Corporation (Amerigroup).
The Amerigroup acquisition is expected to close by year-end 2012, subject to state and federal regulatory approvals. WellPoint’s ratings are anticipated to remain under review pending the completion of the transaction and A.M. Best’s continuing discussions with management. However, A.M. Best will continue to monitor WellPoint’s operating performance, risk-based capitalization at the operating companies and its capital structure to ensure financial and operating metrics remain within A.M. Best’s expectations.
The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
As yet another day of trading is behind us, here's how the ""Fast Money"" traders plan to tackle Friday, Oct. 28:
Joe Terranova, chief market strategist at Virtus Investment Partners, recommends using a stop. He didn't elaborate.
Metropolitan Capital president Karen Finerman simply said she's selling upside calls against her long positions.
Check out Ametek's stock, trader Guy Adami said. The Berwyn, Penn.-based company makes electronic instruments.
Click here to see other Final Trade posts
______________________________________________________
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to .
Q: On Fast Money’s trader radar we look at the stock that was lighting up screens across Wall Street. This firm was founded as a mining company in the small town of Two Harbors, Minnesota in 1902. Now it's a leading maker of more than 50,000 products, including duct tape, optical film for TVs and Post-It notes. But today, the CEO should have made a note to remind him to hedge overseas exposure, as a stronger dollar is eating away at international sales. Who is it?
A: On the trader radar tonight we’re watching 3M ! The maker of the Post-It and Scotch tape was among the most active names on the NYSE today.
Mark Spitznagel, the libertarian hedge fund manager, has a new part-time job: senior economic advisor to campaign for president.
Spitznagel is the founder and chief investment officer of Universa Investments, a fund that specializes in protecting investors against sharp market drops, sometimes referred to as Black Swan events. The firm manages about $6 billion in assets, a sizable figure for the hedge fund industry.
""I am very grateful to have Mark Spitznagel serve as senior economic advisor to my campaign,"" Paul, now a U.S. senator from Kentucky, said in a statement.
""As I travel across the country, the top concern of the American people is our failing economy. I believe we can revitalize our economy by encouraging opportunity and entrepreneurship with lower taxes, a balanced budget, less Federal Reserve interventionism, and limited government spending,"" the candidate said.
""I look forward to working alongside Mark to solve our nation's economic problem and to restore the American Dream,"" he added.
Paul, one of the leading contenders for the Republican party nomination, was elected in the Tea Party wave of 2010. Much like his iconic father Ron Paul, Paul has become a libertarian standard-bearer.
Read More
Spitznagel is also the author of an investing book, ""The Dao of Capital"" and runs Idyll Farms, an organic goat farm in northern Michigan.
Universa moved its headquarters from Santa Monica, California, to Coconut Grove, Florida last March because of what Spitznagel called a ""more hospitable business and tax environment.""
""Rand Paul is the only candidate that really understands the destructive ramifications of current economic policy driven in large part by a reckless Federal Reserve. I lookforward to working with him on his ideas and message to change that policy,"" Spitznagel said in a statement about his new role.
Read MoreHedge funds eye Florida's 'New Manhattan'
The Fed will likely remain in the spotlight Thursday as a handful of secondary data reports are the major events on the calendar.
""I think barring any huge surprise in the jobs data tomorrow, I think a lot of tomorrow will be spillover from what the Fed had to say,"" said Myles Clouston, senior director at Nasdaq Advisory Services.
""My sense is a lot of investors feel like they're walking on eggshells right now. They're waiting for the next data point to come out,"" he said.
The data releases due Thursday include Fed Chair Janet Yellen's preferred indicator on the labor market, the Job Openings and Labor Turnover Survey for January.
""The labor market data now is somewhat secondary to the inflation data because we're near full employment,"" said Eric Stein, co-director of global fixed income at Eaton Vance Management.
Recent economic reports have showed signs of inflation picking up. The Labor Department on Wednesday said the consumer price index, ex-food and energy, rose 2.3 percent over the 12 months through February, Reuters reported.
However, in her news conference Wednesday afternoon, Yellen said, ""There may be some transitory factors influencing"" the recent rise in inflation.
Read MoreYellen: Negative interest rates not part of an active discussion
""I think markets continue to watch inflation. Markets are going to be continually assessing whether this pickup in core inflation is sustained,"" said Joe Seydl, capital markets economist at JPMorgan Private Bank. ""All of the uncertainty right now is on the inflation side of the Fed's mandate.""
""There's also the risk of another shock coming out of China,"" he said.
Other U.S. economic reports due Thursday include weekly jobless claims, the Philadelphia Fed survey for March, February leading indicators and fourth-quarter current account data.
Stocks rallied cautiously Wednesday after the Federal Reserve kept rates unchanged and lowered its projection to two hikes in 2016, down from four. Most analysts had expected a drop to three.
U.S. crude oil futures jumped 5.8 percent, or $2.12, to settle at $38.46 a barrel Wednesday, helped by the Fed news, a smaller-than-expected inventory build and the announcement of a meeting to discuss a proposal to freeze output.
Read MoreWall Street checks out of coal mines
Materials and energy led gains at the close. The Dow Jones industrial average and topped their 200-day moving averages to close at their highest of the year so far, with the Dow up 74 points to 17,325 and the S&P rising 11 points to 2,027. The Nasdaq composite climbed 35 points to 4,763 for its highest close since Jan. 6.
With Wednesday's gains, the Dow is down less than 1 percent year to date as is the S&P.
Krishna Memani, chief investment officer at Oppenheimer Funds, said the Fed made the right move Wednesday.
""I think the sentiment is still not bullish. I believe the Fed provides a bit of an impetus. The two combined keeps the market down the path of a modest rally,"" he said.
""I think this is an extension of the bull market. This is probably going to be one of the longest expansions we have ever experienced and the longest bull market we've ever experienced,"" Memani said.
Read MoreThe Fed under Yellen and the gold trade
Treasury yields and the U.S. dollar reversed sharply after the Fed announcement, with falling near 0.85 percent after earlier topping 1 percent. The U.S. dollar index fell to its lowest level in more than a month.
Gold jumped in post-settle electronic trade, rising more than $30 to $1,261 an ounce, on pace for its largest one-day gain since Feb. 11.
As traders watch the dollar, gold and yields for any unwind of Wednesday afternoon's sharp moves, options expiration on Friday could also add to volatility.
Companies scheduled to report earnings ahead of the bell Thursday include Tencent and Lands' End. Adobe Systemsis due to report after the close Thursday.
Read MoreStreet Explained: Do elections matter to markets?
The buyer of the $69 million NFT by the artist Beeple said he was prepared to bid even higher, since it will be seen by history as the starting point of a new age of digital art.
In his first television interview, Vignesh Sundaresan, also known as MetaKovan, told CNBC's ""Squawk Box"" that he has no regrets paying $69 million for what many say is simply a JPEG and an hyperlink. He said the rise of nonfungible tokens, or NFTs, herald a new era where technology has allowed artists and collectors around the world to buy and sell art more easily and democratically.
""This NFT is a significant piece of art history,"" Sundaresan said. ""Sometimes these things take some time for everyone to recognize and realize. I'm OK with that. I had the opportunity to be part of this very important shift in how art has been perceived for centuries.""
NFTs have exploded in recent months, as NBA video highlights, memes, digital art and even a tweet sell for six or seven figures. While proponents say NFTs, which assign ownership of any digital asset on the blockchain, will not only change the art world but could be applied to physical goods like homes and property. Sales of NFTs have now topped $500 million, according to many estimates.
""There are going to be hundreds of thousands of people from around the world who are going to adopt this medium, a digitally native medium to monetize art,"" Sundaresan said. ""There is going to be an economy around it. ""
He said that while the art world has been the exclusive purview of wealthy, largely white Western collectors and artists for centuries, NFTs have allowed ""artists in the Philippines, Thailand, or India now to make their first $1,000 or $500 on the internet.""
Sundaresan declined to say exactly how much he was prepared to pay for the work. He said he knew going into the Christie's auction that ""it would be competitive"" and had a ceiling price in mind that was higher than the $69.3 million he paid.
""We did have a higher limit,"" he said. ""I was very motivated and ready to go beyond even what we paid for it.""
Sundaresan said he has been investing in cryptocurrencies and cryptocompanies since 2013. He said he started ""with no money"" and began working for cryptocompanies and was able to invest early in fast-growth companies that have grown up around the cryptoeconomy. He declined to say how much he's worth on paper ""since it depends on the cryptomarket.""
He said he has invested in not just bitcoin and Ethereum, but also blockchain network Polka Dot and Flow. He said he's doesn't think crypto will face a ban from regulators or central banks.
""If regulators were tighter in previous years, that would have stifled innovation. I think we're at a point where they see the positive impacts of crypto around the world.""
When asked what his $69 million Beeple could be worth in a year or even 10 years, Sundaresan said he had no plans to sell it. But he hinted he may find ways to ""monetize it"" by either offering pieces of it or displaying it in a virtual museum.
""The piece is going to take on a life of its own, that's what makes NFTs really interesting,"" he said. ""It may not just be a piece of art, it can become thousands of other things. But I won't be selling it anytime soon.""
Fed Chair Janet Yellen said current high stock market valuations do not mean the market is overvalued or that a sell-off would pose much risk to the economy or financial system.
During her final press briefing on Wednesday, Yellen said when the Fed warns that asset levels are elevated, it means metrics, such as the price-to-earnings ratio for stocks, are on the high end of historical ranges.
""But economists are not great knowing what appropriate valuations are,"" she said. ""We don't have a terrific record. And the fact that those valuations are high doesn't mean that they are necessarily overvalued.""
Yellen said the low-rate environment is supportive of higher valuations. ""We are enjoying solid economic growth with low inflation. And the risks to the global economy look more balanced than they have in many years,"" she said.
The Fed assesses whether there would be an economic impact or financial stability concerns if the stock market were to sell off. ""I think when we look at other indicators of financial stability risks, there is nothing flashing red there or possibly even orange,"" she said.
She said the banking system is more resilient than in the past, and there is not a ""worrisome buildup in leverage or credit growth at excessive levels.""
""This is something that the FOMC pays attention to,"" she said, referring to the Federal Open Market Committee. ""But if you ask me: 'Is this a significant factor shaping monetary policy now?' Well, it's on the list of risks. It's not a major factor.""
As we head into Memorial Day, drivers are experiencing the lowest gasoline prices since 2008. So what explains the weakness?
Refiners are running strong, strong demand for gas has yet to materialize, and supplies outside of the Northeast are good. Couple that with weak numbers out of China on Monday, and you can see why demand for crude will be lagging.
I do not foresee low prices all summer long. After all, demand is expected to increase, and refiner problems are always at risk of cropping up. But by the same token, I do not see $4 gas on the horizon. Sure, we might get a few pockets around the country, but overall, it looks like smooth sailing (or driving).
So what levels am I looking at?
On the downside, I would buy at the $2.75 to $2.70 level. Indeed, gasoline has found solid support here. And as far as the upside goes, I would sell out of my position at $2.90.
LONDON, 31 March 2011 -- CNBC, the leading business and financial news channel, today announced that it will be available on Deutsche Telekom’s leading IPTV platform, Entertain from 1 April.
CNBC will join the Entertain package, which is available to 1.6 million subscribers with high-speed DSL lines across Germany. The agreement with Deutsche Telekom now means that CNBC reaches approximately 33 million households in Germany.
Justine Powell, Vice President, Distribution, EMEA at CNBC commented, “Germany is an important market for the channel and this agreement is significant to grow the reach of the channel in Germany on digital platforms.
“CNBC is already available via a number of digital satellite and cable providers, but we see IPTV as a key growth platform in Germany,” added Powell.
Entertain - Deutsche Telekom’s TV service
With around 140 TV channels, 15,000 titles - 2.000 of which available in HD - in the online video store and in the TV archive, around 2,500 national and international radio stations, as well as interactive applications, Entertain is the undisputed leader of the German IPTV market. Around 20 million households have the option of subscribing to Entertain via a high-speed DSL line. Entertain is available from EUR 27.95 per month (including TV and telephone connection) or EUR 44.95 per month (including TV, telephone and high-speed DSL flat rate.)
- Ends -
SpaceX Chief Executive Officer Elon Musk flew to the Seattle area in June for meetings with engineers leading a satellite launch project crucial to his space company's growth.
Within hours of landing, Musk had fired at least seven members of the program's senior management team at the Redmond, Washington, office, the culmination of disagreements over the pace at which the team was developing and testing its Starlink satellites, according to the two SpaceX employees with direct knowledge of the situation.
Known for pushing aggressive deadlines, Musk quickly brought in new managers from SpaceX headquarters in California to replace a number of the managers he fired. Their mandate: Launch SpaceX's first batch of U.S.-made satellites by the middle of next year, the sources said.
The management shakeup and the launch timeline, previously unreported, illustrate how quickly Musk wants to bring online SpaceX's Starlink program, which is competing with OneWeb and Canada's Telesat to be first to market with a new satellite-based Internet service.
Those services - essentially a constellation of satellites that will bring high-speed Internet to rural and suburban locations globally - are key to generating the cash that privately-held SpaceX needs to fund Musk's real dream of developing a new rocket capable of flying paying customers to the moon and eventually trying to colonize Mars.
""It would be like rebuilding the Internet in space,"" Musk told an audience in 2015 when he unveiled Starlink. ""The goal would be to have a majority of long-distance Internet traffic go over this network.""
But the program is struggling to hire and retain staff, the employees said. Currently, about 300 SpaceX employees work on Starlink in Redmond, the sources said. According to GeekWire, Musk said in 2015 the Redmond operation would have ""probably several hundred people, maybe a thousand people"" after 3-4 years in operation.
So far this year, about 50 employees left the company ""on their own accord,"" one of the SpaceX employees said, though the reason for those departures was unclear. Overall, SpaceX employs more than 6,000 staff.
As of Tuesday, there were 22 job openings — including a job making espresso drinks — for the Redmond office, according to SpaceX's website.
SpaceX spokeswoman Eva Behrend told Reuters the Redmond office remains an essential part of the company's efforts to build a next-generation satellite network.
""Given the success of our recent Starlink demonstration satellites, we have incorporated lessons learned and re-organized to allow for the next design iteration to be flown in short order,"" Behrend said.
She had no further comment on the reorganization or the launch window, but noted the strategy was similar to the rapid iteration in design and testing which led to the success of its rockets.
Among the managers fired from the Redmond office was SpaceX Vice President of Satellites Rajeev Badyal, an engineering and hardware veteran of Microsoft and Hewlett-Packard, and top designer Mark Krebs, who worked in Google's satellite and aircraft division, the employees said. Krebs declined to comment, and Badyal did not respond to requests for comment.
The management shakeup followed in-fighting over pressure from Musk to speed up satellite testing schedules, one of the sources said. SpaceX's Behrend offered no comment on the matter.
Culture was also a challenge for recent hires, a second source said. A number of the managers had been hired from nearby technology giant Microsoft, where workers were more accustomed to longer development schedules than Musk's famously short deadlines. Another senior manager that left SpaceX was Kim Schulze, who was previously a development manager at Microsoft, one of the people said. Schulze did not respond to a request for comment.
""Rajeev wanted three more iterations of test satellites,"" one of the sources said. ""Elon thinks we can do the job with cheaper and simpler satellites, sooner.""
A billionaire and chief executive officer of Tesla, Musk is known for ambitious projects ranging from auto electrification and rocket-building to high-speed transit tunnels.
A Musk trust owns 54 percent of the outstanding stock of SpaceX, according to a 2016 U.S. Securities and Exchange Commission filing, SpaceX's most recent.
SpaceX has said it would launch its satellites in phases through 2024. It goal of having Internet service available in 2020 is ""pretty much on target"" with an initial satellite launch by mid-2019, one of the sources said.
OneWeb aims for a first launch between December and February 2019, while Telesat was targeting 2022 for broadband services.
SpaceX employees told Reuters that two Starlink test satellites launched in February, dubbed Tintin A and B, were functioning as intended. The company is refining the orbital path of the satellites after the U.S. Federal Communications Commission, which oversees satellites in orbit, approved a request from SpaceX to expand Tintins' altitude range, one of the sources said.
The FCC confirmed SpaceX's modifications, which have not been reported previously, but declined further comment.
""We're using the Tintins to explore that modification,"" one of the SpaceX employee sources said. ""They're happy and healthy and we're talking with them every time they pass a ground station, dozens of times a day.""
SpaceX engineers have used the two test satellites to play online video games at SpaceX headquarters in Hawthorne, California and the Redmond office, the source said.
""We were streaming 4k YouTube and playing 'Counter-Strike: Global Offensive' from Hawthorne to Redmond in the first week,"" the person added.
In March, the FCC approved Musk's plan to beam down Internet signals from 4,425 small satellites launched into standard low-Earth orbit — more than two times the total number of active satellites there presently.
One SpaceX engineer told Reuters the company has studied plans to add roughly 10,000 additional satellites after its first array is live to meet bandwidth demand in the coming 20 years. Behrend declined to comment on the plans and referred to a previous FCC filing, which states an additional 7,518 satellites are under consideration.
Such a move would keep it in the race to expand affordable high-speed Internet access to billions of people in rural or suburban areas globally. The Satellite Industry Association, a lobby group, estimates the global market for satellite-based broadband and television services is worth $127.7 billion, dwarfing the roughly $5.5 billion satellite launch services market.
McLean, Virginia-based OneWeb is working to provide internet service from roughly 900 satellites after raising more than $2 billion from SoftBank, the Coca-Cola Company and others.
Telesat, backed by Loral Space & Communications Inc, said on Oct. 23 it conducted the first-ever live test of in-flight broadband via a satellite in low-Earth orbit, and was targeting 2022 for broadband services from a constellation of some 300 satellites.
SpaceX aims to provide Internet service by linking its satellites to ground stations and mountable terminals about the size of a pizza box at homes or businesses, according to the FCC filing. The U.S. market for broadband is already dominated by several incumbent communications companies, including NBCUniversal and CNBC parent Comcast. Comcast declined to comment on the potential new competition.
While SpaceX's model of reusing rockets has generated cash, it is not enough to cover the roughly $5 billion cost to develop its Big Falcon Rocket that Musk wants one day to fly to Mars.
""There had to be a much bigger idea for generating cash to basically realize the Mars plans,"" said one of the SpaceX employees. ""What better idea than to put Comcast out of business?""
WATCH: This Brooklyn startup wants to make spacesuits at a fraction of NASA's cost
Short-term pain, long-term gain.
That's how top fund manager Bill Nygren views investing into the precipitous fall in energy stock prices, telling CNBC.com, ""Given the recent selloff, this is the area to be opportunistic in.""
Target on Sunday announced it's opening dozens of permanent Disney stores within its own stores over the next year, as it invests in more unique ways to lure customers inside.
The announcement comes on the heels of Target's strong quarterly earnings report last week, where it showed it drove more people to stores and got them to spend more money there. Its stock touched a record intraday high of $106.52 on Thursday. Target shares are now up more than 55% year to date.
This Oct. 4, ahead of the holiday season, 25 Disney stores will open at certain Target stores across the country, in cities including Philadelphia, Denver and Chicago. (See a full list of those locations below.) Forty additional Disney locations — selling toys, games, apparel and more — are planned to open by October 2020, the big-box retailer said. It will also be launching a Disney-themed experience on its website, beginning Sunday, where shoppers can find products from the Pixar, Marvel and Star Wars brands, among others.
In expanding its tie-up with Disney, Target will also be opening a small-format store right near the Walt Disney World Resort in Orlando, Florida, in 2021, the companies said.
""Disney is among our largest and most admired [brand] relationships,"" Target CEO Brian Cornell said on a call with members of the media. ""We have spent a lot of time thinking about how to grow.""
Cornell declined to comment on how much Disney merchandise currently brings Target in terms of sales, or how much of a revenue driver he expects the Disney store expansion to be.
Meanwhile, the announcement comes as retailers across the U.S., including Target, Walmart, Kohl's and Amazon, are still vying for the market share Toys R Us left up for grabs after it liquidated last year. Though, the Toys R Us brand is still mapping out a comeback of its own.
Ahead of last holiday season, Target added a quarter-million square feet of space permanently dedicated to toys across more than 500 stores. About 100 stores received a fuller remodel in the toy aisles. When it reported 2018 holiday results, Target said same-store sales were up 5.7%, with the toy category being one of its strongest.
Disney said it will be opening the first batch of stores at Target right as a new assortment of merchandise from Disney's ""Frozen 2"" and ""Star Wars: The Rise of Skywalker"" hits shelves. It said it will also sell some collectible merchandise there, like dolls and apparel from its Disney Animators' Collection.
The companies explained the Disney stores within Target will be staffed by Target employees, who are set to receive special training ahead of the openings.
The mini Disney stores will span about 750 square feet on average, they said, and will be located next to kids clothing and the existing toy aisles in Target stores. Each store is expected to hold more than 450 items, including about 100 products that could previously only be found at Disney retail locations. It has more than 300 such stores globally today.
Target said many items will be under $20, with most ranging from $2 to $200. There will also be seating areas in the pint-sized shops for families to sit, listen to Disney music and watch Disney movie clips or take photos in front of interactive displays, it said.
People who own Disney gear or visit Disney theme parks are likely people who also shop at Target, according to Bob Chapek, chairman of Disney Parks, Experiences and Products. He said there's about a 90% overlap between the two company's customers.
""This gives us the opportunity to expand our footprint well beyond [malls],"" Chapek said on a call with members of the media. ""The experiential retail coming to Target is just what today's consumer is looking for.""
Chapek said Disney also has a partnership with J.C. Penney in some department stores, which it will continue even as it works with Target. ""That was something we started at smaller scale than what this was going to be,"" he said about teaming up with Penney.
The announcement for Disney also comes as it's been revealing new information about its upcoming streaming service's shows and films during its Disney+ panel at D23 Expo this weekend in Anaheim, California.
Meanwhile, for Target, an expanded partnership with Disney could become just one of many national brand partnerships growing in its stores, hundreds of which are being remodeled. CVS acquired Target's pharmacy business back in 2015, for example, and now operates that part of Target's stores through a ""store-within-a-store"" format. Target also recently announced it will be bringing denim maker Levi's to dozens of stores.
""Based on the performance of our business, we've had interest from a number of different vendors,"" Cornell said. But he cautioned Target will be very ""selective"" in picking the brands it chooses to work with. ""I can't think about a better national brand partner than Disney.""
Here are the 25 Target locations where Disney is set to open on Oct. 4:
Allen North #2516 (Allen, Texas)
Austin NW #1797 (Austin, Texas)
Bozeman #1237 (Bozeman, Mont.)
Brighton #922 (Brighton, Mich.)
Chicago Brickyard #1924 (Chicago, Ill.)
Clearwater #1820 (Clearwater, Fla.)
Denver Stapleton #2052 (Denver, Colo.)
Edmond #1398 (Edmond, Okla.)
Euless #1368 (Euless, Texas)
Houston North Central #1458 (Spring, Texas)
Jacksonville Mandarin #1300 (Jacksonville, Fla.)
Keizer #2110 (Keizer, Ore.)
Lake Stevens #1331 (Lake Stevens, Wash.)
Leesburg #1874 (Leesburg, Va.)
Loveland #1178 (Loveland, Colo.)
Maple Grove North #2193 (Maple Grove, Minn.)
Mobile West #1376 (Mobile, Ala.)
Murrieta #1283 (Murrieta, Calif.)
New Lenox #2028 (New Lenox, Ill.)
Pasadena #1396 (Pasadena, Texas)
Philadelphia West #2124 (Philadelphia, Pa.)
San Jose College Park #2088 (San Jose, Calif.)
South Jordan #2123 (South Jordan, Utah)
Stroudsburg #1260 (Stroudsburg, Pa.)
Waterford Park #2068 (Clarksville, Ind.)
One of President Barack Obama's economic advisors will join Hillary Clinton's campaign in another sign of close coordination between the White House and the presumptive Democratic nominee.
Jacob Leibenluft, deputy director of the National Economic Council, will become a senior policy advisor as Clinton prepares to fill out her economic agenda for the general election.
On Tuesday, she plans to deliver a speech in Columbus, Ohio, that will contrast her proposals to lift middle-class incomes with Donald Trump's business record, which she will argue is characterized by self-interest at the expense of others.
Leibenluft has served on Obama's economic team from the beginning of the president's first term. Among his areas of focus have been policies on job training, apprenticeships and the minimum wage.
Jared Bernstein, a former administration colleague, described Leibenluft as a ""very strong, fact-based analyst."" He joins a Clinton team that includes other ex-White House aides such as campaign chairman John Podesta and communications director Jennifer Palmieri.
What appears to be the final resolution of the crisis in Cyprus may not be perfect but it does not stray that far from the approach advocated here and on The Wall Street Journal's editorial page last week.
But a good resolution of the Cyprus crisis may not be enough to undo the damage from interventions that are not based on clearly stated diagnoses or predictable frameworks for government actions.
The lesson that policymakers should have learned in 2008 was that massive ad hoc responses with little public explanation undermine market confidence. Such interventions, developed through secret meetings, promote uncertainty and fear. If, as the gentleman once said, the only thing we have to fear is fear itself, this is the perfect recipe for producing that dangerous dish. (See this paper by John Taylor on how unpredictable intervention worsened the reaction to Lehman's collapse.)
The last-minute deal agreed by Cypriot and EU leaders will impose serious losses on the creditors of Laiki Bank, also known as the Cyprus Popular Bank. Some 4.2 billion euros in deposits of more than 100,000 euros will be placed in a ""bad bank,"" meaning they could be wiped out. Smaller deposits will be moved to the Bank of Cyprus, which will see its own deposits in excess of 100,000 euros frozen while the bank is restructured and recapitalized. A good portion of those deposits—it's not clear exactly how much—is likely to get converted into Bank of Cyprus equity as part of the recap.
Imposing losses on the creditors of failed banks—including uninsured depositors when the losses are extensive enough to wipe out bondholders—should have been the first reaction of policymakers. Instead, they sought to spread the burden of propping up Laiki and the Bank of Cyprus by imposing a tax on accounts of all depositors, including those in healthier banks.
As economic historian Anna Schwartz explained five years ago: ""Firms that made wrong decisions should fail.""
""You shouldn't rescue them. And once that's established as a principle, I think the market recognizes that it makes sense. Everything works much better when wrong decisions are punished and good decisions make you rich,"" Schwartz told The Wall Street Journal.
It's not clear why Laiki has to be wiped out. Perhaps its losses are worse than they have let on. But credible sources I spoke to thought the bail-in recapitalization should have been able to work for Laiki.
It's also unclear why the Bank of Cyprus' bondholders have not yet been wiped out. Depositors should sit on the top of the capital structure. If some deposits are being converted to equity, this should only be a last resort after the wipeout of other creditors.
I suspect the answer to these questions is that both banks were debtors to the European Central Bank. The ECB is unwilling to take losses on its support for banks, so it has arranged a scheme to wipe out Laiki while moving Laiki's ECB debt to the Bank of Cyprus. This isn't necessarily a terrible policy—but it is terrible that we're left speculating rather than being given direct answers by the authorities involved.
It's striking that this level of public dithering can be combined with the extreme lack of transparency. One would think that nothing kept this secretive could possibly look so publicly foolish at the same time. Once again the Eurocrats have outperformed expectations.
It will hardly be surprising if the fallout from this is far more traumatic to markets than the Eurocrats expect. They've revealed that they're still making this stuff up as they go along, that there is no way of predicting (much less quantifying) the risks of unprecedented policy moves being undertaken for unheralded interests. Not exactly the stuff that builds confidence, stability, and trust in a financial system.
PICK A DIRECTION AND GO WITH IT:
The headline: Stocks Finish Higher After Fed October Minutes Spark Roller-Coaster
The price action in the market was indicative of the beginning of a bottom, Jeff Macke said. Tuesday saw the first signs of life from the bulls in some time.
Pete Najarian agreed. Stocks look like they’re starting to find a “smoothing bottom,” he said. As financials fell apart, volatility never spiked, which helped on the rally.
OIL RECORD CLOSE:
The headline: Crude Oil Surges 3.6% to $98.03; Up 61% So Far This Year
The time is right to get long Chevron (CVX), Guy Adami said. It’s cheaper than ExxonMobil (XOM).
Investors shouldn’t think $100 is the endgame for oil, either, Pete Najarian said. Look for crude to continue higher after it breaches that level.
SANTA’S SLAY:
The headline:Target (TGT) Unexpectedly Misses Estimates, Making Holiday Retail Picture Even Bleaker
TGT acted terrible on Tuesday, Karen Finerman and Jeff Macke agreed. The fact that its apparel and home furnishings brands – the areas that it has been able to dominate Wal-Mart (WMT) – are no longer doing as well is concerning, according to Karen. Over time, she wants to own TGT but she’s still waiting for a good level to jump in.
Jeff Macke wouldn’t play Target either way in this market.
AFTER HOURS ACTION: WHOLE FOODS:
The headline:(WFMI) Profit Slides But Sales Climb 25%
Whole Foods is fighting an uphill battle, Jeff Macke said. The economic conditions aren’t right and the company is about to find itself a real competitor in Tesco (TESO).
Pete Najarian said Whole Foods’ increased dividend should be good for a short-term pop.
WILL GOOGLE GO TO $900:
The headline: Google (GOOG) Jumps 4% After Credit Suisse Sets $900 Price Target
Stocks like GOOG, Apple (AAPL) and Research In Motion (RIMM) are starting to find comfortable levels at which to get back in, Pete Najarian said.
Guy Adami would rather stick with Microsoft (MSFT), which has the biggest upside on a percentage-basis, he said. Guy predicted MSFT trades in the $40s next year.
Jeff Macke also recommended staying with Microsoft. It’s the “easier way to make money,” he said.
Unfortunately, they are still years away from targeting stem cells to create organs, Pete Najarian said, so its too early to trade on the headline. In the meantime, he recommended ISIS Pharmaceuticals (ISIS) and Sangamo Biosciences (SGMO) as current plays on cancer treatment.
OPRAH’S FAVORITE THINGS:
The headline: Oprah Releases Highly-Anticipated List of Her Favorite Things
Shares of Williams-Sonoma (WSM) and Deckers (DECK), the makers of some of the items on Oprah’s list, actually moved higher after the list was revealed. Karen Finerman said it wasn’t a “dumb trade,” as Oprah really can move markets.
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Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to .
Trader disclosure: On Nov. 20, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Macke Owns (YHOO), (EMC); Najarian Owns (AMTD) Options; (GOOG) Options; (YHOO) Options; Finerman's Firm And Finerman Own (GS), (KFT); Finerman's Firm Owns (SKS), (TSO), (WMT), (LTD), (CROX), Finerman's Firm Owns (MSFT) Options; Finerman's Firm Is Short (SPY), (IWM), (IYR), (IJR), (MDY), (LEN); Finerman's Firm Is Short (LEH) And Owns (LEH) Puts; Finerman's Firm Owns (HD) And (HD) Puts, Finerman Owns (HD); Finerman's Firm Owns S&P 500 Puts; Finerman's Firm Owns Russell 2000 Puts
Snap's marketing savvy, creativity and understanding of its users will help it survive Facebook's many efforts to kill it by imitation, tech veteran Rahul Sood told CNBC.
""Snap understands their audience better than anybody,"" said Sood, chief executive officer of e-sports betting start-up Unikrn and creator of Microsoft Ventures.
For example, over spring break at the Las Vegas MGM Hotel and Casino, the company installed a kiosk selling Snap Spectacles. ""These guys are hardcore marketers,"" Sood said on ""Squawk Alley.""
Facebook launched three new Snap-like features Tuesday morning — the fourth time Facebook has cloned Snapchat features in less than a year — sending Snap shares down more than 4 percent.
Facebook's big advantage is that it can reach users outside of Snap's relatively narrow demographic and show off features they may never have tried, Sood said Tuesday. ""It gives the an opportunity to play with it and use it,"" he said.
However, he added, what works for Snapchat doesn't always work on Facebook's apps.
""Instagram tried it with their Stories, and it feels sort of like an after-thought, like a bolt-on feature to Instagram,"" he said. ""I don't get it, to be honest.""
Wall Street welcomed Facebook's move to incorporate more Snap-like features. ""It's a great move and one that we expected,"" said Cantor Fitzgerald analyst Youssef Squali.
The last time Facebook did something as important as this — when Instagram copied Snap last year — the impact was a slowdown in user growth and engagement at Snap, he said.
""It will be interesting to see what happens over the next couple of quarters, but clearly if you're Snap, you're worried,"" he said. ""It's easy to copy a lot of these functions and the issue is really around engagement and user growth, ultimately.""
Disclosure: CNBC parent NBCUniversal is an investor in Snap
Despite tight capital control measures from Beijing, Miami is emerging as a cheaper buying destination in the U.S. for Chinese investors, Peggy Fucci, CEO of real estate broker OneWorld properties told ""Squawk Box"" on Thursday.
The city has remained a hot property for mainland investors even as Chinese regulators fined prominent brokerages Citic Securities, Haitong Securities, and Guosen Securities this week as a part of long-term capital control efforts in the country.
""I don't think that's going to stop the investment,"" Fucci said, referring to Beijing's efforts of cleaning up China's financial sector. ""I think that the U.S. real estate will continue to be that safe haven and that the Chinese will always look into it.""
Fucci said lower prices compared to long-standing investment havens like New York, San Francisco and Seattle help keep Miami in the mix for real estate investments from China.
Upcoming development projects are further attracting Chinese demand. Swire Properties is developing Brickell City Centre, which will include complex of luxury condos, office buildings, hotel and a shopping center.
Such increased foreign demand has been blamed for pushing property prices higher in the past, and has forced local governments to introduce cooling measures. But Fucci believes Miami's property market is still in the growing stage.
""I think that Miami has a lot of growing up to do and there's still a lot of room for growth in Miami,"" she said. ""The real estate market is a long-term play not just a short-term.""
—CNBC's Sophia Yan contributed to this report.
Digging out of debt keeps getting harder for the unemployed as more companies use detailed credit checks to screen job prospects.
Out of work since December, Juan Ochoa was delighted when a staffing firm recently responded to his posting on Hotjobs.com with an opening for a data entry clerk. Before he could do much more, though, the firm checked his credit history.
The interest vanished. There were too many collections claims against him, the firm said.
“I never knew that nowadays they were going to start pulling credit checks on you even before you go for an interview,” said Mr. Ochoa, 46, who lost his job in December tracking inventory at a mining company in Santa Fe Springs, Calif. “Why would they need to pull a credit report? They’d need something like that if you were applying at a bank.”
Once reserved for government jobs or payroll positions that could involve significant sums of money, credit checks are now fast, cheap and used for all manner of work. Employers, often winnowing a big pool of job applicants in days of nearly 10 percent unemployment, view the credit check as a valuable tool for assessing someone’s judgment.
But job counselors worry that the practice of shunning those with poor credit may be unfair and trap the unemployed — who may be battling foreclosure, living off credit cards and confronting personal bankruptcy — in a financial death spiral: the worse their debts, the harder it is to get a job to pay them off.
“How do you get out from under it?” asked Matthew W. Finkin, a law professor at the University of Illinois, who fears that the unemployed and debt-ridden could form a luckless class. “You can’t re-establish your credit if you can’t get a job, and you can’t get a job if you’ve got bad credit.”
Others say that the credit check can be used to provide cover for discriminatory practices. Responding to complaints from constituents, lawmakers in a few states have recently proposed legislation that would restrict employers’ use of credit checks. While some measures languish, Hawaii has just imposed new restraints.
Business executives say that they have an obligation to be diligent and to protect themselves from employees who may be unreliable, unwise or too susceptible to temptation to steal, and that credit checks are a help.
“If I see too many negative things coming up on a credit check, it’s one of those things that raises a flag with me,” said Anita Orozco, director of human resources at Sonneborn, a petrochemical company based in Mahwah, N.J. She added that while bad credit alone would not be a reason to deny someone a job, it might reveal poor judgment.
“If you see a history of bad decision-making, you don’t want that decision-making overflowing into your organization,” she said.
More than 40 percent of employers use credit checks at least sometimes, according to a 2004 survey by the Society for Human Resource Management, up from 25 percent in 1998. The share has almost certainly risen today, say career counselors.
“It has been an ongoing and increasing issue,” said Mollie de Rojas, district coordinator for the local operations of the Ohio Department of Job and Family Services.
Credit counselors, worker advocates and the unemployed contend that a credit check is not always relevant to hiring decisions.
“There’s no relationship between being a personal trainer making $12 an hour” and having a good credit history, said Janet L. Newcomb, a career counselor in Huntington Beach, Calif. “People are being turned down for jobs on the basis of things that really have nothing to do with qualifications.”
That is the complaint of Kevin Palmer, 49, who for months lived at the same homeless shelter in Santa Ana, Calif., as Mr. Ochoa. After an interview that seemed to go well one day in June at a property management company, a manager walked him around the office the next day, introduced him to other employees and showed him an available desk.
A credit check later, the offer vanished.
It was “a glorified clerk’s job, taking homeowners’ complaints,” Mr. Palmer said of the opportunity, which paid about $39,000 and could have gotten him back on his feet after losing his condominium to foreclosure and filing for bankruptcy.
Last month, he says he found a job at a property management company in San Francisco — a company that did not run a credit check on him.
It is generally legal to run credit checks on job applicants, but some states have restrictions. In Washington, which has perhaps the most stringent requirement, a candidate’s credit history must be substantially related to the job under a law that took effect in 2007.
Last month, lawmakers in Hawaii approved a measure that generally allows an employer to review a credit history only after making an offer and requires the credit check to be “directly related” to job qualifications.
In California, Gov. Arnold Schwarzenegger vetoed a similar law. (New York law requires a background check’s findings to be related to the job, but it addresses criminal records and does not mention credit checks.)
Lawmakers in Michigan and Ohio have proposed barring employers from using credit history in making employment decisions.
“In my opinion, it’s discrimination,” said Representative Jon Switalski, the Democrat who proposed legislation in Michigan. “If you miss a few payments or you have medical debt, your skills as a pipefitter or an electrician don’t diminish.”
Courts have not been sympathetic to claims that discrimination is being cloaked in credit checks, said Angela Onwuachi-Willig, a law professor at the University of Iowa. “At what point does the fact that someone lives in a particular neighborhood or someone has a bad credit score become a way of eliminating people for illegal grounds?” she asked rhetorically. “Basically, the courts don’t protect against proxy discrimination.”
Stuart J. Ishimaru, the acting chairman of the federal Equal Employment Opportunity Commission, said the commission would probably issue guidance on the proper use of credit checks. Such guidance, though nonbinding, could offer some reassurance against lawsuits to employers who comply.
“It’s something that intrigues us and worries us,” Mr. Ishimaru said, adding that some job-related tests had led to discrimination claims in the past. “The question is, why do you use it? How is this a good screening device?”
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Federal law requires employers to get the consent of job applicants before running credit checks, said Pamela Q. Devata, a lawyer in the Chicago office of Seyfarth Shaw.
And if they are considering denying someone a job based on a check, she said, “they have to notify the applicant.” That is intended to give someone a chance to explain circumstances or spot erroneous information.
When the job market improves and fewer people are fighting for slots, credit histories may become less important, said Michael C. Lazarchick, a career counselor in Pleasantville, N.J. “But these are lean and mean times.”
KIRKLAND, Wash.--(BUSINESS WIRE)-- Taiyo Pacific Partners announced that Daniel Ludwig, CFA and Jeffrey Cagnina, CFA have joined the firm as Managing Directors responsible for marketing and client servicing.
Mr. Ludwig has over eighteen years of experience in the investment industry with both start-ups and industry leaders. He started his investment career at C.S. First Boston followed by institutional marketing positions at Fidelity Investments in Denver, CO, Pacific Investment Management Company in Atlanta, GA and Metropolitan West Asset Management also in Atlanta, GA. Mr. Ludwig then assumed leadership positions with Geode Capital Management, a Fidelity spinout with $90B in assets under management, and Mountain Pacific Group, a start-up specializing in emerging market equities and commodities, both in Boston, MA.
Mr. Cagnina joins Taiyo with twenty-five years of investment management experience with long-only and hedge fund-of-funds managers. He began his investment career at Lehman Brothers. Following Lehman Brothers, Mr. Cagnina held senior institutional marketing positions with Independence Investment Associates and Putnam Investments, both in Boston, MA. Mr. Cagnina moved on to become Managing Director and Head of US Institutional Sales at Optima Fund Management in New York City and then President of Hunt Financial Ventures in Dallas, TX.
Brian Heywood, CEO of Taiyo Pacific Partners, said, “We are excited to have such seasoned veterans as Dan and Jeff join our staff. Both bring years of institutional experience to help us grow our business and continue to be leaders in Asian investing.”
Taiyo Pacific Partners, located in Kirkland, Washington, was founded in 2003 by Asia-focused professionals dedicated to friendly shareholder activism in Japan and other Asian countries. The firm currently manages $1.8 billion in assets across three Japan-focused funds. All strategies employ a friendly activist approach. Investors include US, Japanese and European pension plans and endowments and other institutional investors.
Taiyo Pacific Partners
Brian K. Heywood, 425-896-5300
taiyo_media@tppllc.com
Source: Taiyo Pacific Partners
After months of reading headlines that John Paulson's perspective on gold had not changed, we suddenly read that he had cut his holdings significantly.
Just three months ago, he was quoted as saying that his thesis remains intact, but then we find that Paulson tactically adjusted his portfolios and reduced his gold position. What gives?
While one might be tempted to conjure up scenarios where words do not match actions, we think it's more a function of examining current conditions and making a new decision. And that is the risk associated with reading headlines and making investment decisions based on the latest comments from anyone: Those opinions can change, and they often do.
The market is quite irrational. Gold has become the flag bearer for an environment with less predictability. Gold used to be a fairly predictable trade against inflation and volatility. Now gold trades based on Federal Reserve comments, interest rates, fear, hedge fund liquidity needs, etc.
(Read more: With Paulson's exit, is the worst over for gold?)
It's quite a puzzle to figure out and one we as an asset manager have decided not to attempt to decipher.
In many ways it's no different than the sentiment-based trading around Apple.
The company still has over $100 billion cash in the bank; the stock in the last 12 months has gone from $700 to $390 to $500, and nothing really has changed on a fundamental basis. This position is trading based on expectations and sentiment, and we expect this to continue in the short term. Long term, Apple will trade based on fundamentals; short-term and trades on mood and feeling; not terribly rational inputs.
The market trades based on data, current perception of that data and future expectations. And institutional as well as individual investors either know that fact and invest accordingly, or they are subject to these rapidly changing trading conditions and are victims.
(Read more: Breaking Buffett: The Oracle has underperformed)
This is why it is important to understand the time horizon is key when determining your investment strategy.
If you are a short-term investor you better have a pretty good handle on mood and sentiment. If you are a long-term investor you better have a pretty good concept of the fundamentals and trends that will affect the asset you are investing in.
And perhaps most importantly, remember that when you read headlines or hear interviews that opinions change and often do. Use interviews, columns, insights and protestations from those in the media as information to consider but not gospel and certainly not permanent ideology.
This means that in the end your opinion matters as well as well as your interpretation of others' viewpoints.
(Read more: This might be when the market returns to normal)
So the next time you read a headline that a prominent investor has adjusted a strategy after making previous statements about the wisdom of a particular course of action, remember that perspectives change.
Just because you read it or hear it doesn't mean it's permanent, and you should assume that every opinion that you hear is subject to adjustment prior to relying on that view when you make an investment decision.
Michael Yoshikami is the CEO and founder of the investment committee of Destination Wealth Management.
Here is the best Wall Street research that's moving stocks Monday.
1. Top-ranked analyst: Buy Yelp on better profits
One of the best analysts on Wall Street told investors to buy Yelp on an anticipated earnings upside the rest of the year. ""Yelp [is] likely to exceed 2016 guidance and Street estimates,"" Deutsche Bank's Lloyd Walmsley wrote in a note to clients Sunday.
2. Analyst who called oil rebound: $80 is next stop
The price of oil is going to rise to $80 in the next year on supply constraints, according to Raymond James' energy analyst J. Marshall Adkins, who correctly predicted a rebound in crude at the start of 2016.
3. Morgan Stanley: Bank stock sell-off is overdone
The pullback in financial stocks this year is a buying opportunity, Morgan Stanley told clients Monday, recommending an overweight stance on the group.
4. Bigger TVs equal bigger profits for Corning: Citi
Investors should buy Corning as consumers purchase bigger and bigger TVs which are more profitable for the LCD glassmaker than smaller panels, according to Citi Research.
5. CVS downgraded due to competition: Morgan Stanley
CVS Health shares could come under pressure due to greater price and market share competition, according to Morgan Stanley, which downgraded the shares of the company to equal weight from overweight
ATM fees have always been one of our pet peeves here at OTM. There aren’t many things in this life more frustrating that being charged for the privilege of taking out money from a machine. Just this past weekend, your web producer found himself in need of a quick $20 without a Chase bank in sight – next thing he knew he’s coughing up $3 in fees at a Citibank machine, not to mention another $2 on top of that from Chase (thanks for that!).
The easiest thing you can do to avoid these nasty fees is to only use ATMs from your bank, obviously. But sometimes you’ll be in a pinch and there just won’t be any around. This is when Greg McBridge, senior financial analyst for , suggests ducking in to a store and using your debit card to get cash back at the point of sale. This is tantamount to making an ATM withdrawal, without the fee.
Go to your bank's web site to see where their machines are. If they're sparse, pick up the phone and ask if the bank participates in surcharge-free networks like Allpoint, Moneypass or AllianceOne, which allow customers of participating banks to make withdrawals from a large stable of ATMs without fees.
Bottom line? If you find yourself paying a fee every once and a while, it won’t bankrupt you. But if you’re being charged fees on the regular, it’s time to figure out a new way to access your cash.
Google's $12.5 billion acquisition of Motorola Mobilitygives the Internet search company patent protection while putting it squarely into the smartphone hardware business, Executive Chairman Eric Schmidt told CNBC Monday.
But the acquisition won't affect how Google does business with the other phone makers that use its Android operating system, including HTC, he added.
""We are going into the hardware business, but we’re going to keep it separate and we’re going to treat everybody else on a fair basis,"" he explained.
Android has had more than 550,000 activations a day and is succeeding ""precisely because there are so many partners,"" he said. ""If we somehow p--- them off ... it would be a disaster to the Android strategy.""
Google is also taking advantage of Motorola Mobility's 17,000+ patents, a portfolio Schmidt called ""second to none"" at a time when Google faces ""significant patent challenges from people who want to stop our products.""
Schmidt said he supports the overhaul to the U.S. patent system President Obama signed into law Friday but said it doesn't go far enough.
""We still have a problem where too many overbroad patents are used to shut down other companies,"" stifling the startups that don't have the resources Google has to buy a patent-rich company like Motorola Mobility.
While Google's growth has its advantages, it has also brought scrutiny. Last week Schmidt testified before a Senate subcommittee on antitrust, which he told CNBC Monday gave him an opportunity to ""talk about how we made decisions that basically solve user problems.""
However, Google is different from Microsoft , another company that has undergone antitrust scrutiny.
""Google has not been Microsoft and will never be Microsoft,"" he said. ""It is true because of the role Google plays we really are much more careful now. We have teams of lawyers and product people and so forth at all our conversations.""
He added that ""our products are mostly free. So it’s hard to complain about pricing. So I think we’ll be just fine.""
Nokia (NOK) shares surged Thursday after the company told investors it had grabbed more of the mobile handset market away from rival Motorola (MOT). This comes a day after Motorola announced its first drop in sales in almost 4 years. Can it get any worse?
Dylan Ratigan explains that the drop in sales caused barbarian billionaire and Motorola shareholder Carl Icahn to send off a salvo to Motorola Chief Executive Ed Zander which says in part “The performance at our mobile device business in the first quarter was unacceptable.""
Dylan says the Fast Money traders could not agree more. He asks, with this well know brand trading near its 2 year low, can pressure from Icahn drive Motorola management to make the right moves?
Pete Najarian thinks this is the bottom for the stock because of Carl Icahn. He explains Icahn is known for taking dead companies and resurrecting them, and he’s trying to do that with Motorola. Pete adds he’s seeing bullish MOT trading on the options market.
Eric Bolling doesn’t see much upside in MOT. He says consumers will wait for the iPhone.
Jeff Macke says sometimes dead is dead. He says without Ichan this is a $12 stock. Jeff says it’s a trade, but if investors hold it long term the trade will end in tears.
Questions? Comments?
Trader disclosure:
On APR 19, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Macke Owns (SWY) Najarian Owns (AXP), (HNZ), (MON), (MOT), (NDAQ), (XLF), (MPEL) Bolling Owns (NMX), (MPEL), Gold, Silver, Natural Gas Corn; Bolling Is Short Soybeans
DUBLIN--(BUSINESS WIRE)-- Research and Markets (http://www.researchandmarkets.com/research/d7qnd2/dissolved_gas) has announced the addition of Elsevier Science and Technology's new report ""Dissolved Gas Concentration in Water. Edition No. 2"" to their offering.
Aquacultural, oceanographic, and fisheries engineering, as well as other disciplines, require gas solubility data to compute the equilibrium concentration. These calculations, for example, can affect the output of aquacultural production or assist in environmental consulting.
Until now, published solubility information has not been available in a consistent and uniform manner in one location. This book presents solubility concentrations of major atmospheric gases (oxygen, nitrogen, argon, carbon dioxide), noble gases (helium, neon, krypton, xenon), and trace gases (hydrogen, methane, nitrous oxide) as a function of temperature, salinity, pressure, and gas composition in a variety of formats.
Data, equations, and theory are explained so that the user is able to understand the calculations and problems. Furthermore, data and solubility information are presented in a range of units to make them accessible across disciplines.
This book will help the reader to look at a problem from a quantitative viewpoint and better understand carbonate chemistry. Revised from the earlier edition to include more accurate carbon dioxide tables and separate sections on the solubility of noble gases, trace gases, and oxygen in brines to provide a single resource for gas solubility data. This book is essential for all students and practitioners working in aquatic fields.
- A single source for highly accurate and comprehensive tables for gas solubility in aquatic systems
- Information provided in tables, equations, and computer programmes
- Theory is presented to better understand the equations and calculations
Key Topics Covered:
1: Solubility of Atmospheric Gases in Fresh Water
2: Solubility of Atmospheric Gases in Brackish and Marine Waters
3: Supersaturation of Gases
4: Solubility of Noble Gases in the Atmosphere
5: Solubility of Trace Gases in the Atmosphere
6: Solubility of Gases in Brines
7: Physical Properties of Water
For more information visit http://www.researchandmarkets.com/research/d7qnd2/dissolved_gas
Source: Elsevier Science and Technology
Okay I would like to share some more good news for you stockaholics. Our real-time Nasdaq quotes were so popular with many of you, we decided to turn on the NYSE quotes as well. Now you will get up to the second trading data on blue chip stocks like AT&T, General Motors, and General Electric (my corporate overlord) along with the real-time quotes we're giving on Nasdaq stocks like Microsoft and Google.
Now this added NYSE real-time data comes through Nasdaq as well. We figured, since we were already getting the Nasdaq quotes through that exchange, we may as well give you the data on NYSE stocks traded through Nasdaq as well. Since Nasdaq is handling a substantial number of trades for NYSE based stocks, the quotes from the Nasdaq track pretty closely with quotes from the NYSE. And of course the quotes from the NYSE are available, on a delayed basis, as well. We're just trying to give you the best information available. As always, we may be making added tweaks down the road.
QUINCY, Ill.--(BUSINESS WIRE)-- Titan International, Inc. (NYSE: TWI) is pleased to announce it has received valid acceptances for 87.24 percent of the Offer in respect of Titan Europe plc shares. Titan International announces that all remaining conditions to the Offer, as set out in the Offer Document, have been satisfied and that the Offer is now unconditional in all respects.
The Offer will remain open for acceptance until October 19, 2012, being 14 days after the date on which the Offer has been declared unconditional as to acceptances. On or around this date, the New Titan International shares issued in consideration of the Offer will begin trading on the New York Stock Exchange.
The related Prospectus, Offer documents and Offer Acceptance Declaration are available on our website at www.titan-intl.com.
Titan International, Inc., a holding company, owns subsidiaries that primarily supply wheels, tires and assemblies for off-highway equipment used in agricultural, earthmoving/construction and consumer (including all terrain vehicles) applications. For more information, visit www.titan-intl.com.
BNP Paribas, the French bank, became the latest big European bank to report profits fell at its investment bank on Friday, as it was boosted overall by profits in its retail division.
Its net profit rose to 1.83 billion euros ($2.01 billion) in the three months to the end of September, up 15 percent from the same time in 2014. However, this reflected a much healthier picture at its retail bank, where increased loan demand helped drive up total pretax profit by 5 percent to 979 million euros.
Lars Machenil, chief financial officer of the French bank, told CNBC: ""European growth levels are not the same as we're seeing in our U.S. business, but for the moment, it's a progressive return to growth.""
At its investment bank, which has had to restructure following a record $9 billion fine from U.S. authorities over sanctions violations, there was a 22 percent drop in pretax profit to 624 million euros in the third quarter.
The bank said in a statement that it has now finished the downsizing of its energy and commodity business, and also booked additional costs to comply with new regulations.
BNP Paribas also boosted its core tier-one ratio - a key measure of financial health - to 10.7 percent in September, up from 10.6 percent in June.
Activist hedge fund manager Mick McGuire is lobbying for changes at popular wing restaurant Buffalo Wild Wings.
McGuire, who runs Marcato Capital Management, has been pushing for the company to franchise more of its restaurants since July and even nominated four directors to the company's board in February.
On Wednesday, McGuire once again took aim at Buffalo Wild Wings, publishing a presentation for investors that argued the executives' interests were not closely aligned with the wing chain's shareholders.
""Since its IPO in 2003, Buffalo Wild Wings' Board and Management team have sold the vast majority of all stock ever owned,"" McGuire said in a statement. ""In our view, this lack of long-term ownership has contributed to failures of governance and oversight, poor capital allocation discipline and the severe lack of urgency in navigating the difficult operating environment. Shareholders deserve a Board and management team that is willing to commit its own capital alongside them.""
McGuire noted that none of the Buffalo Wild Wings executives currently owns shares in the company and only one director has ever executed an open-market purchase of the stock.
He also argued that B-Dubs management team has been using equity incentive plans to purchase shares at a lower price and then sell them on the market to make cash.
""Buffalo Wild Wings leadership has not put their money where their mouth is,"" McGuire said.
Buffalo Wild Wings responded by saying that its directors' interests are ""closely aligned"" with those of its shareholders, noting that its team owns ""significant equity interests"" in the company.
""Virtually all trading of the company's common stock owned by management — who receive approximately half of their compensation in performance-based stock awards — is executed under preexisting plans that are commonly adopted for personal financial planning purposes,"" the company said in a statement.
Marcato owns 5.6 percent of the company and is hoping to get McGuire and three other nominated directors onto the board.
The other nominees are Scott Bergren, former CEO of Yum Brands, Sam Rovit, who has 20 years of experience in the food service industry and Lee Sanders, who held leadership roles at TGI Fridays and Johnny Rockets. In February, when the directors were proposed, Buffalo Wild Wings said it would evaluate the nominees independently.
Buffalo Wild Wings also took issue with Marcato's characterization of its stock performance, saying in the last five years, its shares appreciated more than 80 percent and rose more than 470 percent over the last 10 years.
""We believe the stock performance is compelling evidence of the effectiveness of the board and management, and their focus on the creation of long-term shareholder value,"" the company said.
Frightened people living near the Volcano of Fire fled with their children and few possessions when fresh flows of super-heated debris were announced, taking no chances after authorities gave them little time to evacuate before a deadly eruption over the weekend.
Traffic came to a standstill on choked roads Tuesday and those without vehicles walked, even in central Escuintla, which was not under an evacuation order. Businesses shuttered as owners fled, memories still fresh of Sunday's blast, which left at least 75 people dead and 192 missing, and reduced a once verdant area to a moonscape of ash.
Mirna Priz, who sells tamales and chiles rellenos, wept as she sat on a rock at a crossroads, with a suitcase in front of her and her 11-year-old son, Allen, and their terrier mix Cara Sucia by her side.
""You feel powerless,"" she said. ""I don't know where I'm going to go. To leave my things, everything I have.""
But after seeing what happened Sunday, she was afraid to stay.
A column of smoke rose from the mountain Tuesday afternoon and hot volcanic material began descending its south side, prompting new evacuation orders for a half dozen communities and the closure of a national highway. The country's seismology and vulcanology institute said the smoke billowing from the volcano's top could produce a ""curtain"" of ash that could reach 20,000 feet (6,000 meters) above sea level, posing a danger to air traffic.
Rescuers, police and journalists hurried to leave the area as a siren wailed and loudspeakers blared, ""Evacuate!""
Among those fleeing was retiree Pantaleon Garcia, who was able to load his grandchildren into the back of a pickup with a jug of water and some food. They were heading to the homes of relatives in another town.
""You have to be prepared, for the children,"" he said.
When the panic set off by the new evacuations became clear, disaster officials called for calm.
In the community of Magnolia, which was under the new evacuation order, residents fled carrying bundles, bags of clothing and even small dogs in their arms.
Many walked along the side of the highway because vehicular traffic had stalled on the only road out.
By Tuesday the images of Sunday's destruction were familiar to everyone. What was once a collection of green canyons, hillsides and farms was reduced to grey devastation by fast-moving avalanches of super-heated muck that roared into the tightly knit villages on the mountain's flanks.
Two days after the eruption, the terrain was still too hot in many places for rescue crews to search for bodies or — increasingly unlikely with each passing day — survivors.
Lilian Hernandez wept as she spoke the names of aunts, uncles, cousins, her grandmother and two great-grandchildren — 36 family members in all — missing and presumed dead in the volcano's explosion.
""My cousins Ingrid, Yomira, Paola, Jennifer, Michael, Andrea and Silvia, who was just 2 years old,"" the woman said — a litany that brought into sharp relief the scope of a disaster for which the final death toll is far from clear.
A spokesman for Guatemala's firefighters, said that once it reaches 72 hours after the eruption, there will be little chance of finding anyone alive.
At a roadblock, Joel Gonzalez complained that police wouldn't let him through to see his family's house in the village of San Juan Alotenango, where his 76-year-old father lay buried in ash along with four other relatives.
""They say they are going to leave them buried there, and we are not going to know if it's really them,"" the 39-year-old farmer said. ""They are taking away our opportunity to say goodbye.""
The dollar fell against the euro on Thursday as strong German business confidence data and
tough inflation comments by a European Central Bank policy-maker dashed hopes for a near-term interest rate cut in the euro zone.
An improvement in investors' appetite for risk, following a sharp rebound in European stocks, pushed down the U.S. dollar against high-yielding currencies such as the British pound, the Australian and Canadian dollars.
ECB's governing council member Axel Weber said the Federal Reserve's surprise decision to cut interest rates by 75 basis points on Tuesday had not shifted the ECB focus on euro zone
inflation, dampening rising expectations that it too will have to cut rates soon.
""The fact that there seems to be a bit of calm in the equity markets has in some regard sent the forex market towards selling dollars,"" said John McCarthy, director of trading at ING Capital Markets in New York.
""Weber made the usual hawkish comments which underpin the euro and we are just seeing follow through from that.""
The euro jumped to session high of $1.4733, on track for a third consecutive day of gains.
The dollar was flat versus the yen . Against the Swiss franc, the dollar fell .
The euro had come under selling pressure in recent weeks as signs emerged that weakness in the U.S. economy is having a knock-on effect on the euro zone, fueling the argument for a
rate cut by the ECB.
Some of those concerns eased slightly after German corporate sentiment unexpectedly rose in January, bolstering policymakers' assertion that the euro zone economy can withstand turmoil in financial markets.
""The numbers out of Germany were good. You are getting a follow through of what we saw overnight,"" said Brian Taylor, head currency trader ay M&T Bank in Buffalo, New York.
""They are consistently saying that growth is okay, there is going to be some effect from a U.S. slow down, but in their view they are saying the economy is going to be strong and
(inflation) is going to be an issue in terms of their monetary policy.""
The New Zealand and the Australian dollars benefited from the improvement in risk appetite. These currencies are often targets of carry trades, a strategy in which investors borrow
in a low-yielding currency such as the yen to buy higher-yielding currencies and assets.
The Australian dollar rose against the dollar, as did the kiwi .
There was little reaction to a report showing that the pace of existing home sales in the United States fell by 2.2 percent in December to a slower-than-expected 4.89 million-unit annual rate. That confirmed market perceptions that the housing market turmoil, which is threatening to push the economy into a recession, is far from over.
Technology behemoth Google has expanded its fleet of financial services this week by offering homebuyers in California the opportunity to compare and contrast mortgages.
Its online comparison tool has now been expanded to provide information on housing loans after first announcing the idea in May.
""Buying a home is a major financial decision — so when it comes to getting a mortgage, people want an easy way to understand and compare their options online,"" Google said in a blogpost on its news site Monday.
Google predicted that nearly one in two borrowers still don't shop around for their mortgage and set up the tool to help people make ""more informed financial decisions."" It said that it would be rolled out to more U.S. states after launching in California.
""Whether you're a national lender or one local to California, people searching for mortgages on their smartphone or desktop computer can now find you, along with a real-time, apples-to-apples comparison of rate quotes from other lenders — all in as little as a minute,"" it added.
The move follows on from a mortgage calculator tool that launched in February this year. The new services have actually been available in the U.K. for a number of years, where the property industry - and its regulation - is very different with a surfeit of similar tools all competing in the market.
The U.K. version of the general comparison tool - which includes car and travel insurance - states that 51 percent of users could save up to £205.26 ($310) with Google Compare and 80 percent of consumers could save up to £74.54, citing online independent research by analysis group Consumer Intelligence this year.
""Digital channels and digital strategies are of huge interest to the mortgage industry,"" Sue Anderson, the head of member and external relations at the U.K.'s Council of Mortgage Lenders, told CNBC via email.
However, she added that the recent direction of travel in terms of regulation in U.K. – specifically, the provision of advice – has not tended to favor these digital strategies.
""Many lenders are seeking to establish how best to approach the needs of the tech-savvy generation who prefer online purchasing and account management,"" she added.
A U.S. federal judge on Wednesday upheld an Obama-era rule designed to avoid conflicts of interests when brokers give retirement advice, in a possible setback for President Donald Trump's efforts to scale back government regulation.
The stinging 81-page ruling comes just days after Trump ordered the Labor Department to review the ""fiduciary"" rule — a move widely interpreted as an effort to delay or kill the regulation.
The decision by Chief Judge Barbara Lynn for the U.S. District Court for the Northern District of Texas is a stunning defeat for the business and financial services industry groups that had sought to overturn it.
And while it is not expected to stop the Labor Department from delaying the rule's April 10 compliance deadline while it conducts the review, some legal experts say it could make it more difficult for the Labor Department to find a way to justify scrapping or significantly altering the rule.
This marks the second time now a federal district court has upheld the fiduciary rule. A third court, meanwhile, rejected an effort to stay the rule's implementation.
""Three courts have now carefully considered the full range of industry attacks on the DOL's best interest fiduciary rule, and they have firmly rejected all of them,"" said Stephen Hall, the legal director of Better Markets, a non-profit group that supports the rule.
""The decision issued today is definitive and sends a message that ought to put a stake through the heart of industry's efforts to destroy this common-sense rule.""
The Labor Department's ""fiduciary"" rule requires brokers to put their clients' best interests first when advising them about individual retirement accounts or 401(k) retirement plans.
It is championed by consumer advocates and retirement non-profit groups, but has been staunchly opposed by the financial services sector, which argues it will make retirement advice too costly and harm lower-income retirees in particular.
The long list of groups that sued the Labor Department in the Dallas federal court include the U.S. Chamber of Commerce, the Financial Services Institute, the Financial Services Roundtable, the Insured Retirement Institute and the Securities Industry and Financial Markets Association.
In a joint statement, those groups said they disagreed with the judge's ruling and vowed to ""pursue all of our available options to see that this rule is rescinded.""
The decision in the Labor Department's favor came just a few hours after the Justice Department had petitioned the court to stay issuing a ruling because of the Feb. 3 White House request to review the rule to determine if it should be revised or scrapped.
Lynn, who was appointed to the bench by former President Bill Clinton, denied that request shortly after her ruling was filed.
""The Department of Labor is continuing to follow the president's memorandum and is exploring options to delay the applicability date,"" Labor Department spokeswoman Jillian Rogers said in a statement.
Sweeping legal arguments rejected
Wednesday's ruling represents a setback for Gibson Dunn & Crutcher attorney Eugene Scalia, who represented the business groups and has a strong track record for winning legal challenges to kill off unwanted Wall Street regulations.
The decision addressed a sweeping series of legal arguments that Gibson Dunn's attorneys made against the rule, including claims that the Labor Department had exceeded its legal authority and that it had violated federal rulemaking procedures by failing to conduct an adequate cost-benefit analysis to help justify the regulation.
""The court finds the DOL adequately weighed the monetary and non-monetary costs on the industry of complying with the rules, against the benefits to consumers,"" Lynn wrote.
""In doing so, the DOL conducted a reasonable cost-benefit analysis.""
Lynn also rejected other arguments, including claims that the rule violated free speech rights of brokers and that the rule violated federal laws governing arbitration.
The case could still be appealed to a higher court.
Meanwhile, there are still several other pending legal challenges to the rule.
The number of coronavirus cases globally jumped past 8 million on Tuesday during Asia time. China reported 40 new cases as a new cluster in Beijing continued to grow. That new cluster, linked to a wholesale market in Beijing, could impact food shipments into China.
New coronavirus cases and hospitalizations continue to rise in a handful of U.S. states, prompting warnings from some health officials that greater precautions might be necessary to keep the health systems from being overwhelmed. As people grow fatigued from social distancing and other precautions, pharmaceutical and biotech companies are racing forward to develop treatments and a vaccine for the virus.
The coverage on this live blog has ended — but for up-to-the-minute coverage on the coronavirus, visit the live blog from CNBC's U.S. team.
- Global cases: More than 8.01 million
- Global deaths: At least 436,306
- U.S. cases: More than 2.11 million
- U.S. deaths: At least 116,135
The data above was compiled by Johns Hopkins University as at 9:45 a.m. Singapore time.
Switzerland's economy could lose more than $100 billion in output due to the fallout from the coronavirus pandemic, the government said on Tuesday, Reuters reported.
The government expects 2020 gross domestic product (GDP) to be around 652 billion Swiss francs ($687.26 billion), down from a forecast for 712 billion francs made in December.
""On a per capita basis the downturn is going to be as bad as the mid-1970s, if not worse,"" said government economist Ronald Indergand said, Reuters reported. ""It is going to take years to get over this. The economy is only going to get back to its previous level by 2022.""
Earlier Tuesday, government economists forecast a 6.2% fall in GDP in 2020 and for unemployment to average 3.8% over the year as a whole. ""This would make it the lowest economic slump since 1975,"" the government report said. — Holly Ellyatt
2:50 p.m. (Singapore time) — Southeast Asian ride-hailing company Grab announced that it would be cutting 360 jobs, or about 5% of its headcount.
The Singapore-based company, which has a presence in eight countries, said the move was due to the impact of the coronavirus.
In a note addressed to its employees, Chief Executive Anthony Tan said: ""We tried everything possible to avoid this but had to accept that the difficult cuts we are making today are required, because millions depend on us for a living in this new normal."" — Weizhen Tan
2:16 p.m. (Singapore time) — A new cluster linked to a wholesale market in Beijing could impact food shipments into China. According to local media, the virus was found on chopping boards used for imported salmon at the Xinfadi market.
On Monday, the World Health Organization said that the claim the new cluster might have originated from salmon imports or their packaging was not the ""primary hypothesis,"" Reuters reported.
The situation would be ""difficult"" if the cluster is traced back to imported meat as China needs imports to keep meat inflation under control, Darin Friedrichs, senior Asia commodity analyst at trading house INTL FCStone said in a report on Monday.
Any additional safety measures in the handling and process of imported meat could also be disruptive to the industry. Even if it is determined that the new cluster was not triggered by imported meat, the reports may have already hit consumer sentiment. If that triggers a shift in preference for domestic pork, that could drive up food inflation. — Huileng Tan
9:55 a.m. (Singapore time) — Singapore is set to lift most restrictions on Friday. People will be allowed to dine out at restaurants, and social gatherings of up to five people will be permitted. Shops, sports facilities, fitness studios, and parks will also be allowed to reopen.
However, bars and nightclubs will remain closed, and religious congregations, conferences are still not allowed to take place. — Weizhen Tan
9:20 a.m. (Singapore time) — China's National Health Commission reported 40 new cases, with 27 of those in Beijing as a new cluster in the city continued to grow.
Overall, there were 32 locally transmitted cases and 8 imported cases. There were no additional deaths. China's total number of reported cases is now 83,221. Beijing had no new confirmed cases for almost two months until an infection was reported on June 12, according to Reuters.
The new cluster in Beijing has been linked to a wholesale food market. The city began imposing restrictions again, such as closing schools and sports venues, as well as ordering people to get tested for the coronavirus.
The first cases of the virus were first reported in December in China's Wuhan city, also at a seafood market. Cases of Covid-19 have now spread globally, with more than 8 million infections according to Johns Hopkins University data. — Weizhen Tan
7 p.m. ET — Taking hydroxychloroquine along with remdesivir may weaken the effectiveness of the latter drug, the Food and Drug Administration warned, citing a recently completed non-clinical study.
Remdesivir was granted emergency use authorization by the FDA to treat hospitalized patients sickened with Covid-19 in May. Hydroxychloroquine had also been granted a EUA for the coronavirus, but the designation was revoked earlier in the day after the FDA found it was unlikely to be effective.
The news by the FDA of the potential drug interaction is likely to further dampen hopes that hydroxychloroquine is helpful against the coronavirus. —Berkeley Lovelace Jr.
6:20 p.m. ET — JPMorgan Chase is planning to bring more traders back to its headquarters in New York City on June 22, according to someone with knowledge of the bank's plans.
Around 20% of the division's staff has worked from offices during the pandemic, but that number could rise to 50% by mid-July, CNBC's Hugh Son reports.
JPMorgan will institute safety measures like requiring employees to wear masks in common areas and marking desks with colored stickers to indicate where workers can sit. Phasing in the trading division staff will be an early test to see how the company can safely increase in-person attendance. —Hannah Miller
5:30 p.m. ET — Sacramento Kings owner Vivek Ranadive said his organization is experimenting with a breathalyzer device to detect Covid-19. ""You'll be able to blow into a tube and test whether somebody has the virus by looking through a spectroscope,"" Ranadive told CNBC's ""Power Lunch"" on Monday.
Ranadive said the Kings are exploring numerous ""elimination of friction efforts"" to avoid spreading the virus throughout the more than $500 million Golden 1 Center, including access to temperate gauges. Researchers at UCLA and Ohio State University have been awarded grants to test the Covid-19 breathalyzer concepts, one of which could produce results in 15 seconds.
The testing system would be able to take certain compounds of an individual breath to detect coronavirus. The National Basketball Association approved plans on June 4 to resume its season after suspending operations due to the pandemic on March 11. — Jabari Young
5 p.m. ET — The Women's National Basketball Association said it is finalizing a plan to start its 2020 season in July. The league originally delayed its season start date of May 15 because of the pandemic.
The plan calls for the season to include 22 regular games and a traditional playoff format. They would take place without spectators at IMG Academy, a sports academy in Bradenton, Fla. Players from all 12 WNBA teams would also live and train at the facility.
The WNBA's announcement follows the National Basketball Association's approval of a plan that would restart its season on July 31 with 22 teams. The Walt Disney World Resort in Orlando, Fla. would host all games and players under the plan. —Hannah Miller
4:30 p.m. ET — California Gov. Gavin Newsom gave an update on the state's Covid-19 response and said he is continuing to allow counties to tailor their reopenings to their specific needs and that they can decide themselves when to lift restrictions.
""Those decisions should be made with a local lens,"" Newsom said at a press briefing.
He said that as testing has increased in California, the rate of positive results has dropped dramatically from just over 40% in early April to 4.5% by the end of last week. The state has not yet seen a spike in cases after protests in response to the police killing of George Floyd.
However, Newsom said the state is not yet ""out of the woods,"" and is bracing for a potential increase in coroanvirus cases as California reopens further.
""This pandemic is not going away,"" he said. ""You're seeing an increase in numbers all across this country."" —Hannah Miller
3:21 p.m. ET — The Chinese government has donated personal protective equipment and free meals to health care workers in struggling communities across the U.S., NBC News reports, in what some call ""mask diplomacy.""
Critics say the donations, while legal and in some cases needed, are an attempt to garner good publicity as tensions between to the U.S. and China escalate.
Chinese consulates in Chicago, San Francisco and Houston, among others, have donated free meals and face masks numbering in the thousands. Some lawmakers are denouncing the donations. Sen. Marco Rubio, R-Fla., told NBC News that the donations are a way to make people think of China ""as a leader on the response to the Covid-19 pandemic they caused."" —Alex Harring
3:06 p.m. ET — The World Health Organization urged scientists around the world to investigate disease clusters to understand the origin and cause of the coronavirus infection.
The comments come after officials in Beijing reported a total of 79 confirmed cases of Covid-19 originating from Xinfadi, the biggest wholesale food market in Asia, since June 11. The market is more than 20 times larger than the seafood market in Wuhan where the coronavirus outbreak was first identified.
The WHO said in a statement on Saturday that all confirmed cases are in isolation and under care. Health officials are currently tracking the origin of the new clusters in Beijing and closely monitoring the oubtreak.
""The answers lie in careful, systematic, exhaustive investigation of disease clusters to really look at what is happening in these situations and what is causing the amplification of the disease in the human context,"" said Dr. Mike Ryan, executive director of the WHO's emergencies program, during a press conference at the agency's Geneva headquarters.
""If we get that, we will build up a much better picture of the public health advice we need to give to our communities on what behaviors to avoid, what places to avoid, and what circumstances to avoid,"" he said. —Jasmine Kim
2:32 p.m. ET — The Trump administration doesn't want to extend enhanced unemployment benefits past their scheduled July 31 end date, according to White House economic advisor Larry Kudlow.
Instead, the administration and congressional Republicans want to replace the $600 a week in extra jobless benefits with a cash bonus that would pay a temporary, smaller weekly sum to Americans who find a new job.
Democrats want to extend the $600 payments, arguing that high levels of joblessness will persist past July. —Greg Iacurci
1:54 p.m. ET — House Democrats wrote to the chief executives of some of the country's largest banks, including J.P. Morgan Chase, Bank of America and Wells Fargo, demanding documents pertaining to the paycheck protection program.
The Democrats, led by House Majority Whip James Clyburn said they are investigating whether the program has favored ""large, well-funded companies"" over the smaller ones the program was intended for.
Among the documents they want, they asked for ""all internal communications"" and policies pertaining to the program and correspondence with the Treasury and Small Business Administration. They also wrote to the Treasury, demanding a detailed list of everyone that applied and received loans from the program. They chastised both the Treasury and SBA for not making the need to prioritize loans for underserved communities a part of the program's guidance, despite what they say was the original intent of the CARES Act that established the program. —Lauren Hirsch
1:28 p.m. ET — San Francisco has moved into Phase 2B of its reopening, joining other Bay Area counties in easing coronavirus restrictions.
The city now allows outdoor dining, indoor shopping at retailers, non-emergency medical appointments and small gatherings, including religious services and ceremonies. Professional sports can resume for broadcast, but cannot have in-person spectators. Summer camps can also open in San Francisco. —Hannah Miller
1:04 p.m. ET — The Food and Drug Administration announced it is ending its emergency use authorization of chloroquine and hydroxychloroquine, the drugs backed by President Donald Trump.
The move by the agency comes nearly two weeks after a study published in the New England Journal of Medicine found hydroxychloroquine was no better than a placebo in preventing infection of the coronavirus.
The FDA, in its notice, said the drugs were ""unlikely to be effective"" in treating Covid-19 for the authorized uses in the EUA. The FDA had warned consumers in April against taking the drugs due to the risk of ""serious heart rhythm problems"" in some patients.
Even though hydroxychloroquine is not a proven treatment for the coronavirus, some people across the world took it after a handful of small studies published earlier in the year suggested it could be beneficial and Trump promoted the drug as a potential treatment for the virus. —Berkeley Lovelace Jr.
12:40 p.m. ET — The number of patients sickened with Covid-19 across Texas' hospitals continues to climb with the state reporting its sixth new daily high in less than a week.
Texas was among the first states to relax its statewide stay-at-home order. In the past week, Wednesday was the only day that Texas didn't set a new record for hospitalizations. It's likely to add to scrutiny from some U.S. lawmakers that some states, including Texas, opened businesses too early.
On Friday, the Centers for Disease Control and Prevention warned that states may need to reimplement the strict social distancing measures that were put in place earlier this year if U.S. coronavirus cases rise ""dramatically."" —Berkeley Lovelace Jr.
12:22 p.m. ET — Treasury Secretary Steven Mnuchin revealed that he is planning to discuss small business bailout disclosure with members of the Senate.
Mnuchin said he and the Senate will speak on a ""bipartisan basis"" about reaching a potential deal that protects the privacy of recipients of small business loans while ensuring proper oversight of the funds.
Mnuchin announced the news in a tweet, saying he will be ""having discussions"" with the Senate Small Business Committee ""to strike the appropriate balance for proper oversight"" of the Paycheck Protection Program loans ""and appropriate protection of small business information."" —Yelena Dzhanova
10:10 a.m. ET — The Television Academy announced the precursor ceremony to the Primetime Emmy Awards will be held virtually this year as a precaution against the spread of the coronavirus.
The event, which had been scheduled to take place on September 12 and 13, awards those behind-the-scenes working in production, design, set decoration, editing, casting and sound.
The Governors Ball, the official afterparty for the Emmys, has also been canceled.
The Television Academy still plans on hosting the Primetime Emmys on September 20, however it is evaluating safety measures for the ceremony. —Sarah Whitten
9:48 a.m. ET — Without ramped up contact tracing and targeted mitigation strategies, U.S. hot spots could ""quickly get out of control,"" former Food and Drug Administration Commissioner Dr. Scott Gottlieb told CNBC.
Arizona, Texas, Florida, North Carolina, Arkansas and a handful of others have seen an increase in cases in recent weeks. While some attribute the rise in cases to increased testing, hospitalizations, which are not tethered to the availability of testing, has also risen in a number of states.
""What these states need to do, what these cities need to do is good contact tracing, not to find every individual who's infected, but to find the sources of infection, the activities that lead to the infection and take targeted mitigation steps,"" Gottlieb said.
When reached for comment on Friday, Arizona's Maricopa County Public Health spokeswoman Sonia Singh told CNBC that it adjusts staff for ""contact tracing up or down as needed in response to case count trends."" She added that 90 additional staff are on the way, half of whom have already started.
Gottlieb added that Arizona could take responsibility for contact tracing efforts away from the counties and centralize the effort under state leadership. —William Feuer
Disclosure: Scott Gottlieb is a CNBC contributor and is a member of the boards of Pfizer and biotech company Illumina.
9:42 a.m. ET — From March through May, the restaurant industry lost $120 billion in revenue, according to the National Restaurant Association.
The latest sales data from the trade group paint a bleak picture of the industry, which is expected to lose $240 billion by the end of the year. Restaurants across the country are reopening, but capacity limits and new rules to maintain social distancing constrain dining room sales.
Three-quarters of restaurant operators say that it's unlikely that their restaurant will be profitable within the next six months. The NRA surveyed more than 3,800 U.S. restaurant operators between May 15 and May 25. —Amelia Lucas
9:36 a.m. ET — Stocks opened lower as investors grappled with signs of a second wave of coronavirus cases amid the U.S. economy reopening, reports CNBC's Fred Imbert and Yun Li. The Dow Jones Industrial Average fell 608 points at the open, or 2.4%. The S&P 500 slid 1.9% while the Nasdaq Composite traded 1.4% lower. —Melodie Warner
9:33 a.m. ET — The American Red Cross will test all donated blood, plasma and platelets for Covid-19 antibodies for a limited time. The blood bank is not testing for Covid-19 itself and said people who believe they may be ill with Covid-19 should not offer to donate until they are symptom-free for 28 days and are feeling well and healthy.
Donations given before Monday will not be tested. The organization expects to offer the testing throughout summer months and testing may be extended into the fall. Results will be available around seven to 10 days after donating. —Alex Harring
9:19 a.m. ET — Delta Air Lines has received approval from the Shanghai government to resume flights from June 18, according to a Reuters report citing a company spokeswoman.
The airline is still waiting for the Civil Aviation Administration of China to decide on how many flights it can resume and when it can do so, Reuters reported.
China's aviation authority has said it would allow foreign airlines to increase flights between the country and other regions from June 8. —Melodie Warner, Reuters
8:50 a.m. ET — Germany will launch an app to trace the contacts of coronavirus patients this week, Health Minister Jens Spahn said over the weekend.
The country's app is being built with the help of Deutsche Telekom and SAP and relies on privacy-focused technology developed by Apple and Google. Italy's government has also launched an app based on the Apple-Google model, called Immuni.
The U.K., on the other hand, says it will launch its own app ""soon,"" but the timing of its launch remains unclear. There has been a rift in Europe over whether to use Apple and Google's ""decentralized"" approach, with Britain, France and Norway opting for a more centralized model. Norway announced on Monday that it was pausing work on its app after its data protection regulator flagged privacy concerns. —Ryan Browne
8:01 a.m. ET — Nationwide, about 21,000 people are infected with the coronavirus in the U.S. every day. But that national figure masks regional trends, which indicate that while the virus is slowing in the Northeast and Midwest, it's rising in the South and the West, CNBC's Meg Tirrell reported, citing data from the Covid Tracking Project.
While some continue to attribute the rise in cases to increased testing, data on hospitalizations, which is not tethered to the availability of testing, is also on the rise in a number of states, including Arizona, Texas and North Carolina. Some states, such as Florida, do not report hospitalizations. The cities seeing the fastest case-doubling time are Yakima, Washington; Phoenix, Arizona; Austin, Texas; Charlotte, North Carolina; and Tampa, Florida, Tirrell reported, citing data from investment banking firm Evercore ISI.
State officials have responded to the increase of infections in a variety of ways. Arizona Gov. Doug Ducey has insisted the state's hospitals are well prepared for a surge in patients. Oregon Gov. Kate Brown has paused the state's reopening for seven days while health officials reexamine the data and trends. —Will Feuer
7:24 a.m. ET — Italy, Germany, the Netherlands and France have agreed to pay an initial 750 million euros ($843.2 million) for 300 million doses of AstraZeneca's vaccine against Covid-19, a spokesperson for Italy's health ministry said according to a Reuters report.
The countries will have the option to buy a further 100 million doses, the health ministry said, according to the news agency. Italy itself will pay 185 million euros for 75 million doses of the vaccine, which is being developed by Oxford University.
AstraZeneca announced on Saturday it had agreed with the four countries to supply up to 400 million doses of the vaccine, with deliveries starting by the end of 2020. The pharmaceutical said it was building a number of supply chains in parallel across the world and is seeking to expand manufacturing capacity further. Total manufacturing capacity currently stands at 2 billion doses, the company said.
The vaccine is undergoing phase two and three clinical trials with around 10,000 adult volunteers taking part in the late-stage U.K. trial. In a statement Saturday, AstraZeneca said it ""recognises that the vaccine may not work but is committed to progressing the clinical programme with speed and scaling up manufacturing at risk."" –Holly Ellyatt
7:16 a.m. ET — In an effort to restart the country's crucial tourism sector, Greece has reopened its main airports to more international flights, Reuters reported.
Visitors from airports deemed high-risk by the European Union's aviation safety agency will be tested for the coronavirus and quarantined for up to 14 days if they test positive, according to Reuters. Passengers from Britain and Turkey face greater restrictions, and passengers from other airports will be randomly tested.
Country-wide restrictions on movement imposed in March helped Greece contain the spread of Covid-19 infections to just above 3,000 cases, according to data compiled by Johns Hopkins University.
""You can come to Greece, you will have a fantastic experience, you can sit on a veranda with this wonderful view, have your nice Assyrtiko wine, enjoy the beach,"" Prime Minister Kyriakos Mitsotakis said Saturday from the Mediterranean island of Santorini, Reuters reported. ""But we don't want you crowded in a beach bar... There are a few things that we won't allow this summer.""
Tourism employs about 700,000 people and accounts for some 20% of Greece's economic output, according to Reuters. —Will Feuer
Read CNBC's previous coronavirus live coverage here: U.S. second wave could stress medical system; India cases spike despite lockdown
NEW YORK, Nov. 2, 2012 /PRNewswire/ -- The MerchantCashAdvanceIndustry.org network, a lending portal for small and mid-sized businesses has initiated a recovery campaign with its partners in the wake of Hurricane Sandy. The call to action was driven by witnessing the aftermath firsthand near their office in New York City.
A spokesperson for the network was quoted as saying, ""We fear that access to traditional forms of financing will be full of red tape, considering that banks today are already highly risk averse. The additional uncertainty brought on by the disaster, whether businesses were directly affected by it or not could very well lead to fewer loans and lines of credit. We feel it more necessary than ever to spread the message that alternatives like merchant cash advances, cash flow loans, and other forms of merchant financing are accessible.""
A merchant cash advance allows businesses to tap into their projected future revenues today by literally selling a fixed portion of those future sales to a factoring company.
Cash flow loans allow businesses to leverage their historical revenues and positive cash flow to get approved for a short-term business loan. Accepting credit cards as a form of payment is not necessary for consideration.
Approval and funding is typically completed in less than a week. Applicants operating an existing business in a Hurricane affected area can request an even further expedited application process by checking the designated box on the website's inquiry forms.
MerchantCashAdvanceIndustry.org makes no guarantee of loan approval, is not offering grants, and is not involved in any type of governmental assistance program. We are not a lender. Our partners are responsible for all financing terms and decisions. You can follow the industry on Facebook at http://www.facebook.com/MerchantCashAdvanceIndustry, watch our videos on YouTube, and apply at http://merchantcashadvanceindustry.org.
SOURCE MerchantCashAdvanceIndustry.org
","NEW YORK, Nov. 2, 2012 /PRNewswire/ -- The MerchantCashAdvanceIndustry.org network, a lending portal for small and mid-sized businesses has initiated a recovery campaign with its partners in the wake of Hurricane Sandy. The call to action was driven by witnessing the aftermath firsthand near their office in New York City. A spokesperson for the network was quoted as saying, ""We fear that access to traditional forms of financing will be full of red tape, considering that banks today are already highly risk averse. The additional uncertainty brought on by the disaster, whether businesses were directly affected by it or not could very well lead to fewer loans and lines of credit. We feel it more necessary than ever to spread the message that alternatives like merchant cash advances, cash flow loans, and other forms of merchant financing are accessible.""A merchant cash advance allows businesses to tap into their projected future revenues today by literally selling a fixed portion of those future sales to a factoring company.Cash flow loans allow businesses to leverage their historical revenues and positive cash flow to get approved for a short-term business loan. Accepting credit cards as a form of payment is not necessary for consideration.Approval and funding is typically completed in less than a week. Applicants operating an existing business in a Hurricane affected area can request an even further expedited application process by checking the designated box on the website's inquiry forms.MerchantCashAdvanceIndustry.org makes no guarantee of loan approval, is not offering grants, and is not involved in any type of governmental assistance program. We are not a lender. Our partners are responsible for all financing terms and decisions. You can follow the industry on Facebook at http://www.facebook.com/MerchantCashAdvanceIndustry, watch our videos on YouTube, and apply at http://merchantcashadvanceindustry.org.SOURCE MerchantCashAdvanceIndustry.org",2021-10-30 14:11:55.698820
+"Stocks making the biggest moves premarket: WBA, BB, MO, ACN & more",https://www.cnbc.com/2018/12/20/stocks-making-the-biggest-moves-premarket-wba-bb-mo-acn--more.html,2018-12-20T13:03:48+0000,Peter Schacknow,CNBC,"Check out the companies making headlines before the bell:Walgreens Boots Alliance – Walgreens earned an adjusted $1.46 per share for its latest quarter, 3 cents a share above estimates. Revenue also came in above analysts' forecasts and the company announced plans to cut $1 billion in costs. Separately, Walgreens announced a strategic partnership with Alphabet's Verily unit. The two will collaborate on multiple projects aimed at improving health care treatment and lowering the cost of care.Accenture – The consulting firm reported quarterly profit of $1.96 per share, 10 cents a share above estimates. Revenue also topped Street forecasts, boosted by improvements in digital and cloud services.BlackBerry – BlackBerry beat estimates by 3 cents a share, with adjusted quarterly profit of 5 cents per share. Revenue beat estimates, as well. An improvement in automotive services revenue was among the factors helping the bottom line.Conagra Brands – The food producer earned an adjusted 67 cents per share for its fiscal second quarter, 12 cents a share above estimates. Revenue was below Wall Street forecasts, however, but the company reaffirmed its fiscal 2019 guidance for its legacy brands.Altria – The tobacco producer will pay $12.8 billion to take a 35 percent stake in e-cigarette maker Juul. The deal values Juul at $38 billion, well above July's $16 billion valuation.Newell Brands — Investor Carl Icahn increased his stake in the household products maker to 9.89 percent from the previously reported 8.1 percent stake.AB InBev, Tilray – The beer brewer and the cannabis producer announced a partnership to research non-alcohol beverages containing marijuana ingredients THC and CBD. For now, the partnership is limited to Canada.Herman Miller – Herman Miller reported adjusted quarterly profit of 75 cents per share, 3 cents a share above estimates. The office furniture maker's revenue also came in above Wall Street forecasts. The company is also forecasting better-than-expected earnings for the current quarter.Pier 1 Imports — Chief Executive Officer Alasdair James has resigned. The home furnishings retailer has appointed board member and former Popeyes CEO Cheryl Bachelder as interim CEO, and also said it is examining strategic alternatives including a possible sale.Humana – The health insurer's stock was upgraded to ""overweight"" from ""neutral"" at JPMorgan Chase, which cites a number of factors including valuation. The health insurer's stock has fallen about 8 percent over the past month.PPG Industries – PPG was upgraded to ""outperform"" from ""sector perform"" at RBC Capital Markets, which said the involvement of activist investor Trian in the paint and coatings maker is a positive factor.Celanese – Celanese will replace Express Scripts in the S&P 500, following the completion of Cigna's deal to acquire Express Scripts. The chemical maker will join the benchmark index on December 24.Rite Aid – Rite Aid reported adjusted quarterly profit of a penny a share, beating the Street consensus of a breakeven quarter. The drugstore chain's revenue was in line with estimates and Rite Aid announced an extension of its drug supply agreement with McKesson.","cnbc, Articles, Mckesson Corp, Rite Aid Corp, Cigna Corp, Express Scripts Holding Co, Celanese Corp, PPG Industries Inc, Humana Inc, Pier 1 Imports Inc, Herman Miller Inc, Tilray Inc, Anheuser Busch Inbev SA, Newell Brands Inc, Altria Group Inc, Conagra Brands Inc, BlackBerry, Accenture PLC, Alphabet Class A, Walgreens Boots Alliance Inc, Breaking News: Markets, Stock markets, Business, Economy, Markets, Market Insider, Finance, stocks, US: News, U.S. Markets, source:tagname:CNBC US Source",https://image.cnbcfm.com/api/v1/image/105324465-1531345422698gettyimages-591961884.jpg?v=1545780274,"Check out the companies making headlines before the bell:
Walgreens Boots Alliance – Walgreens earned an adjusted $1.46 per share for its latest quarter, 3 cents a share above estimates. Revenue also came in above analysts' forecasts and the company announced plans to cut $1 billion in costs. Separately, Walgreens announced a strategic partnership with Alphabet's Verily unit. The two will collaborate on multiple projects aimed at improving health care treatment and lowering the cost of care.
Accenture – The consulting firm reported quarterly profit of $1.96 per share, 10 cents a share above estimates. Revenue also topped Street forecasts, boosted by improvements in digital and cloud services.
BlackBerry – BlackBerry beat estimates by 3 cents a share, with adjusted quarterly profit of 5 cents per share. Revenue beat estimates, as well. An improvement in automotive services revenue was among the factors helping the bottom line.
Conagra Brands – The food producer earned an adjusted 67 cents per share for its fiscal second quarter, 12 cents a share above estimates. Revenue was below Wall Street forecasts, however, but the company reaffirmed its fiscal 2019 guidance for its legacy brands.
Altria – The tobacco producer will pay $12.8 billion to take a 35 percent stake in e-cigarette maker Juul. The deal values Juul at $38 billion, well above July's $16 billion valuation.
Newell Brands — Investor Carl Icahn increased his stake in the household products maker to 9.89 percent from the previously reported 8.1 percent stake.
AB InBev, Tilray – The beer brewer and the cannabis producer announced a partnership to research non-alcohol beverages containing marijuana ingredients THC and CBD. For now, the partnership is limited to Canada.
Herman Miller – Herman Miller reported adjusted quarterly profit of 75 cents per share, 3 cents a share above estimates. The office furniture maker's revenue also came in above Wall Street forecasts. The company is also forecasting better-than-expected earnings for the current quarter.
Pier 1 Imports — Chief Executive Officer Alasdair James has resigned. The home furnishings retailer has appointed board member and former Popeyes CEO Cheryl Bachelder as interim CEO, and also said it is examining strategic alternatives including a possible sale.
Humana – The health insurer's stock was upgraded to ""overweight"" from ""neutral"" at JPMorgan Chase, which cites a number of factors including valuation. The health insurer's stock has fallen about 8 percent over the past month.
PPG Industries – PPG was upgraded to ""outperform"" from ""sector perform"" at RBC Capital Markets, which said the involvement of activist investor Trian in the paint and coatings maker is a positive factor.
Celanese – Celanese will replace Express Scripts in the S&P 500, following the completion of Cigna's deal to acquire Express Scripts. The chemical maker will join the benchmark index on December 24.
Rite Aid – Rite Aid reported adjusted quarterly profit of a penny a share, beating the Street consensus of a breakeven quarter. The drugstore chain's revenue was in line with estimates and Rite Aid announced an extension of its drug supply agreement with McKesson.
Facebook, the world’s biggest social network, is selling more ad spots to big companies like Wal-Mart Stores, Procter & Gamble and PepsiCo.
But the site’s pages are also home to countless ads from smaller companies that can be funny, weird or just plain creepy — those suggesting you are, say, eligible to get a free iPad because you are exactly 26 years old, or entreaties to see what your offspring would look like if you had a child with a celebrity.
Odd Web ads, like the dancing women promoting mortgage brokers, are not new. But on social networks like Facebook, where people go to communicate with one another, advertisers seem to be trying especially hard to intrude on the conversation.
The so-called self-service ads on the site, from the likes of video game start-ups, herbal supplement makers, sweepstakes companies and wedding photographers, are shown on the right side of most pages. Many advertisers who use the self-service system are tempted to go as far as possible in making ads that attract attention and appear relevant, aided by the information that people give to Facebook.
“When it works, it’s amazingly impactful, but when it doesn’t work, it’s not only creepy but off-putting,” said Tim Hanlon, a principal at the consulting firm Riverview Lane Associates of Chicago. “What a marketer might think is endearing, by knowing a little bit about you, actually crosses the line pretty easily.”
One campaign that flooded the site in recent weeks, before Facebook cracked down on it, tries to take advantage of consumer interest in Apple’s iPad. “Are you a fan of Eddie Izzard? We need 100 music and movie lovers to test and KEEP the new Apple iPad,” one version of the ad says. Louis Allred Jr., 29, a Facebook user in Los Angeles who saw the ad, said he figured it was shown to him because he or a friend had expressed enthusiasm for Mr. Izzard, a British comedian, on their profiles.
“It doesn’t seem like they are using the information in sensible ways,” Mr. Allred said.
Mr. Allred was also skeptical about the test-an-iPad offer. The ad sends people to Prize-Rewards.net, a site that appears to be based in Vancouver, Canada, and tries to get people to pursue rewards by signing up for memberships in services like Netflix. Efforts to reach the company were unsuccessful.
Dan Rose, vice president for business development at Facebook, compared the company’s self-service ad platform to the early versions of Google’s highly profitable AdWords system. He predicted that the quality of the promotional messages on the site would improve as more companies began to use it.
“A year ago, we had lower-quality ads, and a year from now we will have higher-quality ads,” Mr. Rose said. “It’s early, but we have made a lot of progress.”
The self-service ad system offers any person or company the opportunity to quickly design an ad and aim it toward finely segmented groups of Facebook’s 400 million members, based on gender, age, location and preferences like favorite movies and activities.
For example, a promoter can advertise tickets to a band’s concert to the select group of Facebook users who live in the area and have mentioned that band on their profile page or status updates. Or a wedding photographer can show ads only to people in a certain city who have switched their relationship status to “engaged.”
“I’ve had good success with it on a limited budget,” said Carter Rose, a wedding photographer in Dallas who has paid $1,700 for Facebook ads over the last few months and as a result booked three weddings at $3,500 each.
Many advertisers view a site like Facebook as a good place for playful messages. Cordarounds, a San Francisco pants company, talks about “pigeon matadors” and “trouserbots” that make pants in a “zero-G environment” to capture attention for its products on Facebook.
“It’s a conversational medium. If you can be the originator of that conversation, you are fitting in,” said Chris Lindland, the company’s chief executive, who uses Facebook to advertise solely to young men in the 20 largest urban areas.
From the perspective of many users, the tailored ads can often seem, at best, presumptuous.
Women who change their status to “engaged” on Facebook to share the news with their friends, for example, report seeing a flood of advertisements for services and products like wedding photographers, skin treatments and weight-loss regimens.
Then there are the nonsensical ads, which highlight the fact that Facebook does not have employees to review each ad, but relies largely on member feedback to flag inappropriate messages. That allows ads to slip through that run afoul of the company’s policies. “Laws now allow U.S. residents to reduce their credit card debt by more than 50 percent,” reads one ad for a debt-relief Web site, which is accompanied by a surreal image of four tiny babies lying in the palm of a hand.
“It caught my eye, but it sure didn’t win my trust,” said Paige Kobert, 32, an advertising employee from San Francisco who saw the ad recently. “It just seemed like a scam.”
A Facebook spokesman, Brandon McCormick, said ads like that one and the Eddie Izzard iPad ad violated a Facebook policy that requires the text and photo in the ad to be related to what is being advertised.
Mr. McCormick said that in the last few weeks, Facebook had begun enforcing that provision after users complained about the flood of ads aimed at alumni from a certain university or people of a certain age (“Hey, 32-Year-Olds”), with messages that had nothing to do with those characteristics.
Such ads are the equivalent of a direct mail “special offer for John Smith” that turns out to be not so special.
Facebook users seem most perplexed when they are left wondering why they have received a customized ad.
Jess Walker, 22, from central Florida, was recently presented an ad for Plan B, the morning-after pill.
“What do I have on my Facebook page that would lead them to believe I would need that?” she asked, adding that she did not want her sexual behavior called into question.
Ms. Walker noted that Facebook allowed her to delete the ad from the page she was viewing. — which would then make Facebook less likely to allow that particular ad to be sent to other people.
Mr. Rose from Facebook said the ads on the site were becoming more professional and straightforward as the company updated its policies and enforced them.
“When you have got the platform that we have, you are naturally going to attract people who are going to game it,” Mr. Rose said.
For the second time in roughly three months, JPMorgan Chase is scrambling to contain the fallout from a security breach of its vast computer network, according to several people with knowledge of the investigation.
JPMorgan, the nation's largest bank, recently found that hackers, with links to Italy or southern Europe, had gained entry to some of the bank's servers, these people said.
Read MoreJPMorgan:We are not aware of a new cyberattack
The discovery follows an attack that was uncovered in late July and suggests that it was more extensive than first thought. In that attack, hackers obtained entry to dozens of the bank's servers and reviewed information on more than one million customer accounts. Security experts briefed on the matter had said that the full extent of the July attack was not known and that it could take the bank months to discover all of the fallout.
""We are not aware of any new attack,"" Kristin Lemkau, a spokeswoman for JPMorgan, said. Any report that there was a second breach is false, she added.
It is unclear whether the latest discovery constitutes a second breach or is part of broader fallout from the first incident. The revelation illustrates the challenges for JPMorgan as the bank tries to secure all its systems against another threat.
More from The New York TImes:
Pimco says rush of funds may be slowing
Loan fraud inquiry said to focus on used-car dealers
Senior Justice Dept. prosecutor to step down
The original hack sent ripples through the financial system and prompted an investigation by the Federal Bureau of Investigation, even as Wall Street, which has been a frequent target for hackers in recent years, worked to guard against the threats.
The bank was also forced to update its regulators, including the Federal Reserve, on the extent of the breach. The bank said at the time that there was no indication that any customer money was taken and that it believed it had secured all its systems.
On Thursday, the bank's top executives, including Gordon A. Smith, who heads JPMorgan's community and consumer banking, were working to assess the extent of the latest attack, according to two bank executives.
NYT Correction: October 2, 2014
An earlier version of the headline with this article misstated the extent of the cyber security issues at JPMorgan Chase. While the bank found evidence of previously unknown hacking, it says the latest discovery does not constitute a breach separate from an earlier one.
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White House Press Secretary Sean Spicer holds his daily press briefing with Capitol Hill reporters.
One of the key factors playing a key role in T-Mobile's success is its appeal to millennials because of the ""freedom"" it provides, the company's CEO, John Legere, said Tuesday.
""Overall, we've done nine 'uncarrier moves.' An uncarrier move is a move intended to change a stupid, broken arrogant industry, and it's intended to be permanent, and we want everybody to change [to] no contracts, anytime upgrades and international data roaming,"" Legere told CNBC's ""Squawk Alley."" ""This freedom resonates with young folks.""
Legere made his remarks after the company said it added nearly 2 million subscribers in the first quarter of 2015, marking the eighth-consecutive quarter in which the company added over 1 million users. T-Mobile also reported total revenue of $7.8 billion in the quarter, a 13.1 percent rise year-over-year.
Legere added that the company will continue growing as awareness of the company's ""freedoms"" grows. ""Between 10 and 28 percent … those are the awareness levels among wireless subscribers of the changes we've made. When somebody goes overseas and sees that international roaming is free, they say, 'You're kidding me. I didn't know that,' "" he said.
Read More T-Mobile CEO: 'Not afraid' of the competition
T-Mobile's stock was up in midday trading. Click here to see where the stock is trading now.
Democratic presidential candidate Rep. Tulsi Gabbard sued former Secretary of State Hillary Clinton on Wednesday for allegedly defaming her by suggesting the Hawaii congresswoman is a ""Russian asset.""
""Clinton's false assertions were made in a deliberate attempt to derail Tulsi's campaign,"" said the lawsuit, filed in U.S. District Court in Manhattan.
The suit claims that Gabbard has suffered ""actual damages"" of ""$50 million — and counting"" from Clinton's comments. But the suit does not cite a specific amount of damages it is seeking.
Clinton, the 2016 Democratic presidential nominee who previously was a senator from New York, said in an October interview that an unnamed Democratic presidential candidate was ""the favorite of the Russians.""
Clinton did not mention Gabbard, a four-term congresswoman, by name in that interview with the podcast ""Campaign HQ With David Plouffe.""
But Clinton's spokesman, Nick Merrill, said after the interview that ""If the nesting doll fits,"" when asked if she had been referring to Gabbard, who is also a major in the Army National Guard and a combat veteran of Iraq.
Merrill later said in a tweet that Clinton was referring to the Republican Party grooming Gabbard. But it is Russians, not the GOP, who are known for making nesting, or Matryoshka dolls.
Clinton, wife of President Bill Clinton, lost the 2016 election to Republican nominee Donald Trump.
The report by special counsel Robert Mueller as well as a probe by the Senate Intelligence Committee have both found that Russian agents tried to damage Clinton's candidacy, and that they tried to promote the third-party candidacy of Green Party nominee Jill Stein in order to harm Clinton's chances of winning the White House.
When asked about the suit, Merrill told NBC News on Wednesday, ""That's ridiculous.""
The suit suggests that Clinton smeared Gabbard with a false accusation in ""retribution"" for Gabbard's endorsement of Vermont independent Sen. Bernie Sanders in his 2016 candidacy for the Democratic presidential nomination.
""Clinton �� a cutthroat politician by any account — has never forgotten this perceived slight,"" said Gabbard's suit, which also names the congresswoman's presidential campaign committee as a plaintiff.
Clinton ""lied about her perceived rival"" for reasons that could include ""personal animus, political enmity, or fear of real change within a political party Clinton and her allies have long dominated.""
Clinton ""did so publicly, unambiguously, and with obvious malicious intent,"" the suit claimed.
The market for cloud-computing infrastructure to power applications has grown immensely since Amazon introduced its first cloud services in 2006, but U.S. investors haven't had a great way of investing exclusively in cloud.
That will change in the coming weeks when a company called DigitalOcean starts trading on the New York Stock Exchange under the symbol ""DOCN.""
Buying shares of Amazon -- or Alibaba, Google, IBM, Microsoft or Oracle -- has meant getting a small percentage of exposure to the public cloud. DigitalOcean is different because it doesn't do anything else.
The company will start out with a much lower valuation than those other companies. In a Monday update to the prospectus for its initial public offering, DigitalOcean said it expects to sell shares at $44 to $47 per share, which would give it a market cap of about $4.8 billion at the middle of the range. DigitalOcean also said Tiger Global and an entity tied to existing investor Access Industries want to buy up to $175 million in the company's shares at the time of the IPO.
Unlike public cloud market leader Amazon Web Services, DigitalOcean is not profitable. It lost almost $44 million in 2020, compared with a $40 million loss in 2019. DigitalOcean is also growing more slowly than AWS, despite that AWS generates 142 times more revenue. AWS revenue in 2020 totaled $45.37 billion, up 29.5%, while DigitalOcean reported 25% revenue growth.
That might be okay, because DigitalOcean has a specialty: Simplicity. It isn't overwhelming to new users, who wind up increasing the amount they spend on DigitalOcean services over time.
Simplicity is one of the four principles the founders picked when DigitalOcean started in 2012. ""We take infrastructure technology and make it simple across all aspects of the product experience,"" CEO Yancey Spruill, a former operating chief and finance chief at SendGrid, wrote in a letter to investors in the prospectus.
Since 2006 AWS has introduced a wide swath of services for software developers to adopt, and its customer list has gotten long, with big names like Apple paying hundreds of millions per year.
That's not DigitalOcean's path. It has just a handful of products, including customizable Linux-based virtual machines that it calls droplets, data-storage options, networking tools and three databases. Unlike on Amazon, there are no machine-learning services, deployment tools, database-migration technologies or media-transcoding systems. It maintains 6,000 tutorials designed to help people get going.
DigitalOcean also tries to stay simple with pricing and the bills it sends each month to its nearly 600,000 customers.
DigitalOcean took a swipe at the big public-cloud vendors in its prospectus, saying their products aren't intuitive enough for sole developers and small businesses and ""suffer from near-infinite feature complexity and have opaque pricing and billing practices that are often accompanied by significant hidden costs."" As a result, the company said, small businesses are often unable to enjoy the benefits of cloud computing.
""Companies frequently need dedicated employees, pricing analytics tools or even specialized consultants to understand how products are priced and how to manage their bills,"" it wrote.
If DigitalOcean has found a sweet spot, it's with small businesses, rather than large enterprises, which the big clouds have been fighting over in the past few years. It's a self-service business that doesn't rely heavily on a large group of salespeople. In that way it will be like website-building company Wix and e-commerce software maker Shopify.
The New York-based company also has foreign reach. Rather than touting S&P 500 clients in its prospectus, DigitalOcean showcases customers such as Bunnyshell of Romania, Cloudways of Malta, Jiji of Nigeria, Vidazoo of Israel and Whatfix of India. In 2020 38% of DigitalOcean's revenue came from North America; by comparison, 68% of Amazon's 2020 revenue came from the U.S.
DigitalOcean has yet to take major share in the cloud infrastructure market, though, and some of its customers could end up switching to more comprehensive cloud providers as their needs evolve.
But DigitalOcean is hopeful. In the prospectus the company said it expects more than 14 million small and medium-size businesses to be formed each year, and their founders don't necessarily come with sharp technical skills. ""These individuals are able to leverage simple and reliable development tools and the widespread availability and significantly lower upfront cost of cloud computing to start companies,"" the company said.
WATCH: Bessemer's Byron Deeter on the resurgence of cloud computing stocks
Ford, Amazon, Subway and the History Channel are the ""buzziest"" brands in the United States, according to the latest bi-annual list from YouGov's BrandIndex.
The U.S. survey is based on interviews with 20,000 people each week and measures a brand's buzz, which includes whether people have heard anything positive or negative about the brand in the media or through word of mouth. The company issues a new list every six months.
Buzziest American brands
1) Ford
2) Amazon
3) Subway
4) History Channel
5) Lowe's
6) V8
7) Walgreens
8) YouTube
9) Kindle
10) Cheerios
Some of the names are notable in that they can be classified as self-empowerment brands, advertising executive Donny Deutsch said on the TODAY show.""The consumer has control,"" when it comes to Kindle, Subway and You Tube, he said. ""This is a lot of the trend that is going on.""
(Read More: Apple Verdict May Not Result in Cheaper E-Books)
The mid-year BrandIndex survey also compiles a list of brands with the most-improved buzz from six months ago. This time around, Goldman Sachs, Bank of America and J.P. Morgan win the awards for making the best rebound. In part, that boost can be tied to the improved economy, according to the survey researchers.
Most-improved buzz
1) Goldman Sachs
2) Bank of America
3) J.P. Morgan
4) American Airlines
5) BlackBerry
6) Galaxy
7) Morgan Stanley
8) Kodak
9) Bing
10) Starbucks DoubleShot Energy Coffee
BrandIndex also conducts its surveys internationally, examining thousands of brands on a daily basis. ""Globally, Samsung is the winner,"" the company states in its mid-year report. ""Samsung is the strongest international performer for the second year running—the technology brand appears in the Top 10 lists for eleven out of fourteen countries monitored.""
(Read More: US Ad Spending Flat, Cable and Hispanic TV Up)
—By CNBC's Amy Langfield. Follow her on Twitter @AmyLangfield.
President Donald Trump's personal attorney, Rudy Giuliani, was paid $500,000 for work he did for a company co-founded by the Ukrainian-American businessman arrested last week on campaign finance charges, Giuliani told Reuters on Monday.
The businessman, Lev Parnas, is a close associate of Giuliani and was involved in his effort to investigate Trump's political rival, former Vice President Joe Biden, who is a leading contender for the 2020 Democratic Party nomination.
Giuliani said Parnas' company, Boca Raton, Florida-based Fraud Guarantee, whose website says it aims to help clients ""reduce and mitigate fraud,"" engaged Giuliani Partners, a management and security consulting firm, around August 2018. Giuliani said he was hired to consult on Fraud Guarantee's technologies and provide legal advice on regulatory issues.
Federal prosecutors are ""examining Giuliani's interactions"" with Parnas and another Giuliani associate, Igor Fruman, who was also indicted on campaign finance charges, a law enforcement source told Reuters on Sunday.
The New York Times reported last week that Parnas had told associates he paid Giuliani hundreds of thousands of dollars for what Giuliani said was business and legal advice. Giuliani said for the first time on Monday that the total amount was $500,000.
Giuliani told Reuters the money came in two payments made within weeks of each other. He said he could not recall the dates of the payments. He said most of the work he did for Fraud Guarantee was completed in 2018 but that he had been doing follow-up for over a year.
Parnas and Fruman were arrested at Dulles Airport outside Washington last week on charges they funneled foreign money to unnamed U.S. politicians in a bid to influence U.S.-Ukraine relations in violation of U.S. campaign finance laws. The men were preparing to board a plane to Europe.
According to an indictment unsealed by U.S. prosecutors, an unidentified Russian businessman arranged for two $500,000 wires to be sent from foreign bank accounts to a U.S. account controlled by Fruman in September and October 2018. The money was used, in part, by Fruman, Parnas and two other men charged in the indictment to gain influence with U.S. politicians and candidates, the indictment said.
Foreign nationals are prohibited from making contributions and other expenditures in connection with U.S. elections, and from making contributions in someone else's name.
Giuliani said he was confident that the money he received was from ""a domestic source,"" but he would not say where it came from.
""I know beyond any doubt the source of the money is not any questionable source,"" he told Reuters in an interview. ""The money did not come from foreigners. I can rule that out 100%,"" he said.
He declined to say whether the money had been paid directly to him by Fraud Guarantee or from another source.
John Dowd, a lawyer for Parnas and Fruman, also would not discuss the source of the funding that Giuliani said he received for his work for Fraud Guarantee. ""What I know is privileged,"" Dowd said.
Vanguard founder and former CEO Jack Bogle is not a believer in trading 'FANG' stocks.
When asked about Intercontinental Exchange launching a FANG+ index futures contract for traders on Wednesday, Bogle blasted the idea.
The product enables investors to trade an index that tracks the performance of Facebook, Apple, Amazon, Netflix, and Google-parent Alphabet, along with Alibaba, Baidu, Nvidia, Tesla and Twitter.
""If you want to do such a crazy thing, it certainly makes it easy to do. ... I have no doubt it's a liability,"" Bogle said on CNBC's ""Power Lunch"" Tuesday. ""I think the odds are very bad. It appeals to the trading instincts in investors. ... If you like gambling, if you like casinos, these things are really, really, really good.""
Instead he recommended investors focus on the long term with a multidecade time horizon by buying index funds that minimize trading transaction costs.
""Anything that gets investors into trading is a negative,"" he said. ""Trading is a loser's game. Trading is short term speculation.""
Bogle founded Vanguard Group in 1975. The firm is widely regarded as the leader of passive index investing. It has approximately $4.7 trillion in assets under management, according to its president.
U.S. stocks closed lower on Thursday, with the Nasdaq off 1.6 percent, as investors weighed declines in oil and disappointing earnings ahead of Friday's key employment report. (Tweet This)
""There's nervousness among momentum investors caused by some of the outperforming names either missing or giving cautious comments in earnings reports,"" said Robert Pavlik, chief market strategist at Boston Private Wealth.
""I don't think much of it is warranted,"" he said, noting some profit-taking.
The major averages came off session lows in the close. The Dow Jones industrial average ended at its lowest level in 6 months and posted its first 6-day losing streak since October.
Stocks extended losses in midday trade as the S&P 500 broke through a key level of 2,087 that many analysts were watching. The index closed below that level but held above its 200-day moving average of 2,072.
Art Cashin, director of floor operations at UBS, said the next level of support is 2,063 to 2,067.
Viacom and 21st Century Fox plunged, joining Disney in a post-earnings stock decline to bring the media sector down about 8 percent for the week so far. At its lows the media sector was off about 11 percent for the week, on track for its worst week since October 2008, when it lost 21.87 percent.
The media sector weighed on consumer discretionary, off more than 1 percent as one of the greatest decliners in the S&P 500.
Read MoreAmid media carnage, opportunities may abound
Health care was the worst sector performer, falling more than 2 percent as biotechs plunged. The declines weighed heavily on the Nasdaq, which closed more than 1.5 percent lower. The iShares Nasdaq biotechnology ETF (IBB) fell 4.3 percent, while Apple reversed recent declines to end mildly higher.
The Dow Jones industrial average closed about 120 points lower, after falling as much as 177 points.
The greatest weight on the index was Disney, which closed 1.8 percent lower, off an earlier 5.5 percent decline. The stock extended its post-earnings plunge from Wednesday after the firm missed on revenue and disappointed investors with subscriber losses. Year-to-date, the stock is the third-best performer in the Dow.
""You've got some nervousness ahead of the jobs report, lack of a bullish impetus, narrowing leadership,"" said Adam Sarhan, CEO of Sarhan Capital. ""The market continues to get weaker, not stronger.""
He is watching 2,040 on the S&P 500. ""Right now there're less and less bullish drivers and concurrently more bearish drivers,"" Sarhan said. ""If support breaks there's no question on my mind (that we get a correction).""
""Market participants are really groping for a new catalyst to move stocks higher,"" said Mark Luschini, chief investment strategist at Janney Montgomery Scott. ""There's still some questions on the economy, the pace of growth.""
He noted there were few indications that the market was strongly concerned about an interest rate hike, as bond yields held lower, the dollar was flat, and gold traded a touch higher.
""The rise in the Treasury market is a take of two separate things moving in different directions,"" said Eric Stein, co-director of global fixed income at Eaton Vance Management. He noted hawkish comments from policymakers balanced by ""the continued selloff in commodity prices.""
""It's not all about September, it's obviously about the path of rates (in the next) two to three years,"" Stein said.
Friday's jobs report is one of the few key pieces of data expected before the Federal Reserve meets in September and could potentially find enough impetus for raising short-term interest rates. Economists expect 223,000 nonfarm payrolls on Friday, with unemployment unchanged at 5.3 percent, according to Thomson Reuters.
""I think this (jobs) report is what everyone's keying on. We've kind of got mixed messages in the data this week,"" said Chris Gaffney, president of EverBank World Markets.
""I think the key is average hourly earnings and if that comes with a 2 percent increase tomorrow, absolutely September comes into play,"" Gaffney said.
Read MoreEarnings? Who cares. All eyes are on Jobs Friday
""I think the market is really getting anxious about nonfarm payrolls,"" said Doug Cote, chief market strategist at Voya Investment Management. ""If it's a moderate number, then (liftoff) could be put off, but if it's a really big number tomorrow—if unemployment is 5.2 percent—the market struggles a little bit, raise the prospect of a September rate increase.""
Jobs data so far this week was mixed. Initial claims came in Thursday at 270,000, slightly below expectations. The private sector report from ADP showed fewer-than-expected jobs were created.
U.S. job cuts in July exceeded 100,000 for the first time in nearly four years as the military announced plans to reduce troop and civilian workforce payrolls, according to Challenger, Gray & Christmas. A year ago, U.S. companies announced plans to cut 46,887 jobs.
However, the major jump in job cuts is not expected to significantly affect Friday's key report.
""We think this increase in announced job cuts will have no impact on the July BLS report, and only a minimal impact on the employment data over the next few years. The jump in layoffs announced in July was basically entirely due to reductions announced by the US Army that are scheduled to begin in October and be implemented over the next two years,"" JPMorgan said in a morning note.
Oil continued to decline, with WTI crude settling down 49 cents, or 1.09 percent, at $44.66 a barrel. Brent dipped below $48 a barrel.
""I know that a lot of people that are bearish,"" said Phil Flynn, energy market analyst at Price Futures Group. ""As weak as the market feels right now the onus is on the bears to take out $40 a barrel. Really we're following a seasonal pattern.""
In Europe, equities closed lower as crude weighed on sentiment and the Bank of England kept rates unchanged.
Analysts said the central bank's position could be an indication that the U.S. Federal Reserve also holds off on raising rates.
Read MoreDoves dominate as Bank of England holds rates
The dollar traded mildly lower, with the euro above $1.09 and the yen little changed against the greenback at 124.7 yen.
Treasury yields held lower, with the 10-year at 2.22 percent and the at 0.70 percent.
Many stocks saw outsized moves amid the slew of quarterly reports towards the end of earnings season. About 80 percent of names in the S&P 500 have reported.
There are ""tons of stocks reporting earnings. We've had a tough morning because they've been volatile,"" said Phil Quartuccio, CEO of Illustro Trading. ""Earnings (are) surprising on both ends.""
Viacom fell 14 percent and is in a bear market. The firm matched earnings per share estimates but missed on revenue as advertising sales declined and lack of major movie releases from the firm during the quarter.
21st Century Fox declined 6.4 percent after reporting earnings that topped estimates on revenue that missed. The media company also announced a $5 billion stock buyback program.
CBS gained 3.6 percent after the firm reported an adjusted quarterly profit of 74 cents per share, 2 cents above estimates, with revenue essentially in line. CBS benefited from higher subscription fees and increasing revenue from affiliates.
Art Hogan, chief market strategist at Wunderlich Securities, expects some recovery in media names.
""There's a lot of wreckage after Disney,"" he said. ""I think things got overdone.""
Keurig Green Mountain plunged nearly 30 percent after the firm missed significantly on revenue and sales of its coffee pods fell for the first time ever. The single-serve coffee company also lowered its sales and earnings forecasts and announced it would cut 5 percent of its workforce.
Read MoreBad taste: Street spits out Keurig Green Mountain
Fitbit fell 13.6 percent after the firm reported that its profit margins fell during the second quarter and would likely stay at current levels for the rest of the year. That news has put the fitness tracking device maker's shares under pressure, despite seeing revenue more than triple during the second quarter compared to a year earlier.
Herbalife surged 17.2 percent after the firm reported earnings that beat estimates on both the top and bottom line. The nutritional products company raised its full-year earnings guidance, even as its sales are impacted by a stronger dollar.
Tesla closed down about 8.9 percent despite posting a lower-than-expected decline in earnings on revenue that beat. However, the automaker announced its second cut in its sales forecast in the past year.
Reports from Con Ed, EOG Resources, Wingstop, Lions Gate, Great Plains Energy, Noodles and Co., TrueCar, Zynga and Monster Beverage are all due after the bell.
Mondelez closed up 1.12 percent after news that Bill Ackman took at $5.5 billion stake in the snack maker and is considering a pushing for a takeover.
Read More Early movers: CF, CCE, LB, COST, MDLZ, BDX, COST, FIT, TSLA, JPM & more
The Dow Jones Industrial Average closed down 120.72 points, or 0.69 percent, at 17,419.75, with Microsoft leading decliners and Chevron the greatest advancer.
The Dow transports fell 0.83 percent and is back in correction territory.
The closed down 16.28 points, or 0.78 percent, at 2,083.56, with health care leading eight sectors lower and energy and utilities the only advancers.
The Nasdaq closed down 83.50 points, or 1.62 percent, at 5,056.44.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, jumped above 14.
About three stocks declined for every two advancers on the New York Stock Exchange, with an exchange volume of 956 million and a composite volume of 4.2 billion in the close.
Gold futures settled up $4.50 at $1,089.80 an ounce.
—CNBC's Peter Schacknow and Jenny Cosgrave contributed to this report.
On tap this week:
Thursday
Earnings: Con Ed, EOG Resources, Wingstop, Lions Gate, Great Plains Energy, Noodles and Co. TrueCar, Zynga, Monster Beverage
Friday
Earnings: Berkshire Hathaway, Allianz, Hershey, BioCryst Phama, Cablevision, Groupon, Brookfield Asset Management, Sirona
08:30 a.m.: Employment report
03:00 p.m.: Consumer sentiment
More From CNBC.com:
With shares up more than 40% ytd and a valuation of 131 times 2014 earnings, is the Amazon premium too great – even for Amazon? The stock just made a new all time high!
That's the question on the minds of many investors after Amazon shares surged over 8% on better than expected earnings.
The numbers were good – but were they that good?
Revenue increased 24 percent to $17.09 billion from $13.81 billion a year ago.
Meanwhile, the company's net loss dropped to $41 million, or 9 cents per share, from a loss of $274 million, 60 cents per share, the year-earlier period.
That's right – this sky high valuation is for a company that posted a loss.
""I hear people speak of how horrendous this all ends, and how there has to be a moment where shares tumble precipitously,"" Cramer mused.
However, if you're looking for a sharp decline now, Cramer says don't hold your breath.
""If you think it's wrong that Amazon is trading where it is – I ask, who made you the judge?""
There is only one judge that matters; Mister Market.
And the market has decided that Amazon should trade at these valuations. Whether you agree or not doesn't really matter.
""This is no short squeeze,"" Cramer said. ""It's the real deal.""
That's not to say Amazon may not present more risk than other, more conventional stocks.
If you buy Amazon stock, you should know you're buying a stock with one of the richest valuations in the market, Cramer added. You should know that you're buying a stock where conventional metrics don't always apply.
------------------------------------------------------
Read More from Mad Money with Jim Cramer
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2 tailor made retailers for growth investors
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However, that won't prevent you from making money. And in the end, ""The simple truth is that the goal of investing in the stock market is to make money.""
""Nowhere does it say that you must hold each stock to the same set of rules,"" added Cramer. Amazon plays by its own rules. But when you make the rules, often times you win.
Call Cramer: 1-800-743-CNBC
Questions for Cramer? madmoney@cnbc.com
Questions, comments, suggestions for the ""Mad Money"" website? madcap@cnbc.com
(Updated on Oct 1 with central state budget)
NEW LISTINGS OR, AMENDMENTS ARE MARKED*KEY INTEREST RATES ECB'S TWO-WEEK REPOrate (pct) 0.75last changed JULY 5, 2012former rate (pct) 1.00SLOVAK REAL GDP Q2/12 (pct change q/q) (pct change y/y)FLASH ESTIMATE +0.7 +2.7SLOVAK REAL GDP Q2/12 Q1/12 Q2/11 FY/11(pct change yr/yr) +2.8 +3.0 +3.5 +3.3Final consumptionHousehold -0.3 -0.1 -0.1 -0.4Government -2.1 +0.4 -5.1 -3.5Gross fixed capitalformation -1.1 -3.9 +6.4 +5.7Foreign trade balanceexports of goodsand services +8.9 +6.0 +13.1 +10.8imports of goodsand services +3.2 +2.1 +10.9 +4.5SLOVAK REAL GDP (pct change yr/yr)FY/2011 +3.3FY/2010 +4.2 (+4.0)FY/2009 -4.9 (-4.8)FY/2008 +5.9 (+5.8)FY/2007 +10.5 (+10.5)FY/2006 +8.3 (+8.5)FY/2005 +6.7 (+6.7)FY/2004 +5.1 (+5.1)FY/2003 +4.8 (+4.8)FY/2002 +4.6 (+4.6)FY/2001 +3.5 (+3.5)FY/2000 +1.4 (+1.4)C/A BALANCE JUNE 12 MAY 12 JUNE 11(mln euro) +364.0 +449.0 -19.0C/A BALANCE END-2011 END-2010 END-2009(bln euro) +38.0 -1.637 -1.627FOREIGN TRADE JULY 12 JUNE 12 JULY 11 JAN-DEC 11(mln euro)Imports 4,578.9 4,983.0 4,227.5 53,966.1Exports 4,977.9 5,331.9 4,252.6 56,407.9Balance +399.0 +348.8 +25.1 +2,441.9DYNAMICS OF TRADE(pct y/y change)nominal imports +8.3 +8.4 +9.5 +13.6nominal exports +17.1 +11.4 +12.9 +16.9SLOVAK UNEMPLOYMENT AUG 12 JULY 12 AUG 11pct of workforce 13.19 13.27 13.12number available for work 356,423 358,652 349,885
SLOVAK EU-NORM INFLATION AUG 12 JULY 12 AUG 11
pct change mo/mo 0.0 0.0 0.1pct change yr/yr 3.8 3.8 4.0SLOVAK HEADLINE CPI AUG 12 JULY 12 AUG 11pct change mo/mo 0.1 0.0 0.1pct change yr/yr 3.7 3.7 4.0SLOVAK CORE CPIpct change mo/mo 0.0 0.0 -0.2pct change yr/yr 2.9 2.8 2.3
*CENTRAL STATE BUDGET JAN-SEPT/12 JAN-SEPT/11 FY 2012 PLAN
(mln euro)revenues 8,202.210 8,279.351 13,624.720expenditure 10,787.841 10,438.259 17,299.980balance -2,585.631 -2,158.908 -3,675.260INDUSTRIAL OUTPUT JULY 12 JUNE 12 JULY 11pct change yr/yr +18.5 +13.0 (+11.3) +3.4INDUSTRIAL ORDERS JULY 12 JUNE 12 JULY 11 FY-2011pct change m/m +5.4 -1.8 -7.2pct change y/y +37.9 +20.0 -2.9 +8.3volume (mln euro) 3,434.6 3,552.8 2,572.7 37,202.7CONSTRUCTION OUTPUT JUNE 12 MAY 12 JUNE 11pct change yr/yr -12.1 -7.9 -1.2SELECTED SECTOR SALES APRIL 12 MARCH 11 APRIL 11 JAN-DEC 11(pct change yr/yr)Retail sales -1.9 +0.1 -0.3 -2.8Vehicle salesand maintenance +6.2 +14.9 +11.4 +11.8SLOVAK AVG WAGES Q2/12 Q1/12 Q2/11 FY/11Real pct change yr/yr -1.9 -0.6 -0.9 +2.2Nominal pct change yr/yr +1.5 +3.2 +3.0 -1.6ECONOMIC FORECASTS: GDP EU-NORM CPI C/A DATE'12 '13 '12 '13 '12 '13FinMin +2.5 +2.1 +3.9 +3.1 +0.9 +1.2 Sept 17NBS +2.7 +2.0 +3.7 +2.4 +2.2 +1.1 Sept 18IMF +2.6 May 29EC +1.8 +2.9 +2.9 +1.9 May 11Notes:FinMin - Finance MinistryNBS - National Bank of SlovakiaIMF - the International Monetary FundEC - the European Commission- GDP - Real gross domestic product growth (pct change yr/yr)- EU-NORM CPI - Annual average consumer price index, calculatedunder the EU methodology (pct)- C/A - Current account deficit (pct of GDP)- DATE - The date of the forecast release(Created by Martin Santa)
((martin.santa@thomsonreuters.com)(421 2 3231 0254)(ReutersMessaging: martin.santa.reuters.com@reuters.net))
Keywords: SLOVAKIA INDICATORS/
Check out the companies making headlines after the bell:
Shares of Nike hit an all-time high, surging more than 5.5% during extended trade, following strong first-quarter earnings. CEO Mark Parker credited the earnings beat to product innovation and stronger e-commerce business.
The footwear giant posted earnings of 86 cents per share and revenue of $10.66 billion, far exceeding the 70 cents per share increase on revenue of $10.44 billion Wall Street had expected, according to Refinitiv consensus estimates.
Broadcom shares dipped 3.5% after the company announced a new offering of $3 billion Series A mandatory preferred stock to the public, to be converted intro common stock in late September of 2022. Each share of preferred stock is expected to have a liquidation preference of $1,000, and the net proceeds from the offering will be spent of repayment of ""outstanding borrowings,"" the chip-maker detailed in a press release. Bank of America Merrill Lynch Citigroup, J.P. Morgan and Morgan Stanley will serve as underwriters and joint-book running managers for the offering.
HD Supply Holdings spiked 5% after the industrial distributor filed to separate its facilities maintenance and construction & industrial businesses into two separate publicly traded companies, expected to be completed by the middle of fiscal year 2020. The distribution will be tax-free to HD Supply shareholders, and each company will have its own independent board of directors that will include some of the current members of HD Supply's Board, the company explained in a press release.
Shares of Kinder Morgan rose 1.4% after the bell following an announcement that its Gulf Coast Express Pipeline Project will be in full service on Sept. 25, ahead of schedule. The pipeline will provide approximately 2 billion cubic feet of incremental natural gas capacity per day and help lower natural gas flaring, the energy infrastructure company said in a press release. Other equity holders in the pipeline include Altus Midstream, DCP Midstream, and an affiliate of Targa Resources.
Shares of SYNNEX soared more than 9% following the IT supply chain company's strong third-quarter earnings. The company reported an increase of $3.30 per share ex-items and revenue of $6.20 billion. Analysts had forecast earnings of $2.86 per share on revenue of $5.69 billion, according to Refinitiv consensus estimates.
Cintas shares climbed more than 4% after the company improved its full-year guidance. The business services company reported better-than-expected earnings of $2.32 on $1.81 billion in revenue for its first quarter, compared to the $2.15 per share increase and revenue of $1.79 billion analysts had expected, according to Refinitiv.
With all the talk about when the Federal Reserve might increase interest rates, former New York Stock Exchange chief Dick Grasso said Wednesday he's concerned about how the central bank plans to reduce its $4.4 trillion balance sheet.
The question nobody seems to be asking the Fed, according to Grasso: ""How are you going to do that in the context of everyone else in the world stimulating [and] lowering rates—applying, if you will, the type of stimulus we applied.""
The total assets of the Fed have increased from about $869 billion in August 2007, during three rounds of quantitative easing bond purchases that started in November 2008 in an effort to support the economy and combat the effects of the financial crisis.
Former Fed Chairman Ben Bernanke argued at an event last month the central bank could maintain its balance sheet at somewhat higher amounts than precrisis levels.
Read MoreDon't expect 'rate riot': Roubini
Some Fed watchers see perhaps $1.2 trillion to $1.3 trillion as a new sweet spot, once the unwinding is complete.
""Four trillion is unprecedented, but to shrink it by two-thirds you don't have a comparable period in our history,"" Grasso said in an interview on CNBC's ""Squawk Box.""
HARTFORD, Conn. -- Connecticut's athletic director says the university is looking for a sponsor to step forward and secure the naming rights for its planned basketball training center and has no plans to name the building after newly retired basketball coach Jim Calhoun.
""There's not been one point in the conversation about naming the building for Jim, because we've always, since I got here, been talking about the naming opportunity to raise money,"" said Ward Manuel, who addressed the speculation Monday after Calhoun spoke at a chamber of commerce breakfast in Cromwell.
The facility, which is expected to cost more than $40 million, is being funded entirely by private donations.
It would be built adjacent to Gampel Pavilion on the site where the former football stadium was razed earlier this year. Plans call for separate practice courts for the men's and women's basketball teams, locker rooms, weight rooms, classrooms, a sports medicine center and offices for the basketball staff.
About $22 million of the $32 million needed to break ground on the center, the school said this week.
""We're more than halfway toward the total and about 75 percent to what we need to start construction,"" Manuel said.
Calhoun, who retired as coach last month, is raising money for the center as part of his new job as a special assistant to Manuel.
He said he will be visiting NBA training camps this fall and plans to ask former UConn players for their help with the center, which he said will also celebrate the history of Husky basketball.
""Some of the kids have expressed some interest, and those who haven't are going to become more interested,"" Calhoun said.
Calhoun said he's talked to planners about including a locker room just for basketball alumni, who will be able to use the facility.
""That in turn, in my opinion, will keep, five years, 10 years, 20, down the line, all those guys connected,"" he said. ""And as guys graduate and go on to their careers, obviously they will be able to do more. _ maybe one guy will want a room named after him, etcetera.""
Earlier this summer, the school announced that Webster Bank had made a significant donation to the building, but would not release the details. Last December, the school announced that a Woodbridge couple, Peter J. and Pamela H. Werth donated $4.5 million for the building, the largest single private gift ever to the Division of Athletics.
Uber could still make a U-turn.
That's according to JC O'Hara, chief market technician at MKM Partners, who told CNBC's ""Trading Nation"" on Friday that breaching one key level could greatly bolster the stock's bull case.
Uber shares have endured a great deal of push-and-pull in recent days, sent higher on Friday by positive analyst notes from Stifel and SunTrust, but tipped into a 1% decline on Monday after the city of London stripped the ride-hailing giant of its license to operate there — Uber's biggest European market. The order is on hold as Uber appeals the decision.
Looking at Uber's chart since its IPO — which, as of Monday, displayed a painful 36% decline from the debut price — O'Hara saw some hope for the stock.
""I can really appreciate this recent short-term positive momentum, especially after we got past the lockup expiration earlier this month,"" O'Hara said. Since the on Nov. 6, current and former insiders including ex-CEO Travis Kalanick,have sold large blocks of shares.
""But ... if we take a step back and look at the six-month chart, we find that we are still in a defined downtrend,"" O'Hara said. ""We have price trading below a declining 50-day moving average. We have a series of lower highs in place as well as lower lows. So, I think it might be too premature to say the worst is behind us.""
Still, O'Hara said one level would determine Uber's ability to turn around.
""If we do manage to push up and break above the October highs in that $34-35 area, I think I would be a little bit more confident at that point in time that the worst is behind us, and the base suggests that we can move higher at that point,"" the technical analyst said.
Uber shares were just above the $29 level in early Monday trading.
Steve Chiavarone, equity strategist, vice president and portfolio manager at Federated, wasn't as confident that Uber could find an upward catalyst.
""I think scalability is the issue,"" Chiavarone said in Friday's segment. ""We focus on incremental margins. You've got insurance costs here that grow as the company expands, and that raises questions about scalability. So, as we evaluate IPOs, particularly through our Kaufmann Growth franchise, what we're looking for is companies that are asset-light, can scale the business and are generating incremental margins. I'm not sure we find that here.""
Chiavarone added that his firm was not yet exposed to the ride-hailing space, citing its stringent guidelines for investing in newly public names.
""What we're looking for are those companies where we can see a clear pathway to cash-flow growth because that ultimately is going to be where the value is, and so we have not played this space,"" he said.
Earlier this year, Uber CEO Dara Khosrowshahi told CNBC that he expected the company to be profitable by 2021.
Disclaimer
Consumer prices in the world's second-largest economy accelerated to a six-month high in February as seasonal distortions caused food prices to spike.
Consumer price inflation rose 2.3 percent from a year ago, faster than January's 1.8 percent rise and well above Reuters expectations for 1.9 percent rise. February's expansion was the fastest annual pace of growth since July 2014, Reuters said.
February's spike was only a temporary effect, warned Grace Ng, greater China economist at J.P Morgan.
""Part of the increase is due to Chinese New Year-related issues. Generally, the inflation picture overall is quite tame. For the whole year, we're still looking for inflation below 2 percent,"" she told CNBC's ""Squawk Box.""
The week-long Lunar New Year holiday that began on February 7 tends to increase demand for fresh food every year, which pushes up prices. Unusual cold weather this year also caused a tightening in the supply of vegetables, driving prices higher, according to a Societe Generale note.
Despite the surge, inflation isn't expected to continue accelerating.
""We think it would take a big food supply shock or energy price spike for CPI inflation to cross the central bank's 3 percent inflation red line,"" said Tim Condon, head of Asia research at ING.
Meanwhile, February producer prices tanked 4.9 percent on year, slower than January's 5.3 percent and in line with estimates. This marks the fourth consecutive year of Chinese firms slashing prices of their goods, according to Reuters.
""What's worrying is the PPI deflation trend as that impacts company profits and sales revenue. Considering the fact that the corporate sector is the most leveraged among economic players in terms of financial risk, it's a difficult situation,"" Ng said.
Asian markets were mixed following the data, with the Shanghai Composite down nearly 1 percent and the Australian dollar, a proxy for China plays, modesty lower at $0.7470.
""The 18 percent month-on-month drop in global crude prices in January ensured that deep PPI deflation will persist until global oil prices stabilize long enough for a low-base effect to kick in, which would be toward the end of the year,"" said Condon.
""Deep PPI deflation squeezes cash flows in China's highly-leveraged corporates and calls for lower interest rates. We expect the PBOC to cut policy interest rates by 25 basis points.""
—Follow CNBC International on Twitter and Facebook.
President Donald Trump repeated an earlier call for an internet tax, in a thinly veiled shot at Amazon's Jeff Bezos, who owns The Washington Post.
""The internet — they're going to have to start paying sales tax because it's very unfair what's happening to our retailers all over the country that are put out of business,"" Trump said Wednesday.
Trump also reiterated concerns about Amazon's effect on the U.S. Postal Service as it struggles to keep up with online orders.
The comments mirror tweets from the president in December that named the e-commerce giant.
Dec tweet
""There's always been a fear for players like an Amazon or a Google that something like this could actually get through,"" Daniel Ives, head of technology research at GBH Insights, told CNBC. ""We believe it's more noise than a real threat.""
There's been speculation that the president's shots at Amazon are aimed at Bezos, whose newspaper has published stories critical of the president.
Amazon already collects sales tax on products it sells directly to consumers, but has faced challenges from states over its policy of allowing third-party vendors to charge varying levels of sales tax.
In June South Carolina filed a complaint against the online retailer, and Amazon agreed in November to take on additional third-party tax burden in its home state of Washington.
The issue has garnered more attention as Amazon continues to take a bigger share of overall retail sales. Amazon celebrated its ""biggest holiday"" shopping season at the end of last year.
There is an underlying movement among traditional brick-and-mortar retailers to more heavily tax Amazon, Ives said, so the discussion is ""something you have to keep an eye on.""
But the likelihood that an internet tax would pass is small, he said.
""Listen they've [Amazon] significantly changed the retail landscape across the world,"" Ives said. ""I think it's more of the same where they're getting in the crosshairs.""
Trump spoke before media and members of the administration Wednesday evening during the signing of the Interdict Act, which seeks to reduce drug smuggling through the purchase of opioid sensors.
Amazon did not immediately return a CNBC request for comment.
—CNBC's Kevin Breuninger and Eugene Kim contributed to this report.
Stocks closed lower on Tuesday with concerns about the financial health of Europe once again driving losses.
A report out of Germanysaid that country's 10 biggest banks may need significantly more capital. Also Wall Street Journal report suggested the recent stress tests results out of Europe weren’t as rosy as they appeared.
However overseas woes may not be entirely to blame for the domestic sell-off; the move could be as much about technicals.
A large number of investors believe that the S&P is range bound. Considering last week was the best week in the past two months, as stocks approached the top of the range investors may have just locked in profits.
How should you position now?
Instant Insights with the Fast Money traders
In August the trading low was 1039 and the high was 1128, explains Steve Grasso on Friday's Fast Money.I don’t see anything that suggests the market is anything but range bound and until the S&P breaks above 1130, I'd buy the dips and sell the rips.
I’d trim some of my long positions, says Guy Adami on Monday's broadcast. Action in the Vix gives me pause. It closed above 23.5, that's the 200-day moving average.
That's what I did on Tuesday; I took profits in names that had a good run such as McDonald's , says Karen Finerman.
I don’t agree that the market goes sharply lower, counters Tim Seymour. There's not a lot of data that should drag us down and key stocks are trading well. I'd position on the thesis that the market drifts higher into mid-September.
It seems to me that the big issue right now is the euro-banking problem and the flight to quality it triggers, says Anthony Scaramucci. Until we get a little rise in interest rates I don’t think the market acts much better.
----------
MARKET BUZZKILL: RESOURCE/INDUSTRIAL STOCKS
Resource and industrial stocks led the way lower on Tuesday due to fears that last week’s euphoria may have been overblown.
How should you play the dip?
Copper continues to trade well, muses Tim Seymour. I think there’s real industrial demand and not a lot of supply. I’d play the space long copper.
Hong Kong rallied sharply on Monday, says Steve Cortes and that suggests to me Asia’s market is strong enough to feel bullish about resources. I’m a buyer of Freeport and BHP on pullbacks.
I also like FCX, says Joe Terranova. And I’d also suggest long US Steel if it breaks above $51, it’s 200-day.
----------
MARKET BUZZKILL: FINANCIALS
As we mentioned above, investors slammed banks across the world due to renewed fears that Europe’s bank crisis might not be contained after all.
What’s the trade?
Banks are trading as if they need to have another capital raise, says Guy Adami. I think the space is a little dicey but if you want to be in the space I’d look at longBofA and US Bancorp .
----------
STREET FIGHT: H-P STRIKES BACK AT HURD
Hewlett-Packard sued former Chief Executive Mark Hurd and asked a court to block him from joining Oracle saying his hiring by the rival technology firm puts HP's trade secrets ""in peril.""
Oracle, the world's third-largest software maker, named Hurd co-president and director on Monday, a month after he resigned from HP over expense account irregularities related to a female contractor.
In a civil complaint filed in Superior Court in Santa Clara County on Tuesday, HP said: ""In his new positions, Hurd will be in a situation in which he cannot perform his duties for Oracle without necessarily using and disclosing HP's trade secrets and confidential information to others.""
HP said if Hurd is allowed to go to Oracle it would ""give Oracle a strategic advantage as to where to allocate or not allocate resources and exploit.
And on a related note, after hours UBS downgraded HP as well as Intel from 'Buy"" to 'Neutral.'
What does ISI analyst Heather Bellini have to say about these developments?
* Watch the video and find out now.
______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our Web site send those e-mails to .
Trader disclosure: On September 7th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour owns (AAPL), (BAC), (INTC), (MON), (POT); Adami owns (AGU), (BTU), (NUE), (C), (GS), (INTC), (MSFT); Adami’s wife works at Merck; Cortes owns (SFD), (BMO), (TD), (FCX), (BHP); Cortes owns the British Pound; Finerman and Finerman’s firm owns (BAC); Finerman owns (GOOG); Finerman’s firm owns (HPQ); Finerman’s firm owns (IBM); Finerman and Finerman’s firm owns (JPM); Finerman owns (ORCL); Finerman owns (POT) options; Finerman's firm is short (IJR); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Finerman’s firm owns S&P 500 puts; Finerman’s firm owns Russell 2000 puts
For Anthony Scaramucci
Scaramucci & SkyBridge Capital own (AAPL)
Scaramucci & SkyBridge Capital own (AMZN)
Scaramucci & SkyBridge Capital own (C)
Scaramucci & SkyBridge Capital own S&P 500
Scaramucci & SkyBridge Capital own Gold
For Heather Bellini
ISI does and seeks to do business with (ORCL) and has received non-investment banking compensation in the past 12 months
For Dennis Gartman
Funds managed by Gartman own Gold
For Ed Mills
***No Disclosures***
For Scott Nations
***No Disclosures***
CNBC.com and wires
For a company that has long struggled to re-make its image with American car buyers, GM sure has a lot of issues with names.
Remember when it went bankrupt and the folks at GM said they'd stop using the GM name in marketing because of its battered reputation?
Now comes word GM is planning to change the name of its compact car - the Chevy Aveo. Apparently, Aveo lacks the connection GM is seeking with buyers.
Are you kidding me?
I suspect there is some marketing consultant or some study showing the Aveo lacks oomph. Hmmmmm. Is it possible the Aveo isn't quite the hit GM would like because the car itself lacks pizazz? Just a thought.
By the way, Aveo sales this year are up 12.1% according to the research firm AutoData. That's better than overall industry sales and more than double the percentage increase in U.S. sales.
Still, GM fixates on a name.
Do they really think a name will dramatically change things? It reminds me of when the company was thinking of putting the GM logo in green instead blue as it was trying to change its image during bankruptcy. Or a few years back when Ford had the idea to kill the Taurus line even though it still had incredible name recognition.
Folks, this isn't rocket science. You want to sell more of a particular model, make that model the best in its class. I guarantee you that if the Aveo was the most incredible compact car in the world, it would have huge sales, regardless of its name.
Click on Ticker to Track Corporate News:
- Ford Motor
- Toyota Motor
- Nissan
- Honda Motor
___________________________ Questions? Comments? BehindTheWheel@cnbc.com
Mergers and acquisitions activity kicked into even higher gear this week as Intel’s $7.67 billion all-cash bid for security technology firm McAfee led to biggest week for M&A since mid-December.
The the dealbetween Intel and McAfee brings the total value of global M&A deals for the week to $84.81 billion, according to Dealogic.
The last time M&A dollar volume was as high was the week Exxon Mobil announced it was buying XTO Energy. That week M&A volume reached $88.6 billion, Dealogic said.
Global M&A has now reached $1.7 trillion for the year, up 23 percent from the same period last year, Dealogic said. The volume of U.S. targeted deals is at $498.1 billion, up 1 percent from the same period a year ago, according to the firm, which specializes in technology, data, analytics and consulting for investment banks.
The dollar totals don't include spinoffs and repurchases.
This week's M&A deals include BHP Billiton's $39 billion hostile bid for Potash , announced earlier this week.BHP is hoping to win over regulators before approaching Potash shareholders, after the board of the Canadian-fertilizer company rejected BHP's bid.
The Intel acquisition is the largest technology M&A deal since September 2009 when Xerox bid $8.1 billion for Affiliated Technologies.
The other deals this week include New Zealand's Rank Group’s $4.5 billion bid for Pactiv , the maker of Hefty bags, and Dell’s $1.15 billion for data-storage company 3PAR .
Commerzbank raised its third-quarter net profit by more than half thanks to a one-off German tax gain but missed expectations after the gain was marred by a big write-down on its subprime investments.
Germany's second-biggest bank also confirmed that Chief Executive Klaus-Peter Mueller would step down next May and that board member Martin Blessing would become the new CEO. Sources told Reuters last week Mueller is set to become chairman.
Commerzbank on Tuesday posted net profit of 339 million euros ($493 million) in the third quarter, after writing down 291 million euros on assets exposed to the market for risky mortgages in the United States.
Its profit was below the average forecast in a Reuters poll for quarterly net profit after minorities of 451 million euros.
Commerzbank shares rallied on relief that the subprime losses would not be worse, with the share rising more than 4 percent to 28.31 euros by 1330 GMT, outpacing a 0.4 percent gain among European banking peers.
Commerzbank said in July that it would book 80 million euros to cover expected subprime-related losses but CEO Mueller said last month that this would not be enough.
Like other European banks, Commerzbank had been hit by investor worries about its exposure to subrime risks, with its share down 6 percent over the last two months, even after Tuesday's sharp gain.
The shares trade at about 8.6 times estimated 2008 earnings, compared with a multiple of 9.3 for European banking peers, a discount that is not justified by the bank's earnings prospects, research analysts at Equinet said.
It's an axiom of modern capitalism, almost as certain as death and taxes: No matter how bad an economic crisis gets, someone is bound to get rich from it.
Very rich.
During the 2008-2009 financial meltdown, Goldman Sachs and hedge fund tycoon John Paulson hauled in billions betting against mortgage-backed securities. Likewise, the financial nerds profiled in Michael Lewis' ""The Big Short"" cashed in, big time.
And this is nothing new.
Before the UK's 1994 Black Monday crash, financier-philanthropist George Soros, sensing central bankers with their heads in the sand, made billions shorting the pound sterling — essentially borrowing the currency, selling it, and later paying back his creditors when he could buy it cheaper. He successfully repeated this trick as Southeast Asia went into crisis in 1997.
Now, the euro zone increasingly appears to be in a terminal mess. Growth has stagnated. Debt is out of control. In vulnerable countries like Spain, interest rates are veering toward usury. Governments are bailing out banks. And Greece has imploded, both politically and economically; this week, citizens have been emptying their bank accounts, always a grim sign that economic Armageddon looms.
It’s time for the average person to worry yet again about his job or her disintegrating retirement account. But for the crafty and courageous, opportunity beckons.
So, what investments are they salivating over?
One obvious option would be to shop for cheap stocks on European exchanges. This ""value"" approach is a time-honored strategy. It’s used by moguls such as Warren Buffet, who advised in the bleakest days of the 2008 mortgage meltdown: “Be fearful when others are greedy, and be greedy when others are fearful.”
Anyone who took Buffet’s adviceand bought US stocks at the nadir of the financial crisis could have nearly doubled their money by now. Bargain hunting is particularly tempting for individual investors, who could shift 401K allocations into mutual funds or exchange traded funds (ETFs) with, say, exposure to Spain or Portugal, whose markets are trading at lows not reached in years.
But it's not yet time to pursue this strategy, insists David Twibell, president of Denver-based Custom Portfolio Group. ""Europe is a slow-motion train wreck ... stuck with an unsustainable fiscal mess,"" he says. ""There’s often a fine line between courage and stupidity, and I would say investing in Europe right now comes dangerously close to the latter.""
One critical risk factor: If the euro zone does indeed break apart, you may end up holding investments in national currencies that could plummet in relation to the dollar, wiping out any gains from stock appreciation.
— This is the script of CNBC's news report for China's CCTV on January 26, Monday.
The risk of a sovereign default in Greece has increased after the anti-austerity Syriza party won Sunday's snap elections, analysts say, noting that anxiety over the possibility that Greece will exit the euro zone will keep global markets nervous. The winning party's leader Alexis Tsipras promised that five years of austerity, ""humiliation and suffering"" imposed by international creditors were over after his Syriza party swept to victory in a snap election on Sunday.
[ALEXIS TSIPRAS / SYRIZA PARTY LEADER] ""Greece is turning a page, Greece is leaving behind catastrophic austerity, it is leaving behind the fear and the autocracy, it is leaving behind five years of humiliation and pain.""
Greece owes more than $350 billion to government institutions and investors. The country also faces a 3.5 billion euro bond coming due this July and another 3 billion in August. Syriza members told CNBC on Sunday that the party's top priority is to win a dramatic easing of its repayment terms.
[Jeff Halley / Saxo Capital Markets] ""I think they are pretty high right now. They are above 40% now Looking at some of the headlines from new PM this morning he was pretty determined and i think troika era is over for greece. bi-lateral agreement in place for Greece.""
While Tsipras fell just short of an overall majority, he is set to lead the first euro zone government committed to overturning the kind of budgetary rigor that was imposed on Greece as a condition of the bailout in 2010.
[STEFAN AUER / University of Hong Kong] ""It's not just about the EU, it's about the european currency right? They're determined to stay in the eurozone and I cannot see how they can stay in the eurozone if they truly deliver on what they promise the people.""
[TAIMUR BAIG / Chief Economist, Asia, Deutsche Bank] ""I think that the eventuality of something like this 2 years ago would have been very disruptive. we;ve had a lot of friewalls built within the eurozone area and we have a very proactive central bank now so I think the abilityof the eurozone to take a hit, he worse case scenario which is a greek -exit, even that is there. So I think that to some extent, the pricing in of an extreme event is there.""
CNBC Qian Chen, reporting from Singapore.
Yesterday I spoke to the legendary Jack Welch, former Chairman and CEO of GE. In addition to his comments on a variety of issues, I began asking Mr. Welch about the very sad passing of Steve Jobs.
LARRY KUDLOW, host:
We welcome back to THE KUDLOW REPORT an old friend, the great famed CEO Jack
Welch.
Mr. Welch, thank you for coming back, sir.
Mr. JACK WELCH: Larry, it's great to be here.
KUDLOW: Let me just begin, as we have all day, luminaries like yourself, the way too soon passing of the brilliantentrepreneur Steve Jobs, what's your thought on that?
Mr. WELCH: Absolutely tragic. I mean, his family has certainly had the biggest loss, but America and the world has lost something. He wasn't just a genius entrepreneur, he was an executor. He got—people are not giving him enough credit for getting a million or two million or five million to the customer on time with great quality. That's a real job.
KUDLOW: He was a great retailer and a great marketer you got there.
Mr. WELCH: Great marketer. Great—a supply chain manager and a great genius of an entrepreneur. He—to show you his impact, though, I had an experience at home. My stepson's grandmother called, 85 years old, upset as could be.
KUDLOW: Mm-hmm.
Mr. WELCH: The kids called from college, two of them. They don't call when CEOs die.
KUDLOW: Yeah.
Mr. WELCH: They were so impacted. What this guy did for business, he invented cool.
KUDLOW: Yeah.
Mr. WELCH: He made cool--most business guys are in suits like you are and I am right now.
KUDLOW: Right.
Mr. WELCH: This guy, though, delivered products that made business cool.
KUDLOW: And he made a better world of it. I think...
Mr. WELCH: You know...
KUDLOW: ...everybody agrees that his impact was just vastly beyond just being a businessman.
Mr. WELCH: Oh.
KUDLOW: Just vastly beyond.
Mr. WELCH: I mean, he was a true visionary.
KUDLOW: Yeah. All right, I appreciate that very much.
Let me come back to some of the current events of the day. President Obama had a lengthy news conference today, over an hour. Among the many points he made, I want to get your take on this, he is endorsing the Senate Democrats' idea of a 5.6 percent surtax on millionaires. And the president also indicated, however, that other tax increases would still be necessary to fund the budget. Do we need a millionaires tax? Will it help the economy grow? And the whole tax plan, how do you see it?
Mr. WELCH: Will this—will this tax be on income or wealth?
KUDLOW: I think it's going to cover capital gains, dividends and ordinary income, as far as I know, take effect in 2013.
Mr. WELCH: Well, look, I think we ought to go back and look at what he's done so far, Larry. He put a stimulus bill in, $785 billion, whatever it was. It did nothing. Now, let's look at what he projected. He projected we'd have 6.2 percent unemployment in October 2011. We've got 9! Larry, if you're in a business and you miss by that much, somebody's calling you in for a chat.
KUDLOW: And, in fact, his whole plan is doubling down. Now...
Mr. WELCH: Same plan.
KUDLOW: ...the financing, it's more spending. I don't want to prejudge it, but it's more spending, and it's temporary tax rebates or temporary tax credits. It didn't work for George W. Bush, it didn't work for Barack Obama 1. Why should it work for Obama? 2. Isn't there a better way? We all know the economy is in lousy shape and it's faltering, as Bernanke said. Jack, with your experience, what's the better way to grow this economy?
Mr. WELCH: I would say you start out with discretionary spending. It's 1.3,
1.4 billion. Eight hundred and fifty of it's defense, 450 is total discretionary. Take 25 percent of the 450, that's $100 million, 90 or so. Take 5 percent of defense, that's 50...
KUDLOW: Take it out of the budget?
Mr. WELCH: Take it out of the budget.
KUDLOW: Right.
Mr. WELCH: Take--but reduce it, not from projections, actual take it out.
KUDLOW: Level. The level.
Mr. WELCH: The level we're at.
KUDLOW: Right.
Mr. WELCH: Take it down. That's a billion-three or a billion-five—a trillion-three or a trillion-five over 10 years. That's one step, OK? Step number two, freeze regulations.
KUDLOW: Right.
Mr. WELCH: Freeze them. This Senator Johnson thing...
KUDLOW: President Obama mocked the Republican freeze on regulations at the press conference today. I just want to put that in. He mocked.
Mr. WELCH: He's shown no ability to lead. Let's talk about that. But let's just take this point. Let's just take freezing regulations until we get unemployment below 6 percent. So, you know, we--just freeze them. The third thing, entitlements. Go after means testing. Lower the age for those below 50. Increase the age till they can get it. Means test. I shouldn't be getting Social Security. I shouldn't be getting Medicare benefits at the level I'm getting them. I mean...
KUDLOW: This would provide some confidence, is what you're saying, right?
Mr. WELCH: Larry...
KUDLOW: Let me come back to taxes. Is it time to raise the tax rates on the
upper income?
Mr. WELCH: There's nothing that says it should.
KUDLOW: OK.
Mr. WELCH: All it is a transfer payment.
KUDLOW: Right.
Mr. WELCH: Take it from one hand, give it the other hand. Doesn't work.
KUDLOW: And I think a lot of people are skeptical. So you raise taxes on millionaires, which sounds good. `Hey, get the millionaire. I'll feel better if a millionaire gets hurt.' It'll be spent on spending. It won't be used for debt reduction. Isn't that the possibility here?
Mr. WELCH: Everything's going to be spend on spending.
KUDLOW: Yeah.
Mr. WELCH: I mean, they are spenders. They believe government should do more. They don't believe jobs come from the private sector. They believe government creates jobs. That's just a fundamental difference.
KUDLOW: So another part of his news conference today, he was asked about the so-called Wall Street Occupiers, the Wall Street protesters, that's going on around the country and predominantly here but not only here. He expressed a lot of sympathy for that group. And I want to ask you, those guys are against the banks, they're against financial institutions, they're against a lot of things to do with capitalism. Are we going to live through a period of kind of left-wing populism where we're bashing millionaires and billionaires, we're bashing banks, we're bashing corporations, we're bashing Wall Street, we're bashing, you know, Bank of America for raising its debit card fees. Is that the way this election period is going to go? And how's it going to affect the economy?
Mr. WELCH: Well, that's all bad news. But it would be solved if we had jobs.
KUDLOW: Mm-hmm.
Mr. WELCH: I mean, these people have a case. Unemployment at 9 percent. The president promised 6 percent, Larry, in October of '11. That's—nobody goes back and looks at the pledge they made.
KUDLOW: Where did it fail? Where did that plan break down?
Mr. WELCH: Shovel-ready jobs. People were ready to go, but we had a couple things wrong. Davis-Bacon wages, that changed the class structure. Buy America. A lot of these jobs--and with a penalty if you didn't. So a lot of these jobs, they weren't ready. From the cup to the lip was a much bigger distance. And then to put regulations on top of the stimulus.
KUDLOW: So how do we stop this demoralization, to use Governor Christie's word? How do we get back to the Steve Jobs optimism, entrepreneurial model of economic growth? It worked for Jobs, it worked for this whole country. How can we preserve that spirit of Steve Jobs?
Mr. WELCH: Larry, companies--I just had a review of my 12 companies in the last week--they're on fire. They're growing revenues at 7 percent average, the 12 companies. Their EBITDA is up double digits, strong double digits in some cases. This economy doing more with less is not good for jobs because it's not growing fast enough. It's growing at a 1 to 2 percent range. We got to get it to 3 to 4, and that's unshackling this government away from it. When I take out 25 percent of the discretionary spending, the same way we did in GE 20 years ago, guess what it does? You give them a soft landing, you take care of the people who are injured. You--we've got a balance sheet to do that. But when they come to work, they don't come to work and say, `What can I do today?' It's when they come to work they cause problem, not the cost of them.
KUDLOW: And you're sending a signal. There's a confidence signal...
Mr. WELCH: Yeah. And we're going to unshackle business.
KUDLOW: All right. So unshackling business, reforming the corporate tax code, freezing regulations. Some tough spending measures from Jack Welch. Who fits the bill for all this in the Republican presidential primary sweepstakes right now? Who are you backing? Can you tell me?
Mr. WELCH: Yeah, I'm backing Mitt Romney. Now, whether or not he takes the whole platform, because I want to drill, too. I want to drill on nongovernment land and I want to get royalties from that that are going to help lower the deficit. And I want to have by 2020 total energy independence not from renewables. I want to still support renewables. You don't stop that, but I want to really unleash the energy-driven sector in this economy.
KUDLOW: I thought Romney was a greenie. He flirted with cap and trade when he was the governor of Massachusetts.
Mr. WELCH: I said he may not follow my whole platform.
KUDLOW: What about--what about Governor Perry. Last question, what about Herman Cain, who's actually going to appear on the show later?
Mr. WELCH: I hope Herman Cain's serious. I don't think he's serious. I think he's got a book tour he's on, OK, and...
KUDLOW: Well, I'm going to ask him that.
Mr. WELCH: Yeah.
KUDLOW: OK, I'm going to ask him if that's the case.
Mr. WELCH: Well, that's one...
KUDLOW: But if he were serious, could you back him?
Mr. WELCH: I'm afraid he's not electable, and I'm afraid--I think--I think Romney, by the way, will have more trouble in the primary than he will in the general.
KUDLOW: So you're looking for a defeat of Obama?
Mr. WELCH: I want to take this administration out. They don't understand how to create jobs. They don't understand to grow this—America is on fire. America is still the greatest country in the world. And we have everything going for us except a government that is not supportive of capitalism.
KUDLOW: All right. I hear you. We'll leave it right there. Mr. Jack Welch, former CEO of General Electric and just a famed businessman and adviser.
Questions? Comments, send your emails to: lkudlow@kudlow.com
Saudi Arabia has withdrawn tens of billions of dollars from global asset managers as the oil-rich kingdom seeks to cut its widening deficit and reduce exposure to volatile equities markets amid the sustained slump in oil prices.
The Saudi Arabian Monetary Agency's foreign reserves have slumped by nearly $73 billion since oil prices started to decline last year as the kingdom keeps spending to sustain the economy and fund its military campaign in Yemen.
The central bank is also turning to domestic banks to finance a bond programme to offset the rapid decline in reserves.
This month, several managers were hit by a new wave of redemptions, which came on top of an initial round of withdrawals this year, people aware of the matter said.
""It was our Black Monday,"" said one fund manager, referring to the large number of assets withdrawn by Saudi Arabia last week.
Institutions benefited from years of rising assets under management from oil-rich Gulf states, but are now feeling the pinch after oil prices collapsed last year.
Nigel Sillitoe, chief executive of financial services market intelligence company Insight Discovery, said fund managers estimate that Sama has pulled out $50 billion-$70 billion over the past six months.
""The big question is when will they come back, because managers have been really quite reliant on Sama for business in recent years,"" he said.
Since the third quarter of 2014, Sama's reserves held in foreign securities have declined by $71 billion, accounting for almost all of the $72.8 billion reduction in overall overseas assets.
Other industry executives estimate that Sama has withdrawn even more than $70 billion from existing managers.
More from the Financial Times:
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By surging in Syria, Putin goes from pariah to powerbroker
While some of this cash has been used to fund the deficit, these executives say the central bank is also seeking to reinvest into less risky, more liquid products.
""They are not comfortable with their exposure to global equities,"" said another manager.
Fund managers with strong ties to Gulf sovereign wealth funds, such as BlackRock, Franklin Templeton and Legal & General, have received redemption notices, according to people aware of the matter.
Some fund managers have seen several billions of dollars of withdrawals, or the equivalent of a fifth to a quarter of their Saudi assets under management, the people aware of the matter said.
Institutions such as State Street, Northern Trust and BNY Mellon have large amount of assets under management and are therefore also likely to have been hit hard by the Gulf governments' cash grab, the people added.
""We are not that surprised,"" said another fund manager. ""Sama has been on high risk for a while and we were prepared for this.""
Sama has over the years built up a broad range of institutions handling its funds, including other names such as Aberdeen Asset Management, Fidelity, Invesco and Goldman Sachs.
Read MoreIran leader demands Saudi Arabia apologise for hajj deaths
BlackRock, which bankers describe as the manager handling the largest amount of Gulf funds, has already reported net outflows from Europe, the Middle East and Africa.
Its second-quarter financial results reported a net outflow of $24.1 billion from Emea, as opposed to an inflow of $17.7 billion in the first quarter.
Market participants say the outflow is in part explained by redemptions from Saudi Arabia and other Gulf sovereign funds, such as Abu Dhabi.
BlackRock and other funds declined to comment or did not respond to requests for comment. Sama did not respond to request for comment.
The Senate Intelligence Committee on Thursday issued its long-awaited report on how former President Barack Obama handled Russian meddling in the 2016 election.
The bipartisan report found that the Obama administration was ill-prepared to handle the novel election interference offensive and recommended that in the future the ""public should be informed as soon as possible"" if a foreign active measures campaign is detected.
""After discovering the existence, if not the full scope, of Russia's election interference efforts in late-2016, the Obama Administration struggled to determine the appropriate response,"" the committee's GOP chairman, Sen. Richard Burr of North Carolina, said in a statement.
""Frozen by 'paralysis of analysis,' hamstrung by constraints both real and perceived, Obama officials debated courses of action without truly taking one,"" he said.
Virginia Sen. Mark Warner, the committee's top Democrat, said that there were ""many flaws"" with the Obama administration's response but noted that ""many of those were due to problems with our own system – problems that can and should be corrected.""
The report was released one day after President Donald Trump was acquitted by the Senate of a charge that he abused his power by seeking to pressure the government of Ukraine to open investigations into former Vice President Joe Biden. He was also acquitted of a charge of obstruction of Congress. Trump has denied any wrongdoing.
Trump, who spent the first two years of his presidency dogged by a federal investigation into whether he unlawfully conspired with the Russian government in the 2016 election, has criticized Obama for his handling of the situation.
""He did NOTHING, and had no intention of doing anything!"" Trump wrote in a post on Twitter last year.
The U.S. intelligence community concluded in 2017 that Russian President Vladimir Putin ordered an influence campaign during the 2016 campaign targeting Democratic nominee Hillary Clinton and that the Russian government had a ""clear preference"" for Trump.
The attacks included the pilfering of data and emails from Democratic National Committee networks which were then released to outlets including WikiLeaks, an anti-secrecy group, in a manner designed to raise doubts about Clinton's viability.
The Senate Intelligence Committee also concluded that the Russian government sought to bolster Trump's 2016 election chances.
Former special counsel Robert Mueller, who led the investigation into Trump's campaign, concluded that Trump expected to benefit from Russian interference. Mueller, however, did not establish coordination between Trump's associates and the Russian disinformation campaign.
Trump tweet
The Senate report released Thursday is the third, out of an expected five, stemming from the committee's probe into the government's handling of Russian meddling efforts. The investigation began in 2017 and has proceeded on a largely bipartisan basis, in contrast with parallel congressional inquiries.
The committee found that the Obama administration was ""not well-postured"" to counter the Russian interference campaign and said that while ""high-level warnings were delivered to Russian officials, those warnings may or may not have tempered Moscow's activity.""
Obama said in 2016 that he confronted Putin over allegations that the Russian leader ordered the hacking of the Democratic National Committee, telling him to ""cut it out.""
The committee noted that institutional constraints prevented the administration from acting more aggressively. The report documents members of the administration agonizing over the potential that a public statement about the hacking efforts — while Obama was actively campaigning for Clinton — would be perceived as political.
""Those factors included the highly politicized environment, concern that public warnings would themselves undermine confidence in the election, and a delay in definitive attribution to Russia, among other issues,"" the report said.
It noted that most administration officials first learned about the Russian hacking efforts from a June 2016 article in The Washington Post. In October of that year, the administration released its first public statement saying that the intelligence community was ""confident"" that the Russian government directed cyberattacks on American political organizations.
The committee emphasized that in case of future attacks, the public should be notified ""as soon as possible with a clear and succinct statement of the threat.""
""If the Administration had informed the public of Russian hacking and dumping earlier than October 7, and had there been bipartisan condemnation of these operations, the public and the press may have reacted differently to the WikiLeaks releases,"" the committee wrote.
""At the least, stories about Democratic emails might have mentioned that their release was part of a Russian influence campaign and that Donald Trump's repeated references to the releases, his stated adoration of WikiLeaks, and his solicitation of Russian assistance were taking place in the context of an ongoing influence campaign to assist him,"" it said.
The committee will release two more reports on its findings. Those will cover the intelligence community's 2017 assessment of Russian interference and the committee's final counterintelligence findings. The committee did not say when those reports will be released.
A spokesperson for Obama did not immediately respond to a request for comment.
""Ride Along,"" a buddy cop comedy starring Kevin Hart and Ice Cube, raced to the top of the weekend box office charts for the second week in a row, collecting $21.2 million in ticket sales.
The Afghanistan war tale ""Lone Survivor"" took the No. 2 spot with ticket sales of $12.6 million. Mark Wahlberg plays the role of the only one of four U.S. SEALs to return from a vicious fire fight with Taliban fighters.
The animated film ""The Nut Job,"" featuring the voices of Will Arnett and Katherine Heigl, was third with $12.3 million in sales at U.S. and Canadian theaters, according to studio figures provided by Rentrak.
(Read more: The 15 Biggest BoxOffice Bombs)
In a week in which the top three films mirrored last week's results, ""I, Frankenstein,"" an action film in which Victor Frankenstein's creation is reimagined as a hero battling gargoyles, was the only major new release. It opened in sixth place with ticket sales of $8.3 million.
""Ride Along"" received mostly negative reviews, with only 17 percent positive writeups according to aggregator website Rottentomatoes. But the movie opened far stronger than expected a week ago with ticket sales of $41.2 million to easily surpass Hollywood projections. The film has collected sales of just over $75 million since its Jan. 17 release.
Universal Pictures, the studio behind both ""Ride Along"" and ""Lone Survivor,"" said the films' one-two punch marked the first time a single studio's films have grabbed the top two spots for two consecutive weeks in nearly two decades. Warner Bros. last achieved the feat in February 1994, with ""On Deadly Ground"" and ""Ace Ventura.""
""I, Frankenstein,"" which fell short of industry forecasts of an opening weekend between $10 million and $15 million, received generally poor reviews, but 57 percent of the audience said they liked it, according to Rotten Tomatoes.
(Read more: The 15 most profitable movies of all time)
Based on actor Kevin Grevioux's graphic novel, it takes place in a dark, dystopian world. Actor Aaron Eckhart plays the title role, with not much resemblance to the monster in earlier films based on Mary Shelley's 1818 novel. Less gruesome, he is blessed with extraordinary speed and endurance.
Lionsgate Films acted chiefly as its distributor, with Lakeshore Entertainment funding most of its reported $65 million production costs.
Disney's long-running animated hit ""Frozen"" claimed the No. 4 spot with $9 million. The musical is nearing $350 million in domestic sales in its 10th week in release.
""Jack Ryan: Shadow Recruit,"" starring Chris Pine as the late author Tom Clancy's fictional CIA analyst, rounded out the top five with ticket sales of $8.8 million.
The strongest finisher among major Oscar-nominated films was ""American Hustle,"" which took seventh place selling $7.1 million worth of tickets for a total domestic haul of $127 million.
""Ride Along"" and ""Lone Survivor"" were released by Universal Pictures, a unit of Comcast. Lionsgate distributed ""I, Frankenstein."" ""The Nut Job"" was released by Open Road Films, a joint venture of U.S. theater chains Regal Entertainment and AMC Theatres. Paramount Pictures, a unit of Viacom, released ""Jack Ryan: Shadow Recruit.""
--By Reuters.
Earlier this week I discussed the ""Dopeler Effect"" — ""The tendency of stupid ideas to seem smarter when they come at you rapidly.""
I'm thinking I should rename this blog The Dopeler Effect. Or at least use that title for the occasional post.
Like this one.
Today's example of the Dopeler Effect involves social networking. Our desire to share every little detail about ourselves can be a really stupid idea that seems smart because everyone else is rapidly doing it all over the internet. Whether it's on , or newer Web sites like foursquare, some of us even reveal our exact locations.
Burglars must be thrilled.
A new Web site is trying to scare us straight.
It's called PleaseRobMe.com. The site was reportedly created by three Dutch developers after one of them was awakened at night by a would-be burglar. Afterwards, he started thinking about what might have happened if he hadn't been home. Then he started thinking about all the people who broadcast such news on the internet. Then they created the Web site.
PleaseRobMe.com tracks—and posts for public consumption—announcements by people all over the world notifying the online world that they're not at home. ""I'm at Manhattan Beach Farmer's Market"" says @captainsean. Gee, bet Captain Sean is pleased that PleaseRobMe.com is distributing the news. Except he already did that himself. ""Our intention is not, and never has been, to have people burgled,"" the site says. ""All this site is, is a dressed up Twitter page. Everybody can get this information.""
Ok, so you're not home and you tweet that. That's not a problem as long as burglars don't know where you live, right? Make sure it stays that way, because sometimes it doesn't. Even if you never post your home address on social networking sites, others might. ""It gets even worse if you have 'friends' who want to colonize your house,"" says the Web site. ""That means they have to enter your address, to tell everyone where they are. Your address.. on the internet."" The Web site advice? ""Now you know what to do when people reach for their phone as soon as they enter your home. That's right, slap them across the face.""
PleaseRobMe has been funded by a company called For The Hack, which describes itself as a launching pad for ""early stage ideas and concepts"". They claim the site has gotten so much buzz they're now looking to offer it a foundation or agency which can raise awareness about online privacy issues. I've contacted the owners to see if they've had any takers yet.
I've also asked if anyone has threatened to sue them for republishing what was already public.
I'll let you know.
By the way, I'm home right now. With my ferocious basset hound, er, Doberman.
Questions? Comments? Funny Stories? Email
WASHINGTON, Oct 1 (Reuters) - The U.S. Supreme Court onMonday refused to consider an appeal by Bank of America Corp's
Merrill Lynch unit of a ruling that allowed blackbrokers who accused it of bias to pursue their lawsuit as aclass action.
Merrill contended that the 7th U.S. Circuit Court of Appealsin Chicago misinterpreted a 2011 Supreme Court decision, in acase known as Wal-Mart Stores Inc v. Dukes, that made itsignificantly harder to pursue class-action cases.
The lawsuit accused Merrill of steering blacks into clericalpositions and diverting lucrative accounts to white brokers,resulting in lower pay and fewer career growth opportunities.
(Reporting By Jonathan Stempel in Washington, D.C.; Editing byMaureen Bavdek)
((jon.stempel@thomsonreuters.com)(646)(223-6317)(Reuters
Messaging: jon.stempel.reuters.com@thomsonreuters.net))
Keywords: USA COURT/BANKOFAMERICA MERRILL
Solar companies, already benefiting from booming share prices, are turning to increasingly innovative ways to raise capital, including bond issues, bank loans and even crowd-funding.
SolarCity—Wall Street's newest renewable energy darling—last week announced that it will offer debt investments backed by pools of solar assets this year. Last year, SolarCity, which is backed by Tesla Motors founder Elon Musk, issued about $54.4 million in the first-ever solar bonds. They secured an investment-grade rating from Standard & Poor's.
(Read more: A day in the sun: Solar's revival sends stocks on a tear)
Observers say SolarCity's fortunes are the latest signs of a maturation process that could hasten the day when renewable energy is less dependent on government subsidies. It also comes as demand for solar power is expected to see what research firm NPD calls ""explosive growth,"" with demand expected to surge more than 36 percent in 2014.
""As we're seeing costs and price point for solar systems fall, we're seeing concomitant increase in deal structures and investment vehicles available to individual investors and utilities,"" said Nadav Enbar, senior project manager in power delivery utilization at the Electric Power Research Institute. ""As a result of this maturity, investors consider renewable energy/solar as a potential area with less risk for their dollars.""
Solar securities are still largely unproven, and the relatively short tenure of solar projects–less than 20 years in many instances–may become a barrier to wider adoption of solar financing.
Still, the move toward tapping capital markets means green projects could make the sector less vulnerable to the backlash that often ensues from using public funds. Private investors are starting to warm to the idea: US Bank has a alternative energy arm that has doled out more than $1.7 billion to a spate of renewable projects in the U.S.
A steep drop in solar prices and costs—data from the Solar Energy Industries Association says sun-power is now 60 percent cheaper than it was just a few short years ago—is fueling strong demand.
According to the Energy Information Administration (EIA), growth in renewable power generation is expected to exceed 858 billion kilowatt hours by 2040, with a bulk of that growth coming from solar. Renewables generated 524 billion kilowatt hours in 2011.
Because solar power can be generated at the local level, and because its infrastructure can be built easily without the politically-tinged problems that accompany crude, it makes for a comparatively attractive investment.
(Read more: Critics question 'green loans,' but US points to the numbers)
Mike Sheppard, senior energy and power analyst with research IHS, says investors ""see it as a trend…that opens up new sources of capital investment from people not yet willing to risk money in technology"" that may not be proven, he added.
""Securitization smooths out [risks], diversifying over multiple projects,"" Sheppard said. ""That concept is relatively new…and its a definite trend that a lot of people are looking forward to.""
—By CNBC's Javier E. David. Follow him on Twitter @TeflonGeek
ARCHBOLD, Ohio, Oct. 1, 2012 /PRNewswire/ -- Paul S. Siebenmorgen, President and CEO of Farmers & Merchants State Bank in Archbold, Ohio, announced that construction will begin in the fall on the bank's twentieth office, in Waterville, Ohio.
The full-service office will serve the Waterville and Whitehouse markets and include a drive-up ATM and three drive-up lanes staffed with local bankers to serve customers, with decisions made locally. F&M focuses on locally owned and operated businesses and individuals because that is where 'its' own roots are. The Waterville office compliments the existing F&M office network.
The new office is located at the entrance to the new Villages at Waterville Landing, in front of the Kroger at 8720 Waterville-Swanton Road (near the new U.S Highway 24). This is a rapidly growing area with shopping and housing. The opening is scheduled for the first half of 2013.
Farmers & Merchants State Bank is a $930 million independent community bank that has been serving Northwest Ohio for 115 years. Farmers & Merchants State Bank has 19 offices with locations in Fulton, Williams, Henry, Defiance, Lucas and Wood counties in Ohio and three offices in DeKalb and Steuben counties in Indiana. Farmers & Merchants Bancorp, Inc. is the one bank holding company of the Farmers & Merchants State Bank and is traded under the symbol FMAO.
www.fm-bank.com
SOURCE Farmers & Merchants State Bank
The dollar fell against a basket of major currencies on Tuesday modestly pressured by the weight of Federal Reserve measures meant to ensure there was enough liquidity in the global financial system.
The dollar earlier in the session benefited from quarterly and fiscal year-end demand from portfolio managers and Japanese firms, but trading was choppy, with the dollar alternating between gains and losses.
For the quarter, the dollar was the biggest gainer, rising 2.8%. The Norwegian crown was the biggest loser, falling 18% against the dollar.
Analysts said the steep fall in U.S. equity markets during March led to increased buying of dollars for asset managers seeking to rebalance their portfolios at the end of the month.
But the U.S. currency pared gains in the aftermath of the latest Fed move on Tuesday to expand the ability of dozens of foreign central banks to access dollars during the coronavirus crisis. Essentially, the Fed is allowing foreign central banks to exchange their holdings of U.S. Treasury securities for overnight dollar loans.
It is one of a slew of measures that the Fed unleashed to address liquidity problems caused by the economic fallout from the coronavirus pandemic.
That has dented the dollar's luster a bit as the supply of the U.S. currency expands.
""The dollar will struggle to extend gains significantly at the moment just because of the relative supply of cash coming in from the Fed in dollar terms,"" said Shaun Osborne, chief FX strategist at Scotiabank in Toronto.
In afternoon trading, the dollar index was down 0.2% on the day at 99.042.
It reached 102.99, its highest in more than three years, earlier this month as a global market sell-off fueled a rush for dollars. Dollar demand has ebbed, but analysts are still forecasting more dollar gains.
Against the yen, the dollar slipped 0.2% to 107.57 yen. For the quarter, the dollar was down 1.1%.
Tuesday was the last trading day of Japan's fiscal year and the end of the quarter for major investors elsewhere, which has fueled some volatility as big currency market players close their books. The bulk of those positioning changes caused the dollar to strengthen earlier.
The dollar also weakened after data showed U.S. consumer confidence dropped to a near three-year low in March as households worried about the economy's near-term outlook amid the coronavirus pandemic.
The euro, meanwhile, was down 0.2% against the dollar at $1.1007, falling 1.8% in the first quarter.
Some analysts believed that the dollar is likely to remain supported as investors brace for a sharp economic downturn in the coming quarters.
""The Fed's efforts so far are the closest thing to taming the dollar's strength,"" said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.
""But the desire to hold dollars remains elevated ahead of what's expected to be a punishing second quarter for U.S. and global growth.""
Blackstone Group and Apax Partners Worldwide are front-runners to buy a minority stake in Weather Investments SpA, a telecom holding company controlled by Egyptian billionaire Naguib Sawiris, the Wall Street Journal reports.
The purchase price could total 1.2 billion euros (US$1.7 billion), the Journal said, citing people close to the talks. Other possible buyers include TPG Capital, the sources said.
Sawiris in an interview told the paper he had planned to take his company public, but now was more inclined to sell a 10% to 12% stake.
A sale, which could value Weather at more than 10 billion euros, could happen as early as the next few weeks, he said. Proceeds could be used to pay down debt or for new acquisitions, he said in the Journal interview.
One business in his sights is France's Bouygues Telecom, part of the Bouygues group, the paper said.
Weather owns Italy's Wind Telecomunicazioni, Greek wireless operator Wind Hellas Telecommunications, and a 51% stake in Orascom Telecom Holding, the Middle East and Africa's largest telecom company by customers.
Check out the companies making headlines before the bell:
Big Lots – The discount retailer reported adjusted quarterly earnings of 92 cents per share, compared to a consensus estimate of 70 cents a share. Revenue was slightly above forecasts, although comparable-store sales were up a less-than-expected 1.5%. Big Lots also raised its full-year profit forecast.
Genesco – The apparel and accessories retailer earned an adjusted 33 cents per share for its latest quarter, well above the consensus estimate of 4 cents a share. Revenue beat forecasts as well, and a comparable-store sales increase of 5% beat the 0.6% consensus of analysts polled by Refinitiv.
Ford Motor, General Motors – These and other auto stocks are falling this morning following President Donald Trump's threat to impose tariffs on Mexican imports. GM is the largest automaker in Mexico with 14 plants, among the companies taking advantage of proximity to the U.S. border and lower labor costs.
Uber Technologies — Uber posted a loss of $1.01 billion in its first quarter as a public company, matching Wall Street's forecasts. Revenue was slightly above expectations and up 20% over a year earlier.
Gap Inc. – Gap earned an adjusted 24 cents per share for its latest quarter, 8 cents a share below consensus forecasts. The apparel retailer's revenue was also below forecasts, and a same store sales decline of 4% was larger than the 1.2% drop that analysts had been expecting. The same-store sales decline was most prominent at the Gap flagship brand.
Costco – Costco beat estimates by 7 cents a share, with adjusted quarterly profit of $1.89 per share. The warehouse retailer's revenue was also above forecasts. Comparable-store sales rose 5.5%, just under the consensus forecast for a 5.6% increase.
Ulta Beauty – Ulta reported quarterly profit of $3.26 per share, compared to a consensus estimate of $3.07 a share. The cosmetics retailer's revenue was slightly below forecasts, with comparable-store sales in line with estimates. Ulta also raised its full-year guidance.
Williams-Sonoma – Williams-Sonoma came in 12 cents a share above estimates, with quarterly earnings of 81 cents per share. The housewares retailer's revenue matched Street forecasts. Comparable-store sales were up 3.5%, more than double the 1.7% consensus estimate. Williams-Sonoma also raised its full-year earnings outlook.
Dell Technologies – Dell reported adjusted quarterly earnings of $1.45 per share, 24 cents a share above estimates. The computer maker's revenue came in below forecasts on slowing demand in China.
Amazon.com – Amazon is interested in buying Boost Mobile from T-Mobile US and Sprint, according to Reuters. T-Mobile and Sprint are planning to sell the prepaid mobile brand in order to get their planned merger approved by regulators.
Okta – Okta reported an adjusted quarterly loss of 19 cents per share, 2 cents a share smaller than Wall Street had expected. The maker of identity management software also saw better-than-expected revenue during the quarter, as subscription revenue grew 52% compared to a year earlier.
Kraft Heinz – Piper Jaffray upgraded the food maker's stock to ""neutral"" from ""underweight,"" saying caution about the company's outlook is reflected in its current valuation. The stock has lost more than half its value over the past year.
The Fed is not expected to take any action on its benchmark fed funds rate this week, but it is likely to reassure markets that it is watching the outbreak of the coronavirus and other geopolitical uncertainties.
Fed Chairman Jerome Powell is slated to brief the press after the Fed releases its statement Wednesday afternoon, and it is in those comments investors will likely get the most insight into the Fed's thinking. The Fed starts its two-day meeting Tuesday.
""They might say something about paying attention to global developments, but I wouldn't expect them to do anything at this point,"" said Ed Keon, chief investment strategist at QMA. Strategists expect the Fed has been watching tensions in the Middle East and now the coronavirus.
""They're looking at the global economy and it doesn't look like it will have much affect at the moment,"" he said.
It is still unclear how serious the virus will become, or how it will impact the Chinese and other economies. By Monday, the virus had affected 2,900 people and killed 82.
On the policy side, the Fed is expected to hold rates steady and not signal any other moves.
""I think the Fed will be silent,"" said Joseph Quinlan, head of CIO market strategy at Merrill and Bank of America Private Bank. ""They've come into 2020 with their work done. This is a political year. They've done their job when it comes to cutting rates. I think they're in wait-and-see mode.""
The biggest issue for markets is when the Fed will slow and ultimately stop its purchases of Treasury bills, an effort credited by some for a surge in liquidity that has helped boost risk assets, particularly stocks, and tighten credit spreads. The Fed began purchasing $60 billion a month to expand its balance sheet and increases reserves, after problems in the short-term funding market created a temporary snap up in overnight rates.
The Fed has calmed the short-term lending market with the purchases and also ongoing repurchase, or repo, operations. It has said it would continue its operations to help the repo market through the tax season, when there could be higher-than-normal demand for short-term cash. The repo market is basically the plumbing for the financial markets and is where financial institutions go for short term cash.
""It would be nice if they did discuss it, but I don't know if they're going to or not,"" said John Briggs, head of strategy at NatWest Markets. Briggs said he doesn't expect Powell to reveal much in the way of specifics on how it will wind down its Treasury bill purchases. He expects the Fed to say in March that it is paring back those purchases from $60 billion to $40 billion, and then will taper them down.
BlackRock's Rick Rieder said he will be listening for how the Fed describes inflation since it has said it is willing to let it run ""hotter"" than its 2% target, though the measure it watches has not yet met the target. He, too, is looking for clarification on the Fed's plans for its T-bill buying program.
He expects the Fed to discuss it by mid-second quarter. ""I think they'll start to taper it down, and I think they'll be very deliberate and prescriptive about how they're going to do that,"" said Rieder, BlackRock's global CIO of fixed income.
He said the Fed is adding a lot of liquidity to the financial system on its own, but it is even more massive when combined with the efforts of the People's Bank of China and the European Central Bank.
""I think they'll start to taper down the program some time during or toward the middle or the end of the second quarter,"" he said. ""My sense is they're beginning the discussions but those discussions will gather momentum in the next month or two.""
Rieder said he expects more Fed officials to become concerned about their policy causing too easy financial conditions, boosting stocks and tightening credit spreads. ""My sense is that's going to be very slow in incubating that idea.""
""The one thing I've got my eye on is I think at some point in the next couple of months, assuming what is happening now is a relatively near term risk, I think a lot of the discussion is going to head toward financial conditions,"" Rieder said. ""You've had some of the Fed members talking about financial conditions.""
The Fed is also expected to boost the interest rate on excess reserves by five basis points. That's a technical tool that it would hope would push its fed funds rate slightly higher. The fed funds rate has been at 1.55%, the low end of its 1.50 to 1.75% range.
""Historically, the Fed has made these adjustments when the funds rate has been trading within 5 basis points of the borders of the target range, as it has recently,"" notes JPMorgan chief U.S. economist Michael Feroli. ""The markets and the public seem to have understood that these technical adjustments do not represent a change in the stance of monetary policy and we expect that to continue to be the case next week.""
The financial sector will be at the crux of market worries Wednesday, as the U.S. Senate moves closer to a vote on banking reform and German regulators explain their surprise move to ban naked short-selling on a group of bank stocks and sovereign debt.
Investors are looking for clarity on Germany's late day move Tuesday to ban naked short selling in the shares of 10 German financial institutions and in euro zone sovereign debt. The ban, which took effect at midnight, would also apply to credit default swaps based on those bonds. German officials hold a press briefing on the ban Wednesday.
As news of the rules slipped out during the early afternoon in New York, the euro went into a dive, taking risk assets, like stocks and oil with it. The euro fell to a fresh four-year low against the dollar, touching $1.2161 before finishing at $1.2213. Oil fell nearly 1 percent to $69.41, its lowest close since last September.
The Dow finished down 114 points at 10,510, after being up as much as 93 points on the day. The S&P 500 fell 15 points, or 1.4 percent, to 1120.
Euro Trashed
""The measures today were missing the forest for the trees,"" said David Gilmore of Foreign Exchange Analytics. ""Really all they do is channel more of the market risk takers into expressing their negative view on the euro zone into the currency.""
""It says a lot of why the euro went to a new four-year low today, and that was after spending most of the day strengthening and squeezing out short positions. In any crisis, there's always going to be policy mistakes. Some of the mistakes are going to be bigger than others. This has the potential to be quite big. It may not be a Lehman mistake, but it's right up there,"" he said.
However, Stephen Stanley, chief economist with Pierpont Securities, said he doesn't believe the moves will make that much of a difference unless other countries join Germany.
""From what I read, it looks like it's really mostly symbolic. They clearly have the ability and authority to prevent short selling on those German stocks, but I don't think this has much teeth when it comes to euro bonds and CDS... Much more of those trade in London than in Germany,"" he said.
Goldman Sachs' European economists, meanwhile, said they believe the move was made by German officials to make the expected passage of the $440 billion euro bailout package Friday more palatable to the German parliament. They also say they expect other countries to follow Germany's lead.
The new rules are valid until next March 31, and it appears to have some exemptions for market makers who need to hedge.
The news leaked out after European markets were closed, but it rattled U.S. investors who remembered U.S. regulators banning short selling in financial stocks during the thick of the financial crisis.
""What bothers people here, in as much as it smacks of desperation, is when we got to the stage where we were eliminating short selling, we were in deep, deep trouble. I wouldn't have thought the situation was so dire over there to take those actions. It's pretty clear policy makers are out of control, and they're flailing around. That's not going to make the euro stop going down,"" said Barry Knapp, head of U.S. equities strategy at Barclays Capital.
Fin Reg
Congressional efforts to enact financial regulatory reform legislation has been a long process, and now that the Senate moves toward a potential vote later this week, the market is taking more notice. The S&P financial sector was down nearly 2.8 percent Tuesday, giving it a 7.8 percent decline this month.
""I don't think people had really done the analysis on this, and all of the sudden, we're at the verge of it, and now people are putting pen to paper and they're saying 'wow,' he said. Knapp said if rules similar to Basile III capital standards were applied to U.S. banks, the top 20 banks would need an additional $160 billion in capital.
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Even after the Senate approves a bill, the final shape of legislation will still be unclear. The Senate bill will have to be reconciled with a bill passed previously by the House of Representatives.
""It all adds up to the same thing, which is a pretty big hit to the forward earnings outlook. It is also unclear for what it means for credit creation and the economy,"" he said.
""The problem with fin reg here is if you get a vote on, let's say Thursday night, you've got headline risk the day before an (options) expiration. Just from a market perspective, that's added a level of complexity. That's just not what traders want to deal with,"" Knapp said.
Goldman Sachs analysts Monday issued a report saying the proposals so far in the regulatory reform bill present about 20 percent risk to normalized earnings per share for banks. They also said the moves in CDS and options markets imply the stocks of financials may be about 6 percent too expensive.
Widely followed bank analyst Meredith Whitney also Monday said that she would avoid the group, as regulatory reform will dent their earnings and restrict lending.
On Tuesday, Sen. Christopher Dodd, D-Conn. made moves to compromise on a key and controversial feature of the Senate bill which would force banks to spin off their swaps desk. Dodd suggested a proposal to delay any ban on bank derivatives operations for two years while federal regulators study the potential impact. But Sen. Blanche Lincoln, D-Ark., who proposed the rule said she would fight any effort to weaken it.
What Else to Watch
Consumer price index inflation data is released at 8:30 a.m., and minutes of the Fed's last meeting will be released at 2 p.m.
Stanley said the market more likely than not will brush off the Fed minutes. ""The meeting was before the European stuff came to a head...It's pretty clear to me that the Fed reaction in all of this has been pretty cautious and aggressive, opening up swap lines again and the rhetoric..It takes teeth out of any hawkish noise coming out of those minutes. People will dismiss it as old news. If it's dovish, people could say, 'geez, if they were dovish before all this happened, where are they now?'"" he said.
Stanley said he had been expecting the Fed to move toward a tighter monetary policy by September, but now thinks the Fed will wait until next year because of the European situation.
Hewlett-Packard, meanwhile, may get some focus after it reported better-than-expected earnings and raised its full year outlook after Tuesday's bell. The company earned $2.2 billion on revenues of $30.8 billion.
Earnings Wednesday include Target ,Limited Brands , and Polo Ralph Lauren .
Knapp pointed to the decline in consumer discretionary stocks Tuesday, even after some good retail earnings.
""This is the stage in the economic cycle where you would expect consumer discretionary would have been a big winner, and it's not trading particularly well... Some of it's cyclical rotation..but I'm not so sure I want to say it's a bad sign about the economy. It does tell you there were a lot of people in the trade.
You put all these things together -- You have fin reg. You have the euro going down and you have retailers not responding to good earnings and that's making for a pretty good drubbing I suppose,"" said Knapp.
Who Dunnit?
The SEC and CFTC still don't know what caused the market plunge May 6, but they will continue to study it and they have six scenarios they are pursuing. Those include a mismatch in liquidity, disparate trading rules, and linkages between the decline in stock index products such as index ETFs and the e-mini S&P 500 futures.
They did say they found no evidence of a fat finger trade, computer hacking or terrorist activity but they could not completely rule out those possibilities either.
The SEC issued new rules on single stock circuit breakers, where it would require a five minute trading halt if the price declines by 10 percent in a five minute period.
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* List named Greeks with Swiss bank accounts
* Journalist faces up to two years in jail if convicted
* Greeks angry over govt's tax evasion
* Speed of arrest, trial criticised
ATHENS, Nov 1 (Reuters) - Greek lawyers launched their defence of a prominent journalist on Thursday charged with breaking private data rules after he published the names of more than 2,000 wealthy Greeks believed to be holding Swiss bank accounts.
The printing of the ``Lagarde List'' by magazine editor Costas Vaxavanis has touched a nerve in almost-bankrupt Greece, where rampant tax evasion is undermining a struggle to cut public costs and raise revenue under an EU/IMF bailout deal.
His speedy arrest and trial following publication at the weekend has enraged many here already furious over consecutive governments' failure to crack down on a rich elite, who they blame for years of recession that has wiped out a fifth of economic output and hammered middle-class living standards.
Vaxevanis, editor of the ``Hot Doc'' weekly, was surrounded by fellow journalists and other supporters who packed the Athens courtroom as his lawyers began their defence.
They argued the prosecution had charged him without any of those on the list having filed a complaint about privacy violation, a rare occurance in a freedom of speech or defamation case in Greece.
``He's been accused without reason,'' said Nicos Constantopoulous, his lawyer and a former leftist politician. ``The principles of a fair trial are not being followed.''
Under Greek laws covering sensitive data, a defendant must stand trial within 48 hours if arrested within a day of charges being filed in absentia. Vaxevanis faces up to two years in prison if convicted.
He has said he received the list, named after International Monetary Fund head Christine Lagarde who gave it to authorities in several EU countries in 2010 when she was French finance minister, from an anonymous source.
Another newspaper, daily Ta Nea, also published the 2,059 names, which includes several politicians as well as many businessmen, shippnig magnates, doctors, lawyers and housewives, over 10 pages.
It said the accounts had held about 2 billion euros until 2007 but also made clear that there was no evidence any of them had broken tax evasion laws.
Shares of GoodRx, a company that finds users prescription drugs at a discount, plunged this week after Amazon announced online prescription fulfillment. But GoodRx co-CEO Doug Hirsch said investors' fear was misguided, that the two companies are ""complementary,"" not competitors.
""The headlines say it's GoodRx versus Amazon, I say no. GoodRx is a marketplace, Amazon is a pharmacy,"" Hirsch said at CNBC's Disruptor 50 Summit on Wednesday. ""People perceive it as going head-to-head with us, but it's not.""
GoodRx, founded in 2011 by Facebook veteran Hirsch and software entrepreneur Trevor Bezdek, offers users a free list of discount cards and coupons to cut down costs of their prescription medication.
Amazon Pharmacy, meanwhile, will allow customers in the United States to order prescription medications for home delivery. The company will also give Amazon Prime members additional perks, such as free delivery and potential discounts.
""I think they're trying to do what they do best, which is mail order,"" Hirsch said. ""I don't see it as competitive, I see it as complementary.""
However, Wall Street hasn't been swayed. The company's stock dropped more than 6% Wednesday after JPMorgan downgraded the platform to underweight from neutral, citing the launch of Amazon Pharmacy as a threat.
GoodRx ranked No. 20 on this year's CNBC Disruptor 50 list.
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It's that time again! Jim Cramer rang the lightning round bell, which means he gave his take on caller favorite stocks at rapid speed:
Phillips 66: ""I don't like the margins anymore on some of these businesses. You want to be careful — it is not my favorite name.""
Exelixis: ""I like the risk-reward on that one. Now for a $4 stock remember you can lose $4 and people aren't speculating right now, but I like that pipeline very much.""
Michael Kors: ""I finally saw an upgrade today. I think that stock is nearing a bottom. I would now say that and Coach are getting very close to rock bottom valuations. I wouldn't pull the trigger yet, but I'm no longer negative on Kors. And I've been saying sell it for about 100 points.""
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: ""That deal is over, it's done. You ring the register and you move on.""
International Paper: ""It does have a 5 percent yield. I would start accumulating the stock at around 5.5 percent, which I think would mean it's still got some downside but I do think the yield is safe.""
BB&T: ""As long as you say long-haul ... but BB&T is not one I would throw away down here. It's just too cheap.""
Intuitive Surgical: ""Intuitive Surgical is like Netflix. These things do not need a powerful economy. They are really, really hard to own. But if you want to own one, whether it be a FANG or an Intuitive Surgical, it's fine with me. Don't own too many.""
Investors—Canadian ones, in particular—may recall Colombia as one of the hottest oil plays in the world.
That was just a few years ago. Huge wells in these plays created huge valuations—and some strong runs for stocks like Pacific Rubiales and Petrominerales.
Today of course is a different story, with stock prices having fallen off the map—despite favorable oil prices. So what happened that caused these sharp share price drops? And are there good reasons for investors to turn back again to Colombia's oil plays?
We asked Fred Kozak for his insights—He's an independent oil and gas analyst, formerly with the Canadian brokerage firm Canaccord Genuity.
“Colombia still has FARC issues, environmental permitting is still a big problem and pipeline constraints are all impacting the investment climate,” he said in an interview.
FARC is the Spanish acronym for the left wing guerrilla movement in Colombia. Former President Alvaro Uribe was able to secure billions of dollars in US aid in the last decade, which was used for the military and other means to reduce the FARC’s impact on the country.
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With the FARC risk down considerably, foreign investors felt secure in investing billions of private capital into the country’s energy sector—especially the upstream oil and gas producers.
The Canadians were quite active then, led by companies like Frank Giustra’s and Serafino Iacono’s Pacific Rubiales and John Wright’s and Corey Ruttan’s Petrominerales.
Both companies had great success developing assets in the Llanos Basin in the middle of the country, and both had exceptional stock runs. PRE skyrocketed from $2-$34 in 2009-2010, and PMG rose from $6-$40.
A Perfect Storm of Oil Exploration
It all happened at the same time: There was a perfect storm of exploration success, a lower royalty rate, and the sense that this under-explored country could continue its string of high profile discoveries for years. Promoters created new junior exploration companies with bloated share counts—hundreds of millions of shares out—and investors jumped all over these opportunities.
These days? In what I would refer to as the senior Colombian stocks—Rubiales, Gran Tierra—they’re just above 50 percent of their highs, and the rest are anywhere from 20-50 percent of their highs. That second round of bloated share-count juniors quickly lost 80 percent of their value, and have only recently popped their head up.
Did anybody get the license plate on the truck that ran over these stocks?
It was actually several trucks, says Kozak. He says one of the big factors hitting these stocks was the Arab Spring of 2011—all international juniors the world over sold off after institutional and retail investors lost their appetite for foreign risk, as dictators got toppled one after the other starting in early 2011.
And sadly for everyone, FARC violence has increased this year. After several years of declining activity, brokerage firm Raymond James reports in an Aug. 13 report that there has been a “material” increase of security incidents reported since the beginning of the year. Pipeline attacks increased three-fold year-over-year, and five Ecopetrol contractors were killed in Putumayo this summer, near the Colombian/Ecuador/Peru border.
FARC pipeline attacks don't help an already difficult situation—increased oil production in Colombia has strained pipeline capacity.
“As much as 100,000 barrels a day of oil production (bopd) could be shut in, I'm not exactly sure, but it means that you have to truck oil,” says Kozak.
This means higher transportation costs, and companies can’t produce new discoveries at full throttle. In a negative market, that's deadly to a company’s share price.
Colombia’s daily oil production currently exceeds 900,000 bopd, having risen more than 60 percent since 2006, but pipeline constraints have not allowed it to crack the magic 1 million bopd mark.
Barriers to Progress
Producers in Colombia are also experiencing long delays in permitting. Wells are not being drilled as fast as before, with companies being left waiting for up to a year without knowing when they’ll be able to drill.
That has hurt exploration activities, and several of the leading Colombian juniors are now spending a big chunk of their exploration in Brazil, Ecuador and Peru—and sometimes even farther afield.
Another factor, Kozak adds, is that the new discoveries in Colombia just aren’t coming as quickly as they did a couple years ago.
“Colombia had great success at one point—but today look at Petrominerales and GranTierra Energy. PMG is now struggling while GTE is focused on developing discoveries. New discoveries are still limited,"" he said.
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Colombia reported that 34 percent of all wells were successful in the first half of 2012, compared with a 48 percent average from 2008-2010.
Canadians formed a big portion of the foreigners who entered into the Colombian oil and gas sector in 2008-2009. I asked Kozak why that was, and he answered: “We in Canada are entrepreneurs. We have so many teams chasing so many opportunities, and recent success with our 'resource plays' here has been technology-related. Then guys say, hey, we can apply that somewhere else. We go apply our best practices and use our technology and turn things around.”
The Canadians focused on the Llanos Basin, which looks geologically a lot like Alberta’s foothills (light oil) and the Putamayo in the south which is similar to Alberta’s plains (heavy oil).
Colombia is one of a few countries in South America where you could go into the country and do business a lot like you would do in the west. The country is out of favor right now but Fred believes the question is when do you invest in the country, not if.
“With $100 Brent oil, you have $60-$70 netbacks—you can make phenomenal money in that country, but there are short term issues"" Kozak said, adding that those short-term issues reflect growing pains, as the oil and gas sector continues to mature.
“Success is responsible for the delays we’re seeing now—Colombia redefined its fiscal regime to attract new investment and kicked FARC out of most of country since President Uribe started his second term in 2006,"" he said.
Recently, the army has increased its size and activity in the oil-producing regions, improving security. That may lead to an improved perception regarding security in 3-6 months.
Permitting times have been slowly improving—the government is adding more people here as well. That should allow several companies to carry their plans of drilling high impact wells in the second half of 2012.
Catalysts for Colombia's Junior Oil Companies
A new pipeline starting in the first quarter of 2013 is expected to carry more than 490,000 bopd. As that new capacity becomes imminent, it could be a huge catalyst for Colombian juniors.
An intriguing potential catalyst will happen sooner, however. The government has a new bid round in October for 115 blocks including 1/3rd for shale exploration in the Magdalena Basin.
Says Kozak: “There have been a number of wells drilled that have seen shale but nothing like western Canada. Remember that the drilling density in this part of Colombia is a fraction of what North America is used to. Both Exxon and Shell are scheduled to drill a well each on Canacol farm-in lands, but depending on the bid round results in October, those results are not likely to be a 2012 catalyst.”
Kozak concludes that addressing the country-specific risks will help (FARC, permitting delays, pipeline constraints) but the tide that would lift all boats requires the risk on trade to come back. But he says investors should not sit on their hands waiting for the tide to come in:
“There’s going to be opportunity there especially through mergers & acquisition. These companies are very cheap. At these levels it’s almost cheaper to buy than to drill. The acquisition of PetroMagdalena by Pacific Rubiales being an example.”
So how should investors approach investing in Colombian juniors?
“Remember it’s always about the people. When looking at companies to invest in, who are the people involved—and projects—how quickly can they take it to production,"" Kozak said.
By Keith Schaefer
—This story originally appeared on Oilprice.com. Click here to read the orginal story.
The coronavirus-induced economic upheaval is taking a toll on a popular source of investment income for retirees: dividends.
As U.S. companies deal with steep revenue drops and are forced to cut expenses, 203 stocks this year have reduced or suspended their dividends, 44 of them on the S&P 500 index. And, with economic uncertainty remaining going forward, that number could grow.
""I definitely expect this to continue, unfortunately,"" said Howard Silverblatt, senior index analyst with S&P Dow Jones Indices, which keeps tabs on dividend actions by publicly traded common stock with a market capitalization of $25 million or more.
Dividend-yielding stocks generally reward long-term investors, typically paying them quarterly from the company's profits. For retirees fearful of depleting their savings, this can offer a regular income stream without having to sell assets.
While not all stocks have slashed dividends — at least 57 have increased them this year — relying solely on those payments for income may be missing the bigger picture.
""Investors may have to shift their mindset about what it means to generate income from their portfolios,"" said certified financial planner Adam Reinert, chief investment officer with Marshall Financial Group in Doylestown, Pennsylvania.
""If you think about what income means, is it really just dividends and [bond payments], or is it cash flow from the portfolio as a whole?"" he said.
In other words, Reinert said, think of dividends, interest and growth of assets as the building blocks of an income stream. That way, he said, you can reduce some risk that comes with too heavy a focus on those income yields (payments as a share of the asset price).
""If you just focus on dividends or coupon payments, you might see something with a higher yield, say 6%, but it could be riskier,"" Reinert said. ""Maybe the price is falling, or the dividend hasn't been adjusted yet.""
Retirees also could use the bucket approach — using fixed-income investments, such as U.S. treasury bonds — to plan for income over a multi-year period.
""You effectively cover your living expenses for five or seven or 10 years by buying the appropriate fixed-income investments to match that time horizon,"" said CFP Michael Hennessy, founder and CEO of Harbor Crest Wealth Advisors in Fort Lauderdale, Florida. ""Then, the remaining funds in your retirement account can be invested to capture long-term equity growth.""
It also may be worthwhile upgrading your dividend stock holdings by replacing companies with weaker balance sheets — and more at risk of cutting dividends — with those whose financials suggest they are in better shape to continue paying, said Shon Anderson, a CFP and president of Anderson Financial Strategies in Dayton, Ohio. Some companies have consistently paid dividends for 25 years, or even 50 years or more, he said.
""The company board of directors, and executive management, know that a growing dividend is extremely important to the majority of their shareholders and will protect it at all costs, even if it isn't necessarily the optimum short-term solution,"" Anderson said.
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Even if a company cuts its dividend, they may resume or increase them once their finances are stronger.
""They're likely to bring them back,"" Anderson said. ""But the reason they've had to reduce them is distress in their business, so it probably won't be in the near future.""
Silverblatt, of S&P Dow Jones Indices, anticipates dividend cuts to be more prevalent among smaller and mid-sized public companies as the economy struggles to right itself.
""I expect those companies to feel it the most,"" Silverblatt said.
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""The corn kernel is king right now,"" declared Ed Williams. He's a fifth-generation Iowa City farmer, and he's determined to seize the day on the ethanol and bio-fuel frenzy that's driven up the golden grain's price nearly 100% over recent months.
Williams, a member of the Bio-Development Association, told CNBC's Carl Quintanilla that his fellow agriculturists are watching the markets and demand carefully. He said that previously, the ratio of corn to soybean plantings were generally 50/50; now, most farmers are plotting a 75/25 ratio. The ramification for investors? Corn uses much more fertilizer, so look for those products' prices to rise, too -- and maybe a share boost for fertilizer makers like Bunge.
But amid the euphoria, Williams is still the farm pragmatist: he and his peers are protecting themselves against market vagaries via futures and options planning. As to the frenzy over corn-based ethanol, he muses that, ""We're taking advantage while it's here -- it's not going to last forever.""
European banks are finding it hard to recruit the right people due to new regulations and intense competition from some of their U.S. peers, industry insiders have told CNBC.
""It is a vicious circle, isn't it?"" a senior executive at a European bank told CNBC who preferred to remain anonymous due to the sensitive nature of the topic.
""You want to hire the right talent because you can see the business is suffering, but you don't get approvals for the headcount and when you finally do, you aren't able to match the salaries,"" they told CNBC.
Pay in the banking sector is generally higher compared to other industries. A junior-level analyst in a trading role at a European bank can start at anything between $50,000 to $60,000 for a base salary. On top of this they would receive allowances and a bonus, which can sometimes be given in the form of company shares.
This is where U.S. banks differ as they tend to stick to cash bonuses, taking the overall compensation of a junior analyst to somewhere between $80,000 to $100,000. This gap starts to widen more as employees go up the ladder.
People outside the industry have often found these figures to be shocking, especially as the world economy is undergoing uncertainty and still reeling from the effects of the financial crisis of 2008. Banks are often criticized for big payouts and new rules on salary caps in Europe hasn't stopped that.
""I think we are seeing some incentive systems in some corners of the financial sector, yet again, moving in the direction that I find not exactly aligned with the sense of purpose that I hope banks actually have,"" Christine Lagarde, the managing director of International Monetary Fund, said at a CNBC-moderated panel at the World Economic Forum in Davos last month. She also advised the financial sector to work with a sense of purpose and not ""single-mindedly"" for the pursuit of profits.
European banks have to adhere to an EU-wide bonus cap that was put in practice in early 2014. The regulation limits bonuses paid to senior managers and other ""material risk takers"" to no more than 100 percent of their fixed pay generally, or 200 percent of their fixed pay with shareholders' approval.
While this limit may have calmed an uproar over the large sums of money that executives take home, it has also led to banks increasing basic salaries as a way to compensate for the bonus restrictions.
""One consequence of the regulation of remuneration, particularly the introduction in the EU of the bonus cap, has been an increase in fixed remuneration as a proportion of total remuneration,"" a Bank of England report published in December 2015 found.
In 2015, the Bank of England and the Prudential Regulation Authority, also made changes around bonus buyouts, where banks compensate new employees for any remuneration foregone when they change jobs. As part of the new rules, banks can claw back some or all of the bonus already paid to an employee for up to seven years, if the employee is found to have committed wrongdoing in their previous job.
The EU-wide bonus cap saw an impact not just on employee morale but also on hiring. Big European banks found it difficult to hire executives, especially when compared to U.S. banks where bonuses and fixed salaries can be higher.
European banks are suffering from years of weak profits, massive fines, ultra-low monetary policy and uncertainty surrounding the U.K.'s exit from the European Union. The U.S. banks, on the other hand, especially the big ones like J.P. Morgan and Citi have very strong retail operations that have kept these banks resilient in the face of economic headwinds. This makes them better paymasters and a more conducive place to work.
One recruitment consultant told CNBC, on condition of anonymity due to their relationship with large banks, that lenders like Goldman Sachs and J.P. Morgan see strong bonus payouts for front of office roles executives — such as in the trading room — and were up to 30 to 40 percent better when compared to European banks such as Barclays, Deutsche Bank and UBS. Spokespersons for Goldman Sachs, Barclays and Deutsche Bank were not immediately available for comment when contacted by CNBC. Meanwhile, J.P. Morgan and UBS declined to comment.
""There is no comparison. A vice-president or a director level executive in a trading function at a U.S. bank will easily see a 100 percent cash bonus component as compared to a European bank where these are generally given as deferred, or in stocks,"" the consultant said.
Banks pay out bonuses in various ways. While some banks, especially the U.S. banks, pay out a 100 percent cash bonus, several European banks pay out bonuses as a mix of cash and stocks. The cash component of the bonus, in many cases, is deferred and is paid out over a longer period — an incentive for the employee to stay with the company and a way for the institution to deal with costs.
""I think that was the case three or four years ago, but we started to see the stronger European banks catch up last year to pay market levels,"" Joseph Leung, the founder and managing partner at recruitment firm Aubreck Leung, told CNBC last week.
""Keep in mind many of them exited unprofitable businesses a few years ago and redistributed their capital to performing areas enabling them to pay their good people,"" Leung added.
He, however, warned that this could change in 2019 since none of the European banks have announced their compensations yet.
Amid all the uncertainty currently surrounding the banking sector, it is the new talent that is bearing the brunt. Young people joining banks often find themselves witnessing a massive income divide when compared with their senior peers who have climbed up the ladder pre-crisis and bonus-cap era.
While some employees at European banks may feel disappointed with low pay and non-existent bonuses, others may feel comfortable with a steady flow of income — that is comparatively higher than what several other sectors pay.
""Banks have been paying like this for years so don't think its affected morale in any way,"" Leung said.
""Because of the bonus cap most people have seen their fixed compensation gone up — whether it's in a higher basic salary or in allowances ... So in a warped way some are actually getting more cash than they did before because they are getting less deferred stock.""
As for Rakuten's ambitions in Japan's crowded telecommunications space, Mikitani said lower capital costs from new technologies and his company's proven track record in other businesses make him optimistic.
At present, Rakuten sees about $120 billion in global transactions, and Mikitani said the goal is not just to have a shopping platform.
With the inclusion of the telecommunications business, the Walmart partnership, and the acquisition of Asahi's insurance business, the company is seeking to build out a full lineup of services, he said.
""It's all about ecosystem,"" he told CNBC.
Using China's Tencent as an example of a company ""going everywhere"" in consumer services, Mikitani said his firm is attempting to follow a similar trajectory. Partnerships such as the one with Walmart, he said, are likely to become more common in the future.
The U.S. economy is on the mend and has been getting better, but JPMorgan Chase CEO Jamie Dimon said chief executives he has spoken to have told him they are already making decisions to protect their companies from a looming ""fiscal cliff.""
The mix of automatic spending cuts and the expiration of Bush-era tax cuts at the end of the year could cut U.S. growth in 2013 and send the economy back into a recession, according to economists.
, including Dimon, have been lobbying for a deal to avert such an outcome.
""I've spoken to CEOs who say, you know, absolutely, we are making decisions to protect ourselves from the 'fiscal cliff' and those are like investment decisions and hiring decisions,"" Dimon told CNBC-TV18 in India, during a visit to the country.
(Read More: )
Dimon said the so-called fiscal cliff could end up being worse than a 3 percent contraction that economists have so far predicted.
""[The fiscal cliff] alone would take 3 percent or so out of (gross domestic product), that is a recession,"" he said. ""The problem is that's kind of a static analysis, people's reaction could actually make it worse.""
According to Dimon, the outcome of the election isn't as important as good fiscal policy to deal with the country's rising debt.
The economy is still difficult, but we’re seeing some signs of firming, General Electric CEO Jeff Immelt told CNBC in an interview.
""I think that while the economy is still difficult, we’re starting to firm,"" said Immelt. ""We’re starting to see that the sequential appliance orders are firming, we’re starting to see some signs that businesses are ready to invest again. I think in certain ways, companies have to make their own rallies right now…I think as we get more confidence in the system, we have to pull our ways out of this.”
GE is the parent company of CNBC and CNBC.com.
GE posted better-than-expected quarterly profit last Friday, as a strong performance at its large energy operation offset declines at the GE Capital finance and NBC Universal units.
“Financial services was tough as expected, but we still made money,” said Immelt. “Some of the shorter cycles like advertising on NBC are still in a difficult phase. [But] I was quite encouraged in our infrastructure orders and how our infrastructure businesses did
Cisco's CEO John Chambers agreed and explained his position on the economy.
“You’re beginning to see governments and companies realize that [technology] is going be an area that is going to grow really well,” said Chambers. “Both technology will play a key role in the recovery, also the smart use of electricity…Recoveries don’t happen unless businesses take good business risks.”
Amazon announced three renewable energy projects on Thursday, saying it was committed to minimizing carbon emissions following criticism earlier this year.
The tech giant said the facilities would provide energy to its Amazon Web Services data centers.
A wind farm, with a max capacity of 50 megawatts (MW), will be situated on Scotland's Kintyre Peninsula and is expected to produce 168,000 megawatt hours (MWh) of energy each year. Amazon said the facility could power the equivalent of 46,000 U.K. homes and would be the U.K.'s ""largest corporate wind power purchase agreement.""
Additionally, two solar projects in North Carolina and Virginia will amount to 215 MW of total capacity, with Amazon expecting them to produce 500,997 MWh per year. The projects announced Thursday are expected to start generating energy in 2021. They are not owned by the company, but it says its commitment to purchase their output enables the projects to be built.
In a statement issued Thursday, Amazon's Director of Sustainability Kara Hurst said the firm was ""committed to minimizing our carbon emissions and reaching 80% renewable energy use across the company by 2024.""
In June, Amazon was one of more than 700 firms targeted by 88 investors ""for not reporting environmental information."" The aim of the investors was to push businesses such as Amazon to disclose information via the CDP, a not-for-profit platform which enables companies to divulge environmental performance data.
A few months earlier, in April, thousands of Amazon employees signed an open letter to CEO Jeff Bezos and the firm's board of directors, imploring them to take action on climate change.
In September, Amazon co-founded an initiative called The Climate Pledge, which asks signatories to become ""net zero carbon across their businesses"" by the year 2040.
It has also launched what it calls a ""transparency website"" which it uses to report on what it describes as its ""sustainability commitments, initiatives, and performance."" The site also has information on the firm's carbon footprint, which it reports as being 44.40 million metric tons of carbon dioxide equivalent for the 2018 fiscal year.
Amazon is just one of many global technology firms looking to power operations using renewable sources of energy.
In March 2019, for example, Microsoft signed a 15-year power purchase agreement for the energy produced by a 74-megawatt solar power facility in North Carolina, while in April 2018 Apple announced its global facilities were powered using ""100 percent clean energy.""
Making sure that its facilities are powered by clean energy is a multi-faceted process for Apple.
In its Environmental Responsibility Report covering the 2018 fiscal year the California-headquartered firm said that, where feasible, it sourced renewable energy by building its own projects.
In addition, it invests capital to become a part owner in wind and solar projects and signs ""long-term renewable energy contracts.""
With two months of urgent repairs beginning at New York's Pennsylvania Station, commuters on Monday may get their first taste of the havoc the track work is expected to bring to the challenge of getting into and out of the largest U.S. city.
New York Governor Andrew Cuomo has predicted a ""summer of hell"" for commuters as scheduled repairs force a partial shutdown of the busiest passenger train hub in the country from July 10 through Sept. 1, or longer if work falls behind schedule.
Track closures mean some people find other ways into the city, including ferries, buses and PATH trains, a subway line running between lower Manhattan and New Jersey.
One harried New Jersey commuter suggested that finding a way to work every day was a task best suited for members of a club for geniuses.
""It's like some Mensa test, just trying to figure out how to get there,"" David Weinstock, 51, said, referring to the Mensa International, a club for people with high IQ's.
Weinstock, a public relations executive, moved to Maplewood, New Jersey, five years ago, lured by the convenient 35-minute commute by rail directly into Penn Station. But with nearly all trains on his line rerouted to Hoboken, New Jersey, he has had to piece together a makeshift plan to cross the Hudson River to Manhattan.
""It's going to become an almost two-hour commute each way, on top of 10-hour work days,"" said Weinstock, a married father of two young children.
With fewer platforms available, the repair work will complicate schedules for the three rail operators that use Penn Station: the national rail corporation Amtrak and the regional commuter train operators New Jersey Transit and the Long Island Rail Road.
All three have canceled some routes into Penn, rerouted others and warned commuters to expect delays on remaining trains until all tracks are up and running again. The terminal serves 600,000 riders a day.Deb Wilson, 53, a human resources executive from Montclair, New Jersey, 15 miles west of Penn Station, said she is worried about the overflow of rerouted commuters in the small Hoboken terminal during the evening commute home from New York.
""It's going to be mass pandemonium in Hoboken,"" Wilson said. ""They should have planned better. This is pretty dramatic.""
Delays at Penn Station have become routine after a series of derailments, highlighting the urgency of the track repairs. The most recent incident occurred on Thursday evening when 180 people had to be rescued from a NJ Transit train that derailed as it emerged on the New York side of a tunnel under the Hudson River.
New Jersey Governor Chris Christie on Friday demanded a ""full investigation into all potential causes"" of the derailment.
Deteriorating transit conditions have led to renewed criticism of Christie for canceling a new Hudson River rail tunnel project soon after taking office in 2010, saying the cost to his state was too high.
Cuomo, touted as a potential Democratic challenger to President Donald Trump in 2020, has also come under pressure to fix New York's problem-plagued subways. As governor, he controls the Metropolitan Transportation Authority, which runs the subway system as well as LIRR and Metro-North, a commuter rail line serving the city's northern suburbs that use Grand Central Terminal.
Still, the New York governor has no direct oversight over repairs at Penn Station, which is owned and operated by Amtrak.
The national rail corporation is undertaking the massive repair program and rents track and station space to NJ Transit and the MTA's LIRR.
Each railroad has devised separate contingency plans to work around the repairs, including reduced fares and alternate routes into New York.
Amtrak CEO Charles Moorman told CNBC on Monday no one person is at fault for Penn Station's recurring infrastructure problems.
Moorman, whose company took over Penn Station in the 1970s, said the transit hub went without major investments for a significant period of time and now it's time for an expedited update.
""We like to think of it as the summer of renewal,"" Moorman said on ""Squawk Box."" ""The summer is generally a better time to this kind of work. Traffic patterns are down a little big because of vacation. And we just need to keep going and get this work done.""
The CEO admitted that there had been an ongoing tension between Amtrak and New York's MTA. But the two groups have to coexist and work together, he said.
""We have a good relationship with the Long Island Railroad and Metro North. ... A good working relationship at the operating level. I have a good working relationship with the MTA executive team,"" Moorman said.
—CNBC's Berkeley Lovelace Jr. contributed to this report.
(Adds defence analyst comment, share movement)
* Doubts over German backing for $45 bln aerospace merger * UK Takeover Panel deadline at 1600 GMT * BAE shares down 1.6 pct By Sophie Sassard and Jason Neely LONDON, Oct 10 (Reuters) - EADS and BAE Systems
are engaged in a final push to rescue their $45 billionaerospace merger from the political jockeying that threatens tosink it, as doubts grow over German backing for the deal.
The European companies have until 1600 GMT on Wednesday todeclare their intentions and either scrap their merger or ask UKregulators for more time or finalise their plans to create theworld's largest aerospace and arms group.
""We will keep going until 5 (pm London time),"" a personinvolved in the negotiations said.
Several sources close to the negotiations said GermanChancellor Angela Merkel had opposed the proposal to combineAirbus passenger airplanes with UK defence contractor BAE.
""Merkel is against the deal but has not given reasons,"" asource involved in the negotiations said.
A spokesman for the German government declined to comment.
Early on Wednesday EADS said it had no plans to issue astatement in the morning.
At 0925 GMT shares in BAE were down 1.6 percent at 320.2pence in London, while EADS shares were down 0.15 percent at26.065 euros in Paris.
Brinkmanship is common in European negotiations, andFranco-German-led EADS was itself only created after talks aboutits structure collapsed and were resurrected weeks later.
But with the current negotiations taking place in a glare ofpublicity, the margin for manoeuvre is rapidly dwindling.
On Tuesday, French Defence Minister Jean-Yves le Drian saidnegotiations on the merger had moved forward.
""We had made a lot of progress, I think, but have weprogressed enough? That is up to those who initiated the projectto say,"" the minister said.
But by late that evening it appeared that there were threelines drawn in the sand, each of which excluded one of theBritish, French and German governments, leaving the highlypolitical European merger in danger of collapse.
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Graphic on EADS/BAE market cap and share prices:
Factbox on the two companies:
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THREE-WAY TUSSLE
France and Germany want to keep a strong say in the combinedcompany, while Britain wants to protect BAE from stateownership, which could affect its contracts in the UnitedStates.
Germany and Britain could accept lower state shareholdingsthan is the case at EADS, which is more than half controlled byFrance, Germany and Spain, but France rejects that.
France and Britain, meanwhile, could accept unequal stakesbetween France and Germany, but Berlin demands parity. Sourcesinvolved in the deal said Germany also wanted to ensure therewas a major headquarters in Munich to counter corporate centresin Toulouse, France, and Farnborough, Britain.
Under rules set by the UK Takeover Panel, EADS and BAE canask for an extension to their negotiations, but only if EADS""has every reason to believe that it can and will continue to beable to implement the offer"".
""Extending the deadline will not change the dynamics of thenegotiation and would almost certainly weaken the positions ofKing and Enders going forward, as it would signal they felt theyhad no other acceptable options,"" said David Reeths, Directorfor consulting at defence analysts IHS Jane's.
Negotiators described the atmosphere as tense and frustratedas bickering immediately broke out behind the scenes to lay theblame elsewhere in case the talks officially break down.
The merger has faced growing unease from investors in bothcompanies who complained they were ill-prepared and lackinginformation. Many people bought shares in EADS on the strengthof its Airbus civil unit, rather than its defence ambitions,while BAE investors were attracted by its dividend yield.
(Additional reporting by Matthias Blamont, Arno Schuetze, PaulTaylor, Andrea Shalal-Esa and Tim Hepher; Writing by Tim Hepherand Jane Barrett; Editing by Will Waterman)
((tim.hepher@thomsonreuters.com)(+33 1 49 49 54 52)(ReutersMessaging: tim.hepher.thomsonreuters@reuters.net))
Keywords: EADS BAE/
With shares of Diamond Foods up 57% over the past year and trading near its 52-week high, is the stock about to break out, technically?
And fundamentally, could this under-the-radar snack food company be poised to take market share from the likes of Frito Lay?
Don’t make a move until you check out our interview with Diamond Foods CEO Michael Mendes.
Watch the video now!
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Summer isn't over yet, but the languid pace that has prevailed in Washington since Congress left town in August has now definitively vanished. On every front, the White House and Congress, Republicans and Democrats, are girding for political action that will unfold rapidly with its ultimate consequences uncertain.
Let's look at the most important points of engagement:
--The elephant in the room: the Iraq war. This is President Bush's top priority and there's no close second. Facing resistance from Congressional Democrats, Bush sought a momentum boost with his surprise visit to Iraq in advance of Gen. David Petraeus' testimony on the troop surge in Washington next week. Bush and even some Democrats see signs of military progress; Democratic leaders said the US military commitment isn't leading to political reconciliation that would allow troops to come home.
--The new wild card: the economy. When you have a single issue stirring fear and anxiety among hedge fund markets, pension fund investors, and moderate-income homeowners, there's potential for a powerful political reaction. That's what the mortgage mess has produced. Bush responded last week with his limited assistance proposals, while Democrats want more -- including potential cash bailouts. This may be one area where Democratic and Republican choose to work together.
--The old battle: taxes and spending. Republicans bruised by the unpopularity of Iraq and scandal drama (see: Craig, Larry) are spoiling to battle Democrats over one of their familiar themes. That's what Bush is threatening to veto spending bills from the Democratic Congress, and almost certainly would do the same if Democrats could muster the votes to raise taxes on private equity. The GOP badly needs to reclaim the tax-spending brand.
--The backdrop: the 2008 elections. The campaign trail has almost supplanted Washington as the focus of national attention already. And that trend will only increase. A Wednesday night debate in New Hampshire will showcase the tightrope Republican candidates have to walk between distancing themselves from an unpopular White House and building support among the Republican base. The next morning, the new Republican candidate, Fred Thompson will enter the race in Iowa (having appeared on ""The Tonight Show with Jay Leno"" on the same night of that GOP debate).
Can Thompson be the Reagan heir in the race? and can Barack Obama sharpen his change message enough to win a change election against Hillary Clinton in the Democratic primary? I travel to Iowa this afternoon to see both candidates. And I will blog on what I see.
Questions? Comments? Write to politicalcapital@cnbc.com.
Despite the rising cost of private schools, demand continues to grow across the world. For many, private schooling buys luxury, exclusivity and privacy. In many developing countries, private education is a must-have for parents who want their children to succeed.
Across the world, the cost of private education has risen faster than incomes. In the U.S., private high schools cost over $40,000, compared to a median income of around $50,000. In the U.K., boarding school fees jumped 65 percent from 1992 to 2008, while household incomes increased only 30 percent over the same period, according to the Institute for Fiscal Studies.
We’ve put together a list of the countries with the most expensive private schools based on the cost of sending a child to one of the top three or four private schools in that country.
We used annual tuition fees for high school students for both day and boarding schools. Since boarding is often the more expensive option, we ranked the countries by boarding fees, except in the cases of China and Brazil.
The fees we considered include boarding, food and basic curriculum costs, but exclude charges such as registration fees, deposits, extra-curricular activities and field trips. We also excluded schools that specialized in children with special needs.
Click ahead to find out which countries have the world’s most expensive private schools.
By Posted: June 19, 2011
Most Expensive: Hilton College
Annual Tuition: $25,614
Students in Private School: 2.5%
South Africa has a long tradition of all-boys boarding schools that were established in the 1800s by Dutch and British missionaries. But only 2.5 percent of South African students were enrolled in private schools, as of 2007.
Founded in 1872, Hilton College (pictured) is South Africa’s most expensive private boarding school. Located in the eastern KwaZulu-Natal Midlands, the school has about 400 students and sits on a 17 square-kilometer property.
Hilton is part of a group of private South African schools referred to as the ""Elite 7."" Schools in the group include Diocesan College, Michaelhouse, St. Stithians College, St. Andrews College, Kearseny College, and St. John’s College.
The average annual boarding fee is around $20,000 for most of these schools. A strong emphasis is placed on sports competition among the schools, with Hilton’s website listing over 15 different sports programs.
Most Expensive: Yew Chung International School of Shanghai
Annual Tuition: $34,407*
Students in Private School: NA
The business of international schooling in China is booming. The country’s private education market is expected to grow to nearly $80 billion by 2012 from $60 billion in 2009, according to Bank of America Merrill Lynch.
The World Bank says the number of private schools in China rose 134 percent from 29,964 to 70,256 between 1997 and 2003. Over the same period, the number of private school students increased 273 percent to 14.16 million, but that’s still just a tiny fraction of the population.
Yew Chung International School (YCIS) in Shanghai is the most expensive school in China. The day school has four campuses with two dedicated to junior schools. The Hong Kong based organization with 5,000 students also has schools in Beijing, Chongqing, Qingdao and Silicon Valley, California.
Beijing and Shanghai have nearly half a dozen international schools that charge over $30,000 in annual tuition fees. In Hong Kong, the Hong Kong International School is the most expensive at $21,273 per year. Several other international schools in Hong Kong charge over $15,000.
* Annual fees for day school
Most Expensive: Ermitage International School of France
Annual Tuition: $39,388
Students in Private School: 15%
About 15 percent of students in France attend private schools. The most expensive institutions are ones that offer education in French and English, along with the International Baccalaureate program.
Ermitage International School of France is the most expensive boarding school in the country. Founded in 1941, the school is located in the north-central town of Maisons-Laffitte — about 12 miles (20 kilometers) from Paris. Ermitage offers bilingual education for over 1,000 students, and day school costs over $20,000 annually.
In the capital, the International School of Paris is the only English-speaking school within the city and day school costs over $36,000 per year. Outside Paris, the British School of Paris, situated near Versailles, charges over $33,000 for day school.
Most Expensive: American International School of Sao Paulo
Annual Tuition: $39,419
Students in Private Schools: NA
The demand for private school education in Brazil has been rising with the increase in the number of rich and super wealthy. In 2010, for example, there were 30 billionaires in Brazil — up 60 percent from the year before, according to Forbes magazine.
Brazil's most expensive school is located in Sao Paulo (pictured), which is Latin America's second largest city. The day school known as ""Graded"" or the American International School was founded in 1920. It has a 16-acre campus with has 1,200 students including members of its junior and middle schools.
International schools, mainly those with U.S. curricula such as American School of Rio de Janeiro and the American School of Brasilia, are the next most expensive private schools in Brazil, with annual tuition costs of about $30,000.
* Annual fees for day school
Most Expensive: United World College Southeast Asia
Annual Tuition: $45,847
Students in Private School: 20%
Despite its small population of five million people, and a great public school system, Singapore has 1,000 private schools including 30 international schools. Nearly one in five students or around 100,000 attend private schools in the city-state.
However, since Singaporeans cannot send their children to private schools without approval from the government, most private school students are the children of expatriates or foreign-born permanent residents.
United World College (UWCSEA) is the most expensive boarding school in Singapore. The school has two campuses in the island-nation with over 3,800 students. It expects to expand in order to cater to over 5,000 students by 2015. While the boarding option costs over $45,000, day school tuition fees come to about $22,000.
In terms of non-boarding schools, Tanglin Trust is the most expensive in Singapore with tuition fees of $27,869 per year. Founded in 1925, the British school teaches students from ages three to 18.
Most Expensive: Lawrence Academy
Annual Tuition: $50,375
Students in Private School: 10%
In total, the U.S. has over 33,300 private schools, which account for about 25 percent of all schools in the country. About 5.5 million or 10 percent of all students attend private schools, according to National Center for Education Statistics (NCES).
The most elite and prestigious private high schools in the U.S., also known as ""prep schools,"" are located on the east coast. The long tradition of east coast education goes back to 1642, when Massachusetts Bay Colony became the first colony to make formal education mandatory.
Located in Groton, Massachusetts, Lawrence Academy is currently the most expensive private high school in the U.S. Day school tuition costs around $38,770. Founded in 1793, the co-educational school is the third oldest boarding school in the state. The Lawrence Academy campus sits on 100 acres, and is close to the third most expensive school in the U.S., called Groton. One of Groton’s most famous graduates is former U.S. President Franklin D. Roosevelt.
Coming in a close second to Lawrence Academy is the Dana Hall — an all-girls boarding and day school located in Wellesley, Massachusetts, where boarding tuition costs up to $49,620 per year.
Most Expensive: Geelong Grammar School
Annual Tuition: $53,028
Students in Private School: 34%
More than one in three students attend private schools in Australia.
Over the past ten years, the number of students in private schools has increased by over 20 percent compared to an only one percent increase in students attending public schools, according to the Australian Bureau of Statistics. Unlike most other countries, private schools in Australia also receive funding from the state and federal governments.
Victoria’s Geelong Grammar School is the most expensive private school in the country. With five campuses located in the southwestern part of the state, the school’s full-day program costs $31,284. The school was founded in 1855, and its notable alumni include media mogul Rupert Murdoch, and Prince Charles, who studied two terms at the school.
Most Expensive: Appleby College
Annual Tuition: $54,087
Students in Private School: 6% - 8%
Only an estimated six to eight percent of Canadians attend private schools, with the majority attending public schools funded by the government.
Canada’s most expensive private school is Appleby College. Day tuition at the school costs $36,102 per year, while boarding costs over $54,000.
Located in Oakville, Ontario — about 30 minutes outside of Toronto — Appleby College was founded in 1911 by John Guest, a former headmaster of the renowned Upper Canada College (UCC). UCC is the oldest independent school in the province and is the second most expensive school in Canada with an annual boarding cost of $52,379.
UCC is also the wealthiest independent school in Canada with an endowment of over $49 million.
Most Expensive: Hurtwood House
Annual Tuition: $54,928
Students in Private School: 6.5%
The U.K. has a very long tradition of private schools that dates back to the 600s. According to the Independent School Council census, about 6.5 percent of students attend private schools in the U.K.
The country has about 2,600 private schools, which ironically are referred to as ""public schools"" even though they are independent and don’t receive funding from the government.
Among the most famous private schools in England are the ""Clarendon Schools,"" which consist of nine institutions that were considered to have the best education systems dating back to the 1800s. Several private schools around the world are modeled after Eton College and Harrow, where boarding fees cost over $48,000 per year.
Hurtwood House is the most expensive private high school in Britain. As of the 2011-2012 academic year, it costs $18,500 to send your child for one term to the school. The co-educational boarding school is located in Surrey, England, and was founded in 1970 by the current headmaster Richard Jackson. Renowned for its theatre and media curriculums, the main school is an Edwardian mansion set in 200 acres in the Surrey Hills.
Relatively new in comparison to England’s long list of prestigious private schools, Hurtwood House was ranked second in the country for adding the most value to student education in 2010.
Most Expensive: Le Rosey
Annual Tuition: $113,000
Students in Private School: NA
Switzerland is home to 10 of the world’s most expensive private schools - all set in and around the Swiss Alps. About 100,000 students attend private school in Switzerland, according to the Swiss Federation of Private Schools and the top three boarding schools cost over $100,000 a year.
Le Rosey, also referred to the ""School of Kings,"" is one of the most prestigious private schools in the world. Founded in 1880, its Switzerland’s oldest and largest boarding school with 28 hectares of land. Generally, only one in three candidates are accepted to the school that operates on a national quota system, where no more than 10 percent of students can be from one country or group of countries with the same dominant language.
Facilities at the school include 10 tennis courts, an open-air theatre, circus tent, shooting and archery ranges to name a few.
Some of Le Rosey’s famous students include the Aga Khan, King Albert II of Belgium, Prince Rainier of Monaco, as well as other European, and Middle Eastern royal family members. Children of movie stars, rock stars, and American business tycoons have also been Le Rosey alumni.
Online payments technology provider Stripe announced Sunday that it has raised a new $600 million round of funding that values the company at $95 billion — nearly triple its last reported valuation of $36 billion from April 2020, according to PitchBook data.
Stripe, which makes software that allows businesses to accept payments over the internet, intends to invest the new capital into its European operations, the company said in a release. Thirty-one of the 42 countries that Stripe operates in are located in Europe, and President and Co-Founder John Collison singled out Ireland — where the company is headquartered — as a particular area of focus.
Founded more than a decade ago, today Stripe is by far the most valuable private fintech company, with Robinhood trailing at a roughly $11.7 billion valuation after investors wrote the company a $3 billion check amid this year's GameStop chaos.
Stripe has seen eye-popping growth during the pandemic as its revenue is largely tied to growth in online shopping. In its previous funding round last April, Stripe was early to highlight the Covid-19 outbreak as ""pushing the economy online"" and said ""several years of offline-to-online migration are being compressed into several weeks.""
""We're investing in the infrastructure that will power internet commerce in 2030 and beyond,"" wrote chief financial officer Dhivya Suryadevara, who joined the company in August after moving out of her role as General Motors' CFO. ""The pandemic taught us many things about society, including how much can be achieved — and paid for — online, but the internet still isn't the engine for global economic progress that it could be.""
In December, the company launched banking services through partnerships with Goldman Sachs, Citigroup, Barclays and Evolve Bank & Trust.
But despite its ballooning growth and valuation, the company has stayed tight-lipped about the prospect of a Wall Street debut, as John Collison told CNBC last year that the company has ""no plans"" to go public right away.
Primary investors in the new series H round include Allianz, Fidelity, Sequoia Capital and Ireland's National Treasury Management Agency (NTMA). Previous investors include Tesla CEO Elon Musk, Peter Thiel, and Alphabet's late-stage investing arm, Capital G, among others.
Earlier this year, Stripe invested $102 million in a Series B round for Fast — a smaller online checkout company based in San Francisco. Stripe, which also led the start-up's Series A, is the underlying payments rails for Fast's checkout product.
Stripe is a six-time CNBC Disruptor 50 company and landed at the top spot on the list in 2020.
Correction: The first paragraph of this story has been updated to reflect that Stripe's latest valuation is $95 billion.
NEW YORK — Newly public ride-sharing companies Uber and Lyft have tumbled more than 25% since their initial public offerings, but Light Street's Glen Kacher still believes there's a path for profitability for them.
""The end market is huge,"" Kacher, chief investment officer and founder of Light Street Capital, said at the Delivering Alpha conference presented by CNBC and Institutional Investor.
Kacher said Uber and Lyft are both raising prices rapidly in the U.S. and they are also benefiting from rise in the food delivering business. Kacher, who manages $2 billion in global technology assets, said he's a shareholder in both companies.
It hasn't been smooth sailing for those two ride-sharing companies, however. Uber went public in May, and reported a $1.8 billion loss ahead of its public debut. It revealed a $5.2 billion loss in the second quarter. Uber's ride-hailing rival Lyft, posted a 2018 loss of $900 million ahead of its March IPO. Both stocks are down more than 25% since their IPO date.
""Investors and maybe the financial press are quite negative"" on both companies, Kacher said.
Scott Kupor, Andreessen Horowitz's managing partner, is less bullish on them as their cash-consuming business is less likely to bode well in a late-cycle environment.
Kupor said he sees big opportunities in enterprise software companies.
""I think the market size for those [software] companies is just materially bigger than we had expected,"" Kupor said. He highlighted cloud-based software company Salesforce whose stock has gone up 12% this year.
What follows is a roundup of corporate earnings reports for Monday, July 19.
Dow component IBM is expected to report after the bell.
Companies that reported before the bell include Delta Airlines, Halliburton and Hasbro.
BEFORE THE BELL
Delta Airlines
The airline reported 65 cents a share on revenue of $8.17 billion.
Read Full Story
- Get Real-Time Quotes for Delta Airlines
Halliburton
The oil services company delivered earnings of 52 cents a share on revenue of $4.4 billion.
Read Full Story
- Get Real-Time Quotes for Halliburton
Hasbro
The toy maker posted earnings of 29 cents a share on revenue of $737.8 million.
Read Full Story
- Get Real-Time Quotes for Hasbro
AFTER THE BELL
IBM
The technology services company posted earnings of $2.61 a share on revenue of $23.70 billion.
Read Full Story
- Get Real-Time Quotes for IBM
Texas Instruments
The semiconductor maker delivered earnings of 62 cents a share on revenue of $3.50 billion.
- Get Real-Time Quotes for Texas Instruments
Tupperware
The container maker reported earnings of 93 cents a share on revenue of $564.10 million.
- Get Real-Time Quotes for Tupperware
Zions Bancorp
The bank posted a loss of 84 cents a share on revenue of $522.76 million.
- Get Real-Time Quotes for Zions Bancorp
* Earnings data from Thomson Reuters excludes extraordinary items.
Americans' access to credit improved while their perceived vulnerability to a financial shock declined, according to a Federal Reserve Bank of New York survey that painted a slightly more optimistic picture of U.S. households.
The so-called survey of consumer expectations found that respondents who were too discouraged to apply for credit over the past 12 months declined to 4.9 percent in October, continuing a downward trend and reaching its lowest level since the survey began in 2013.
The survey, done every four months, also found a rise in those applying for and accessing credit, and a drop in rejections. It focuses on mortgages and refinancing, credit cards and limit increases, and auto loans.
The New York Fed also updated its gauge of so-called financial fragility, which measures expectations.
While the average probability of respondents needing $2,000 for an unexpected expense in the next month rose to 33 percent, from 32 percent previously, the probability of being able to come up with the funds also rose to nearly 70 percent, from 67 percent.
Palestinians clashed with Israeli forces a day after President Trump signed a proclamation recognizing Jerusalem as the capital of Israel. The Trump administration's decision is a dramatic shift from decades long U.S. policy toward the Middle East and sets into motion steps to move the U.S. embassy from Tel Aviv to Jerusalem.
Protests erupted throughout the Middle East and the Muslim world. The Palestinian Authority has called for a general strike and Hamas has declared a new ""intifada,"" or uprising, in response to the Trump administration's new shift in policy.
Here are some of the scene from across the region.
Palestinians watch a televised broadcast of President Donald Trump delivering an address, in Jerusalem's Old City.
Vice President Mike Pence stands behind President Donald Trump, as he holds up the proclamation he signed that the United States recognizes Jerusalem as the capital of Israel and will move its embassy there, during an address from the White House in Washington.
Palestinian demonstrators holding a national flag throw stones towards Israeli troops.
A Palestinian man argues with an Israeli border policewoman as Israeli forces disperse Palestinian protesters outside Damascus Gate in Jerusalem's Old City.
Israeli forces clash with Palestinian protestors near an Israeli checkpoint in the West Bank city of Bethlehem. Israeli forces fired tear gas and stun grenades to disperse crowds.
Palestinian protesters run from tear gas fired by Israeli troops, during clashes at a protest against President Donald Trump's decision to recognize Jerusalem as the capital of Israel. The protests were near the Jewish settlement of Beit El, near the West Bank city of Ramallah.
Hamas leader Ismail Haniya gestures as he delivers a speech over US President Donald Trump's decision to recognize Jerusalem as the capital of Israel, in Gaza City on December 7, 2017. Haniya called for a new Palestinian intifada, or uprising.
A wounded Palestinian protester is evacuated during clashes with Israeli troops at a protest against President Donald Trump's decision to recognize Jerusalem as the capital of Israel, near the border with Israel in the southern Gaza Strip.
A Palestinian woman reacts on a street in Beit Hanun in the northern Gaza Strip as people gather during a Hamas rally against US President Donald Trump's recognition of Jerusalem as Israel's capital.
Tunisian demonstrators shout slogans and wave Palestinian flags during a demonstration on December 7, 2017, on Habib Bourguiba Avenue in Tunis against US President Donald Trump's recognition of Jerusalem as Israel's capital.
A Palestinian protester burns a poster depicting President Donald Trump during a protest against Trump's decision to recognize Jerusalem as the capital of Israel, in Gaza City.
A Palestinian protester prays during clashes with Israeli troops at a protest against President Donald Trump's decision to recognize Jerusalem as the capital of Israel, near the Jewish settlement of Beit El, near the West Bank city of Ramallah.
A Palestinian protester runs after catching fire during clashes with Israeli troops near the Jewish settlement of Beit El, near the West Bank city of Ramallah.
A man reads a newspaper as he sits in a café outside the US embassy in Tel Aviv. President Donald Trump's decision to recognize Jerusalem as Israel's capital upends decades of careful US policy. It ignores dire warnings from Arab and Western allies alike of a historic misstep that could trigger a surge of violence in the Middle East.
The Dome of the Rock Mosque in the Al Aqsa Mosque compound in Jerusalem's Old City is seen while Jewish orthodox men pray in a cemetery in Jerusalem.
Children stand on U.S. and Israeli flags during a protest following President Donald Trump's announcement that he has recognized Jerusalem as Israel's capital, in Islamabad, Pakistan.
People like to talk about “the wealth gap” as relating only to the one percent and the 99. But there are actually multiple wealth gaps emerging – by age, gender and now, by race.
According to a study by the Census Bureau, the wealth gap between whites, Hispanics and black Americans grew during the recession.
Between 2005 and 2010, the media net worth of white Americans (non-Hispanic) fell 15 percent, to $110,729. The median net worth of black Americans fell 55 percent to $4,955. And the median net worth of Hispanic Americans fell 56 percent, to $7,424. The net worth of Asians fell 54 percent, to $69,590.
Asians and whites lost more in absolute terms, with Asian median wealth dropping by $83,000 while whites lost $20,000. That compares to a loss of about $6,000 for blacks and $10,000 for Hispanics. Yet because whites' and Asians' net-worths are higher, their percentage losses were lower.
What accounts for this widening wealth-race gap?
The main contributor is home ownership and wealth portfolios. Historically speaking, homes make up a larger share of wealth for black and Hispanics. Whites have a greater share of wealth in other assets, like stocks, mutual funds and other financial instruments.
Because financial assets have recovered from the recession more strongly than home prices, wealth for whites also recovered more rapidly.
Blacks and Hispanics have also suffered from higher unemployment than whites. The unemployment rate for whites is around 7.4 percent; it’s nearly twice that level for blacks.
Just to be clear, the study doesn’t show that race is a cause of these disparities. But it is clear that in strict economic terms, the wealth gap in America is growing between the races.
Do you think there are other reasons that the wealth gap between races is growing?
-By CNBC's Robert Frank
Follow Robert Frank on Twitter: @robtfrank
U.S. Treasurys prices were modestly higher in extremely quiet trading, in a partial reversal of Friday's sell-off.
With very little economic data to speak of, ""activity is somewhat subdued"" and ""liquidity is definitely impaired,"" said Jason Evans, head of government trading for Deutsche Bank.
The price of the Treasury's 10-year note was up around midday, while its yield fell from Friday's level, when trading desks closed early ahead of the Christmas holiday. Prices and yields move in opposite directions.
A manufacturing and economic activity report from the Federal Reserve Bank of Richmond released Tuesday morning came in at negative 6 versus November's 7. However, the data failed to move the market in any noticeable way.
The real surprise in the market was Friday's sell-off, Evans said. Friday's data _ and in particular the core personal consumption expenditures price index, a key measure of inflation _ were on the tamer side. Compared with a year earlier, the core PCE price index rose 2.2% in November from a year earlier, down from a 2.4% year-over-year climb in October.
However, despite what should have been bond-friendly data, the Treasurys market sold off heavily, largely on profit-taking.
The sell-off Friday ""occurred on relatively light volume,"" Evans said, ""and the market is ... in recovery.""
Hedge funds were in the market buying 10-year Treasurys Tuesday, with good buying by money managers in five-year Treasurys as well, according to RBS Greenwich Capital.
As for the remainder of the week, ""we are rather neutral,"" RBS Greenwich noted in market commentary.
The S&P closed in positive territory Thursday with bulls driving the market despite a slew of new signs that suggest the price of almost everything would be creeping higher.
If inflation does become a catalyst in the days ahead, how should you trade?
Willie Williams, Societe Generale Director Derivative Sales suggests looking at currencies. Despite inflation, he’s bullish the US dollar for 3 reasons.
1. Rate Hike Expectations
2. Recovering U.S. Economy
3. Risks of Global Unrest
If you share his opinion, ahead of the broadcast Williams told our producers he liked following positions:
- Buy the dollar against the Yen, Swiss Franc
- Buy one month 85 calls in Dollar/Yen
- Buy one month 98 calls in Dollar/ Swiss
Get all the details. Watch the video now!
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For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
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""As of right now I do not own any futures. I do have some forward contracts with local elevators that are backed up by futures contracts of corn, soybeans and wheat. All hedging positions and no speculation.""
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Societe Genarale Facilitates Transactions In Tradeable Currencies
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Joe Chen, CEO of Chinese social networking service Renren, first met SoFi CEO Mike Cagney in Palo Alto in 2011 and, over coffee, decided to invest in the fast-growth, disruptive online finance start-up. That initial $4 million investment helped SoFi get its start and led to two more financings within three years, with Renren contributing a major chunk of some $230 million raised.
Fast-forward, and SoFi last month topped it off with a $500 million investment from private-equity powerhouse Silver Lake.
SoFi is just the kind of deal that Chen has been pursuing: His NYSE-listed company, once known as the Facebook of China, has been investing in to broaden its revenues and boost its stock price. That connection with Renren has also boosted SoFi.
""Joe is a great investor and was our investor from the early days. He saw the vision early on and pushed us to grow faster and be more aggressive,"" said Dan Macklin, a co-founder of SoFi in San Francisco.
Similarly to Renren, China's tech titans Baidu, Alibaba and Tencent are leading a surge of Chinese investment in cutting-edge U.S. technology start-ups with bold ambitions to expand their footprint, attract top talent and gain an edge in innovation.
Collectively known as the BAT, China's giant technology companies that dominate search, e-commerce and mobile messaging in their home market are going global. The United States is their primary shopping place to diversify and build out their brands. The hunt is on to acquire or buy into fast-growing young companies in a broad range of the hottest tech sectors, such as virtual reality, fintech, social media, video games and mobile apps. Their deals include such well-known American brands as image messaging app Snap, ride-sharing service Lyft and virtual reality player Magic Leap.
China's four largest internet companies — the BAT plus e-commerce company JD.com — have invested $5.6 billion in 48 U.S. tech deals over the past two years, according to CBI Insights data. California took in more than three-quarters of the total U.S.-based deals by these four companies, with Silicon Valley a popular hunting ground.
Overall, Chinese investment in the U.S. economy has soared, with such high-profile deals as China's Anbang Insurance purchase of the landmark Waldorf-Astoria hotel in New York City for $1.95 billion.
Last year Chinese investors put a record $45.6 billion in U.S. companies, triple the amount for 2015, according to research group Rhodium Group in New York City. The momentum has picked up as the Chinese economy has slowed and as the U.S. dollar has appreciated against the Chinese yen, points out Rhodium economist Thilo Hanemann.
""The Chinese government is spending billions of dollars literally trying to level the playing field a bit"" between the United States and China in technology, said Orville Schell, director of U.S.-China relations for the Asia Society, which released a 2014 report on China high-tech investments in the United States.
This flurry of deal making comes against a recent crackdown by Chinese authorities to tighten restrictions on capital outflows and control ""irrational"" outbound investment by Chinese firms. Such restrictions are threatening completion of a $1 billion purchase by Chinese conglomerate Dalian Wanda Group of Dick Clark Productions in Los Angeles. Meanwhile, U.S. alarms about potential security and economic risks over Chinese takeovers of American companies have been heightened during the recent presidential election.
For the founders of U.S. tech start-ups, getting cozy with Chinese acquirers and investors can make good business sense. With a Chinese investor, their business gains a competitive edge in the exceedingly difficult-to-penetrate China market. Getting funds from China's leading tech companies can help U.S. companies gain an entry point to China, an immediate on-the-ground presence and strategic insights such as how to best customize products for the local Chinese market.
More from Global Investing Hot Spots:
The billionaire who is saving Bethlehem with the support of a Saudi Prince
Trump's ban on immigration has an unexpected beneficiary: Canadian start-ups
An anti-Buffett investing bet that's suddenly busting out
Moreover, founders of U.S. tech start-ups can get favorable terms from the Chinese corporate investors, which are known to pay more to invest in American start-ups compared with Sand Hill Road venture capitalists. The Chinese buyers are in effect ""paying a tuition"" to get insights into the U.S. market, points out Jay Eum, co-founder and managing director of TransLink Capital in Silicon Valley.
China's e-commerce leader, Alibaba, by the visionary Jack Ma, has been particularly active in investing in U.S. start-ups. In recent years Alibaba has led a $793 million financing round in virtual reality start-up Magic Leap, $200 million in social media company Snap, $215 million in mobile messaging app Tango, $250 million in ride-sharing app Lyft, $50 million in remote-control app Peel, $120 million in mobile gaming start-up Kabam in July, $50 million in app search engine Quixey and $206 million in subscription service ShopRunner.
Not to be outdone, Baidu has invested $30 million in mobile safety firm TrustGo and $10 million in mapping company Indoor Atlas. Meanwhile, Tencent invested $400 million in game developer Riot Games and another $400 million in Epic Games, in addition to co-investing with Alibaba in Lyft. Besides its groundbreaking investment in SoFi, Renren has invested in a series of U.S. fintech start-ups, leading a $31 million lead investment in crowdfunding real estate site Fundrise in 2014 and leading a $40 million investment in U.S.-based stock-trading outfit Motif in 2015.
The China deals typically are for a minority investment stake rather than a controlling interest —in part a strategy to minimize risk while still getting an angle of U.S. tech. Taking a long-term perspective, Baidu, Alibaba and Tencent have all established offices in California for research and development and for corporate venture investing. This type of China tech deal making is a long way from the pattern of Japanese deal makers during the 1990s in the United States, when investment from Japan poured into trophy properties such as Pebble Beach and Rockefeller Center and later suffered major losses.
The Chinese deal makers in U.S. tech companies are active, not passive, investors. Silicon Valley-based messaging app Tango, which snared a $215 million investment by Alibaba in 2014, holds monthly meetings with a board member at Alibaba to review strategies and strategic impact, says Tango CEO and co-founder Eric Setton. He frequently visits Alibaba headquarters in Hangzhou and has set up a Beijing office. Setton said he got his initial introduction to Alibaba from Jerry Yang, a founder of Yahoo, which has been strongly linked through ownership ties with the Chinese conglomerate for several years.
Another Silicon Valley start-up, Peel, has experienced a similar tight interaction with its Chinese investors, which include Alibaba. Co-founder Thiru Arunachalam said he gets access to talent in China through the Alibaba connection and gains leverage in the fast-growing Chinese market.
Venture investor Eum of Translink, which has seen three of its portfolio companies (Peel, Tango and Quixey) get invested in by Alibaba, said he has been ""super impressed"" by Alibaba as a strategic investor. He pointed to a synergistic relationship and solid informational interchange as key advantages for both the China and U.S. sides.
— By Rebecca Fannin, special to CNBC.com
Officials say former French President Jacques Chirac has been ordered to stand trial in a second corruption case regarding his 1977-1995 tenure as Paris mayor.
Chirac already is set to be tried in March in one City Hall phony jobs scandal.
The judicial officials said Monday that a judge in the Paris suburb of Nanterre has ordered him to also be tried for ""illegal conflict of interest"" in a similar case.
The officials spoke on condition of anonymity because of judicial policy.
In the new case, Chirac has faced questions about seven jobs at his former Conservative Party that were improperly paid for by City Hall or by construction companies.
The two cases against Chirac could be tried at the same time.
Chirac has denied any wrongdoing.
Some of the biggest technology names on Wall Street are set to announce earnings this week that could potentially bring the tech sector's rally to a crashing halt.
Of the four so-called FANG stocks, three are reporting this week: Alphabet, Facebook and Amazon.
Google parent company Alphabet's quarterly earnings report could be a bellwether for technology stocks, according to one trader. Advertising revenue for Alphabet could indicate if ad dollars are also flowing into smaller, tech companies.
Wall Street analysts predict Facebook will earn about 11 percent lower profit this year than they did at the start of the quarter, possibly due to higher capital expenditures.
Experts also think Amazon could be the next FANG stock to surge on the back of strong earnings.
So in this week's Trader Poll, tell us which is your favorite FANG stock.
China's parliament passed a controversial new anti-terrorism law on Sunday that requires technology firms to hand over sensitive information such as encryption keys to the government and allows the military to venture overseas on counter-terror operations.
Chinese officials say their country faces a growing threat from militants and separatists, especially in its unruly Western region of Xinjiang, where hundreds have died in violence in the past few years.
The law has attracted deep concern in Western capitals, not only because of worries it could violate human rights such as freedom of speech, but because of the cyber provisions. U.S. President Barack Obama has said that he had raised concerns about the law directly with Chinese President Xi Jinping.
Speaking after China's largely rubber-stamp parliament passed the law, Li Shouwei, deputy head of the parliament's criminal law division under the legislative affairs committee, said China was simply doing what other Western nations already do in asking technology firms to help fight terror.
""This rule accords with the actual work need of fighting terrorism and is basically the same as what other major countries in the world do,"" Li told reporters.
This will not affect the normal operation of tech companies and they have nothing to fear in terms of having ""backdoors"" installed or losing intellectual property rights, he added.
Officials in Washington have argued the law, combined with new draft banking and insurance rules and a slew of anti-trust investigations, amounts to unfair regulatory pressure targeting foreign companies.
China's national security law adopted in July requires all key network infrastructure and information systems to be ""secure and controllable"".
The anti-terrorism law also permits the People's Liberation Army to get involved in anti-terrorism operations overseas, though experts have said China faces big practical and diplomatic problems if it ever wants to do this.
An Weixing, head of the Public Security Ministry's counter-terrorism division, said China faced a serious threat from terrorists, especially ""East Turkestan"" forces, China's general term for Islamists separatists it says operate in Xinjiang.
""Terrorism is the public enemy of mankind, and the Chinese government will oppose all forms of terrorism,"" An said.
Rights groups, though, doubt the existence of a cohesive militant group in Xinjiang and say the unrest mostly stems from anger among the region's Muslim Uighur people over restrictions on their religion and culture.
The new law also restricts the right of media to report on details of terror attacks, including a provision that media and social media cannot report on details of terror activities that might lead to imitation, nor show scenes that are ""cruel and inhuman"".
Central banks have created an environment where both major downturns as well as expansions are almost impossible, venture capitalist Chamath Palihapitiya said Tuesday.
A well-known investor across a multitude of areas, including as a very early Facebook executive and a big proponent of cryptocurrencies, Palihapitiya told CNBC that entities like the Federal Reserve have used quantitative easing to stage-manage an essentially stagnant economy.
""I don't see a world in which we have any form of meaningful contraction nor any form of meaningful expansion,"" he told CNBC's Scott Wapner during a ""Fast Money Halftime Report"" segment. ""We have completely taken away the toolkit of how normal economies should work when we started with QE. I mean, the odds that there's a recession anymore in any Western country of the world is almost next to impossible now, save a complete financial externality that we can't forecast.""
A lack of downturns is not necessarily a good thing, Palihapitiya added, and he criticized central banks for refusing to allow normal economic cycles to play out.
""Central bankers have lost all intestinal fortitude to actually put a country through a recession, because it's actually regenerative and useful,"" he said. ""Even if they had the wherewithal to do it, the political infrastructure will just completely absorb that intent. So we are probably not, save of something crazy, going to see massive, massive negative growth except in countries that are so fundamentally crippled that they tip over.""
For investors, that means a limited menu of choices.
""So the reality is we're going to grow low single digits every year, which means there's no growth anywhere else, which means you're better off buying equities and you're better off buying equities that are substantively ones that are sort of the deflationary stocks, the cheaper, faster better stocks, the tech stocks,"" he said.
Palihapitiya is CEO of Social Capital and he also is a minority stakeholder and board member of the NBA's Golden State Warriors.
Stocks edged higher in another choppy, thin-volume session Wednesday after investors largely shrugged off news that ISM non-manufacturing index slipped last month and China's latest interest rate increase.
The Dow Jones Industrial Average rose into positive territory, after snapping a five-day rally in the previous session.
Among the blue-chip index, Bank of America and JPMorgan slipped, while DuPont gained.
The S&P 500 and the tech-heavy Nasdaq also turned higher. The CBOE Volatility Index, widely considered the best gauge of fear in the market, gained above 16.
Among key S&P stocks, energy and financials slipped, while consumer staples gained.
“There’s going to be continued volatility in the markets throughout the summer months into early fall,” said Zahid Siddique, portfolio manager of Gabelli Equity Trust. “[But] as the economic indicators begin to improve, there will be less volatility and more stability in the markets by year-end.”
Meanwhile, the ISM non-manufacturing index slipped slightly below estimates to 53.3 in June. Economists expected the index to fall to 54.0.
“The market really wanted some glimmer of hope that we’re exiting a soft patch…and this is not it,” Jim Iuorio, director of TJM Institutional Services told CNBC. “There’s too much to bear for the stock market to go higher.”
Meanwhile, the number of planned layoffs increasedfor the second month in a row, according a report from job outplacement firm Challenger, Gray & Christmas. This comes ahead of a number of key employment news starting with ADP's jobs survey and weekly jobless claims on Thursday and the government's monthly report on Friday.
The Chinese central bank approved an increase of 0.25 percentage points, the nation's latest move to cool growth.
The euro slid for a second session against the dollar.
Banks were among the worst performers, led by Barclays, which tumbled almost 5 percent after Moody's said almost a third of European banks being tested for their their resilience in bad markets may need extra support.
Other large banks such as BofA , Citigroup and Wells Fargo also traded to the downside.
On the tech front, Apple has placed orders for key parts in a next-generation iPhone which it is preparing to launch by year-end, according to people familiar with the situation. The new iPhone is rumored to use wireless chips from Qualcomm , instead of Samsung, used in the current iPhone4.
Netflix declined after Merriman Capital downgraded the online-video streaming firm to ""neutral"" from ""buy."" The company hit another all-time high following news that it will expand service in 43 countriesin South and Central America along with the Caribbean later this year.
Oil prices declinedamid worries over the sustainability of global economic recovery. U.S. light, sweet crude slipped below $97 a barrel, while London Brent crude traded near $113.
Meanwhile, Berkshire Hathaway has made a bid for Citigroup'sconsumer lending unit OneMain, according to the Wall Street Journal said, citing people familiar with the matter.
General Motors gained after Morgan Stanley added the automaker to its Best Ideas list, while removing Ford .
Walgreens gained after the drugstore chain reported better-than-expected June sales.
In other economic news, the Mortgage Bankers Assocation reported that application activity dipped 5.2 percent last weekeven though actual home loan requests rose. The overall drop came from a plunge in refinancing requests.
Stocks ended mostly flat in the previous session, as investors shrugged off a downgrade for Portugal’s sovereign debt.
The Moody’s downgrade of Portugal’s credit rating had already been priced in, analysts said, but five-year credit default swaps (CDS) on Portuguese government debt rose to a record high and yields on Portuguese bonds spiked on Wednesday.
President Obama will answer questions from Twitter usersaround the country in a town hall hosted by the social media service, focusing on jobs and the economy. He will also summon lawmakers to the White House on Wednesday to start new talks on raising the debt ceiling.
European shares snapped a seven-day winning streak, led by banks, as euro sovereign debt worries resurfaced after Moody's cut Portugal's credit rating.
On Tap This Week:
WEDNESDAY:Obama townhall on economy, NYSE shareholders vote on DB merger
THURSDAY: ADP employment report, jobless claims, oil inventories, chain-store sales
FRIDAY: Non-farm payroll, wholesale trade, consumer credit
More on CNBC.com
Signs of friction between the U.S. and Saudi Arabia have caught the attention of the oil market, but traders aren't concerned about supply issues for now.
Saudi Arabia has been unhappy about the U.S. approach to Syria and Iran, and it is apparently making that clear in diplomatic circles. Last week, it turned down a two-year term on the U.N. Security Council in protest against inaction over Syria, even though that body oversees the United Nation's handling of Syria.
""With all the supply issues we've had from all the countries throughout the Arab spring, the Saudi's have consistently filled the gap,"" said John Kilduff of Again Capital. ""We have to watch if they would, not use oil as a weapon, but as a tool to teach us a lesson that they are unhappy.""
News reports Tuesday quoted sources saying that Prince Bandar Bin Sultan al-Saud, the kingdom's respected and powerful intelligence chief, told European diplomats last weekend that he plans to cut back cooperation with the U.S. on arming and training Syrian rebels, in protest of U.S. policy in the region.
(Read more: Everything (energy-related) is bigger in Texas)
""I don't think it's going to affect our oil relationship,"" said Andrew Lipow, president of Lipow Oil Associates. ""But I do think there's a lot of turmoil in the Middle East, and you certainly have the Saudis—who dislike the Iranians—upset about the fact there could be a thawing relationship between the U.S. and Iran. ... The Saudis have been showing their displeasure for some time.""
Lipow said the U.S. will continue to be an important market to Saudi Arabia, which owns 50 percent of the Motiva refinery in Texas in a joint venture with Shell.
""They just finished spending $10 billion in Port Arthur on the expansion,"" he said.
Iran's new president Hassam Rouhani has been on a ""charm offensive,"" since visiting the U.N. last month. He received a historic phone call from President Barack Obama as he was leaving New York, breaking 30 years of silence between leaders of the two countries.
Rouhani has said Iran has no intention of developing nuclear weapons. Analysts do not expect sanctions to be lifted any time soon, even if there is progress in the talks. But Reuters reported Tuesday that Iran is already reaching out to its old oil buyers and is talking price cuts if sanctions are lifted.
As for Syria, the Obama Administration was adamant about making the regime there accountable for the deaths of civilians from a gas attack. The U.S. prepared to bomb the country but reversed course at the last minute and the UN has now taken the lead.
Saudi Arabia had been lobbying for the temporary seat on the Security Council, so it was surprising when the kingdom turned it down, citing the council's ineffectiveness in dealing with Syria and the Israeli-Palestinian conflict.
Brent crude, reflecting the international oil price, ticked slightly higher on the report but slipped back. West Texas Intermediate, on the other hand, was sharply lower after delayed U.S. inventory data showed a supply buildup in domestic crude.
WTI futures fell below their 200-day moving average of $98.60 for the first time since June. The futures, scheduled to expire at the close of business Tuesday, dipped $1.42 to close at $97.80.
The December contract was trading just above $98.
""It looks the same ... very bearish on a technical basis,"" Kilduff said of the December contract. ""The U.S. refining industry has slowed from its summer peak, and that's allowing the crude oil inventories to really replenish and build back up, given the surge in shale production.""
The Saudis have been instrumental in the West's embargo on Iranian oil. Iran is being sanctioned for its nuclear program, which it says is not for weapons use. An improvement in U.S.-Iran relations would return more than 1 million barrels a day to the world market.
""They really don't want that Iranian oil back on the market,"" said Tradition Energy analyst Gene McGillian. It may be that the Saudis withdrew from the Security Council because they are more comfortable working behind the scenes, he added.
The Saudis have been producing record amounts of oil to make up the for the shortfall from Iran. Saudi output is over 10 million barrels a day. The U.S. has supplanted Russia this year as the world's largest producer of both oil and gas, but in oil production the Saudis remain at the top.
The U.S. produced 7.4 million barrels a day in the week ended Oct. 11, down from 7.8 million barrels the week earlier.
Saudi Arabia exported an average of 1.4 million barrels a day of total petroleum liquids to the United States last year, up from 1.2 million in 2011. That represented 16 percent of U.S. crude imports and was second only to those from Canada.
(Read more: Three possible winners from Kenya's oil explosion)
U.S. oil inventory data for last week is expected to be reported Wednesday at 10:30 a.m. ET, and McGillian expects to see another build of 3 million barrels. He was skeptical that the Saudi reports affected oil markets.
""I don't think it really spilled over into the oil market,"" he said. ""There are reports the Saudis are going to try to increase their production to put pressure on Iran but they do that anyway.""
McGillian said there's plenty of reasons for U.S. oil to remain depressed, and the spread is widening dramatically with Brent.
""We pumped nearly 19 million barrels back into storage in the United States in the last four weeks,"" he said, ""and you haven't seen a pickup in demand.""
A lot of folks have empty nest eggs.
A third of people (36 percent) in the U.S. have nothing saved for retirement, a new survey shows.
In fact, 14 percent of people ages 65 and older have no retirement savings; 26 percent of those 50 to 64; 33 percent, 30 to 49; and 69 percent,18 to 29, according to the survey of 1,003 adults, conducted for Bankrate.com, a personal finance website.
Read MoreWhy many Americans aren't saving for retirement
""These numbers are very troubling because the burden for retirement savings is increasingly on us as individuals with each passing day,"" says Greg McBride, chief financial analyst for Bankrate.com. ""Regardless of your age, there is no better time than the present to start saving for your retirement. The key to a successful retirement is to save early and aggressively.""
Other recent research confirms that many people aren't saving enough for their golden years. About 36 percent of workers have less than $1,000 in savings and investments that could be used for retirement, not counting their primary residence or defined-benefits plans such as traditional pensions, and 60 percent of workers have less than $25,000, according to a survey of 1,000 workers from the non-profit Employee Benefit Research Institute and Greenwald and Associates.
More from USA Today:
Many would take lower salary for bigger 401(k) match
How to save a million bucks for retirement
Retirees get creative to eat cheap at restaurants
Many people realize that they are not on track in saving for retirement, and the two most important reasons they give are cost of living and day-to-day expenses, says Jack VanDerhei, the institute's research director.
He advises people to join the 401(k) plan if their employer offers one and to make sure to contribute at least enough to receive the maximum employer match. ""Contributing anything less than that is leaving free money on the table,"" he says.
Read MoreThe millennial retirement problem
Other findings from the Bankrate.com survey:
- Some people are starting to tuck away retirement savings at an earlier age. About 32 percent of people ages 30 to 49 started saving for retirement in their 20s, compared with 16 percent who began in their 30s. About 24 percent of people 50 to 64 started saving for retirement in their 20s vs. 21 percent who began in their 30s. About 16 percent of people 65 and older started saving for retirement in their 20s; 15 percent in their 30s; 17 percent in their 40s.
- 24 percent are less comfortable with their debt than they were a year ago; 23 percent are more comfortable.
- Job security, net worth and overall financial situation are areas in which people have seen improvement over one year ago.
- 32 percent of people are less comfortable with their overall savings now than they were a year ago; 16 percent are more comfortable.
""Month in and month out, consumers sound a dour tone about how they feel about their overall level of savings,"" McBride says. ""Many people know they are under saved, whether it's for emergencies, retirement or both.""
Read MoreOlder Americans seek roomies to survive
—By Nanci Hellmich, USA Today.
Bank of America said on Tuesday it would exercise part of an option to buy shares of China Construction Bank, investing HK$14.52 billion (US$1.86 billion) and raising its stake in China's second-largest bank to 10.75 percent.
Bank of America, the No. 2 U.S. bank by assets, said it intended to buy 6 billion of CCB's Hong Kong-listed shares around June 5 for about HK$2.42 each under a formula set when it first agreed to buy a 9 percent stake in CCB investment in June 2005 for US$3 billion.
With CCB shares closing at HK$6.65 in Tuesday trading, Bank of America is getting the stake at a 64 percent discount.
The new shares are currently worth about HK$39.9 billion (US$5.11 billion), offering some good news for a U.S. retail banking giant that has been hit by rising consumer credit losses and a weakening economy.
Bank of America earlier this year raised more than $12 billion to boost capital required by bank regulators. Some analysts have forecast that BofA will cut its dividend in the second half.
The investment in one of the world's hottest markets has paid off handsomely for the North Carolina bank. CCB stock has surged 83 percent since the bank's October 2005 IPO.
After the latest transaction, Bank of America said it would hold about 25.1 billion shares, which means US$4.86 billion of investments by the bank currently have a paper value of US$21.4 billion.
Bank of America spokesman Bob Stickler said the bank would not record any gain from the transaction because the new shares cannot be sold until August 2011 without CCB's consent. The shares will be carried at cost.
Shares For Sale?
Last month, several press reports said BofA was looking to shed part of its CCB stake to raise capital needed to cope with a weakening U.S. economy. BofA is also preparing to take over Countrywide Financial , the largest U.S. home lender slammed by the mortgage slump.
Stickler declined to comment on speculation that BofA was considering selling CCB shares, though the latest transaction will likely do nothing to end the market talk.
""We've been in talks with the Chinese government for a number of months. Anything we do is in consultation with them"" and with the management of CCB, Stickler said.
The shares acquired in 2005 have a three-year lock-up that expires October 2008.
By exercising the call option now, BofA ""starts the clock"" and increases its flexibility to sell the new shares down the road, Stickler said.
Bank of America had talks with CCB and SAFE Investment (Huijin), the Chinese government body that controls CCB, about exercising a portion of its call option. BofA will purchase its new shares from Huijin.
Under the 2005 stock purchase agreement, BofA can increase its stake to just under 20 percent. CCB currently has a market value of nearly US$200 billion, or one-fourth more than that of BofA.
Last month BofA Chief Financial Officer Joe Price told Reuters the bank would likely raise its stake first before considering any share sales.
Bank of America shares were unchanged at $33.94 on the New York Stock Exchange early Tuesday afternoon.
Restaurant stocks are the talk of the Street in light of Panera Bread's takeover by JAB Holdings, so Jim Cramer turned to two food chains to illustrate the winners and losers of the casual dining market.
Both Darden Restaurants, the parent of Olive Garden, and Brinker International, the Chili's parent, rallied almost hand-in-hand in the second half of 2016. Once 2017 hit, however, their stocks went separate ways, with Darden rising almost 15 percent and Brinker sliding 14 percent year-to-date.
""On the surface, the two companies would seem to have a lot in common,"" the ""Mad Money"" host acknowledged.
They are comparable in scale: Brinker has 1,600 restaurants around the globe while Darden has 1,500, and both own smaller brands alongside their trademark restaurants.
Watch the full segment here:
But once the market started worrying about the wherewithal of restaurants to survive in the stay-at-home economy and Brinker tanked, their stories started to look markedly different.
""Brinker is pretty much the baseline here,"" Cramer said. ""Its performance has essentially been in-line with the rest of the industry, which is why Wall Street's quickly turned so negative on the stock.""
The Chili's parent suffered a big earnings miss, declining same-store sales, slashed full-year guidance, and bad press on Veterans Day when one veteran was denied a promotional free meal at Chili's.
""The company reports again in three weeks. Can't be super optimistic,"" Cramer said.
Meanwhile, Darden reported a strong quarter at the end of March that included a bump up in same-store sales, improved 2017 earnings guidance, and a new acquisition of Cheddar's Scratch Kitchen. Management was also upbeat about Darden's to-go business, which was up 17 percent.
""Here's the thing you need to understand: Darden's turn has literally been years in the making,"" Cramer said.
It started with their sale of Red Lobster, followed by major changes in management spurred by activist fund Starboard Value in 2014, and ending with traffic-boosting store remodeling and a growing to-go business.
""Compare that to Brinker, where they've got the same old management team and the same old tired stores,"" Cramer said. ""Neither company has particularly healthy food, but Darden's brands are certainly perceived as being healthier than Chili's — the unlimited salad bowl which I love so much, it's better than the baby back ribs for you.""
Darden may seem expensive at 19 times earnings, but Cramer gave it a pass because it is one of the few restaurant chains with proof of growth.
The bottom line? ""It's very tough to invest in the restaurant industry right now, but that's why it's so important to remember why it's worth paying up for best of breed stocks like Darden, rather than going bargain hunting for companies that seem to be struggling like Brinker,"" Cramer said.
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The National Basketball Association and its players union have finalized plans to resume its 2019-20 season that was halted by Covid-19.
The NBA will commence on July 30 at Walt Disney World in Orlando and include 22 teams. Games will be played at the Arena, the Field House and Visa Athletic Center at ESPN Wide World of Sports Complex ""for the remainder of the season,"" the league said, adding no spectators will be allowed.
""We have worked together with the Players Association to establish a restart plan that prioritizes health and safety, preserves competitive fairness and provides a platform to address social justice issues,"" said NBA Commissioner Adam Silver in a press release.
""We are grateful to our longtime collaborator Disney for its role in playing host and making this return to play possible, and we also thank the public health officials and infectious disease specialists who helped guide the creation of comprehensive medical protocols and protections.""
All 22 teams will compete in eight ""seeding games"" to determine the final 16 spots. The games will be selected from clubs' remaining regular-season matchups. After the 16 teams are set, the NBA's postseason will transition to its traditional format with four rounds of best-of-seven series. The NBA Finals will end no later than Oct. 13, according to the league.
""It is very exciting to officially announce the restart of the 2019-2020 season,"" said Michele Roberts, the National Basketball Players Association executive director. ""It has taken true collaboration between the league and the union – special kudos to our executive committee and several other team reps – along with the continued support and assistance from medical experts, public health officials and many others.""
Though the NBA and its players have their plans finalized, concerns remain about sports resuming in Florida as coronavirus cases surge there. Gov. Ron DeSantis said Thursday that the state has no plans at the moment to move forward with its reopening plan. Disney workers from Florida have petitioned the company and local government officials to reconsider the reopening of Disney World next month.
Milwaukee Bucks and Avenue Capital co-founder Marc Lasry said on CNBC's ""Halftime Report"" he remains hopeful that the NBA will conclude its season despite Covid-19.
""We'll see what happens over the course of the next two weeks,"" Lasry said Thursday. He added that for ""players that don't want to go, I fully respect that"" but also said, ""every single one of our guys (Bucks players) is going to be down there.""
Earlier Friday, the NBA announced 16 of the expected 302 players that will compete in Orlando tested positive for Covid-19. ""Any player who tested positive will remain in self-isolation until he satisfies public health protocols for discontinuing isolation and has been cleared by a physician,"" the NBA said in a press release.
The NBA will release Friday evening the broadcast schedule for its restart. On March 11, the league became the first U.S. big league organization to suspend its season due to Covid-19.
After writing a letter Friday to Sotheby's, chiding it for enacting a ""poison pill,"" hedge-fund titan Dan Loeb spoke exclusively to CNBC and said he expects action.
Loeb wants the company to replace CEO William Ruprecht and add new board members, including himself. He told CNBC there's ""no good reason"" he shouldn't be added to the board, given that he's the largest shareholder and has a track record of creating value for shareholders.
""It would be a shame if we had to wait until proxy season to do anything,"" he added.
""It's incumbent on the board to either say it's satisfied with the CEO's performance or set out a road map as to how they're going to improve performance, improve cost issues and its deteriorating competitive position,"" Loeb said.
He also commented on the high-flying art market, saying, ""It's just getting started"" and ""prices will go up from here.""
CNBC Pro highlights the top performing stocks this week and analyzes whether the good times will continue.
(The price change was calculated as of Friday morning so it is subject to change. If one stock led multiple indices, we profiled the second best too.)
Hedge funds are heading into a rough few weeks. Many funds are looking at some pretty average returns this year--and if that's not bad enough--the industry faces U.S. Congressional hearings starting tomorrow on regulations and insider trading.
William Galvin is Secretary of the Commonwealth of Massachusetts. Tom Curran is a securities lawyer and partner with Ganfer and Shore. Both men appeared on ""Street Signs"" and have different opinions on what needs--or doesn't need--to be done with hedge funds.
Galvin says hedge funds are marketed to people who shouldn't be investing in them. And he says there should be minimum investments and the funds should be registered. He said there needs to be total transparency when it comes to hedge funds.
Curran is completely on the other side--saying there is no need for minimum investments. He said Congress should proceed cautiously on hedge funds--considering the role they play in the U.S. economy. He said there are a lot of myths when it comes to hedge funds--and that the criticism is over blown.
FYI: There are some 9,228 hedge funds with nearly $1.3 trillion dollars invested in them.
In the wake of the collapse of Lehman Brothers, the U.S. dollar saw widespread declines as the Federal Reserve was forced to slash interest rates to eventually zero. Since then there has been growing speculation that the greenback may not hold on to its status as the world’s reserve currency and faces more declines.
Near-Term Outlook Remains Grim
“Near-term it does look pretty tough for the dollar … rates being so low in the US in response to the crisis, that really hurts the dollar, which is used to having a least some yield premium over the Japanese yen for instance,” Sean Callow, senior currency strategist at Westpac Bank, told CNBC.
“A pretty grim picture until we get a lot better news on the economy and at this stage it doesn’t seem time yet,” Callow added.
Will There Be a Dollar Crisis?
“Over the long term you expect the US dollar will remain relatively weak,” Jim Vrondas, manager of corporate business at OzForex, told CNBC.
“It’s going to take a long time to unwind these massive deficits that they’ve got going on at the moment and in that kind of environment it’s only naturally that people become a little bit hesitant of holding dollar reserves,” he said.
Recovery Still A Few Years Away
John Licata, chief investment strategist at Blue Phoenix, says that while the progress over the last 12 months had not been as dramatic as expected, the financial crisis has increased investor awareness.
Greed Has Returned
The lessons of the past year have been forgotten and risk appetite has returned dramatically on Wall Street, says Richard Bove, financial strategist at Rochdale Securities.
US has Not Learned from Crisis
The U.S. has not learnt anything and without dealing with the economy's core structural problems, the malaise will continue, says Damon Vickers, CIO at Nine Points Capital Partners.
Credit Crisis is Receding: Analyst
The credit crisis is receding, notes Sean Fenton, portfolio manager at Tribeca Investment Partners. He offers his take on how markets will fare going forward.
German consumer confidence rose to its highest level in six years heading into October, supporting expectations strong consumer spending will help Europe's largest economy to post moderate growth in 2013.
GfK market research group said on Wednesday its forward-looking consumer sentiment indicator, based on a survey of around 2,000 people, rose to 7.1 going into October from an upwardly revised 7.0 the previous month.
The original September figure was 6.9 and analysts in a Reuters poll had forecast the October reading at 7.0. The strengthening data chimed with other recent releases suggesting gradual but steady growth for the end of the year.
""German consumers are expecting the economy to gain momentum in the next few months,"" GfK said in a statement. ""There is a clear upwards trend.""
(Read more: Germans give Merkel a mandate but markets muted)
Germans, traditionally savers, became more willing to spend in September than at any point since December 2006, encouraged by an essentially stable job market and historically low interest rates. Saving appeared less attractive as inflation overtook bank interest rates.
A sub-index tracking consumers' income expectations eased, albeit from a high level, due to rising food prices, which dampened perceived purchasing power.
""It's also possible that some consumers fear further financial burdens due to the euro crisis or tax hikes,"" the GfK said, referring to the outcome of the German election which was still uncertain at the time of the survey.
Angela Merkel's conservatives romped to victory in Sunday's election, winning 42 percent of the vote, but are in need of a coalition partner after falling just short of a parliamentary majority.
(Read more: The secret recipe of German economic success)
The chancellor appeared headed towards coalition talks with her main center-left rivals the Social Democrats (SPD), who had campaigned on a platform of tax increases for Germany's highest earners.
Concern over income was offset by strong willingness to buy, which the GfK dubbed ""euphoric"".
The GfK reiterated its forecast for private consumption to grow by around 1 percent in real terms in 2013, a sign that the German economy is on track to grow moderately this year.
The Berlin-based economic think tank DIW forecasts that the economy will expand by 0.4 percent in 2013, and 1.7 percent in 2014.
(Read more: Euro zone seen growing at last: Thank Germany)
A bastion of strength in the early stages of the euro zone crisis, the German economy shrank at the end of last year and narrowly avoided recession early in 2013 before bouncing back.
Recent data from Germany has been mixed, with the private sector expanding, unemployment falling and business sentiment brightening, though industrial data has been weak and exports have dropped.
Consumers' view of the economy in September improved significantly from the previous month to hit 10.7 points, its highest level since May 2012.
Separately, according to the Ifo Institute business morale improved slightly to its highest level in 17 months in September
The anticipated departure of Merrill Lynch Chief Executive Stan O'Neal would mark a surprising flameout in a career that had been impressive in its ascent.
The first African-American to run a major Wall Street firm, O'Neal appears to have lost his grip on the top job after misjudging subprime mortgage risk and presiding over the biggest quarterly loss in the brokerage's 93-year history.
O'Neal, 56, who is also Merrill's chairman, was expected to step down, possibly on Monday, from board pressure in what would make him the highest-ranking casualty in the U.S.
subprime mortgage crisis.
Named CEO in 2002, O'Neal pushed the world's largest brokerage into new businesses, expanding its revenue base outside the United States. But he looked set to lose his job less than a week after the company wrote down $8.4 billion in the third quarter, mostly on bad bets tied to risky subprime loans and related securities.
The write-down, announced on Wednesday, triggered a $2.3 billion quarterly loss, or several times bigger than what O'Neal initially warned investors about earlier his month.
Two Decades at Firm
In 1986, Merrill Lynch recognized O'Neal's star quality and plucked him from the ranks of the treasury office at General Motors, where his father was a factory worker.
O'Neal earned his stripes on the assembly line, too, alternating between the factory and the classroom to earn his degree. GM later paid for him to go to Harvard Business School.
Merrill Lynch put O'Neal in the firm's high-yield business. From there, he eventually became chief financial officer and, in 2000, president of the bread-and-butter private client business, where he oversaw an army of brokers and later became a cost cutter during lean times in the stock market.
Under O'Neal's leadership, Merrill Lynch devoted considerable energy to diversifying its businesses and expanding overseas. When Goldman Sachs Group began raking in money by taking more proprietary risk, Merrill Lynch tried doing the same.
As recently as a month ago, O'Neal's hold on the company looked solid. Merrill Lynch seemed mostly removed from the subprime turmoil that buckled two hedge funds at Bear Stearns
Cos Inc this past summer and led to the ouster of Co-President Warren Spector.
Past and current executives at Merrill say O'Neal could be autocratic at times and relied heavily on industry benchmarks -- such as comparing Merrill to Goldman Sachs -- to map out the
company's strategy.
Subprime Stumble
Through the second quarter, profit had quintupled, increasing at a compound annual rate of more than 40 percent since O'Neal took over Merrill Lynch. Since he became chairman, the company has had four consecutive years of record net earnings. He received about $48 million last year for his work.
But Merrill stumbled by paying $1.3 billion in December for subprime lender First Franklin Financial. The timing and price of the acquisition puzzled Wall Street because defaults on risky subprime loans already were escalating and demand for pools of these loans packaged into securities was drying up.
Merrill Lynch's position as the leading underwriter of collateralized debt obligations -- complex securities that repackaged risk from mortgages and other collateral -- also presented considerable risk because they were tied to subprime loans, too.
On Oct. 5, O'Neal shocked Wall Street when he said the company would take $5.5 billion in write-downs and post a quarterly loss, its first in six years.
But what really shook investors' confidence in O'Neal was that the write-down figure had mushroomed by nearly $3 billion by the time the company officially reported results last week.
From Farm to Boardroom
Born in 1951 in the segregated South, O'Neal picked corn and cotton on his grandfather's farm in Wedowee, Alabama.
He was born in Roanoke, Alabama, because the hospital in Wedowee did not serve African-American families, O'Neal said years later in a 2001 profile for the Harvard Business School
Bulletin.
Prospects for O'Neal's family brightened when they moved to Atlanta and his father landed a job at GM.
In 2002, Merrill Chief Executive David Komansky, a wisecracking Bronx native and Merrill Lynch lifer, tapped O'Neal, who had proven his mettle by cutting nearly 2,000 jobs in the brokerage group, as his replacement. It was a critical time for the company, as weak stock markets hurt the brokerage and investment banking business.
O'Neal did not return messages left at his home and office.
But last week, he accepted blame for the quarterly loss during a tense conference with analysts, investors and reporters.
""The bottom line is, we got it wrong by being overexposed to subprime,"" O'Neal said. ""And we suffered as a result of an unprecedented liquidity squeeze and deterioration in that market. No one, no one is more disappointed than I am in that result.""
As employers around the world figure out how best to return workers to the office, tech companies are hoping that gadgets and software could help the process.
The coronavirus pandemic and resulting lockdowns have left offices around the world empty. And while there's been lots of talk about the benefits of flexible working, there are still some workers who want to experience life in the office again.
But to do that, companies need to make sure they have strict health and safety regimes in place. Tech firms big and small have been developing everything from wearable devices to thermal imaging cameras to help businesses equip their office spaces for the future.
Tharsus, a U.K.-based robotics group, is mostly known for designing robotics and automation systems for firms like online retailer Ocado and telecommunications firm BT. In response to the Covid-19 outbreak, the firm developed wearables for workers to wear around their necks to help with distancing themselves from colleagues.
The hardware — which looks like a futuristic smart necklace — sends out alerts to wearers every time they come into close proximity with another worker. Tharsus is looking to roll the technology out in a number of workplace environments, including offices, warehouses and canteens.
The tech is currently being trialed at the Manufacturing Technology Centre, an independent research institute based in Coventry, England. The facility houses manufacturing titans such as Rolls-Royce, Airbus, Siemens and General Motors.
""Bump is like traffic lights, which improve safety and at the same time improve capacity,"" Tharsus CEO Brian Palmer told CNBC. ""Analysis of Bump traffic data enables the volume of people in the workplace to increase, safely.""
It's somewhat evocative of contact-tracing apps, another tool that companies — and governments — have been considering as part of their reopening plans. These apps rely on Bluetooth or location data to notify users if they may have been exposed to the virus.
Consulting giant PwC, for instance, developed an app for corporate clients to track employees who come into close contact and alert human resources staff if they may be at risk of coming down with the virus. The app has been tested in the company's Shanghai office.
However, contact-tracing apps have faced criticism from privacy advocates concerned they could be too invasive. Officials and experts have also said the apps deployed so far haven't yet been a ""game changer"" in tackling the coronavirus pandemic.
While different from contact tracing, Tharsus' solution is similar in that it aims to measure proximity. Bump relies on radio frequencies to send out signals to users if they get too close to each other. As far as privacy is concerned, Palmer said the tech was compliant with EU privacy laws and that data wouldn't be shared with third parties.
""We designed Bump with this in mind and to ensure wearers don't need to sacrifice data privacy,"" he said. ""All data is available to an individual business and their team members alike. Everyone can see who collected data, when and why.""
""Other app-based solutions only notify users if social distancing fails 'after the event' i.e. after they have been exposed to risk,"" he said. ""Bump provides real-time protection from the risk in the first place.""
Meanwhile, thermal imaging cameras have also been suggested as a potential way of helping bring staff back to the office. The cameras use infrared technology to detect radiating heat from a person and then estimate their body temperature.
British telecommunications firm Vodafone is deploying heat detection cameras made by surveillance tech maker Digital Barriers. The cameras are currently in use at the training ground of English rugby club Wasps, however Vodafone said they will also be used in offices, typically by an entrance or reception area.
""The device uses both thermal and HD cameras to deliver reliable, real-time body temperature screening accurate to within +/- 0.3 degrees Celsius and can screen up to 100 people every minute,"" said Anne Sheehan, director of Vodafone Business U.K.
Responding to concerns over whether the cameras could infringe workers' privacy, Vodafone said its cameras are a ""temperature screening solution only.""
""The data it gathers is only relevant at that particular point in time,"" said Sheehan. ""The device doesn't include technologies such as facial recognition and it cannot be used as a tracking device.""
But like much tech being proposed to return life to some level of normality, health officials have cast doubt on the use of thermal cameras in trying to screen people for potential virus cases. The World Health Organization for instance has said temperature screening alone ""may not be very effective.""
And while some tech companies are figuring out ways of detecting symptoms and regulating exposure to the virus, others are seeking to eradicate it.
Take ultraviolet lights, which have previously been used to kill bacteria, for instance. Some firms, such as Dutch lighting maker Signify, are hoping the technology can be applied to the novel coronavirus that causes Covid-19.
The World Health Organization has warned people not to use UV lights on their skin due to the dangerous levels of radiation that they emit. But Signify aims to use the lights to disinfect surfaces in offices and other settings like schools and restrooms.
And science may be on the company's side. Signify tested its own UV lights with researchers at Boston University, who found that exposure of the virus to UV light helps eradicate it. Signify is now ramping up production of the lights.
One trend the pandemic has accelerated is the use of software to communicate and collaborate remotely. Platforms like Zoom, Slack and Microsoft Teams have seen a surge in demand with entire workforces forced to adapt to telecommuting. Cisco's Webex video-conferencing app saw a record 324 million users attend virtual meetings in March.
""There's been a seismic change in the last few months in terms of working,"" Chintan Patel, Cisco's chief technologist in the U.K., told CNBC. ""It goes without saying that what's taken place has been incredible.""
The question for these platforms is whether they can continue this momentum as shelter-in-place measures ease and businesses start to reopen. Executives said there would be a continued need for such services as businesses adopt a ""hybrid"" approach of keeping staff at home while some employees return to the office.
Patel said touchless technology such as voice-activated intelligent assistants could help with holding virtual meetings from the office. Cisco's video technology is also capable of measuring how many people are in a meeting, he said, adding this was compliant with EU privacy laws.
Still, it could be some time before a majority of office workers are back in the office. Many large tech companies are now offering workers greater flexibility over their working situations due to Covid-19 — Twitter has gone so far as to let employees work from home ""forever.""
According to a YouGov study commissioned by identity management software firm Okta, just 29% of European workers surveyed between April and May wanted to go back to the office full-time. That figure fell to as low as 24% in Britain.
Meanwhile, 55% of workers felt they were equipped with the necessary hardware for working at home, while 56% said they had the appropriate software. YouGov surveyed over 6,000 people across the U.K., Germany, France and the Netherlands.
""If you really have to bring everyone to a meeting together, something extraordinary will have to happen,"" Julien Codorniou, vice president of Facebook's Workplace app — a rival to Slack and Teams — told CNBC. ""I hope the office will be a place for more meaningful interactions.""
Finally, there's the issue of how workers will get to the office. It's easy to see why many people in big cities like London and New York might be anxious about the idea of taking public transport, potentially being packed in like sardines on a busy bus or subway. And driving in such areas can be far from ideal.
Several start-ups are hoping to convince authorities and consumers that two-wheel electric vehicles like scooters and bikes might be able to solve this problem. In the U.K. that's particularly relevant, since the government has recently made it legal to ride e-scooters on roads. A number of trials are getting underway across the country.
New York City has also approved the private use of e-scooters and bikes, and will allow e-scooter operators to apply for permits in the city, with the exception of Manhattan.
It is hoped the devices will offer a safer and more environmentally-friendly alternative for people commuting to the office.
""This is about getting the public back to work moving again in a safe way,"" Richard Corbett, the U.K. general manager at Swedish e-scooter firm Voi, told CNBC.
""Authorities are using the current opportunity as an opportunity for challenge,"" said Per Brilioth, CEO of VNV Global, an investor in Voi.
""That's been the ongoing trend, to reduce — not take away completely — but reduce the need for cars and fossil fuel for transportation into something that's cleaner in every aspect.""
Check out the companies making headlines in midday trading:
Walt Disney — Disney shares rallied 3.7% in midday trading after it reported quarterly earnings of $1.07 per share, 12 cents a share better than what Wall Street analysts had expected. Revenue also beat forecasts, boosted by a 52% increase in studio entertainment revenue amid a strong movie box office performance. Its long-awaited streaming service, Disney+, is set to launch on November 12.
Monster Beverage — Shares of the energy drink maker gained more than 3% after the company beat earnings and revenue estimates for the third quarter. Sales rose 11%, and the company also announced a $500 million share repurchase program.
Gap — The apparel retailer's stock fell 7% after the company announced that CEO Art Peck would be stepping down, effective immediately. The company also warned that its results for the current quarter would be weaker-than-expected. The slide in the stock price wiped $466 million from the company's value.
Zillow — Zillow's stock popped more than 12% after it reported a loss 12 cents per share for the third quarter, smaller than the 21 cents a share loss for which Wall Street was preparing. The real estate website operator's revenue came in above estimates, and it gave an upbeat forecast as well.
Take-Two Interactive — Take-Two rose 2.3% after reporting a better-than-expected $2.02 per share in profit for its fiscal second quarter. The quarter's performance was buoyed by strong demand for its NBA, Grand Theft Auto, and Red Dead Redemption games.
Teradata — Shares of the data analytics software company plunged more than 16% on weaker-than-expected quarterly results. Teradata posted a profit of 32 cents per share on $459 million in revenue. Analysts polled by Refinitiv expected earnings per share of 40 cents on $486 million in revenue. The company also issued soft earnings guidance for the current quarter and announced CEO Oliver Ratzesberger resigned, effective immediately.
Dropbox — Dropbox slid nearly 6% despite better-than-expected earnings. The cloud storage company earned 13 cents per share in the third quarter, 2 cents ahead of estimates, according to Refinitiv. Its revenue also topped estimates. The company said it is benefiting from its new desktop app as well as good results from its Dropbox Spaces collaboration software.
SurveyMonkey — Shares of online cloud-based survey company tanked 9% after the company reported disappointing third-quarter earnings. The company reported a loss of 12 cents per share, while analysts were expecting a loss of 5 cents per share, according to Refinitiv. Revenue came in at $79.3 million, which beat estimates of $77.95 million.
– CNBC's Yun Li, Pippa Stevens, Fred Imbert and Maggie Fitzgerald contributed to this report.
Kraft and Mondelez are taking the Commodity Futures Trading Commission to court in a bid to keep the agency from discussing a $16 million fine to settle allegations of manipulating the wheat markets.
The two food companies agreed to pay the fine as part of a deal with the CFTC that the companies say restricted what regulators could say about the case. Kraft and Mondelez, which was created when Kraft split into two companies in 2012, are now suing the CFTC for contempt. They filed a motion in federal court in Chicago on Friday, saying the regulator violated the order in an Aug. 15 press release announcing the deal.
""The CFTC and its Commissioners engaged in a deliberate, orchestrated effort to violate the Court's Consent Order within minutes of its entry,"" the companies said in the filing. The two sides face off in court Sept. 12, according to court documents.
According to the CFTC, Kraft intentionally drove down the price of wheat in 2011 by buying an excessive amount of futures contracts on the grain.
Food companies have made such moves to hedge fluctuations in commodities prices by agreeing to pay a specific price at a specific date in the future. Unlike a hedge fund or trading firm, companies like Kraft are limited in their futures purchases and are prohibited from speculating.
Kraft was allowed to have a futures position of roughly 3 million bushels of wheat, the CFTC said in the original complaint. Instead, Kraft allegedly bought futures contracts for 15.75 million bushels, worth more than $93 million.
The consent order included a clause that read ""neither party shall make any public statement about this case other than to refer to the terms of this settlement agreement or public documents filed in this case.""
The order also prohibited the CFTC from saying whether either defendant violated federal law.
After the agreement, the CFTC issued a press release on Aug. 15 saying the penalty was ""valued at three times the alleged gain"" and included statements from Chairman Heath P. Tarbert and links to statements from individual commissioners.
""Market manipulation inflicts real pain on farmers by denying them the fair value of their hard work and crops,"" Tarbert said in his statement. ""It also hurts American families by raising the costs of putting food on the table. Instances of market manipulation are precisely the kinds of cases the CFTC was founded to pursue.""
The CFTC told the court Saturday that its public statements didn't violate the order and that its individual commissioners were not bound by the agreement. The CFTC voluntarily removed the announcement from its website until the next court appearance.
The CFTC and Kraft declined to comment for this article. Mondelez did not respond to a request for comment.
The segments of Kraft and Mondelez named as defendants in the case were part of the same company in 2011 when the trades took place. In 2012, Kraft Foods changed its name to Mondelez and spun off Kraft Foods Group Inc., which merged with Heinz in 2015 to form the Kraft Heinz Co.
Kraft's futures position in 2011 represented 87% of the active futures market for that particular month and type of wheat, according to the CFTC. The agency accused the company of taking this position to try to lower the price of wheat in the spot market where it was buying the grain.
With Kraft signaling to the market that it intended to change its normal plan and buy wheat through the futures market instead of the spot market, the price of wheat in the futures market rose and the cash price fell, allowing Kraft to reap a profit, according to the complaint.
When the company bought wheat in the spot market and unwound a large portion of its futures position, it generated a gain of more than $5 million, according to the CFTC.
Some companies are allowed to file for exemptions to the caps on futures positions for hedging purposes. The CFTC said Kraft did not have an exemption and that its futures position represented a six-month supply of the wheat it needed at its Toledo area-flour mill and was not for legitimate business purposes.
The regulator also said Kraft performed illegal offsetting trades of futures contracts with itself.
Kraft has been one of the worst-performing large cap stocks in 2019, shedding more than 40% of its share price this year. The stock of Mondelez International, the parent company of the defendant in this suit, is up more than 35% this year.
Clarification: The headline of this article was changed to clarify that Kraft hasn't filed a new lawsuit against the CFTC. The company filed a contempt motion in an already existing lawsuit by the agency.
New York Gov. Andrew Cuomo said Wednesday that the coronavirus outbreak could ""stabilize"" within weeks if the state maintains strict social distancing policies, even as he announced the highest daily death count yet and said life for New Yorkers will never be the same.
""I don't think we return to normal. I don't think we return to yesterday,"" Cuomo said at a news conference in Albany. ""I think if we're smart, we achieve a new normal.""
The governor offered a glimmer of hope that the state's stringent policies — closing nonessential businesses and requiring residents to stay home — are helping to slow down the spread of the virus.
Those social distancing measures are working, he said: ""It is flattening the curve.""
If those rules are maintained, he said, there's reason to believe the health ""system should stabilize over these next couple of weeks.""
The coronavirus pandemic continues to hammer the Empire State, new figures showed. New York reported 10,453 new cases Wednesday, comprising 4,927 positive tests in New York City and 5,526 in the rest of the state.
Half of all tests in two New York City boroughs – Queens and the Bronx – came back positive, the state reported.
Cuomo said the state appears to be flattening the curve of the outbreak, referring to a line chart that projects the growth in new cases over time. But he quickly added that would only last if people continue to adhere to social distancing guidelines.
""If we stop what we are doing, you will see that curve change,"" Cuomo said.
The bad news, he said, ""isn't just bad. The bad news is actually terrible.""
Cuomo announced that 779 people had died from the virus since the last count, marking the state's highest daily death toll yet.
New York is the epicenter of the COVID-19 crisis in the United States, with 140,386 confirmed cases and more than 5,489 deaths, according to data from Johns Hopkins University.
According to CNBC’s Kate Kelly, Goldman Sachscould spin off at least part of its proprietary trading operations as early as this month.
The move comes in the wake of new rules that limit Wall Street firms from betting their own money in financial markets.
Though details are still sketchy, a couple of options are on the table. One is to seed a hedge fund staffed by former Goldman proprietary traders with Goldman money and replace it in the coming years with third party money as the new rule goes into effect.
Another possibility is to move proprietary trading into the firm's asset management unit, where Goldman invests clients' money rather than its own.
How should you trade Goldman in the wake of this news?
Instant Insights with the Fast Money traders
I think this is a reason to buy, says Jon Najarian. I like the idea of a spin-off.
The move allows Goldman to retain intellectual capital and not have restrictions on the work it does best, muses Joe Terranova. I’m bullish.
Also, keep in mind the performance of the capital markets in July was very strong and that should bode well for Goldman’s earnings in October. On top of that, from a technical perspective, I think the stock is poised to break out. Right now is a good spot to get in.
I’m not sure I’d start nibbling at Goldman in the high 150’s, says Zach Karabell, but I think the stock is fine.
Goldman has already had an amazing run, reminds Brian Kelly. I don’t know if the spin-off is a reason to buy. However, if you like the bank space, then a long position in Goldman makes sense.
Read More:
> Goldman Sachs May Spin Off Proprietary Trading This Month
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BLACKBERRY BAN?
Shares of RIM slipped on reports that Saudi Arabia will move forward with its ban on BlackBerry’s instant messaging service as soon as Friday.
Elsewhere in the region, government officials in the United Arab Emirates (UAE) say they will shut off BlackBerry e-mail, messaging, and web browsing features on Oct. 11 if the government is not granted more access.
But perhaps the greatest concern for investors is that India, which constitutes one of the largest emerging markets and has 1 million BlackBerry users, is threatening to stop BlackBerry services as well.
What’s the trade?
I don’t care what Saudi Arabia does with BlackBerry and I wouldn’t hold my breath waiting for India to ban BlackBerry, says Zach Karabell. I expect RIM as well as Apple , and the new Android to dominate this space going forward.
I got out of my position in RIM, reveals Joe Terranova. I think there are better places to put money.
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THE RETAIL PLAY
Retailers topped the tape on Wednesday ahead of July comp sales due out on Thursday.
How should you play the space?
I’d play it with bargain names such as TJX, says Brian Kelly.
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OIL MARCHES HIGHER
The traders were closely watching the action in oil after official figures showed a higher than expected fall in crude stocks.
What’s the trade?
I’d play the refiners from the long side, counsels Joe Terranova.
The higher oil goes the better the chance that the driller moratorium is cut short, adds Brian Kelly. I’d be long the OIH .
If you agree with Brian, check out Diamond Offshore, adds Terranova.
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WHEAT RALLY
In the chart of the day the traders look at wheat, which rallied to fresh 22-month high on concerns about a prolonged drought in Russia.
What’s the trade?
I think the trade is long Agrium , Mosaic and Potash , says Joe Terranova.
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BP PROGRESS REPORT
BP reported big progress Wednesday in its attempts to permanently cap the well in the Gulf. They say mud pumped into the well to stop the flow of oil, now appears to be successfully controlling its pressure.
Despite the relative success, BP shares moved lower.
What’s the trade?
I wouldn’t be long BP, says Joe Terranova. If you want to play the space I’d look at Occidental or Suncor .
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MEDIA EARNINGS
Media earnings are moving center stage with News Corp releasing results after the bell Wednesday and Viacom doing the same on Thursday.
What should you expect?
We’re seeing a broad based recovery, says David Bank of RBC. Just an incredibly buoyant network advertising market at a time when other positive factors are baked in. Largely these stocks are cheap.
I’d play the space with OmniCom and/or Interpublic , says Jon Najarian, as beneficiaries of ad spend ahead of the mid-term elections.
Or look at Belo or Media General as plays on races on Texas and Georgia, adds Brian Kelly.
My play is long Disney , says Joe Terranova.
Hear more from David Bank including which stock he likes best ahead of earnings. Watch the video now!
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UNUSUAL ACTION: FIRST SOLAR AND PACTIV
Jon Najarian has two stocks on his radar due to unusual options action.
A large volume of calls traded in First Solar and Pactiv ; that action suggests to Najarian that positive catalysts may boost both companies.
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BURGER KING DOWNGRADE
You might say that Burger King was dethroned by analysts at RW Baird; they downgraded the stock to Neutral from Outperform and cut the price target to $19 from $24.
What should you make of it?
I still like the stock here, says Brian Kelly. I’d get in.
If you want to play the space, I’d look at McDonald’s , says Zach Karabell.
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CALL TO THE FLOOR: ISIS
The traders are closely watching developments in the health sector. Genzyme and IsisPharmaceuticals just came out out with two very positive studies on their new cholesterol lowering drug.
What should you make of it?
Find out from Isis CEO Stanley Crooke. Watch the video below!
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Trader disclosure: On Aug 4, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour owns (AAPL), (BAC), (BX), (GOOG), (INTC); Terranova owns (AMZN), (AKAM), (APA), (AGU), (ADBE), (BAX), (BBY), (BMO), (C), (COP), (CVS), (EMC), (FCX), (GOOG), (GS), (JNPR), (JOYG), (KOL), (KR), (MMM), (MOS), (MSFT), (PCP), (PEP), (PFE), (POT), (RIMM), (TER), (SKX), (SU), (UAUA), (WYNN), (XBI); Finerman owns (AAPL); Finerman's firm owns (ARM); Finerman's firm owns (LEA); Finerman & Finerman's firm owns (RIMM); Finerman's firm owns (WMT); Finerman's firm owns (DAN); Finerman's firm is short (IJR); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Pete Najarian owns (C); Pete Najarian owns (CTRP); Pete Najarian owns (ALL); Pete Najarian owns (GS); Pete Najarian owns (MGM); Pete Najarian owns (PFE); Pete Najarian owns (RSH); Pete Najarian owns (ETFC)
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CNBC.com with wires.
China is offering to bankroll a development fund for the Solomon Islands in the South Pacific if it switches diplomatic ties from Taiwan to Beijing, a parliamentary committee in the small island nation has heard.
The proposal, which would replace a similar structure set-up by Taiwan, comes amid a global push by Beijing to peel away the allies of what it considers a wayward province with no right to state-to-state ties. Only 17 countries now recognize Taiwan.
China and Taiwan have fought a tug-of-war for diplomatic recognition in the South Pacific for decades, with some island nations switching allegiances for financial gain.
John Moffat Fugui, a Solomons' parliamentarian and head of a taskforce charged with evaluating diplomatic ties, said on Wednesday that Beijing would pay into a fund even though it usually preferred ""grants, concessionary loans and sometimes gifts"".
""But for you, we will give you a 1/8Rural Constituency Development Fund 3/8 for a certain period,"" Fugui said, referring to recent negotiations with Beijing officials.
Fugui said the offer would help fill an immediate gap should the Solomons cut ties with Taiwan that date back to 1983.
Taiwan has pledged $8.5 million to the Solomons in 2019-20 through a fund, budget documents show.
The Solomons, an archipelago of just over 600,000 people, relies heavily on such payments due to its limited means of generating income, which is largely through timber exports.
The South Pacific has been a diplomatic stronghold for Taiwan, where formal ties with six of the 16 island nations make up more than a third of its total alliances.
A report by the Australia-based Lowy Institute think-tank last month said: ""Both Australia and the U.S. are concerned about whether Solomon Islands chooses to switch recognition from Taiwan to China"". It said ""a switch by any one (of the states that recognize Taiwan) may stimulate others"" to abandon Taipei.
Fugui spoke positively about a potential switch in ties at a parliamentary committee in the capital of Honiara on Wednesday, although he said the taskforce had not yet completed its report.
Separately, the government has convened a ministerial team that has been liaising directly with Beijing.
An observer at the meetings told Reuters that: ""The government is trying to make a relationship with China now; but to formalize it we need to wait for the report."" The meeting was open to the public, but has not been broadcast.
China's foreign ministry in Beijing did not immediately respond to questions.
Joanne Ou, spokeswoman for Taiwan's foreign ministry, said: ""Relationship with Solomon Islands currently is stable, but we are closely monitoring and situation and development.""
Solomon Islands has been actively assessing its Taiwan alliance since a general election in April.
Anti-graft agency Transparency Solomon Islands has urged caution in changing ties over concerns Solomons will not be able to hold firm against Beijing's interests.
""It is not a secret that China is the most assertive donor nation offering funding and development assistance that exploit governance gaps in countries with weak or corrupt structures, and makes the gaps wider,"" Transparency Solomon Islands said in a statement last month.
The number of nations recognizing Taiwan has been dwindling, with El Salvador in Central America, Burkina Faso in West Africa and the Dominican Republic in the Caribbean, all switching to China last year.
The world's second-largest economy has responded to President Donald Trump's controversial trade tariffs.
China's commerce ministry proposed a list of 128 U.S. products as potential retaliation targets, according to a statement on its website posted Friday morning.
The U.S. goods, which had an import value of $3 billion in 2017, include wine, fresh fruit, dried fruit and nuts, steel pipes, modified ethanol, and ginseng, the ministry said. Those products could see a 15 percent duty, while a 25 percent tariff could be imposed on U.S. pork and recycled aluminium goods, according to the statement.
The statement did not go into greater detail. U.S. agricultural products, particularly soybeans, have been flagged as the biggest area of potential retaliation by Chinese President Xi Jinping's administration.
Beijing will take measures against the 128 U.S. goods in two stages if it cannot reach an agreement with Washington, the ministry said, adding that it could take legal action under World Trade Organization rules.
Asian stock markets took a dive on the news, with Japan's index sliding as much as 4 percent.
The Friday response from Beijing is relatively measured, experts told CNBC.
The decision to target $3 billion in U.S. imports is significant, ""but it's not a lot in terms of the total U.S.-China relationship,"" said economist Tony Nash, who is CEO and founder of data analytics firm Complete Intelligence.
Chinese imports from the U.S. are expected to hit $172 billion this year, he pointed out.
Recent U.S. trade actions severely damage the multilateral trading system and disturb the international trading order, China's commerce ministry said, urging Washington to resolve its issues with Beijing to avoid harming the bilateral relationship.
Trump signed an executive memorandum on Thursday that will impose tariffs on up to $60 billion in Chinese imports. ""This is the first of many"" trade actions, the president said. The new measures will primarily target certain products in the technology sector where Beijing holds an advantage over Washington.
That followed Trump's executive order earlier this month that imposed broad duties on foreign aluminum and steel imports — an action that many said could trigger a global trade war.
—Reuters contributed to this report.
Main Street's slow economic recovery has one restaurant chain handing out a free meal to its customers...again.
Denny's, a family-style franchise, is giving away a free 'Original Grand Slam' meal, which includes two eggs, two sausages links, two strips of bacon and two pancakes, on Tuesday, Feb. 9, as a way to give back to his customers who are still facing economic hardships, Nelson Marchioli, the CEO of the Denny's franchise, told CNBC Wednesday.
""My belief is we are still suffering, my customer is still suffering in this economy. They are the ones who have lost jobs, they are the ones who have lost their homes,"" said Marchioli. ""Wall Street may be in recovery; Main Street is not in my opinion.""
Marchioli said more than 40 percent of Denny's customers are blue collar workers who earn $45,000 or less in household income.
The company started the free Grand Slam Meal program last year as a part of its marketing strategy. About two million took advantage of the Denny's free meal in 2009, Marchioli said.
Denny's will be promoting the free meal deal in a Superbowl commercial on Sunday, Feb. 7.
Benjamin Franklin once said nothing in life is certain except death and taxes. Only one is an out-of-pocket expense.
Americans can spend hundreds of dollars on help preparing and filing their taxes although there are plenty of ways to do it at no or little cost.
For starters, ambitious filers can always do it on their own by filling out the e-file forms the IRS — and in some cases, states — make available online. But an increasing number of tax preparation software companies offer to help — for free.
More from Your Money Your Future:
What Trump's fight over retirement savings rules means for your nest egg
That '4 percent rule' could spell trouble for early retirees
Why everyone needs to check their paycheck
Most recently, Credit Karma announced Credit Karma Tax, a do-it-yourself tax prep service at no cost. It covers a 1040 (the standard federal income tax form) and is best suited for simpler tax returns. (Those with multistate filings or a trust or farm subsidies would still be better off with an accountant who can offer advice as well as assistance, according to Credit Karma's founder and CEO, Kenneth Lin.)
Other services include TurboTax's Absolute Zero, which began three years ago for taxpayers filing federal 1040A or 1040EZ returns as well as state returns.
The IRS also maintains Free File for more complicated returns (but still not multistate), which is administered through the Free File Alliance, a nonprofit organization of a dozen tax prep service providers, including TurboTax, H&R Block and Jackson Hewitt.
Free File projects that, in 2017, it will prepare about 3 million individual income tax returns out of the 153 million the IRS expects to receive. ""One-hundred-million people are eligible, but it's not advertised, so nobody knows about it,"" said Tim Hugo, the alliance's executive director.
The program, which walks you through your tax filings step by step, is geared toward low- and moderate-income taxpayers, but each provider has its own restrictions on who qualifies. For example, some will accept all filers who make $64,000 or less while others may have age requirements or geographical restrictions (a wizard will walk you through the available programs that fit your criteria).
And you still may not be able to wrap up all your paperwork before April 18 (yes, the deadline is different this year) completely scot-free. There could be some additional charges, including a fee for those who owe taxes and use a credit card to make a payment or for filing a state return online.
For those determined not to spend a dime, and still want in-person assistance from a tax pro, the AARP Foundation runs the volunteer-based Tax-Aide program for those who can't afford tax prep help.
The IRS also has both a Volunteer Income Tax Assistance program, or VITA, for people with disabilities, limited English or those who generally make $54,000 or less, and Tax Counseling for the Elderly, or TCE, for those age 60 or older.
VITA and TCE sites are generally located in community centers, libraries and schools around the country. And many of the TCE sites are operated by AARP's Tax-Aide program.
For more information, go to irs.gov.
Two former Wells Fargo employees have filed a class action in California seeking $2.6 billion or more for workers who tried to meet aggressive sales quotas without engaging in fraud and were later demoted, forced to resign or fired.
The lawsuit on behalf of people who worked for Wells Fargo in California over the past 10 years, including current employees, focuses on those who followed the rules and were penalized for not meeting sales quotas.
""Wells Fargo fired or demoted employees who failed to meet unrealistic quotas while at the same time providing promotions to employees who met these quotas by opening fraudulent accounts,"" the lawsuit filed on Thursday in California Superior Court in Los Angeles County said.
Wells Fargo has fired some 5,300 employees for opening as many as 2 million accounts in customers' names without their authorization. On Sept. 8, a federal regulator and Los Angeles prosecutor announced a $190 million settlement with Wells.
The revelations are a severe hit to Wells Fargo's reputation. During the financial crisis, the bank trumpeted being a conservative bank in contrast with its rivals.
A Wells Fargo spokesman on Saturday declined to comment on the lawsuit.
The lawsuit accuses Wells Fargo of wrongful termination, unlawful business practices and failure to pay wages, overtime, and penalties under California law.
Former employees Alexander Polonsky and Brian Zaghi allege Wells Fargo managers pressed workers to meet quotas of 10 accounts per day, required progress reports several times daily and reprimanded workers who fell short.
Polonsky and Zaghi filed applications matching customer requests and were counseled, demoted and later terminated, the lawsuit said.
While executives at the top benefited from the activity, the blame landed on thousands of $12-per-hour employees who tried to meet the quotas and were often required to work off the clock to do so, the lawsuit said.
Employees with a conscience who tried to meet quotas without engaging in fraud were the biggest victims, losing wages, benefits and suffering anxiety, humiliation and embarrassment, the lawsuit said.
Wells Fargo was aware many accounts were illegally opened, unwanted, carried a zero balance, or were simply a result of unethical business practices, the lawsuit said.
""Wells Fargo knew that their unreasonable quotas were driving these unethical behaviors that were used to fraudulently increase their stock price and benefit the CEO at the expense of the low level employees,"" the lawsuit said.
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A snafu at an Apple supplier could restrict the supply of some models of its next generation iPhone when it launches later this month, AppleInsider reported last week.
Problems at Japanese company Minebea have affected production of the iPhone 6s Plus's backlight and could lead to a shortage when it goes on sale Sept. 25, analyst Ming-Chi Kuo of KGI Securities said in a note obtained by the website.
Apple placed rush orders with another supplier, Radiant, to resolve the issue, according to the report.
Apple and Kuo did not immediately respond to requests to comment.
Shipping times for the iPhone 6 Plus were already moved back at least three weeks from the initial launch, and the problem at Minebea could further exacerbate the delay, the report says.
""Recently, Minebea's stock price seems to be affected by some of news articles on websites regarding the condition of our LED backlight business, some of which seem groundless,"" Minebea said in a statement. ""We had some delays ramping up production of an LED backlight product for a certain new model for a customer, and for a while an original shipment schedule did not go through as much as we had expected, but now we are in full production stage, and this is expected to continue at least until the end of this year.""
Earlier on Monday, Apple announced it was on pace to break its iPhone sales record set last year. The iPhone 6 series debuted with 10 million units sold in its first weekend.
""Customer response to iPhone 6S and iPhone 6S Plus has been extremely positive and preorders this weekend were very strong around the world,"" the company said in a statement.
It appears Kanye West's alleged debt burden may have just been lifted, with the help of wife and fellow celebrity, Kim Kardashian West.
On Monday night, the reality TV personality tweeted that she was ""busy cashing (her) 80 million video game check"", and transferring $53 million into a joint account.
TWEET
This comes less than a month after her husband and musician, Kanye West announced that he was allegedly $53 million in debt to his several million Twitter followers.
On top of that, Kardashian West released ""Kimoji"" last December, an app allowing users to use emoji characters based on the reality star's life.
West's debt announcement was made at the time the rapper released his latest studio album, ""The Life of Pablo"", which he plans ""never"" to put on sale (in hard format) or on Apple Music. It is currently legally available to those who use premium streaming service, Tidal.
This Monday, West also announced he was thinking about ending his relationship with CDs, and only publishing his music through the streaming format.
TWEET
Rumors about West's ""debt"" have been raised in the past, with West reportedly saying around the time of 2015's BET Honors ceremony that he had been some $16 million in debt, after trying to become a fashion entrepreneur with his own clothing line.
Since Kardashian West's financial announcement online, the tweet has been retweeted over 83,000 times, and several Twitter users have concluded that this means the rapper is now free of debt.
TWEET
TWEET
TWEET
Neither Kim Kardashian West nor Kanye West have confirmed whether the $53 million was to fix the rapper's debt.
Wall Street still has an appetite for fake meat.
Beyond Meat rose nearly 7% on Tuesday after J.P. Morgan upgraded the meat-alternative stock to an overweight rating, citing valuation after a pullback from its highs.
However, Boris Schlossberg, managing director at BK asset management, isn't firing up the grill just yet.
""I think the way to play is actually through the retail stores,"" Schlossberg said Tuesday on CNBC's ""Trading Nation.""
Beyond Meat has risen over 500% since it's early May IPO, but has dropped nearly 40% off its late July high.
""My favorite is actually Dunkin' Donuts, which has been really highlighting Beyond Meat and the Beyond Egg sandwich very well and has also done a very good job merchandising,"" said Schlossberg. ""That stock has also been a very strong momentum stock, but I still think it's the right way to play it because it's done a very good end-around McDonald's and Starbucks, and I think it has some very, very strong momentum going forward.""
Ari Wald, head of technical analysis at Oppenheimer, agrees food retailers would be a better play.
""We would prefer the food servers over the food suppliers, and the restaurant industry in general is really broadly strong here when we're talking about McDonald's, Starbucks, Wingstop, Dunkin' Brands, Wendy's and Restaurant Brands, that's what we're looking for, those broad based themes,"" said Wald.
All those names are outperforming the S&P this year, and Wald says Wendy's is showing signs of relative strength.
""Our analyst recently raised his target to $24 after recent management meetings, and the charts are supportive to really classic breakout here,"" said Wald. ""The stock got through $18 in April, came back tested that breakout in August, now turning higher again, new high in this mixed market tape, we see that as a sign of relative strength.""
Wendy's has soared 5% in the past week even as the S&P 500 has fallen 1%. It is up 32% in 2019.
Disclaimer
Hurricane Irene and the closure of at least 1,000 theater locations along the East Coast is expected to put a dent in this weekend's domestic box office.
Preliminary figures show the weekend box office is off 26 percent from last year, according to Paul Dergarabedian, President of the Hollywood.com Box-office division.
The Rentrak box office reporting service said in an advisory ""a possible 1,000 theaters could be affected by the weather on the East Coast. We've been hearing about closures of many theaters.""
There were reports Clearview Cinemas, which has 57 theaters in the NYC-Philadelphia area, closed most locations over the weekend. AMC Entertainment, another major chain, also planned to shut locations in the path of the hurricane.
Three major films are debuting in theaters this weekend: ""Colombiana,"" an action flick from Sony's TriStar; the indie horror flick ""Don't be Afraid of the Dark"" from FilmDistrict; and Weinstein Company's comedy ""Our Idiot Brother.""
""Hurricane Irene is definitely wounding this weekend's box office, but only by washing away a couple million off the top of our estimates,"" Boxoffice Magazine's Amy Nicholson tells CNBC. ""To be honest, none of this weekend's three new releases was projected to open to more than $12 million.""
Nicholson said the marketing on new releases ""just wasn't there to motivate people to leave their houses regardless of the weather. At least those executives now have an act-of-God excuse for why their films underperformed.""
Nicholson added that the drama ""The Help,"" a three-week-old release that was predicted to win the weekend, ""has barely been affected. We bet on Wednesday it would make $15 million -- and after Friday's numbers, it's still on track to do $14.5 million.""
""The Help"" has so far brought in an estimated $96.7 million at the US box office since its release August 10, according to Boxoffice.com. The film is part of DreamWorks Pictures' multi-picture distribution deal with Disney's Touchstone Pictures label.
Meanwhile, Time Warner Cable issued a press release saying ""Hurricane Irene gives Time Warner Cable customers the perfect excuse to get caught up with on demand shows and movies."" The company has 5.9 million subscribers along the East Coast.
The full-size pickup truck market has never been hotter, with Fiat Chrysler's Ram and General Motor's Chevy duking it out second place in sales behind Ford. All three big American companies are constantly refreshing their lineups to cling to any advantages over the competition.
That's big trouble for Toyota, which hasn't completely redesigned its Tundra pickup since 2007. It's received a slew of updates and a large refresh in 2014, but sales have always lagged behind the big three in Detroit. In a segment of six, the Tundra is the fifth-place finisher, besting only Nissan's Titan in sales.
After a week with one, it's not hard to see why. It's well built and isn't as pricey as the American trucks, but we still wouldn't recommend one.
As of last week, there have now been two Toyota Tundras of this generation that have reached one million miles on their original transmissions. That's a seriously impressive feat, a testament to the reputation Toyota trucks have long maintained for unbeatable reliability.
Part of that comes from simplicity. For the buyers that bemoan Ford moving toward turbocharging, Ram putting in mild-hybrid systems and GMC offering tailgates that fold in a variety of ways, the Tundra's old-school style may be refreshing.
It's got a 5.7-liter V-8 linked to a six-speed transmission, providing 381 horsepower. It's not the most powerful engine in its class, but it offers more than enough power to work in day-to-day life without taxing the motor. There's enough reserve power that it'd be fine loaded up with gear, people and a trailer.
Plus — though Toyota still has a lot to learn from American trucks in other categories — the Japenese company has certainly matched the in-your-face, bombastic styling of the big three. The Tundra looks like a sledgehammer, with a broad and aggressive face and oversized details. Our $46,610 tester looked alright, but in TRD Pro guise the Tundra is a mean looking machine.
It also came in about $17,000 cheaper than the last Ram we tested, though it was significantly lighter on feature content and lacked the Ram's crew cab, bed liner and integrated bed cargo system. Credit to Toyota, though, for including active safety features like forward collision warning in all Tundras.
The downside of two current-generation Tundras having hit one million miles is that it draws attention to just how long the truck has been on sale. In a rapidly changing market, the Tundra feels ancient. It's by far the oldest vehicle in the segment.
The infotainment system is far behind the competition; Ram offers a 12-inch portrait touch screen, but Toyota makes do with a screen that looks largely the same as it did in 2014. The interior materials are hard plastics that look cheap and it's behind on tech.
Most notably, the newest crop of huge trucks offer 360-degree cameras and self-parking systems to help drivers manage the behemoths. The Tundra doesn't, a shame since it feels more unwieldy than other full-size trucks.
It lumbers around without a sense of poise or refinement, making it hard to place the truck where you want it. It, of course, didn't help that the Tundra we tested was equipped with the longer bed option. Even still, the handling was poor.
Power, as mentioned, was adequate. Unfortunately, the old-school way that the Tundra makes the power isn't particularly efficient. The Tundra with the 5.7-liter V-8 is rated for 17 miles per gallon on the highway, while a Ram 1500 with a 5.7-liter V-8 is good for 21 mpg on the highway. Add the eTorque mild hybrid option and that climbs to 22 mpg.
And then it comes to luxury. Pickup truck buyers are increasingly opting for more expensive, more optioned trucks. The Tundra offers none of the refinement of the luxurious trims of the competition and the options list is significantly shorter.
Of course, longtime truck buyers might not care about tech or luxury features. Complaining about those things may come off as missing the point. And to some extent, they're right. If the Tundra was more capable than its rivals, a lot could be forgiven.
Unfortunately, it's not. The Tundra is not the most powerful, it doesn't tow the most and it doesn't have a higher payload capacity than its rivals. Rivals also offer more engine choices, more cab configurations and things like corner steps and in-bed locking storage that make work duties more manageable.
The Tundra makes sense for some buyers. If your primary focus is on reliability, there's a solid argument to be made that this is the most dependable vehicle on sale. If you are fine with the options it offers, it can also undercut similarly equipped trucks from the Detroit brands.
But you'll always be aware of the lower price. The Tundra feels substantially cheaper than rival trucks. It's not as comfortable, quiet or livable. It feels clumsy, unlike the pseudo-luxury experiences offered by top-trim rivals.
It's also not the most capable or configurable truck. We can't argue that it's unbelievably reliable and extremely well built, but in a fiercely competitive segment that isn't enough to offset the Tundra's downsides.
Exterior: 3.5
Interior: 1.5
Driving experience: 2
Value: 2.5
Overall: 2.4
Price as tested: $46,610
*Ratings out of 5
Last week I was a guest on Larry Kudlow’s Saturday morning radio program (on WABC, New York). A man called the program and said that some of these surveys which claim scientific support for the global warming hypothesis, contained some decidedly unclimatolgical signatures from pediatricians, gynecologists or just about anybody else with a terminal degree. In other words the case against oil was a little slipperier than reported.
“Gynecologists against drilling?”, I thought, “Seems like there must be some kind of conflict of interest here. I need to learn more.”
Googling ‘gynecologist’ and ‘warming’ is an adventure in itself, but eventually I found a report by the National Center Policy Analysis which indeed found such signatures on a letter released by Ozone Action, and widely circulated in the media. (See Bowyer's take on oil in the video).
Who am I to judge the scientific case for global warming? I have barely any more experience in climatology than I do in gynecology, although I am an eager student in both. However, it seems to me that the incredibly obvious point of weakness in the public policy argument is blindingly obvious.
What are other CNBC.com guest commentators saying?
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President Obama's executive order preventing the deportation of up to 5 million undocumented immigrants won't preclude all of them from getting affordable health coverage. But it remains to be seen just how many will be presented with that option.
Even if a good amount do get insurance, the health, social and economic costs from having the remaining immigrants effectively locked out of health coverage will remain a problem, say advocates and analysts. And some of those costs—including visits to emergency rooms that aren't paid by insurance—could end up getting passed along to the general public, they noted.
Undocumented immigrants, who currently comprise one in every six people in the United States without health insurance, by 2017 are projected to make up 1 in 4 such uninsured people, said Stephen Zuckerman, co-director of the Health Policy Center at the Urban Institute.
Zuckerman noted that it's not because there will be more undocumented immigrants without insurance. Instead, he said, it's because there will be significantly more currently uninsured people overall getting insured in the coming years through Obamacare insurance plans and from Medicaid, particularly in states that have expanded eligibility for Medicaid to include more people.
But both those options will essentially be blocked to the people subject to Obama's order last week, which lifts the threat of deportation and will give those people the ability to work legally in the U.S.
Read MoreCat got your tongue, HealthCare.gov?
The White House has indicated it will not allow such undocumented people access to federal subsidies that help most Obamacare enrollees afford policies sold on government-run insurance exchanges. And those people will also be barred by federal law from enrolling in Medicaid, the joint federal-state program that covers poor people.
""This issue of health coverage has been separated from their legal status and the ability to work,"" Zuckerman said. ""And that's going to leave a large number of people without coverage, and without the ability to get coverage either through Medicaid or the subsidies in the marketplace.""
That decision to separate health coverage out of the equation echoes a similar decision in 2013 by the Obama administration when it deferred deportation for young undocumented immigrants said they could not benefit from Obamacare subsidies, said Shannon Erwin, state policy director at the Massachusetts Immigrant and Refugee Advocacy Coalition.
""It was a political decision, and not really a health policy-informed decision,"" said Erwin, pointing out that the Obamacare exchanges were due to launch later that same year.
""I would hope there would be an an opportunity to re-open that conversation,"" said Erwin, who noted that health coverage is ""a top concern"" among immigrants.
But Derrick Morgan, vice president for economic freedom and opportunity of the conservative Heritage Foundation, said that while, ""I think the administration would like"" to expand subsidies to those affected people, it shouldn't do so.
""The president promised that illegal immigrants would not receive funding for Obamacare,"" Morgan said. The Heritage Foundation, he said, opposes having undocumented workers receive health coverage from government-sponsored or government-subsidized programs.
""They're here unlawfully, and the American taxpayer and the American citizens are the ones paying for these benefits, and these subsidies should not be going to those that are here illegally,"" Morgan said.
Read MoreObama's immigration plan risks backlash
That said, the people covered by Obamas order will have several avenues for health coverage as they become eligible for work permits.
""More people will have jobs,"" noted Claudia Calhoon, senior health specialist with with the New York Immigration Coalition. ""They will have more financial stability because they no longer will be in the shadows.""
With some of those job, people will be offered employer-sponsored insurance, Calhoon said. They will also have the option of buying unsubsidized individual insurance outside the Obamacare exchanges, at the least, although Calhoon noted such ""off-exchange"" plans can be much more expensive than the ones sold on the exchanges.
""It will be very important to get the word out to people so they understand what benefits are available to them,"" she said. ""Educating immigrant communities about what options do exist, and safety services for people who are uninsured, will be important.
But it's not clear how many of the immigrants subject to Obama's order will be able to buy—and able to afford—health coverage through their jobs or in the individual health plans, said Samatha Artiga, director of the Disparities Policy Project at the Kaiser Family Foundation.
""We do know, historically, that immigrants have been more likely to have low-wage job and be in industries that do not provide health-care coverage to workers,"" said Artiga.
And even if they are offered coverage through their employer, ""In many cases, that's unaffordable,"" she said.
Artiga said Obama's order could alleviate the fears of being deported that have kept some of the affected undocumented immigrants from enrolling their U.S.-born children in Medicaid and CHIP health insurance programs that those kids are eligible for due to their citizenship status.
""From past research and experience, that has always been a big barrier for enrolling children in those mixed-status families,"" she said.
""But I think the broader issue is that individuals remain without access to affordable health coverage options, so many of them may remain uninsured.""
But that doesn't mean they will stay out of the hospital.
Uninsured undocumented immigrants, along with other uninsured Americans who visit the emergency room and get other hospital services despite being unable to pay for their care, in 2012 generated nearly $46 billion in uncompensated care costs at 4,999 U.S. hospitals in 2012, the last year data was available, according to the American Hospital Association.
Those costs, equal to 6.1 percent of total hospital expenses, end up being covered by a federally funded program, by extra charges to those with insurance, or by the hospitals themselves.
While the AHA doesn't have data on how much of those costs are due to undocumented immigrants, they can be considerable in individual cases.
Dr. Julia Koehler, a pediatrician at Boston Children's Hospital, told CNBC about how an undocumented Brazilian immigrant had previously sought her help after incurring a back injury he suffered while trying to lift an older, heavier stranger who had slipped and fallen on some ice on a sidewalk.
For more than two weeks the immigrant, a father of three, had avoided going to the doctor because he lacked insurance, said Koehler, a Harvard Medical School assistant professor who volunteers at a clinic that serves immigrants.
""He ended up with an emergent injury to his spinal cord, which was a prolapse of the disc into the spinal canal,"" Koehler said. When he was properly diagnosed by ""an excellent neurosurgeon,"" Koehler said, the man was told he had more than a 50 percent risk of paralysis.
""He was going to lose control of his feet, his bladder and his bowel, and not be able to work anymore because he didn't have health insurance,"" Koehler said.
Read MoreTech world needs high-skilled foreigners: CEO
Fortunately, the man's surgery at Brigham and Women's Hospital in Boston was a success, and he made a full recovery, she said. But the surgery itself cost ""tens of thousands of dollars,"" which he was unable to pay, and which the hospital absorbed.
While the man's story has a happy ending, Koehler said in other cases, breadwinner in immigrant families are hurt on the job or get sick elsewhere, and then are left temporarily or permanently unable to support their families, which can in turn lead to health issues for them as well, and them becoming an economic burden to hospitals and taxpayers.
Even an immigrant going without a flu shot because of lack of insurance can lead to significant costs for others, she said.
""If you don't have health insurance and you have low income, it is very unlikely that you will come up with the money to buy a flu shot,"" Koehler said. ""So the unimmunized person will then possibly expose other vulnerable people, perhaps asthmatics, young infants, older people.""
""Health insurance should be available regardless of immigration status, because, again, it goes beyond the health of the affected individuals, and it goes to the health of the whole family and the whole community,"" she said.
Squawk Box Live in Europe kept you up to date with China's stock markets, which staged a late rally Wednesday. This came as investors geared up for another bumper day of earnings and the conclusion of this month's Federal Reserve monetary policy meeting.
The stock market rallied midday Wednesday following the Federal Reserve's announcement of more bond buying, but will it continue?
""This does look like it's going to be a long-term prognosis,"" OptionMonster's Pete Najarian said on ""Fast Money.""
Specifically, the Fed's bond-buying and continued low interest rates would benefit the financial sector, he added.
The rally in stocks suggested that Washington lawmakers would strike a budget deal to avoid the so-called ""fiscal cliff,"" which would trigger tax hikes and automatic spending cuts on Jan. 1, Stephen Weiss of Short Hills Capital said.
""You're looking for talk of a grand bargain at this point,"" he said. ""You've increased the risk dramatically to your portfolio with the way the market's risen.""
Rosecliff Capital's Mike Murphy said the midday pop in the S&P 500 to 1,435 was significant and set up for a new level of resistance at 1,450.
The Fed action signaled that it was safe to get back into stocks, he added.
""I think the market continues to rally.""
Trader disclosure: On Dec. 12, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC's ""Fast Money"" were owned by the ""Fast Money"" traders: Mike Murphy is long AAPL; Mike Murphy is long TGT; Enis Taner is long GS; Enis Taner is long AAPL 1X2 CALL SPREAD; Enis Taner is long GOOG PUT BUTTERFLY; Enis Taner is long SPY PUTS; Enis Taner is short XRT**; Pete Najarian is long AAPL; Pete Najarian is long BAC CALLS; Pete Najarian is long INTC CALLS; Pete Najarian is long RIMM CALLS; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MSFT; Pete Najarian is long LLY; Steve Weiss is long BAC; Steve Weiss is long JPM; Steve Weiss is long C; Steve Weiss is long FXI. (**Corrected.)
The ""Fast Money"" traders shared their first moves for the market open.
Tim Seymour was a buyer of the Russia ETF.
Brian Kelly was a buyer of Freeport McMoRan.
Karen Finerman was a seller of Apple calls.
Guy Adami was a buyer of UnitedHealth.
Disclaimer
Trader disclosure: Tim Seymour is long AMZA, AMZN, AAPL, ACBFF, ACRGF, ALEF, ACB, APH, ARNA, BA, BABA, BAC, BTI, C, CARA, CCJ, CF, CGC, CLF, CNBS, CRLBF, CRON, CSCO, CWEB, CURLF, DAL, DIS, DVYE, EA, EBR, EDC, EEM, EMH, EUFN, EWM, FB, FDX, FIRE, FLWR, FXI, GE, GM, GOOGL, GTBIF, GTII, GWPH, HEXO, HK.APH, HRVOF, HVT, HYYDF, IIPR, INTC, ITHUF, JD, KERN, KHRN, KRO, KSHB, LABS, LEAF, LNTH, MAT, MCD, MJNE, MO, MOS, MPX, MRMD, NEPT, NKE, NRTH, OGI, OGZPY, ORGMF, OTC, PAK, PCLO, PHM, PKI, RIV, SBUX, SNDL, SQ, SSPKU, STZ, T, TCEHY, TER, TGOD, TLRY, TNYBF, TRSSF, TRST, TWTR, UA, UAL, VEON, VFF, VIAB, VIVO, VOD, WAB, WB, WMD, X, XLY, YCBD, YNDX, ZENA, ZYNE, 700. Tim is short IWM, RACE, SPY. Tim's firm is long CGC, HEXO, CRON, APH. Tim is on the advisory board of KSHB, Heaven,Tikun Olam, CCTV, and Canndescent. Tim has securities licenses registered with The Benchmark Company. Tim is an advisor to JWAM. Brian Kelly is Long Bitcoin, Ethereum, Oil, GLD. Short US 10 Year Notes. Karen Finerman's firm is long ANTM, C, CBS, CPRI, FB, FDX, FL, FNAC, GOOG, GOOGL, GLNG, GMLP, HD, JPM, LYV, REZI, RRGB, SPY puts, SPY put spreads, STNG, TBT, TGT, TIF, URI, WIFI. Her firm is short HYG, IWM, LQD. Her firm is short TGT calls. Her firm is long DIS call spreads. Karen Finerman is long AAL, AYR/CN BAC, BOT Bitcoin, Bitcoin Cash, Ethereum, C, CAT, CBS, CPRI, DAL, DVYE, DXJ, EEM, EPI, EWW, EWZ, DVYE, FB, FL, GM, GMLP, GLNG, GOOG, GOOGL, JPM, LOW, LYV, KFL, MA, MTW, REAL, REZI, SEDG, TACO, WIFI, WFM. KarenFinerman is longFB spread calls. KarenFinerman is long GOOG put spreads. Karen Finerman is long SPY puts. Bitcoin and Ethereum are in her kids' Trust. Guy Adami is long CELG, EXAS, GDX, INTC. GuyAdami's wife, Linda Snow, works at Merck.
As horrible as they may seem, sell-offs are inevitable, Cramer said. But instead of panicking when a downturn happens, investors should see opportunity.
There’s always a bull market somewhere, and there are opportunities in every market. That’s especially the case during a correction because stocks go on sale when the market drops. So instead of gnashing their teeth for not sidestepping a sell-off – an “amateurish pipedream,” Cramer called it – investors should take the chance to buy great companies on the cheap.
This is why Cramer recommended having at least 5% of a portfolio in cash. So investors are ready when it’s time to pounce. If stocks have had a bigger run than usual, meaning some type of correction could be coming, 10% might be better.
The bottom line: Big declines will always happen. But smart investors with readily available cash can take advantage of them.
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
Hurricane Ida was on the verge of making landfall in the United States on Sunday as an extremely dangerous Category 4 storm that could plunge much of the Louisiana shoreline underwater as the state grapples with a Covid-19 surge already taxing hospitals.
Ida gathered more strength overnight, faster than meteorologists had predicted only a day ago. It is the toughest test yet for the hundreds of miles of new levees built around New Orleans after the devastation of Hurricane Katrina, which made landfall 16 years ago to the day, inundating historically Black neighborhoods and killing more than 1,800 people.
Louisiana Governor John Bel Edwards said that the storm, due to make landfall by Sunday afternoon, could be the state's worst direct hit by a hurricane since the 1850s.
The state is also dealing with the nation's third-highest rate of new COVID-19 infections, with about 3,400 new cases reported on Friday alone. Hospitals were treating some 2,450 COVID-19 patients, Edwards said, with those in many of the state's parishes already nearing capacity.
By early Sunday, Ida was a Category 4 hurricane on the five-step Saffir-Simpson scale, the National Hurricane Center (NHC) said. At 11 a.m. CDT (1600 GMT) it was located about 60 miles (95 km) west-southwest of the mouth of the Mississippi River, and some 85 miles (135 km) south of New Orleans, carrying top sustained winds of 150 miles per hour (240 km per hour).
Rain gusted through New Orleans on Sunday morning, where retired 68-year-old Robert Ruffin had evacuated with his family to a downtown hotel from their home in the city's east.
""I thought it was safer,"" he said. ""It's double trouble this time because of COVID.""
IDA's landfall was only a few hours away, according to the NHC, which warned of life-threatening storm surges, potentially catastrophic wind damage and flooding rainfall.
""We're as prepared as we can be, but we're worried about those levees,"" said Kirk Lepine, president of Plaquemines Parish on the state's Gulf Coast.
Plaquemines is one of the most vulnerable parishes, where 23,000 people live along the Mississippi delta stretching into the Gulf. Lepine feared levees along Highway 23 were not up to task.
""Water could go over top,"" he said. ""That's our one road in and out.""
Edwards told CNN on Sunday that he believed the state's levees would be able to withstand the storm surge, though he expressed some doubt about parishes, like Plaquemines, in the south.
""Where we're less confident is further south where you have other protection systems that are not built to that same standard,"" he said. ""That's where we are most concerned about the impact of storm surge.""
He said on Saturday there were no plans to evacuate patients from hospitals, and that state officials had been speaking with hospitals to ensure their generators were working and that they had more water on hand than normal.
Officials ordered widespread evacuations of low-lying and coastal areas, jamming highways and leading some gasoline stations to run dry as residents and vacationers fled.
""This is a powerful and dangerous storm. It is moving faster than we had thought it would be, so we have a little less time to prepare,"" said Dr. Joseph Kanter, Louisiana's chief medical official. ""There is a lot of Covid out there, there are a lot of risks out there.""
Utilities were bringing in extra crews and equipment to deal with expected power losses. U.S. President Joe Biden said he has coordinated with electric utilities and 500 federal emergency response workers were in Texas and Louisiana to respond to the storm.
U.S. energy companies reduced offshore oil production by 91% and gasoline refiners cut operations at Louisiana plants in the path of the storm. Regional fuel prices rose in anticipation of production losses and on increased demand due to evacuations.
Coastal and inland oil refineries also began to cut production due to the storm. Phillips 66 shut its Alliance plant on the coast in Belle Chasse, while Exxon Mobil cut production at its Baton Rouge, Louisiana, refinery on Saturday.
Jean Paul Bourg, 39, was planning to ride out the storm in Morgan City, about 70 miles (112 km) west of New Orleans. His wife's brother was recently released from the hospital after contracting COVID-19 and secured a generator to ensure access to oxygen if needed.
""You can't necessarily pile in with family members during Covid,"" Bourg said, after trimming trees and putting up plywood on his house. ""More people than you'd think are sticking around.""
The Federal Reserve's economic outlook isn't so much pessimistic as it is uncertain, with expectations running a wide gamut from a plodding recovery to a sharp rebound.
If that sounds a lot like the market lately, it's probably not a coincidence.
Following its two-day meeting earlier this week, the Fed released its Summary of Economic Projections for GDP, unemployment, inflation and interest rates. The estimates largely reflected the current unprecedented downturn followed by expectations for varying levels of growth ahead.
Specifically on GDP, which measures goods and services produced and is the broadest yardstick for economic growth, the median figures in each of the three years for which estimates were provided masked wide disparities of views from the policymaking Federal Open Market Committee's 17 members.
For 2020, the median expectation was for a GDP decline of 6.5%. But that was merely the midpoint of forecasts that ranged all the way from -10% to -4.2%.
The difference gets even more pronounced in 2021, where the median is a 5% gain but the range goes from -1% — in essence, a continuation of the recession that started in February 2020 — to a 7% gain, which would be the fastest one-year growth rate since 1984.
The outlook for unemployment and inflation all showed a substantial disparity of opinions.
Such wide spreads over what the future holds now seem written in the financial markets and particularly stocks, which on Thursday suffered their worst one-day plunge since late March and now suddenly look wobbly after a stunning 2½-month run higher. The surge came against a bevy of jaw-dropping economic numbers that showed how much damage the pandemic has caused.
""They've been pretty honest and straightforward about the high level of uncertainty that they see around how the economy's progressing, which is nice,"" Kathy Jones, head of fixed income for Charles Schwab, said of the Fed policymakers.
""We all know the second quarter is the trough and things will get better and the market is trying to discount that,"" she added. ""But I think the markets got pretty carried away.""
Indeed, Fed Chairman Jerome Powell has been emphasizing that even with all of the rescue funding that the central bank and Congress have been providing, the strength of the recovery is largely dependent on the path of the coronavirus.
Powell even noted at the end of this week's meeting that the SEP readings should be viewed cautiously. Because so much was unknown, the Fed declined to provide the quarterly summary at its main March policy meeting but elected to do so this week even with abundant questions about the future.
""Given the unusually high level of uncertainty about the outlook, many participants noted that they see a number of reasonably likely paths for the economy and that's not possible to identify with confidence a single path as the most likely one,"" Powell said Wednesday, noting that the SEP was ""a full range of plausible outcomes and not one particular forecast.""
At a time when fears of a second round of Covid-19 infections are heightened, the Fed's sketchy outlook helped precipitate a wicked Thursday market slide that was only partially offset by a Friday rally that continued to weaken as the day progressed. President Donald Trump weighed in Thursday, saying the Fed is ""wrong so often"" even though its 2021 forecast is for the fastest pace of growth since Ronald Reagan was president.
The Fed offered no additional policy tools to help guide the economy through what promises to be a murky road ahead, only assurances that short-term benchmark interest rates would remain anchored near zero through at least 2022.
The SEP ""showed a remarkably wide range of potential outcomes for the American economy over the next 2 years,"" wrote Nick Colas, co-founder of DataTrek Research. ""Despite that, the Fed did not announce anything new [Wednesday] aside from some assurance that it will not employ negative interest rates.""
Markets for the moment are no longer pricing in a chance that the Fed in fact would go to negative rates anytime soon, despite persistent speculation that it might follow the example of Europe and Japan if things continued to deteriorate.
But the chasm of economic expectations between officials serves as a reminder of how in flux the future can be, even as investors continue to price in a best-case scenario.
""In the end, equity markets have made their bullish bet about future corporate profits specifically and the state of the US economy more generally,"" Colas said. ""Even a Federal Reserve with an unabashedly uncertain outlook will not change that much.""
Sitting on a growing bitcoin fortune? Consider giving away some of it to charity.
As 2020 draws to a close, the cryptocurrency has seen a massive surge in appreciation. The value of a single unit of bitcoin is now hovering around $28,000.
Though longtime holders of the virtual currency are rejoicing, they run the risk of winding up overweight in bitcoin. That is, the massive run-up in values could suddenly result in investors having more exposure toward bitcoin — and its risks — than they'd like.
Similarly, while cashing out of your holdings might seem attractive, it could come with a hefty capital gains tax bill on the appreciation.
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That's where charitable giving comes into play.
""We believe in asset diversification, and because the price of bitcoin rose significantly, investors could be overallocated based on their targets for their portfolio,"" said Stefan Podvojsky, senior vice president of Fidelity Charitable.
""A donor advised fund provides a great outlet to remove that overweight and support the philanthropy that is important to the donor,"" he said.
Indeed, investors in bitcoin have been able to donate their holdings to donor-advised funds via Fidelity Charitable since 2015.
Benefactors have given close to $26 million in bitcoin to Fidelity Charitable's donor-advised funds year to date as of Dec. 29.
Donor-advised funds are accounts generous investors can fund with a variety of assets and use for making grants to their favorite charitable causes.
Nevertheless, giving away bitcoin and other crypto assets can come with a unique set of hurdles, including price volatility and additional tax reporting on the part of the investor.
Though you can convert cryptocurrency into dollars, the IRS regards it as property for income tax purposes.
This means you're subject to capital gains taxes if you decide to sell or exchange your virtual currency holdings.
The magnitude of the tax hit will depend on how long you've held your bitcoin — if it's at least a year, you may qualify for the long-term capital gains rate of 0%, 15% or 20% — and your cost basis in the asset.
Investors who snapped up bitcoin when it was especially cheap — consider that one bitcoin was worth $7,220 Dec. 30, 2019 — may face the harshest tax consequences when they sell or exchange it.
That's because the tax would be based on the difference between their cost basis and today's market price.
Meanwhile, donating an asset you've held for at least a year will allow you to claim a tax deduction based on its fair market value.
""Donating it could be incredibly tax-conducive,"" said Bryan Clontz, founder and president of Charitable Solutions, a firm that specializes in receiving and liquidating noncash assets for charities.
""It's the holy grail of charitable planning: a low basis, highly appreciated asset,"" he said.
Another reason why donating crypto via a donor-advised fund might make sense: Your favorite charity may be skittish about accepting direct contributions of virtual currency due to data security issues.
""The big issue for charities is the volatility and the risk that if you set up your own wallet, wallets can be hacked,"" said Greg Sharkey, senior philanthropy advisor at The Nature Conservancy, a charity in Arlington, Virginia.
The organization teamed up with BitPay, a bitcoin payment service provider, to accept donations and convert them to cash.
""If the donor calls this morning and wants to make gifts and does it through BitPay, the money would be at the charity's account tomorrow,"" said Sharkey.
What makes cryptocurrency so complex is the fact that not only are these assets subject to price volatility, but they also trade constantly.
Generally, the deduction a donor can claim is based on the price of the asset on the date they relinquish control to the donor-advised fund.
Fidelity Charitable only trades bitcoin during New York Stock Exchange market hours, or 9:30 a.m. to 4 p.m. Eastern, on weekdays, said Podvojsky.
""Depending on when during the day you might transfer the bitcoin to us, you would be subject to the price in the market and the liquidity we would be able to obtain at that point in time,"" he said.
Investors hoping to claim a tax deduction for their donation have extra legwork.
Because they're giving away a special asset, they must obtain a qualified appraisal from a third party and file Form 8283 with the IRS.
""Roughly $500 to $600 per appraisal would be the market for this space, and you'd have to have a larger donation to make it worth it,"" said Clontz. ""There's a cost to the donor, and it's not just five minutes of work.""
Giving away those appreciated bitcoin holdings and collecting a tax write-off isn't just a one-person effort. Here are a few considerations:
- Gather your experts: Financial advisors have a bird's eye view of a client's holdings, but they'll likely need to link up with the client's accountant and a qualified appraiser to ensure the investor maximizes his tax deduction for the donation.
- Consider taking the donor-advised fund route: Volatility and data security are chief concerns for charities, and not all of them are equipped to take direct donations of crypto assets. A donor-advised fund can receive the gift, convert it and allow you to make grants to your favorite charities.
- Maintain solid records. The IRS has made no secret of its interest in crypto assets. The front page of the 2020 income tax return asks whether you've transacted in virtual currency over the year. Be sure to hold on to any acknowledgement letters you receive from charities, as well as your appraisal documents.
Correction: New York Stock Exchange market hours are 9:30 a.m. to 4 p.m. Eastern on weekdays. An earlier version misstated the times.
* The BSE index
falls 0.66 percent while the 50-shareNSE indexis down 0.56 percent heading to their firstweekly fall after five weeks of straight gains.* Shares in Infosys Ltd
drops 5.5 percent afterdisappointing investors with weaker-than-expected margins andtook a conservative view on its full-year earnings.
* Fears of high inflation data due on Monday is also leading totrimming of positions in financials ahead of the weekend.
* ICICI Bank
falls 1.3 percent, while HousingDevelopment Finance Corporationis down 1 percent.* However, HDFC Bank
, gains 1 percent after meetingforecasts with a 30 percent year-on-year rise in second quarterprofit.
(abhishek.vishnoi@thomsonreuters.com)
Bitcoin, the electronic currency, could be used by divorcing spouses to hide assets from estranged partners, lawyers have said, as court battles shift their focus to the disclosure of assets.
Divorce settlements in England are seen as particularly generous to ex-wives, because judges recognize the equal contributions made by the breadwinner and the homemaker in a marriage, and divide the assets equally.
Moreover, courts are increasingly having to deal with legal battles brought by one side claiming the other has not made full disclosure of assets and has concealed wealth.
Read MoreMarc Andreessen in bitcoin for the long run
Ayesha Vardag, a London divorce lawyer, has warned that more lawyers may start including digital currencies in financial disclosure orders if there is evidence they have been used.
""They can be used to run a parallel economy,"" she said. ""People will go to immense lengths . . . as a spousal claim is more damaging than tax because it is half your wealth.""
Already, a number of forums devoted to Bitcoin discussion have seen husbands exploring the option of using digital currencies, she said.
Read MoreDish to becomelargest company to accept bitcoin
Bitcoins provide relative anonymity to investors and, unlike bank accounts and share holdings, they are hard to link to an individual.
For this reason, the currency has become a mainstay of illicit transactions, such as through Silk Road, the now-closed online drugs and weapons marketplace.
Although traditional currency holdings – in US dollars or euros for example – might need to be declared as part of the asset disclosure process, parties could try to hide their wealth by converting it to Bitcoins.
Unscrupulous spouses could also transfer the currency quickly and almost anonymously between online wallets, hiding their wealth in the hands of friends, perhaps outside of the jurisdiction, to avoid discovery and enforcement.
Frank Arndt, head of international family law at Stowe Family Law, said that he expected Bitcoins could become an asset to be disclosed in divorce cases.
Read MoreSchiff now sellinggold for bitcoins
""Husbands are becoming more and more creative in terms of what they do to reduce their wealth and the courts are struggling to catch up. It's just like when the internet started and it was difficult for courts to catch up,"" he said.
Steven Philippsohn, a fraud and asset recovery lawyer at PCB Litigation, said he had not seen any cases of people hiding their assets using digital currencies but believed that court orders of asset disclosure might soon include them. ""Court orders in this country are very extensive and it's inevitable it will happen... orders for disclosure have incorporated new areas like Facebook and Twitter,"" he said.
Courts in California are beginning to issue search and discovery orders of assets that include digital currencies such as Bitcoin.
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Last November, the District Court for the Eastern District of California issued a discovery order in a trademark infringement case involving Entrepreneur Media. It ordered the disclosure of financial statements from the defendant including any use of digital banking services such as Bitcoin.
Ms Vardag said there was no reason a similar disclosure order could not be obtained from the English courts.
Read MoreDisney child starroils Bitcoin Foundation
Michelle Young was awarded a £20m lump sum last year after divorcing her husband Scot Young. Mr Young had claimed he was penniless and could not afford to pay anything. She alleged he was worth millions.
Mr Justice Moor noted that Mr Young was said to be hiding very considerable assets and found he had ""misled the court as to his finances to a very significant extent"" and failed to disclose assets.
The Supreme Court also ruled last year that Yasmin Prest, the former wife of Michael Prest, an oil trader who was worth £37.5m in 2011, could receive millions of pounds of property assets from three offshore companies, despite the fact they were set up as distinct legal entities by her former husband.
Some savvy traders stand to make millions off Friday's General Electric deal as a result of some very well-timed options trades.
On Thursday, when GE stock was trading around $25, traders starting aggressively buying the April 26-strike calls for around 33 cents each. A call purchase is a bullish bet that a stock will rise a certain amount within a set time. All told, nearly 18,000 of those calls traded.
GE shares rallied 8 percent Friday after the company announced it will sell its finance arm and buy back stock. With the advance, those call options are now worth $2 each, a sixfold increase that created an instant windfall for the buyers.
Read MoreGE unveils massive financial unit restructuring
""The rumor had been out there,"" said Dan Nathan, a CNBC contributor, who first wrote about the activity on RiskReversal.com. ""GE is not a name we usually see short-term speculation in the options market.""
Most curious about those purchases is that those April calls expire next Friday, giving whoever bought them precious little time for their bets to pay off.
""The punters were out in force yesterday playing for quick home run, and they got it,"" added Nathan.
This isn't the first time GE has attracted the attention of options traders. Back in early march, a market participant bought 125,000 of the January 2017 30-35 call spread for 50 cents per contract. Since each call contract controls 100 shares, that trade represented a $6.25 million bet that GE shares will rise above $35 by January 2017. With Friday's move, the firm that put on that trade has doubled their money.
Read More The Dow dog that could be set to howl
""Hedge funds have been buying calls for some time now,"" noted Nathan.
Even with Friday's rally, GE shares are still less than half of the all-time high set in 2000.
Cybersecurity, health of the global economy, energy price shock and terrorist attacks are some of the top risks that concern businesses and may threaten their ability to operate, according to results from a new survey by the World Economic Forum (WEF) published Wednesday.
The survey, conducted annually by the WEF's strategic partners Marsh & McLennan Companies and Zurich Insurance Group, highlighted the following ten risks that businesses are presently concerned about:
- Unemployment and underemployment
- Fiscal crises
- Failure of national governance
- Energy price shock
- Profound social instability
- Failure of financial mechanism or institution
- Failure of critical infrastructure
- Cyber attacks
- Inter-state conflict
- Terrorist attacks
While concerns about the overall health of the global economy continue to dominate the list, the report found concerns around cybersecurity risks rising in importance.
""Business leaders in many of world's largest economies now rank cyber as their top risk,"" John Drzik, president of Marsh Global Risk & Digital, said in a press statement. ""Companies need to rigorously analyze how these threats could impact their operations and take appropriate risk mitigation and resiliency measures.""
Results from the survey found that respondents across North America, East Asia and Pacific regions were most concerned by cyber attacks and asset bubbles.
Meanwhile, unemployment, fiscal crises and the failure of a nation's government to provide stability are the top three risks facing businesses globally,
The data from the Executive Opinion Survey (EOS) survey, drawn from over 12,411 executives across 136 countries was conducted earlier this year between February and June. The survey asked respondents to identify the five biggest risks to doing business in their respective countries. The risks identified were spread across economic, geopolitical, social and technological areas that could impact the functioning of corporates over the next 10 years.
Some of the other risks identified by the respondents included energy price shock, profound social instability, failure of financial mechanism or institution, failure of critical infrastructure, inter-state conflict and terrorist attacks.
""Whilst economic growth and technological developments create new opportunities for business and countries, geopolitical risks and events have led to uncertainties which raise questions about how to manage resilience in uncertain times,"" John Scott, chief risk officer of commercial insurance at Zurich, said in a press statement.
Scott further explained that looking at the survey results, it appears that in the medium-term, business leaders are focusing on social and economic risks but it is important to remain prepared for any environmental and technological risks as well.
In terms of regions, while business leaders in Europe highlighted the failure of financial mechanisms or institution as pressing risks, in South Asia, failure of urban planning and failure of critical infrastructure were marked among the key potential threats.
Respondents across North America, the Middle East and Northern Africa were seen to be worried about a threat of potential terrorist attack. Meanwhile, risks associated with the failure of climate change adaptation saw very little concern among respondents. According to the results, only Canadian executives put climate change in their top risks.
A year ago Wal-Mart management said that high gas prices were hurting their customers and store sales.
Now, a year later, gas prices are even higher and Wal-Mart management says those expensive costs are bringing customers into its stores.
So I asked CEO Lee Scott where the tipping point in terms of changing consumer behavior.
His answer was an interesting one. Scott said it was undeniable that Wal-Mart's core customers were the first ones impacted by the spike in gasoline prices and they bought less. What changed? Scott said two things: (1) Wal-Mart improved its store experience (cleaned up aisles, added brands to its merchandise and refocused on retail) and (2) the economic stress spread from the bottom up and brought in new customers at ""the right"" time (i.e. After Wal-Mart improved stores.)
Scott said that this trend doesn't mean that business will fall off when the economy improves. Wal-Mart executives also made it clear that they're interested in expanding health care and green initiatives. In other words, they're trying to anticipate where product trends are headed and carve out a low cost niche to feed developing needs.
Wal-Mart management still thinks that it can tap into the middle income customer base that Target has dominated for the past few years.
While Wal-Mart's past attempts to draw in those customers via merchandising like clothing (remember Mark Eisen?) have failed, this time around the economy may bring those customers in-store. At least, that's what management is betting on.
Questions? Comments? retaildetail@cnbc.com
Paul Singer thinks the recent dramatic move in the Swiss franc—and resulting losses—shows just how exposed most investors are to market risk.
""Given the pricing and the still opaque and over-levered financial system, the sensitivity ... to risks is extremely high ... and the cushion to withstand risks is very low,"" the founder of Elliott Management said at the World Economic Forum in Davos, Switzerland, on Wednesday.
Many traders were caught off guard last week when the Swiss government unexpectedly removed the cap on the Swiss franc to the euro, causing it to spike in value versus other currencies such as the U.S. dollar—and causing major losses for some investors.
Read MoreEverest Capital falls victim to Swiss franc, shutters largestfund
Singer repeated his claim that central bank economic stimulus programs, which have provided access to cash at record low prices, have created a ""major distortion in asset prices.""
He said the high value of stocks and low yield of bonds is leaving little cushion for a negative geopolitical event.
""I believe strongly,"" Singer said, ""that markets are mispricing risk throughout the world.""
Read MoreSwitzerland 'will suffer' after SNB move: Zurich CEO
As another academic year starts, about 500,000 children across the country will find themselves learning subjects like middle school history or high school biology from a new line of digital textbooks. These manuals, branded Techbooks, come with all the Internet frills: video, virtual labs, downloadable content.
But the Techbook may be most notable for what it does not have — backing from a traditional educational publisher. Instead it has the support of Discovery, the cable TV company.
Discovery, which also sells an educational video service to school districts, is entering the digital textbook market largely because it sees a growth opportunity too good to pass up.
Conventional textbooks for kindergarten through 12th grade are a $3 billion business in the United States, according to the Association of American Publishers, with an additional $4 billion spent on teacher guides, testing resources and reference materials. And almost all that printed material, educators say, will eventually be replaced by digital versions.
“It’s kind of perfect for us,” said David M. Zaslav, chief executive of Discovery Communications, which owns networks like Discovery Channel, Animal Planet and TLC. “Educational content is core to our DNA, and we’re unencumbered — unlike traditional textbook publishers, we’re not defending a dying business.”
Mr. Zaslav is not the only media executive talking grandly about education these days. Movies, television, newspapers and magazines are in decline or facing headwinds, putting pressure on media companies to find new areas of expansion.
Education is emerging as an answer, largely because executives see a way to capitalize on the changes that technology is bringing to classrooms — turnabout as fair play, given the way that the Web has upended major media’s own business models.
“We think the opportunity continues to be to use digital technologies to be disruptive to an enormous business stuck decades in the past,” Chase Carey, News Corporation’s chief operating officer, told analysts this year.
News Corporation is betting on just that. This month, the company said it would infuse its fledgling education division, Amplify, with $100 million.
Amplify, focused on digital teaching and assessment tools, is run by Joel I. Klein, the former New York City schools chancellor. Rupert Murdoch, the chief executive of News Corporation, has said he would be “thrilled” if education were to account for 10 percent of its revenue five years from now.
Old-line education companies, however, may be more difficult prey than Mr. Zaslav and Mr. Murdoch think. Pearson, McGraw-Hill and Houghton Mifflin Harcourt are introducing digital educational products of their own, and these stalwarts have a technology giant on their side: Apple , seeking to bolster iPad sales, recently started selling digital high school textbooks through its iBooks store, with those three publishers as partners.
“Over the last 10 years alone, we’ve invested $9.3 billion in digital innovations that are transforming education,” said Will Ethridge, chief executive of Pearson North America, part of Pearson P.L.C., the world’s largest education and learning company. “One way to describe it would be an act of ‘creative destruction.’ By this I mean we’re intentionally tearing down an outdated, industrial model of learning and replacing it with more personalized and connected experiences for each student.”
On a smaller scale, NBCUniversal has been building a service called NBC Learn, which digitizes and archives articles from NBC News to sell as a database and digital blackboard learning system; NBC Learn now operates in 5,000 schools in 43 states.
The Financial Times, owned by Pearson, is pushing MBA Newslines, a subscriber-only feature on its Web site that lets business students and professors create and share annotations on articles, allowing case studies to be built around real-time news events.
And then there is the Walt Disney Company . It is building a chain of language schools in China big enough to enroll more than 150,000 children annually. The schools, which weave Disney characters into the curriculum, are not going to move the profit needle at a company with $41 billion in annual revenue. But they could play a vital role in creating a consumer base as Disney builds a $4.4 billion theme park and resort in Shanghai.
Media companies have dipped their toes into education before, of course, only to find chilly waters. Discovery in 2006 promoted Cosmeo, an Internet-based service that offered children videos and other tools to help them with their homework; a year later, Discovery decided to stop marketing the product, which cost $99 a year, and laid off much of its staff. (Why pay for help when you can search Google at no cost?)
In 2007, Disney introduced a new position — senior vice president for learning — with the goal of moving into the North American education businesses. None of the company’s major efforts got off the ground, and Disney eventually pulled the plug, in part because it decided technology was changing the sector too rapidly.
News Corporation faces perception hurdles as it moves deeper into education — namely what some rivals refer to as the “Foxification” of schools, a pointed reference to Fox News Channel and its stable of conservative pundits. The company has said it has zero interest in inserting politics into schools, and notes that other assets, including the National Geographic Channel, which, like Discovery’s flagship channel, largely focuses on documentaries and educational programming, could play to the company’s advantage.
Last year, the New York State comptroller, citing News Corporation’s phone-hacking scandal in Britain, rejected a $27 million contract with its education division. The decision underscored one of the biggest hurdles faced by companies entering the education market: new products must typically gain state approval before schools even have the chance to decide to buy them.
Wall Street is skeptical that education holds as much promise as some media companies think. “When big conglomerates feel their core businesses have started to mature, they look for related synergistic businesses,” said David Bank, an analyst at RBC Capital Markets. “You have to ask yourself, are those education businesses really related and synergistic in core?”
Bill Goodwyn, chief executive of Discovery’s education unit, says in his company’s case, the answer is an emphatic yes. He conceded that Cosmeo “lost a lot of money,” but said that Discovery’s business had centered on education since its earliest days. Discovery Channel’s original name was Cable Education Network, for instance, and the company used to make money by shipping VHS cassettes of documentaries to schools.
Discovery currently sells a popular subscription streaming service to schools, which comes with 50,500 video segments and 6,200 full-length videos on topics like math, social studies and language arts. The service costs $1,570 a year for a school that serves kindergarten through eighth grade; high schools pay $2,095.
Still, Discovery’s previous efforts pale in scope to its Techbook initiative.
Mr. Goodwyn’s 200-employee division introduced the line of digital textbooks last year. Their cloud-based technology works with whatever hardware a district has — iPads, laptops, desktops. Discovery tailors them to the particular curriculum needs of various states (or districts within states).
“As a 30-year veteran, it was not always easy giving up some of the more traditional ways of teaching,” said Roseann Burklow, a seventh-grade science teacher in Mooresville, N.C. “But I love the Techbook. Students are engaged and can work independently or collaboratively.” (She did suggest one improvement: more games to help students review material for tests.)
Traditional textbooks cost about $70 a student; Discovery’s Techbooks start at $38 a student for a six-year subscription and go up to $55, depending on the subject and grade level.
Discovery knows education will never pay its bills. Last year, the company’s learning products, for instance, generated adjusted operating income of $23 million, a 53 percent increase over a year earlier. In comparison, its United States cable networks delivered operating income of $1.5 billion, a 10 percent increase from a year earlier.
Still, Mr. Zaslav said the education unit’s small size did not dim his enthusiasm. “Television is always going to be our primary focus, but we’re incredibly excited about the business potential of the Techbook,” he said. “Education is an area of solid, sustainable growth.”
34-year-old professional skier Bryce Phillips had a vision to create a retail experience for the active sport enthusiast that would embrace their lifestyle and their values.
In 2005, he launched Evo, an online and brick-and-mortar retail business that caters to skiers and boarders. Retail is just one part of the business. He also engages the community through events such as art openings, film premieres, and skate competitions at the Seattle headquarters.
Evo, short for “evolution”, is how Phillips thinks about his business: always changing to stay relevant. And indeed, his company evolved from a one-man business selling merchandise from liquidators at the age of 12, to a full-fledged business with 120 employees.
Phillips talks about how Evo got its start,why it has thrived, and where he plans on taking the company from here.
Where did you get the idea for your business?
I originally started buying and selling gear to pay for my skiing. When I was in junior high and high school, I was selling equipment just to finance ski trips and equipment. In college I would go to places that were going out of business and I would buy a bunch of boots and resell them. I made a good margin and it allowed me to reinvest and put money into skiing, I wasn’t really building a brand or company, or anything beyond what I was selling to pay for the sport.
Where did the funding first come from?
[When I decided to turn the sideline into a full-time business], it was all credit cards and loans from family. I used school loans to help buy a house, then re-mortgaged my house. I was finding cash wherever I could; you know, the typical founder stuff. It took quite a while. I was
fixing up and selling houses, then brought on individual investors. Our first round was in 2008 when I was introduced to people in Seattle who were in the business. At that time, I got a little more than $1 million; and two years ago it was a bigger round, around $9 million through word of mouth.
Who was your first customer?
I was selling to kids I went to school with in Roseburg, Ore. I bought a bunch of ski boots from a retailer going out of business and sold 10 pairs of boots. I hung flyers around town, but most of it was word of mouth: People knew I had gear and was selling it at a good price.
When did you know the company would be a success?
I’ve always had the confidence it would be. It was naive, for sure, but I guess I always had an understanding what did exist and didn’t exist in the market. And then, tying it into all the elements that surrounded it into the culture. One thing led to another. I sold skis out of my dorm room, and it just grew and grew and grew. Later on in life, you realize there are big challenges and you’re not sure for a moment, but you get through those.
What’s next?
We have a huge opportunity to open stores nationwide. We have an opportunity to grow Evo-branded product. Right now we do small bits of Evo-branded products, such as clothing and accessories. We want to make that a bigger category for our business, with outwear and street wear.
Follow Jessica Naziri on Twitter @jessicanaziri
Political tension with Beijing, high property prices, and an economic slowdown in mainland China have dimmed Hong Kong's growth outlook for 2016 according to the city's white collar workers, a new study has found.
Professional accounting body CPA Australia, which polled Hong Kong-based professionals working in public and private companies, government and other not-for-profit organizations, found 53 percent of respondents described themselves as pessimistic about the region's prospects – a 13 percent increase in gloomy respondents compared to the year before.
Just 9 percent said they saw the economic outlook as ""positive,"" while 34 percent said it was satisfactory.
Almost a third believed Hong Kong's gross domestic product (GDP), the widest measure of economic growth, would expand by between 1-1.9 percent next year; this was a 7 percent decline in the number that expected similarly positive growth in the CPA's 2014 poll.
According to the new poll, 25 percent said GDP growth would decline in 2016, a 13 percent rise in the number of pessimistic votes on the year preceding.
""There is no doubt that the survey results show that economic sentiment for 2016 has turned negative and many respondents believe our competitiveness is declining,"" Kenneth Chen, divisional president of greater China at CPA Australia, said in a press release.
The main threats to Hong Kong's competitiveness were seen as coming from mainland China, despite the volatility that affected Chinese markets in the third quarter, and from Singapore, the CPA Australia study found. About 67 percent of the respondents thought Hong Kong's competitiveness will decline in 2016.
Last month, the World Economic Forum (WEF) ranked Hong Kong seventh in its Global Competitiveness Index, while Singapore ranked second and China was 28th. Hong Kong has been ranked in the same place for three straight years, with the latest report noting ""the challenge for Hong Kong is to evolve from one of the world's foremost financial hubs to an innovative powerhouse."" Hong Kong scored low marks for innovation.
The downbeat view of Hong Kong's outlook is echoed by some analysts and economists.
Rajiv Biswas, chief economist for Asia Pacific at IHS Global Insight, told CNBC by email: ""Hong Kong is particularly vulnerable to an economic slowdown in China, due to the increasingly close economic ties with the mainland."" He added that the impact of China's growth slowdown was already visible in Hong Kong's economic data.
Hong Kong's total merchandise exports fell by 1 percent on-year in the first eight months of 2015; exports to China were down by 2.2 percent. And slow growth in tourism from the mainland hit Hong Kong's retail sales, which clocked a 5.4 percent year-on-year decline in August.
Read MoreHas Hong Kong lost its center of vice?
""In recent months, mainland tourism visits to Hong Kong have shown a dramatic slump, with total mainland Chinese tourist arrivals in August down [by] 7.1 [percent] compared to a year ago,"" said Biswas.
An economic slowdown, along with crackdown on corruption on the mainland, also affected sales of luxury brands in Hong Kong.
""Sales of [luxury] watches and jewelry in Hong Kong [was] down 8.8 [percent] year-on-year in August 2015,"" Biswas noted.
But some believe that for an advanced economy, the projected GDP figures are acceptable.
In a July report on Hong Kong's outlook, Moody's Analytics said that though the region's growth was expected to come in between 1 and 3 percent for the coming two years, the projected figure was ""still robust for an advanced, high income economy.""
""Hong Kong has significant buffers to guard against financial and economic shocks,"" the report noted, citing the region's strong fiscal reserves and international investment position.
In a September report, Moody's issued a revised forecast for Hong Kong's growth outlook to 2.2 percent for 2016.
Even sometimes tense political relations with Beijing were ""unlikely to affect economic policies or result in political protests of a scale that could hinder growth or dent Hong Kong's status as an international financial center,"" Moody's July report noted.
Read MoreHong Kong's cultural hotspots you may not know about
In June Hong Kong's legislature rejected a Beijing-supported electoral bill that proposed Hong Kong residents should vote for their next leader from a list of candidates approved by the Chinese government.
The CPA Australia study said that closer economic collaboration with China would help Hong Kong's economy overcome the negative outlook currently prevalent, especially in sectors such as e-commerce, healthcare, banking and finance.
""China has introduced a number of policies and initiatives that will undoubtedly help drive economic growth in Hong Kong,' noted Chen.
Beijing has used a number of fiscal and monetary policies to stabilize its stock markets and keep growth on track, as well as launching initiatives to establish closer business and trade ties with countries in the region.
These initiatives include the new Asian Infrastructure Investment Bank (AIIB), the Belt and Road initiative, which aims to be one of the largest trade and infrastructure networks connecting the Asia Pacific and Europe, and free trade zones.
London's first Muslim mayor said Americans can't let terrorists scare them into changing the way they live their lives.
""We have to recognize that what these terrorists hate about us is our way of life. We respect each other. We embrace each other. We celebrate each other,"" Sadiq Khan said in an interview on CNBC's ""Closing Bell.""
He explained that terrorists hate the social and religious diversity of global cities like London and New York City. Fortunately, these kind of attacks don't happen daily because law enforcement ""work their socks off"" to prevent them, Khan said.
He made his comments in the wake of explosions in New York and New Jersey. Earlier on Monday, New York City Mayor Bill de Blasio said that this was an act of terror. The FBI said, however, that there is no reason to believe a terror cell is operating here.
Two senior officials have now confirmed to NBC News that Ahmad Khan Rahami was not on a U.S. terrorist watchlist or an NYPD list. NBC News also reported that U.S. Intelligence does not have any information indicating connections between the suspect's family and known terrorist groups or individuals.
Rolling Stone magazine sparked a heated social media debate today after releasing a cover image promoting an upcoming profile of alleged Boston Marathon bomber Dzhokhar Tsarnaev.
The Twitter and Facebook firestorm resulted in calls for boycotts, and drugstore chain CVS announcing that it would not carry the issue in its 7,000 stores nationwide.
""As a company with deep roots in New England and a strong presence in Boston, we believe this is the right decision out of respect for the victims of the attack and their loved ones,"" the statement said. CVS is headquartered in Woonsocket, R.I.
The cover, released online as a preview to Friday's edition with an in-depth article chronicling Tsarnaev's life leading up to the Boston Marathon bombing, features a ""selfie""—or self-taken photo—by Tsarnaev with the teen's hair falling across his face.
Some online noted that the photo called to mind previous Rolling Stone covers of Jim Morrison or Bob Dylan and glorified the teenage suspected killer. Others pointed out that the photo had also appeared on major news sites like The New York Times in the days after Tsarnaev's capture.
""This is obviously a big story and there are a lot of people who are going to be interested in it, but in my mind it isn't deserving of the cover,"" said Duran Fernandez-O'Brien, who lives in Boston and joined the ""Boycott Rolling Stone Magazine for their latest cover"" Facebook page.
Tsarnaev is suspected of setting off two bombs at the Boston Marathon with his older brother, Tamerlan Tsarnaev, on April 15. At his first public appearance since his arrest, Tsarnaev pleaded not guilty to 30 charges brought against him by federal prosecutors in the U.S. District Court.
Fernandez-O'Brien echoed other online critics, voicing concern over whether the magazine is glorifying Tsarnaev and his actions by giving him so much attention.
""Obviously it's what people want to see,"" he said. ""Definitely. But at the same time it creates a culture where people who may be on the fringe of thinking about doing something like that will then push forward and go through their ideas because they think this will make me famous: 'I will leave my mark history if I do something like this.' ""
Instead of focusing on the bombers, the media should focus on the victims, Fernandez-O'Brien said.
MBTA officer Richard ""Dic"" Donohue, who was shot during a chaotic exchange of gunfire with the Tsarnaev brothers following the bombing, released a statement voicing his thoughts on the cover.
""My family and I were personally affected by these individuals' actions. I cannot and do not condone the cover of the magazine, which is thoughtless at best,"" he said. ""I am confident that our Boston Strong community will remain intrepid and unshaken by the cover of this magazine.""
Others, including journalism professor at Northeastern University and frequent media commentator Dan Kennedy, argue that the cover choice is not only not controversial, but a smart editorial decision on behalf of Rolling Stone.
""I think it's important to be responsible,"" he said. ""It's nice to say that we should keep our focus on the victims of this awful crime and not glamorize someone like Tsarnaev, and I agree with that, but at the same time I think that we all want to know what drove him to commit this terrible crime, and he's interesting, and that's the definition of news.""
Kennedy did agree that Tsarnaev looks glamorous on the over, but that every picture he has seen of the alleged bomber from the Boston Globe to The New York Times shows Tsarnaev in the same way.
He also noted the magazine's history of featuring high-profile news as feature and cover stories, such as its 1970 cover of Charles Manson.
""I suppose you could say this one was glammed up to an unusual degree, but I thought it really worked very well because it was an exercise in cognitive dissonance,"" he said.
""You look at the type and it says 'the bomber and how he turned into a monster,' then you look at the glammed-up shot of him and at the word 'bomber,' and you see a monster.""
Read more from NBC News:
Ariel Castro pleads not guilty to massive 977-count indictment
Court provides counseling to Zimmerman jurors days after emotional verdict
Sister of mystery man with amnesia says family had no idea where he was
Rolling Stone released a statement standing by its decision to publish the cover story, noting that its hearts go out to the victims.
""The cover story we are publishing this week falls within the traditions of journalism and Rolling Stone's longstanding commitment to serious and thoughtful coverage of the most important political and cultural issues of our day,"" the magazine added.
Tedeschi Foods, a New England-based grocery chain with 200 outlets, also announced Wednesday that it would not carry the issue of the magazine.
—By Tracy Jarrett, NBC News
Phillips to Share Storage Best Practices for Managing the Rapid Growth of Business-Critical Data
PHOENIX--(BUSINESS WIRE)-- Avnet, Inc. (NYSE:AVT), a leading global technology distributor, today announced that the company’s senior vice president and CIO, Steve Phillips, will be a keynote speaker at SNW Fall 2012. This annual conference for information technology (IT) management focuses on the future of storage, data and infrastructure solutions. The conference will be held at the Hyatt Regency Silicon Valley/Santa Clara Convention Center in Santa Clara, Calif., and Phillips will present on Thursday, October 18, 2012, at 5:00 p.m. PT.
Avnet, Inc. CIO Steve Phillips to Share Storage Best Practices for Managing the Rapid Growth of Business-Critical Data at SNW Fall 2012 (Photo: Business Wire)
LONDON -- Supporters of Occupy have gathered outside St. Paul's Cathedral to mark the first anniversary of the anti-corporate movement's now-dismantled protest camp.
Hundreds of protesters against capitalist excess and social inequality set up camp outside Christopher Wren's famous landmark on Oct. 15, 2011, after they were stopped from demonstrating outside the nearby London Stock Exchange.
The tent city embroiled the historic church in a conflict between bank-bashing demonstrators and the city's finance industry. The church's position on the protesters shifted several times, and the cathedral's dean and a senior priest both resigned over the issue.
The camp was dismantled in February after the protesters lost a court battle with local authorities.
Activist Ronan McNern said Saturday that the movement was still necessary because ""the problem of inequality is not going away.""
Investors who want to buy an energy stock as the price of oil slides should look to Chevron, CNBC's Jim Cramer said Thursday.
""Here's a stock that everyone seemed to just be gaga about a few weeks ago, and now it can't get any love,"" the ""Mad Money"" host said of Chevron. ""The stock's fallen from $113 to $94, but at these levels it sports a 5.7% yield. I like Chevron very much.""
An attractive dividend is the primary reason to consider owning an oil stock right now, Cramer suggested.
Outside of Chevron, Cramer said two other oil plays that carry slightly more risk are Devon and Pioneer Natural Resources. While both companies have solid variable dividends, he stressed that ""their payouts could shrink as oil comes down.""
The price of crude slid in recent weeks and on Thursday closed in the red for the sixth-straight session, touching its lowest level since May.
The U.S. oil benchmark, West Texas Intermediate crude futures, dropped 2.7% to settle at $63.69 per barrel. Brent crude, which is the international benchmark, declined about 2% to just under $67 per barrel.
After a red-hot start to the year, oil has faced weakness due, in part, to concerns about slowing demand as the coronavirus pandemic persists around the world. Comments this week about a potential change to the Federal Reserve's highly accommodative monetary policy also caused the U.S. dollar to strengthen. That can end up hurting oil because it makes crude more costly for overseas buyers.
In July, as WTI traded above $72 per barrel, Cramer said he believed oil had put in its near-term top. He said Thursday more weakness could be ahead, as an increase in supply clashes with a slump in demand. Investors who are looking to buy an oil stock need to be mindful of that, Cramer said.
""Be careful, because oil ... may not be done rolling over yet,"" he said. ""I don't know if oil can even hold above $60 these days. Most American producers are still plenty profitable above $60, but below that level, it does start to get more dicey.""
Shares of Chevron are posting a second day of strong gains, bolstered by an upgrade at Credit Suisse, after the energy giant raised its outlook for oil and gas production on Friday and reported quarterly earnings that topped Wall Street's expectations.
Chevron's stock price jumped more than 3.5 percent, to about $119, on Monday, bringing its two-day gain to roughly 7 percent. The shares are still down about 5 percent this year, roughly in line with the loss for the broader S&P 500 energy sector.
Chevron reported a $4 billion profit for the third quarter of 2018, more than double its earnings during the same period a year ago. The San Ramon, California-based company pumped at a record level last quarter, and executives said they now expect to hit the upper range of their guidance for oil and gas output for the year.
Credit Suisse on Monday upgraded the company's stock to outperform from neutral. The investment bank maintained its price target of $138 on the shares.
The bank said Chevron ""continues to execute on its already superior growth outlook,"" even as its stock trades at a ""wider than normal"" discount to fellow U.S.-headquartered oil major Exxon Mobil.
Chevron now says it expects its oil and gas production to grow at the top end of its previously forecast range of 4 percent to 7 percent.
That should yield better capital efficiency in 2018 and boost free cash flow, in Credit Suisse's view. Healthier cash flow will allow Chevron's management to reward investors with a competitive quarterly dividend payment and potentially expand its $3 billion per year share buyback program, the bank said.
The engine behind Chevron's growing output is its Wheatstone and Gorgon natural gas projects in Australia, the Permian Basin underlying Texas and New Mexico and several offshore projects, according to Credit Suisse.
German Chancellor Angela Merkel has received another glowing endorsement to be a future president of the European Commission — this time from Luxembourg.
Luxembourg's Prime Minister Xavier Bettel told CNBC that Merkel would be a ""dream candidate"" for the presidency of Europe's executive body.
""I love that idea, I've asked Angela Merkel several times. She would be a perfect candidate for the (European) Council, for the Commission,"" Bettel told CNBC's Silvia Amaro in Luxembourg Thursday.
""She's got a global view, she's a great leader and a strong personality. I really, really appreciate Angela Merkel …. I really, really think she would be a great leader for Europe. We have some different candidates who are able but Angela for me would be a dream candidate.""
Bettel's comments come after French President Emmanuel Macron said that he would support Merkel as the next president of the European Commission once Jean-Claude Juncker leaves the post on November 1.
On Tuesday, Macron told Swiss broadcaster RTS that ""If she were to want it (the post), I would support her.""
Merkel has reportedly said that she does not want the position and wants to quit politics when she steps down as German chancellor in 2021 after four terms in office. Nonetheless, she is viewed as a strong and stable leader in Europe despite growing political turbulence in Germany and is something of a figurehead for the European Union (EU).
Other European officials are keen to encourage Merkel to consider the Commission presidency role, praising her as a unifying figure in the bloc and a steady force that region needs when its political environment looks polarized and fractured.
The next president of the Commission has to be approved by a majority of the 28 member states, but also by a majority of lawmakers at the European Parliament, the EU's legislative arm.
There will also be a vote to replace the current President of the European Council, Donald Tusk, when his term also ends in November, as well as new leaders of the EU Parliament, the EU's foreign policy chief and the next president of the European Central Bank.
Battle lines are already drawn between member states over the top jobs up for grabs. Donald Tusk has been consulting member states and the European Parliament about the positions. He has also said the EU should aim to have ""at least two women"" in the senior posts.
Tweet:
Tusk has said that he hoped the appointments would be agreed at an EU summit on June 20-21 when the bloc's 28 leaders next meet.
- CNBC's Silvia Amaro contributed reporting to this story.
Ford Motor's luxury unit Lincoln plans to produce luxury SUVs in China by late 2019, as it steps up its move into the world's largest auto market and aims to catch up with German and U.S. rivals who already manufacture in the Asian nation.
The plan is to build an all-new sports utility vehicle (SUV) to suit Chinese tastes, Lincoln China said in a statement. Ford plans to use an existing assembly plant it jointly operates with Chongqing Changan Automobile to produce the Lincoln vehicles, a Ford spokesman in Shanghai said.
Lincoln vehicles are currently imported into China, and their sales have jumped nearly 180 percent in 2016, the statement said.
""The move to local production is a key next step in Lincolns evolution in China and will complement continued imports from North America,"" it said.
The statement gave no other details about the plans. The Ford spokesman declined to give the model's anticipated production volume or describe the model other than to say it is an SUV.
The Changan-Ford joint venture is in the process of getting approval for this move to produce Lincoln vehicles locally in China, said the spokesman.
Lincoln China President Amy Marentic told Reuters in October that the brand was studying whether to produce cars locally in China.
Lincoln was accelerating its entry into China with plans to have 65 Lincoln stores by the end of 2016, instead of previous plans of 60, with 80 planned for year-end 2017, she said.
Marentic said the company would also open five to 10 smaller sales branches to tap into fast-growing auto sales in lower-tier Chinese cities.
An Air India passenger plane flying to the United States was escorted by British fighter jets to land in London on Thursday after a bomb threat.
Air India said flight AI 191 from Mumbai to Newark had made a precautionary landing at London Stansted Airport ""due to bomb threat.""
Britain scrambled Typhoon fighters at supersonic speed to intercept the Boeing 777-337 and safely escorted it to Stansted.
The airport said its runway has reopened and the Air India flight was at an isolated stand with police in attendance.
""An Air India Boeing 777 diverted into London Stansted Airport at approximately 1015 and landed safely with Essex Police in attendance. It is parked on an isolated stand away from the normal airport operations,"" the airport said.
""Our runway has now re-opened and is fully operational following a precautionary landing of Air India flight,"" it said.
An Air India spokesman was not immediately reachable.
The ongoing trade war President Donald Trump has waged against world powers, including some of our closest allies, doesn't show signs of slowing down.
Left in the fray: Companies, American workers and consumers.
The list of companies affected, either by planning to close plants, laying off employees, tossing out plans for new jobs or raising prices continues to grow.
On Tuesday, the Trump administration announced it was escalating the battle with China by moving forward with a 25 percent tariff on $16 billion in Chinese goods. The tariffs will go into effect later this month.
The end goal in Trump's eyes is for these countries to lower the tariffs they have on American goods, thus improving the market for the U.S. Some say his plan could work as the U.S. is negotiating from a position of strength -- a strong economy and low unemployment rates.
But as the fight continues, some companies are having to absorb the blow. Several have raised prices or suffered lower profits while others announced the possible closing of plants, layoffs and halting plans to add jobs.
More from USA Today:
U.S. trade war with China, other countries: Layoffs, reduced hours, slimmer profits
Trump trade war: U.S. stock market is faring better than China's since dispute began
Tariff winners and losers: How Trump's trade spat could affect shoppers
Here's a list of some of the companies, sorted by state, who have announced effects from the tariffs:
The nation's largest nail maker, Mid-Continent Nail, laid off 60 workers after sales plunged 70 percent in the aftermath of Trump imposing a 25 percent tariff on steel from Mexico and Canada. The Poplar Bluff company said it raised prices but customers defected. The company said it worries more layoffs will occur and that by Labor Day the entire 500-member workforce would be terminated.
SEMO Box, a packaging company in Cape Girardeau, said it has felt a ripple effect from Mid-Continent's slowing business. The company said it would be laying off four temporary workers because of the slowdown, according to the Associated Press and Mid-Continent.
Harley-Davidson plans to shift a portion of its U.S. motorcycle manufacturing outside the U.S. in response to the trade fight. The Milwaukee-based motorcycle manufacturer said Monday in a public filing that the move is necessary to preserve its second-biggest sales market after new tariffs were imposed by the European Union.
The company did not specify whether it would close any U.S. plants or lay off any workers. But Harley recently mapped out plans to shift some production to a new factory in Thailand and said it would close its plant in Kansas City, Missouri, and add some jobs at a facility in York, Pennsylvania.
About 100 employees were laid off from REC Silicon, which supplies silicon materials for solar panels, in the company's Moses Lake plant. The plant also cut production by 25 percent, according to Reuters.
The layoffs were a ""direct result of the ongoing solar trade dispute between China and the United States,"" the company told Fortune. China has imposed tariffs on polysilicon, which the company relies on.
Trans-Matic, of Holland, Michigan, shapes metal, mostly into auto parts, as well as components for door locks. The company has been forced to pay higher steel prices over the last few months due to the trade negotiations. Those higher costs have been passed down to its auto-supplier customers, some of which have scaled back their business.
Company Chief Financial Officer Steve Patterson said his employees are getting slightly fewer hours and have seen a slight decline in profits.
Tariffs could cost up to 4,000 new jobs at a new Volvo plant that opened in South Carolina. Volvo Cars Chief Executive Hakan Samuelsson told Reuters that the ""trade barriers and restrictions"" would prevent them from creating ""as many jobs as we are planning.""
Element Electronics, a television-making company, said it might be forced to shut down its plant in Winnsboro unless certain items are removed from the tariff list that the company needs for production. The plant is one of the biggest job suppliers in Fairfield County and the company said it could be forced to lay off 126 people.
Prices have increased at Vintage Industrial, a steel furniture company in Phoenix, because of the tariffs. Greg Hankerson, co-owner of the company, said the 25-percent tariff on imported steel has boosted raw-material costs, which forced him to raise prices 5 to 10 percent earlier this year for various items, with more price hikes possible.
Many companies are holding out hope that the trade negotiations end quickly but have warned that job cuts and price increases could be imminent. BMW and General Motors sent their warnings in writing to the Department of Commerce.
""This is hurting the economy but so far it's manageable,"" says Mark Zandi, chief economist of Moody's Analytics. ""If the war continues to escalate, it will do more damage and at some point it will undercut the good economy"" and trigger significant job losses and likely a recession.
Despite fears that the trade dispute could spiral out of control, which would slow global growth and dampen investor and business confidence, Wall Street pros still believe the president's use of tariffs as a negotiating tool will likely be a winner.
""Right or wrong, many investors still feel the U.S. has the upper hand in this battle and will win in the end,"" says Randy Frederick, vice president of trading and derivatives at the Schwab Center for Financial Research.
That's because China has more to lose. The country's exports to the U.S., measured in dollars, outnumber American exports to China 3 to 1. That buying power is tough to replace.
And although tariffs could cause prices for consumer products ranging from cars to washing machines to rise, ""the U.S. does not need China as much as China needs the U.S.,"" says Barry Bannister, head of institutional equity strategy at Stifel.
Meet Amanda Campbell, 24 from Kingston. She's a well-spoken graduate from UCL, where she studied interdisciplinary architecture. She is also a huge music festival fan having attended more than 30 since her first one at the age of 16.
Her idea is Comp-A-Tent, a fully compostable tent. Its primary use is for festivals, in order to counter the environmental impact of leaving tents behind once the party is over. Simply, you buy the tent with your festival ticket, pitch it, enjoy the festival, then when it's time to leave, you hand it into the recycling bin area and it then decomposes at the same rate as bread.
Her reasons for developing the tent came from personal frustration from being at festivals and witnessing the number of tents dumped, abandoned and otherwise left behind. She learned that, on average, one in five tents are left behind at European festivals, contributing over 750,000 tents every year to landfill or incineration. These tents aren't feasibly recycled, never break down and leach hazardous toxins. It is a problem that plagues festivals. At Glastonbury this year, the clear up cost for organisers was £780,000 ($990,000).
From China, Amanda would like to source materials and manufacturing for her pilot launch. Currently Amanda has been making prototypes with a hand iron and it takes over one day per tent. Amanda would like to find a factory in China with a faster manufacturing process so that it can get down to the target price of £40 per tent.
It’s the hardest decision an investor has to make; selling a winning trade. Find out why Karen Finerman just pulled the trigger in Children's Place.
This content is only available online - you won't find these trades on TV.
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Trader disclosure: On March 3rd, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Cortes Is Long Soybeans; Cortes Is Short Treasuries Through Futures And Puts; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (USO), (UNG); Finerman's Firm Is Long S&P Puts; Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Owns (BAC), (BAC) Preferred; Finerman's Firm And Finerman Own (GGWPQ); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (MIL), (MIL) Calls; Finerman's Firm Owns (OSIP); Finerman's Firm Owns (TGT); Finerman's Firm And Finerman Own (WFC) Preferred; Finerman's Firm Owns (WMT); Grasso Owns (AAPL), (ABK), (ASTM), (BA), (BAC), (BGP), (C), (COST), (CSCO), (PFE), (PRST), (V), (WMT), (FAZ); Seymour Owns (CHL)
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RUMORS GONE WILD
The headline: Of 130 Buyout Rumors Since December, Only 4 Have Panned Out (source: StreetAccount)
The word: Jeff Macke says speculation and rumors are part of the Wall Street game. They always push stocks higher and traders need to be smart enough to separate fact from fiction.
PEDAL TO THE METAL:
The headline(s):
- Alcoa (AA) , AK Steel (AKS) Buyout Speculation Fueling Red-Hot Metals Trade
- Steelmaker Arcelor Mittal (MT) May Make $4.5B Bid For AK Steel, FT Reports.
- Alcoa Makes $26.9B Bid For Alcan(AL) But May Too Be Bought
The word: Eric Bolling says consolidation in the space is a big trend right now and he expects it to continue. Guy Adami recommends investors own Commercial Metals Company (CMC) on a dip, because it stands to benefit from the boom in non-residential building.
THE WONDERFUL EARNINGS OF DISNEY:
The headline: Walt Disney (DIS) Profit Rises As `Wild Hogs', TV Advertising Drives Earnings
The word: Jeff Macke says DIS had a great quarter and thinks this stock will continue to climb. He was particularly happy to hear that theme park attendance was up nearly everywhere.
TESORO TRADE UPDATE
The Headline: Last Week Eric Bolling Recommends Buying Puts On Tesoro
The word: Eric sold those 120-puts today. Now, he recommends buying TSO shares on the dip.
A BUFFETT BUY?
A Viewer Says Tyco (TYC) Would Be An Ideal Buyout Target For Warren Buffett
Jason from Ohio writes “I think Buffett would pay over $60B and buy Tyco (TYC). It has everything, including a $40 per share break-up value! It has Buffett written all over it.”
The word: Guy Adami says TYC should be a $41 stock. (It closed at $32.05 on Tuesday.) He thinks if the company spins off business units, the stock will do better.
RIMM SHARES IN MOTION:
The headline: Research In Motion (RIMM) Shares Surge As Analysts See Healthy Growth
The word: Eric Bolling explains Karl Icahn doesn't have enough votes to obtain a seat on the board of Motorola (MOT), and that translates into upside for RIMM. (In other words, investors believed that Icahn would have benefited MOT so much, they stayed away from RIMM, until they had a better idea of what was going to happen.)
IT'S ALL ABOUT THE COLOGNE:
The headline: P. Diddy's ""Unforgivable"" -- Distributed By Estee Lauder (EL) – Becomes Top-Selling Men's Fragrance
The word: Jeff Macke says despite the success of this cologne, investors should not buy stock in Estee Lauder. They missed earnings by “a country mile.”
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to .
Trader disclosure: On May 8, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Macke Owns (JWN); Bolling Owns (DIS), Gold, Silver; Bolling Is Short Nasdaq Futures, Bolling Closed Out His Tesoro Put Trade; CNBC Is A Service Of NBC Universal And Dow Jones
I'm flying to Aspen, where I will report live on Thursday about homeowners who sell each other ""development rights"" to get past the 15,000 square foot limit for new homes. Because, for some, 15,000 square feet ain't gonna cut it.
I'm about to take off from LAX. There are a lot of rich people on this plane wearing fur coats and talking about fundraisers. ""I haven't even unpacked from Paris,"" one woman declares in a rush.
People are talking very loudly on the cell phone to friends about dinner. ""You know I don't eat seafood.""
Two other women are having this conversation:
""I like your ring.""
""Thanks, it's Stephen Webster. It's a good vibe color.""
""Yes. It helps your chi.""
And they both laughed.
I feel like a schlub.
Of course, if they were truly rich, they wouldn't be flying United Express.
Comments? Funny Stories? Email
The fed funds market is where officials set what is probably the world's most important interest rate—yet very few people understand its current operations.
This is the market at which the Federal Reserve directs its primary energies.
The Federal Open Markets Committee targets a level or range for interest paid on overnight fed fund loans, which are dollar-denominated loans of U.S. dollars between financial institutions. The trading desk at the New York Fed buys or sells Fed funds in order to get fed funds to trade at the targeted level.
In the textbook narrative about the fed funds market, some banks borrow fed funds in order to meet their reserve requirements while other banks lend fed funds in order to earn a return on excess reserves. But this isn't quite right—and hasn't been right since the financial crisis struck, as a new note from the New York Fed shows.
Prior to the crisis, the lenders in the fed funds market resembled the textbook narrative. That is, they were a somewhat diverse group of financial institutions.
Domestic bank holding companies lent out 25 percent of the $221.7 billion of fed funds traded in the second quarter of 2007, according to data assembled by the New York Fed. Foreign entities accounted for 21.2 percent of fed funds lending. Stand-alone commercial banks were 8.2 percent of the market. The regional Federal Home Loan Banks collectively accounted for 45.3 percent of the market.
In the last quarter of 2012, things were very different.
The market for fed funds had shrunk down to $60.28 billion and lending was overwhelmingly dominated by the Federal Home Loan Banks, which accounted for 73 percent of the fed funds lent. Bank holding companies had shrunk to 13.6 percent, foreign entities to just 5.8 percent, and stand-alone banks to 6.4 percent.
In other words, the fed funds market is nothing like the textbook model of a variety of banks with different reserve positions making deals with each other to reach a market equilibrium. It's mostly banks borrowing fed funds from the Federal Home Loan Banks.
To put it differently, the primary tool of monetary policy—the FOMC target rate—now is mostly used to influence overnight fed funds lending by Federal Home Loan Banks.
Why the transformation?
The New York Fed offers a couple of explanations. First and foremost, the Fed now pays interest on excess reserves. This means that banks won't lend reserves if the rate in the fed funds market is less that what they can earn by holding on to their reserves in accounts at the Fed. The Federal Home Loan Banks, however, are government-sponsored entities that aren't allowed to earn interest on excess reserves. So they'll lend out reserves even at very low rates.
In addition, quantitative easing has greatly increased the amount of reserves in the system, which means that banks are less likely to find that they have too few reserves to meet the regulatory requirements.
(Read more: Is the Fed really driving up stock prices?)
There is something strikingly odd about this arrangement. Our central bank is now setting monetary policy by targeting an interest rate charged by the 12 Federal Home Loan Banks that were established by Congress and are regulated by the Federal Housing Finance Authority.
Sophisticated observers of the banking system have long pointed out that banks do not ""lend out"" reserves. Rather they make loans first and, if they are short required reserves, find the reserves afterward on the fed funds market. We now need to modify this with the observation that, by and large, banks acquire the reserves not from some diverse ""fed funds market"" but from the Federal Home Loan Banks.
(Read more: The irrelevance of bank reserves.)
No one, as far as I can tell, has really done much thinking about what it means to have a fed funds market so dominated by government-sponsored enterprises.
—By CNBC's John Carney. Follow him on Twitter @Carney
U.S. stocks rose on Monday after the U.S. and China agreed to hold off on slapping additional tariffs on their products in an effort to resume trade talks.
The jumped 0.8% to 2,964.33, a record closing high. The broad index also reached an intraday record of 2,977.93. The Dow Jones Industrial Average gained 117.47 points, or 0.4%, to end the day at 26,717.43 as Nike and Apple outperformed. The Nasdaq Composite jumped 1.1% to 8,091.16 and posted a four-day winning streak.
Chipmaker shares rose broadly. Skyworks Solutions gained 6% while Micron Technology advanced 3.9%. Shares of Qualcomm and Broadcom climbed 1.9% and 4.3%, respectively. Tech giant Apple also rose 1.8%.
""The markets appear to be content with the cooperative tone coming out of the meetings. To me, it felt like the contrarian play was to the upside post meetings,"" said Dan Deming, managing director at KKM Financial. ""There was a great deal of bearishness in sentiment headed into the meeting. Many market observers were discounting any change in the narrative, which made many believe the risk was to the downside.""
At its session high, the S&P 500 was up 1.2%. The Dow and Nasdaq rose as much as 290 points and 1.8% respectively.
The major indexes started paring their gains around midday in New York. If it weren't for the big gains from chipmakers and other technology stocks on the Huawei reprieve, it would likely be an average slightly higher market day in reaction to the trade truce.
""There was a fair amount of exuberance at the open. I don't know if it was celebrating good news or the absence of bad news,"" said Willie Delwiche, investment strategist at Baird. ""Either way, we started strong. The problem is, while we had a new high on the S&P 500, the number of individual stocks making new highs was shy of what we say back in late June,"" when the index made its latest record close.
""I don't want to overstress the importance of it, but it is not confirming the index-level highs,"" Delwiche said.
Monday's gains got Wall Street starting off the second half of the year on the right foot following a big first half. The S&P 500 rallied more than 17% to start off 2019, notching its best first half in more than 20 years.
That surge came after stocks recovered in June from a torrid May performance. The Dow soared 7.2% in June, its biggest gain for that month since 1938. The S&P 500, meanwhile, jumped 7.9% for the month, marking its best June performance since 1955.
President Donald Trump and Chinese President Xi Jinping agreed not to impose new levies on U.S. and Chinese goods after meeting on the sidelines of the G-20 summit in Osaka, Japan on Saturday.
Trump said the meeting went as well as it could have, noting: ""We are right back on track."" Chinese state-run news outlet Xinhua said the two leaders agreed to ""to restart trade consultations between their countries on the basis of equality and mutual respect.""
Trump added the U.S. will ease restrictions on American companies from selling products to Huawei, a giant telecommunications company from China. The U.S. barred companies from selling to Huawei in May, citing national security concerns. The U.S. president also said China would ""buy farm product.""
Investors anxiously awaited the meeting between Trump and Xi as they looked for clues on whether the world's largest economies would resume trade negotiations or if the conflict would be prolonged.
Chetan Ahya, global head of economics at Morgan Stanley, described the meeting's outcome as ""an uncertain pause.""
There is ""no immediate escalation, but still no clear path towards a comprehensive deal,"" Ahya said in a note Sunday. ""As things stand, we lack clarity on whether real progress was achieved on the sticking points that caused talks to break down in the first place. Hence, our overarching conclusion is that the developments over the weekend on their own don't do enough to remove the uncertainty created by trade tensions.""
Comments from Larry Kudlow, director of the National Economic Council, added to the uncertainty around U.S.-China trade relations. Kudlow told Fox News on Sunday that Trump was not granting Huawei ""general amnesty."" He also said there is no timetable for when a deal might be finalized.
The lingering uncertainty around U.S.-China trade relations will continue to dampen the outlook on corporate earnings, said Larry McDonald, editor of The Bear Traps Report.
""There's a substantial decay factor developing inside the S&P 500's earnings picture,"" McDonald said. ""CFO's cannot make decisions with a purgatory of uncertainty, endlessly ... hanging over the market. The equity rally is a screaming sell.""
Calendar second-quarter earnings for the S&P 500 are expected to fall on a year-over-year basis, according to FactSet data. Analysts also lowered their third-quarter earnings forecast to show a contraction from the previous year, as profit expectations for multinationals with exposure to China have soured.
China and the U.S. have been embroiled in a trade war for more than a year. In that time, the U.S. has slapped tariffs on more than $250 billion worth of Chinese imports. China has retaliated with levies of its own on U.S. products.
—CNBC's Michael Bloom and Everett Rosenfeld contributed to this report.
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While she supports Megan Rapinoe, soccer superstar Carli Lloyd said her teammate's recent silent protest during the national anthem is an unwelcome distraction.
""The cause is great, the conversation is great, but I do think there are more people talking about her actual kneeling and we're losing sight of what she is actually fighting for,"" Lloyd said. ""That's the unfortunate thing that is happening.""
Following in the footsteps of 49ers quarterback Colin Kaepernick, Rapinoe has taken a knee during the national anthem in her last two games, protesting racial inequality and police shootings of African-Americans.
""If it were me, I would protest in a different fashion,"" Lloyd told CNBC during an interview about her new autobiography, ""When Nobody Was Watching: My Hard-Fought Journey to the Top of the Soccer World.""
The two-time Olympic gold medalist and co-captain of the U.S. women's national soccer team, also opened up about a number of other issues from equal pay to her legacy and her teammates.
In March, Lloyd along with her teammates Hope Solo, Alex Morgan, Becky Sauerbrunn and Rapinoe, filed a complaint against the U.S. Equal Employment Opportunity Commission alleging that members of the women's national team are paid significantly less than their male counterparts.
""Things are going well with that,"" said Lloyd. ""It's my duty and our team's duty to continue this fight. I want to leave the game better off than when I came on,"" she added.
Lloyd said they've received overwhelming support and the real test will come when their collective bargaining deal is up at the end of the year.
The 2015 FIFA World Cup winner also reflected on her former teammate and best friend, Solo. The goalie received a six-month suspension from the U.S. Women's National Team, coming after the defeat by Sweden, where Solo called their team ""a bunch of cowards."" Lloyd says she saddened by what happened, and she hopes it's not the end of Solo's career.
""I think Hope is a very competitive person,"" she said. ""I think her comments were not a jab at every player on Sweden. I think it was about their style of play. It was the icing on the cake and the last string,"" she added.
""At the end of the day, there isn't a whole lot that any of us can do. This was a decision U.S. soccer made, and we'll have to see what happens.""
Lloyd also reflected on her role as co-captain of the U.S. Women's National team and her leadership style.
Lloyd took the co-captain reins in January from superstar Abby Wambach, who retired. ""I think everyone is a leader in different ways. She [Wambach] was very vocal, I'm more of a leader by example,"" said Lloyd.
Wambach, the highest-all-time goal scorer for the U.S. national team, recently revealed in her own memoir, ""Forward,"" her struggles with drugs and alcohol. ""I didn't know it was that bad,"" said Lloyd. ""I know she's a fighter and will overcome this,"" she added. ""She's a legend.""
So, what's next for the soccer phenom? ""Honestly, I'm not sure what the next few years will bring me,"" said Lloyd. But you can count on soccer being involved.
Lloyd said she wants to continue helping younger players develop through her sports camps and helping teach ""mental toughness.""
""It takes a lot of mental toughness to get through certain obstacles — you have to be a fighter and fierce competitor.""
Telecom Italia said Thursday that full-year net profit fell 6.3% on declining margins and tighter competition in the domestic wireline market.
Italy's largest telecommunications operator said 2006 net profit stood at 3 billion euros ($3.9 billion) from 3.2 billion euros a year earlier. The result was slightly above the 2.96 billion euros ($3.88 billion) average estimate of ten analysts polled by Dow Jones Newswires.
It said full-year revenue rose 4.5% to 31.3 billion euros ($41 billion) from 29.9 billion euros in 2005, mainly driven by European broadband and Brazilian mobile.
Italy's former monopoly Thursday confirmed its dividend policy, proposing a 2006 dividend of 0.14 euros ($0.18) a share, unchanged from a year before.
Telecom Italia, which is coming off a management shakeup earlier this year, is schedule to unveil its three-year business plan on Monday.
The pay disparity between CEOs and workers is far too great because few executives value physical labor, former Minnesota Gov. Jesse Ventura told CNBC on Tuesday.
""We somehow diminish physical labor. We call that 'unskilled' and therefore we can pay so much more less for someone who has to physically sweat and labor, digging a ditch, whatever it might be, "" Ventura said on ""Closing Bell."" ""But where you're educated and you push a pencil, well then you make big money.""
Ventura clarified that CEOs have the right to pay themselves as much as they'd like. He just hopes executives will recognize that physical labor takes skill and should command decent pay.
""Most CEOs are incapable of doing physical labor. They sit around with suits on all day pushing pencils,"" said Ventura, who served one term as an Independent governor of Minnesota from 1999 to 2003. ""CEO pay has gotten way out of line compared to the people that work for them.""
Ventura called on executives to pay physical laborers a ""living wage,"" though he didn't specify what it might be.
—By CNBC's Drew Sandholm.
Though it was another disappointing day, note that the Dow was down 690 points at 3:40 PM ET and then rallied 170 points into the close. The S&P 500 and the NASDAQ closed at new lows.
Despite all the worries about redemptions and forced selling, volume was notably light until the last 45 minutes. It really was more of a buyers' strike as bids simply got cancelled.
That changed a bit in the last 45 minutes, as volume picked up a bit, but 6.1 billion shares for the NYSE is still moderate compared to recent activity.
The primary impetus for the weakness was a commodity selloff: the dollar strength and global slowdown concerns created a negative feedback loop.
Commodities today:
Oil down 7.5%
Copper down 9.6%
Gold down 5.9%
Corn down 6.3%
As a result, the weakest section of the market was again commodity-based stocks and commodity based countries:
- Energy stocks: down 10.4%
- Commodity stocks: down 7.7%
- Brazil: down 10.0%
- Argentina down 10.0%
- The Dow 30 at a Glance
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Questions? Comments? tradertalk@cnbc.com
Foreign property owners in continental Europe could face a devaluation of 50 percent on their homes if Greece was to leave the Euro, according to new figures from HiFX.
The foreign currency exchange broker said inquiries by British home owners into selling their properties abroad are up 191 percent since 2008.
Data released today from a survey of British foreign property owners showed that 39 percent were trying to sell up in Greece, 34 percent in Spain and 23 percent in Portugal.
James Price, Head of International Residential Development at Knight Frank, told CNBC’s “Squawk Box Europe” that the numbers of people wanting to sell up and the drop in value of foreign property reflects the pressure on the housing market by the euro zone debt crisis.
“There are different levels in the market and I think that for the mass market of home owners overseas that there may well be issues for them around needing to sell and get out and I think there is quite a lot of pressure on them and they are having to reflect that in the asking prices that they are offering.”
Home owners now had to be “more realistic about where the buyers actually are versus where the property might be” he said.
Price added that there was still room for investment in property abroad, with “prime destinations around Europe still offering firm prices” but that there was much more caution.
“What people are looking at now is the security of their asset in the long term. In the prime areas people are now looking at properties that they are going to use themselves, it’s about their own enjoyment.”
In a market with such unclear trends and extreme volatility, many investors are going back to the basics and looking at the fundamentals of individual stocks. We tapped our Fast Money traders for their best plays.
Patty Edwards of Storehouse Partners likes Arrow Electronics . It is trading at seven times forward earnings, where in the past five years, it has traded at twelve times. With General Motors continuing production this summer, Edwards doesn't think manufacturing is dead.
Steve Grasso of Stuart Frankel is going with tobacco stocks. He recently bought Altria Group , but because of high dividend yields, recommends Lorillard and Reynolds American .
The utility space is where Brian Kelly of Kanundrum Capital is turning. He likes Dominion Resources' 4.7% dividend yield. If you overwrite it by way of a covered call strategy, he thinks you could boost the yield up to 6%.
Guy Adami of Drakon Capital is going with IBM . He says they have a great balance sheet and a lot of cash on-hand.
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CALL OF THE DAY: DARE GO AGAINST WARREN BUFFETT?
Stifel Nicolaus downgraded Berkshire Hathaway from 'hold' to 'sell' Thursday. But why challenge Warren Buffett and sell now?
Try macroeconomic conditions, says analyst Meyer Shields while on Thursday's Fast Money Halftime Report. He says until consumers start spending again, which depends on unemployment, Berkshire's exposure to the US economy is going to suffer.
Brian Kelly of Kanundrum Capital points out that there are two valuations for Berkshire—one for the company itself and another for Buffett's holdings. Shields says Buffett's valuation is particularily valuable during times of crisis. His returns on General Electric and Goldman Sachs were, in part, simply thanks ot his imprimatur on their continued viability. If Buffett were to retire, he thinks it would negatively impact those stocks.
Shields says Berkshire is not a value to buy right now, adding that it's inflated due to fixed income securities are benefitting from low interest rates.
What's the Trade?
The downgrade of Berkshire is a market call, says Guy Adami of Drakon Capital, so he thinks the market overall could go lower. Steve Grasso of Stuart Frankel agrees, also predicting the markets could continue to decline.
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CALL TO THE FLOOR: TRADING HEALTH CARE
Shares of kidney dialysis provider DaVita is coming off of its 52-week high, which it hit last month. The Denver-based company is facing several headwinds could make or break the stock's performance.
Speaking on Thursday's Fast Money Halftime Report, CEO Kent Thiry says federal government deficits is his biggest concern. The bigger the deficits, he says, the more lawmakers look at cutting spending and often times, they cut Medicare. That's worrisome for Thiry because 82% of DaVita's patients are on Medicare.
Watch the video to see the complete conversation with Thiry, including his comments on health care reform.
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LEBRON WATCH
A free agent, NBA standout LeBron James of the Cleveland Cavaliers, is scheduled to announce where he plans to play in an one-hour television special Thursday night.
Last week, James met with the Cavs, Miami Heat, New Jersey Nets, New York Knicks, Chicago Bulls and Los Angeles Clippers. Knicks fans and investors of Madison Square Garden alike are hoping James is in a ""New York State of Mind,"" which brings us to Thursday's Fast Money Poll—Is MSG a buy on possibility of Knicks acquiring LeBron?
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CALL THE CLOSE
Brian Kelly of Kanundrum Capital is still a seller of the market.
""I'm staying in for now,"" says Patty Edwards of Storehouse Partners. ""But I think it's a short-term call.""
Also a seller of the market, Steve Grasso of Stuart Frankel is hiding in tobacco stocks.
Guy Adami of Drakon Capital is also a seller.
______________________________________________________
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CNBC.com with wires
WHEN: TODAY, MONDAY, AUGUST 10
WHERE: CNBC'S ""SQUAWK BOX""
Following is the unofficial transcript of a CNBC interview with Berkshire Hathaway CEO Warren Buffett today on CNBC's ""Squawk Box."" Video of the interview is available on CNBC.com.
All references must be sourced to CNBC.
QUICK: AGAIN WE ARE LOOKING THROUGH THE NUMBERS ON THIS DEAL AGAIN IT IS BERKSHIRE HATHAWAY BUYING PRECISION CASTPARTS THIS IS A DEAL THAT THEY ARE VALUING AT 37 BILLION DOLLARS JUST LOOKING AT THE PRESS RELEASE. WARREN BUFFETT IS CALLING INTO THE CONTROL ROOM IS JUST A MINUTE THEY ARE PAYING $235 PER SHARE IN CASH THIS IS A STOCK THAT CLOSED AT $193.88 ON FRIDAY SO WE WILL BE TALKING MUCH MORE ABOUT THIS. I THINK RIGHT NOW WE DO HAVE WARREN BUFFETT ON THE LINE. SIR ARE YOU THERE? SO WE SEE THE NEWS THAT IS OUT TODAY THIS COMES AS A SURPRISE TO A LOT OF PEOPLE BUT THE WALL STREET JOURNAL DID REPORT THIS ON SATURDAY I WONDER WHEN DID YOU FIRST HEAR ABOUT THIS, WHEN DID YOU FIRST TALK TO THIS COMPANY AND HOW DID THIS DEAL HAPPEN?
BUFFETT: I WOULD SAY IS WAS ABOUT 5 WEEKS AGO. YOU HAVE TO GIVE CREDIT TO TODD COMBS FOR THE DEAL WE HIRED TODD ABOUT 5 YEARS AGO TO MANAGE MONEY AND HE MANAGES ABOUT 9 BILLION NOW AND MAYBE THREE OR SO YEARS AGO HE ADDED PRECISION TO HIS PORTFOLIO AND I REALLY NEVER HEARD ABOUT THE COMPANY BEFORE THAT AND TODD TOLD ME A LOT ABOUT IT AND OVER THE LAST FEW YEARS I HAVE BECOME FAMILIAR WITH IT AND ABOUT 5 OR SO WEEKS AGO THE CEO MARK DONEGAN ALONG WITH HIS CFO AND IR PERSON CAME BY BERKSHIRE THEY WERE SEEING BERKSHIRE HOLDERS AND THEY MET WITH TODD AND THEN I DROPPED IN ON THE VISIT AND IN THE LAST 15 MINUTES OR SO AND I WAS VERY IMPRESSED BY MARK AND OF COURSE I HAD BEEN IMPRESSED BY THE COMPANY SO SHORTLY THEREAFTER I STOPPED AND GIVE THEM A CALL TO SEE IF THEY WOULD BE OFFENDED IF WE MADE A BID AND THEY DIDN'T INDICATE THEY WERE PARTICULARLY RECEPTIVE BUT THEY ALSO INDICATED THEY WOULD LISTEN SO I SUBSEQUENTLY MADE A BID. I MET MARK OUT AT SUN VALLEY, HE WAS ACTUALLY IN THE AIR MOST OF THE TIME AND SO HE CAME BY BECAUSE I WAS THERE FOR THE ALLEN COMPANY CONFERENCE AND I MADE HIM A BID AND HE TOOK IT TO THE BOARD AND BEFORE LONG WE HAD A DEAL.
SORKIN: WARREN I HAVE GOT TO TELL YOU I SAW BECKY THE WEEK AFTER SUN VALLEY AND I SAID BUT WARREN IS DOING A DEAL I HAD SEEN YOU AT SUN VALLEY. YOU HAD THAT PHONE WITH YOU SO INTENSE THERE WAS SOMETHING GOING ON AND I THOUGHT I DIDN'T REALIZE THIS IS WHAT YOU WERE DOING.
BUFFETT: I WILL HAVE TO BE CAREFUL WHEN I AM AROUND YOU ANDREW IF YOU CAN READ MY FACE LIKE THAT.
SORKIN: FROM A PRICE PERSPECTIVE ONE OF THE QUESTIONS WE HAD FROM AN EBITA I WAS DOING IT OFF OF THE $30 BILLION AND THINKING THIS WAS ABOUT 20 TIMES EBITA WHICH I WAS SAYING NOT THE CHEAPEST DEAL IN TOWN. IT DOES ALLOW YOU TO SPEND A LOT OF MONEY QUICKLY. IN TERMS OF THE VALUATION THOUGH HOW DO YOU THINK ABOUT IT AND WHEN YOU ARE TALKING ABOUT SPENDING THIS KIND OF MONEY IS IT HARDER AND HARDER AS WE WERE TALKING ABOUT EARLIER TO ACTUALLY GET A REALLY CHEAP DEAL?
BUFFETT: IT IS NOT 20 TIMES EBITA THOUGH ANDREW. I AM NOT SURE WHAT FIGURES YOU ARE LOOKING AT THERE BUT ALL DEALS SEEM EXPENSIVE TO ME BUT THIS ONE WE ARE CERTAINLY PAYING A VERY GOOD PRICE FOR AN EXTRAORDINARY COMPANY RUN BY A PERSON THAN AS FAR AS I AM CONCERNED HE IS THE BEST IN THE WORLD AT WHAT HE DOES.
SORKIN: HE'S MADE A NUMBER OF DEALS OVER THE PAST COUPLE OF YEARS ABOUT 8 BILLION DOLLARS WORTH OF TRANSACTIONS WHEN YOU LOOK AT THIS COMPANY OVER THE NEXT COUPLE OF YEARS DO YOU IMAGINE USING A LOT OF BERKSHIRE CASH TO MAKE ADDITIONAL ACQUISITIONS TO USE IT AS A ROLL UP VEHICLE IF YOU WILL?
BUFFETT: WELL ITS ALWAYS ACQUIRED COMPANIES I DON'T KNOW HOW MANY ACQUISITIONS THEY MADE OVER THE YEARS BUT IT IS A LOT. BECAUSE THERE ARE A LOT OF THINGS THAT GO INTO AEROSPACE IN THE WAY OF PARTS AND THEY'VE GONE AFTER ONE ITEM AFTER ANOTHER OVER THE YEARS. IN FACT THEY'VE MADE A COUPLE SMALL DEALS I BELIEVE IN THE FIRST FISCAL QUARTER AND I THINK THEY'VE GOT MAYBE ONE PENDING OR SO. NOW THEY MAKE A GOOD BIT OF MONEY SO THEY WILL PROBABLY BE ABLE TO DO THE ACQUISITIONS OR MANY OF THE ACQUISITIONS INTERNALLY GENERATED FUNDS BUT IF THEY NEED ANY MONEY FROM BERKSHIRE ALL THEY HAVE TO DO IS CALL.
QUICKLY: WARREN THIS IS AN EXPENSIVE DEAL IS THIS THE MOST EXPENSIVE DEAL EVER? HOW DOES IT MATCH UP TO BURLINGTON NORTHERN?
BUFFETT: WELL THE MOST DEALS ARE THE ONES THAT DON'T WORK OUT. YOU MENTIONED DEXTER SHOE A LITTLE WHILE AGO. BUT IN TERMS OF PRICE EARNINGS MULTIPLES GOING IN THIS IS RIGHT UP THERE AT THE TOP NOW WHEN WE BOUGHT BURLINGTON THAT WAS A HIGH PE BUT IT WAS OFF A VERY DEPRESSED FIGURE BECAUSE WE BOUGHT THAT IN THE FALL OF 2009 WHEN EARNINGS WERE AT A TROUGH. AND PRECISIONS EARNINGS HAVE FALLEN OFF MODERATELY BECAUSE OF DEVELOPMENTS IN THE OIL AND GAS FIELD WHERE THEY DO SOME BUSINESS AS WELL AS IN AEROSPACE SO BUT THIS IS A VERY HIGH MULTIPLE FOR US.
SULLIVAN: YOU READ MY MIND ON OIL AND GAS HOW MUCH OF THIS IF AT ALL IS A BET THAT THE U.S. OIL AND GAS INDUSTRY MAY BE BOTTOMING OUT AT LEAST FROM A PRICE PERSPECTIVE?
BUFFETT: WELL WE ARE GOING TO BE IN THIS BUSINESS FOR A 100 YEARS SO IT DOESN'T REALLY MAKE ANY DIFFERENCE WHAT OIL AND GAS DOES IN THE NEXT YEAR IN TERMS OF US BUYING IT. IF SOMEONE TOLD ME FOR SURE THE OIL AND GAS BUSINESS WAS GOING TO BE IN THE DULDRUMS WE'LL SAY FOR 3 YEARS I STILL WOULD HAVE MADE THE DEAL. THAT'S NOT A PREDICTION I AM JUST SAYING IT IS NOT IMPORTANT TO US HOW LONG THE OIL AND GAS SLUMP LASTS WHEN YOU GET A CHANCE TO BUY A WONDERFUL COMPANY YOU KNOW THERE IS USUALLY SOME REASON WHY YOU ARE GETTING THAT CHANCE AND PERHAPS THE SLUMP IN OIL AND GAS HELPS US IN THIS CASE. BUT THERE WILL BE SOMEDAY THERE WILL BE A SLUMP IN AEROSPACE AND THAT WILL BE MUCH MORE SEVERE FOR A COMPANY LIKE THIS BUT IF YOU LOOK OVER THE DECADES BOTH OIL AND GAS AND AEROSPACE WILL BE GOOD BUSINESS AND THESE FELLOWS ARE THEIR KEY PARTICULARLY IN THE AEROSPACE BUSINESS THE INDUSTRY NEEDS THEM THEY'RE UNIVERSALLY REGARDED AS THE MOST RELIABLE INNOVATIVE DEPENDABLE SUPPLIER OF VERY KEY PARTS THAT GO INTO ALL KINDS OF AIRCRAFTS.
SORKIN: WARREN SPEAK TO THE DEFENSIVE MODE THAT YOU OFTEN TALK ABOUT WHEN YOU THINK ABOUT PARTICULAR COMPANY IN TERMS OF ITS MARKETSHARE AND ITS ABILITY TO MAINTAIN IF NOT GROW THAT MARKETSHARE
BUFFETT: WELL WHAT YOU NEED IS YOU NEED PEOPLE THAT HAVE PHYSICAL FACILITIES BUT THAT IS A SMALL PART OF IT. THEY DO HAVE MARVELOUS PHYSICAL FACILITIES BUT WHAT YOU REALLY NEED IS BRAIN POWER AND YOU NEED PARTICULARLY AT THE TOP YOU NEED SOMEBODY WITH A TOTAL PASSION FOR THE BUSINESS AND I'VE MET MARK FOUR OR FIVE TIMES AND EACH TIME HE'S BEEN IN THE AIR AND HE'S IN THE AIR ALMOST A THOUSAND HOURS A YEAR THIS FELLOW LOVES THIS BUSINESS LIKE I LOVE BERKSHIRE AND HE'S A LOT BETTER AT IT THAN I AM AT BERKSHIRE. YOU CAN'T FIND PEOPLE LIKE THIS. YOU CERTAINLY CAN'T HIRE THEM. THE ONE THING I GUARANTEE MARK IS THAT HE'S RUNNING THE COMPANY. PEOPLE LIKE THIS ARE VERY VERY RARE. YOU CAN SEE IT IN WHAT HE HAS BUILT AND YOU CAN SEE IT IN THE PASSION HE'S GOT FOR WHAT HE IS DOING NOW. HE'S NEVER SATISFIED IN TERMS OF GETTING MORE BUSINESS IN THE AIRFRAME AND THE ENGINES. HE'S NEVER SATISFIED IN TERMS OF GETTING HIS COST TO WHERE THEY SHOULD BE. HE JUST HAS A PASSION FOR THE BUSINESS.
QUICK: WARREN WHAT DOES THIS MEAN IN TERMS OF THE CASH THAT YOU ARE USING FOR THIS? I KNOW YOU LIKE TO KEEP ABOUT 20 BILLION DOLLARS IN CASH ON HAND. ARE YOU STILL IN THE MARKET FOR OTHER POTENTIAL DEALS? OR DOES THIS TAKE YOU OUT OF THE MARKET FOR AWHILE?
BUFFETT: THIS TAKES US OUT OF THE MARKET FOR AN ELEPHANT BUT WE WILL PROBABLY BE BUYING A FEW SMALL THINGS IN THE NEXT 6 MONTHS. WE ARE IN NEGOTIATIONS ON A COUPLE BUT IN TERMS OF A DEAL OF SIMILAR SIZE IT PRETTY MUCH TAKES US OUT. WHAT WE WILL PROBABLY DO ON THIS ONE WE WILL PROBABLY BORROW ABOUT 10 BILLION AND USE ABOUT 23 BILLION OF OUR OWN CASH ON THAT ORDER. WE'LL BE LEFT WITH OVER 40 BILLION PROBABLY IN CASH WHEN WE GET ALL THROUGH. BUT I LIKE TO HAVE A LOT OF CASH AT ALL TIMES SO THIS MEANS WE HAVE TO RELOAD OVER THE NEXT 12 MONTHS OR SO BUT IT DOESN'T PRECLUDE DOING SMALLER DEALS BUT WE WILL BE DOING A FEW PROBABLY.
SORKIN: AND WARREN ONE OF THE OTHER QUESTIONS YOU ALWAYS TALK ABOUT TALENT AND SPECIAL PEOPLE AND SPECIAL BERKSHIRE PEOPLE AND IT IS HARD TO FIND THEM. WHEN YOU THINK ABOUT MARK DARE I ASK THE QUESTION SHOULD WE START TO ADD HIM TO THE LIST OF POTENTIAL PEOPLE THAT MAY ONLY RUN THIS PARTICULAR COMPANY NOW BUT MAYBE PUT INTO THE BERKSHIRE FOLD WHEN IT SOMES TO SUCCESSION?
BUFFETT: IF I READ MARK CORRECTLY AND IN THIS RESPECT I AM SURE I DO ALL HE WANTS TO DO IS RUN PRECISION AND TO TAKE IT TO GREATER AND GREATER HEIGHTS HE DOES NOT WANT TO RUN BERKSHIRE AND TRUE OF MOST OF OUR MANAGERS THEY LOVE WHAT THEY ARE DOING THAT'S THE BEAUTY OF IT. I HAVE TO DECIDE REALLY WHEN I BUY A COMPANY THERE IS NO WAY IN THE WORLD THAT I COULD RUN PRECISION OR REALLY ANYBODY IN OUR OPERATION COULD SO THE FIRST I ASK AND MARK'S 58 I ASK IF HE HAS ANY IDEAS AT 65 THAT HE'S GO AND PLAY SHUFFLE BOARD IN FLORIDA OR SOMETHING LIKE THAT. AS LONG AS WE TREAT HIM RIGHT NOW WE'VE GOT TO TREAT PEOPLE RIGHT WE TREAT HIM RIGHT HE WILL BE RUNNING THIS FOR DECADES AND DECADES. AND THAT'S WHAT HE WANTS TO DO JUST LIKE I LIKE RUNNING BERKSHIRE.
QUICK: WARREN YOU MENTIONED THAT THIS WILL TAKE YOU OUT OF THE HUNT FOR A BIG ELEPHANT FOR 12 MONTHS OR SO WHILE THE COMPANY RELOADS WITH THE CASH CONTINUALLY COMING IN. JUST LAST WEEK BILL ACKMAN MADE IT PUBLIC THAT HE HAS A LARGE STAKE IN MONDELEZ ONE OF THE THINGS HE THOUGHT ABOUT IS POTENTIALLY MONDELZ GETTING LUMPED IN WITH KRAFT HEINZ. DOES THAT MEAN IT IS NOT AN OPTION AND WHAT DO YOU THINK OF BILL'S PROPOSAL?
BUFFETT: WELL I WILL LISTEN TO ANYTHING MY FRIENDS AT 3G WANT TO DO BUT WITH KRAFT HEINZ WE HAVE OUR WORK CUT OUT FOR US FOR A COUPLE OF YEARS. I THINK IT IS QUITE UNLIKELY YOU NEVER WANT TO SAY ANYTHING IS IMPOSSIBLE BUT I THINK IT IS QUITE UNLIKELY THAT KRAFT HEINZ WOULD BE DOING A BIG ACQUISITION IN THE NEXT COUPLE OF YEARS SOMEWHERE DOWN THE ROAD I WOULDN'T BE SURPRISED. BUT IT ALSO WOULD HAVE TO MAKE SENSE FINANCIALLY AND FRANKLY MOST OF THE FOOD COMPANIES SELL AT PRICES THAT IT WOULD BE VERY HARD FOR US TO MAKE A DEAL EVEN IF WE HAD DONE ALL OF THE WORK NEEDED AT KRAFT HEINZ. A LOT OF THE COMPANIES ARE SELLING AT PRICES THAT SORT OF REFLECT IMPROVEMENTS IN THEM THAT PEOPLE SORT OF WHAT HAS BEEN HAPPENING AT KRAFT HEINZ AND BELIEVE ME THIS IS NOT EASY.
QUICK: MEANING THAT MONDELEZ AT THESE PRICES YOU WOULDN'T LIKE?
BUFFETT: WELL IT WOULD BE HARD FOR US TO MAKE A DEAL THAT MAKES SENSE YEAH. BUT WHO KNOWS WHAT HAPPENS DOWN THE LINE BUT IF YOU LOOK AT KELLOGG OR CAMPBELL'S SOUP OR MONDELEZ THEY'RE PRICES TO SOME EXTENT THE MARKET HAS PUT INTO THOSE COMPANIES PRICES THAT REFLECT AN EXPECTATION KRAFT HEINZ TYPE MARGINS ARE POSSIBLE AND THAT MAY BE THE CASE BUT I HAVE NOT SEEN IT ELSEWHERE.
SULLIVAN: MR BUFFETT IN 2009 MANY OF THE BANKS CAME TO YOU FOR HELP. HAVE YOU HAD ANY OIL OR GAS COMPANIES COME TO YOU IN THE LAST FEW MONTHS LOOKING FOR YOUR HELP, LOOKING FOR YOUR INVESTMENT?
BUFFETT: NOT YET BUT PRICES STAY DOWN HERE. IF PRICES STAY DOWN HERE SO FAR I WOULD SAY THAT MOST OF THE PEOPLE IN THE OIL AND GAS BUSINESS UP MAYBE UNTIL VERY RECENTLY THEY FELT THAT OIL PRICES WOULD BOUNCE BACK. THEY MAY NOT HAVE FELT GAS PRICES WOULD BOUNCE MUCH BUT THEY FELT OIL PRICES WOULD BOUNCE BACK. THE OIL PRODUCTION COMPANIES HAVE BEEN SELLING ON A BASIS NOT OF $45 WTI THEY HAVE ASSUMED HIGHER PRICES AND OF COURSE THE FORWARD CURVE HAVE REFLECTED HIGHER PRICES. I THINK IT WOULD HAVE BEEN HARD TO MAKE REALISTIC DEALS WITH OIL AND GAS UP UNTIL NOW BUT WE WILL SEE WHAT HAPPENS IN THE FUTURE. TO BE SPECIFIC NOBODY HAS COME TO ME.
QUICK: DOES THAT MEAN THAT YOU HAVE NOT MADE ANY OTHER PURCHASES IN THE OIL AND GAS BUSINESS?
BUFFETT: THAT'S CORRECT
QUICK: SO THERE IS NOTHING THAT YOU'VE SEEN ASIDE FROM THIS DEAL TODAY THAT YOU THINK HAS BEEN AN OPPORTUNITY YOU WOULD BUY INTO?
BUFFETT: NO OF COURSE THIS IS KIND OF SECENDARY I WOULDN'T SAY MAYBE 15% OF PRECISION'S BUSINESS HAD BEEN IN THERE AND THEY GOT HURT IN THE LAST COUPLE OF QUARTERS SIGNIFICANTLY BECAUSE WHEN OIL SLOWS DOWN IF THEY'VE GOT VARIOUS BUILDING EQUIPMENT ON HAND ALL OF A SUDDEN THEY DON'T NEED TO ORDER ANY FOR AWHILE EVEN THOUGH CONTINUE TO PRODUCE. SO NO WE HAVE NOT MADE ANY COMMITMENTS IN OIL AND GAS.
SORKIN: HEY WARREN EVERY TIME I SEE YOU I ALWAYS ASK THE QUESTION IBM, IBM UPDATE THE STOCK IS TRADING I THINK ABOUT 155 DOLLARS RIGHT ABOUT NOW HOW ARE YOU FEELING ABOUT IT
BUFFETT: I FEEL FINE.
SORKIN: WHAT'S YOUR BASIS IN THAT COMPANY AT THIS POINT?
BUFFETT: WHAT'S OUR STOCK COST US?
SORKIN: YEH
BUFFETT: I WOULD SAY AROUND 170
SORKIN: AROUND 17O NOW BY MY MATH YOU HAVE ACTUALLY MADE THE MONEY STILL ON THIS DEAL ON PART I THINK THE FUNCTION OF THE DIVIDENDS BUT YOU ARE NOT CONCERNED AT ALL IN TERMS OF THE STOCK
BUFFETT: I LOVE IT WHEN IT GOES DOWN IT MEANS THE COMPANY BUYS STOCK CHEAPER AND MEANS IF I WANT TO BUY MORE STOCK YOU CAN LOOK AT OUR 13F IN A FEW DAYS IT MEANS I GET TO BUY IT CHEAPER
QUICK: DOES THAT MEAN YOU'VE BEEN BUYING IT?
BUFFETT: I AM NOT A SELLER OF STOCK. PEOPLE ASSUME WHEN WE BUY SOME STOCK WE WANT IT TO GO UP. WE DON'T WANT IT TO GO UP MAYBE OBVIOUSLY EVENTUALLY MAYBE FIVE OR TEN YEARS FROM NOW BUT WE LOVE THE IDEA OF A COMPANY BUYING ITS STOCK CHEAPER. I MEAN THAT'S HAPPENED AT AMERICAN EXPRESS FOR INSTANCE AMERICAN EXPRESS IS A REGULAR REPURCHASER OF SHARES AND WE OWN 15% OF IT AND OWNERSHIP GOES UP FASTER IF THE STOCK IS DOWN THAN IF THE STOCK IS UP.
SULLIVAN: WE HAD ON FRIDAY A BILLION DOLLAR ACTIVIST INVESTMENT IN AMERICAN EXPRESS MR BUFFETT JEFFREY UBEN OF VALUEACT CAPITAL. WHEN YOU OWN A STOCK LIKE AN AMERICAN EXPRESS ARE YOU HAPPY TO SEE AN ACTIVIST COME IN DO YOU WELCOME IT.
BUFFETT: NO NOT PARTICULARLY BUT IT IS UP TO THEM WHAT THEY DO WITH THEIR MONEY. ACTUALLY IT SENDS UP FOUR OR FIVE POINTS SO THE EXTENT THAT AMERICAN EXPRESS IS REPURCHASING SHARES WE CAN'T BUY STOCKS IN AMERICAN EXPRESS BECAUSE IT IS A BANKHOLDING COMPANY AND WE OWN OVER 10% BUT THE CHEAPER THE STOCK IS THE MORE SHARES AMERICAN EXPRESS WILL BE ABLE TO REPURCHASE FOR A GIVEN AMOUNT OF MONEY AND ON BALANCE THAT HELPS US WE'RE BUYING YOU KNOW THERE IS NO MORAL PROBLEM ATTACHED TO IT BECAUSE IT TAKES PLACE IN THE MARKET BUT WE'RE ON OUR PARTNERS CHEAPER.
QUICK: LET'S TALK ABOUT SOMETHING ELSE THAT IS ALSO A LOT CHEAPER THAN IT WAS A WEEK AGO YOU LOOKS AT THE MEDIA STOCKS DISNEY KICKED IT OFF WHEN BOB IGER SAID THERE ARE CONCERNS ABOUT ESPN, VERY BRIEF CONCERNS FROM HIS PERSPECTIVE THE MARKET TOOK THAT AS A HUGE SELLING POINT NOT ONLY FOR DISNEY BUT ALL OF THE MEDIA RELATED STOCKS DO YOU SEE ANYTHING IN THE MEDIA INDUSTRY YOU LIKE AT THESE PRICES?
BUFFETT: NO I WOULD SAY THAT I CONSIDER BOB IGER AND I KNOW HIM WELL AND HAD EXPERIENCE WITH HIM MORE THAN 20 YEARS AGO I THINK HE IS ONE OF THE GREAT MANAGERS IN AMERICA AND A GOOD GUY BEYOND THAT BUT I'M AN OBSERVER OF THE MEDIA PICTURE TODD AND TEDD OWN SOME SHARES IN CERTAIN MEDIA STOCKS BUT I AM NO VICTIM OF THIS MYSELF AND THE SELL OFF DID NOT ENTICE ME.
SORKIN: HEY WARREN SPEAKING OF BUYBACKS ONE OF THE QUESTIONS AND I DON'T THINK WE HAVE TALKED ABOUT THIS SINCE YOU SENT YOUR LETTER AND WE HAD YOU ON THE SHOW BUT LARRY FINK FROM BLACKROCK SENT A LETTER A COUPLE OF MONTHS AGO TO CEOS AROUND THE COUNTRY AND SAID LOOK STOP WITH THE BUYBACKS, STOP WITH THE DIVIDENDS WE WANT YOU INVESTING IN THE FUTURE AND IN PART I WOULD ARGUE THAT LETTER SEEMED TO INSPIRE HILLARY CLINTON WITH HER LATEST QUARTERLY CAPITALISM APPROACH AND PROGRAM THAT SHE'S TALK ABOUT IN TERMS OF CHANGING THE TAX STRUCTURE CAPITAL GAINS STRUCTURE AROUND INVESTMENTS. WHAT DO YOU THINK OF WHAT HILLARY CLINTON HAD TO SAY AND WHAT DO YOU THINK OF WHAT LARRY FINK HAD TO SAY?
BUFFETT: WELL PEOPLE MAKE BUYBACKS VERY COMPLICATED. BUYBACKS MAKE SENSE WHEN YOU ARE BUYING YOUR STOCK BACK BELOW ITS INTRINSIC VALUE AND WHEN YOU DON'T NEED THAT MONEY FOR THE NEEDS OF THE BUSINESS. IT MAKES NO SENSE WHEN YOU PAY ABOVE INTRINSIC VALUE AND THAT'S A VERY SIMPLE PRINCIPAL BUT IT HAS BEEN IGNORED BY MANY MANAGEMENTS OVER TIME. IF YOU LOOK AT THE HISTORY OF BUYBACKS PEOPLE BUYBACK A LOT IN TERMS OF AGRIGATE BUYBACKS PEOPLE BUY A LOT MORE STOCK BACK WHEN STOCKS ARE UP THAN WHEN THEY ARE DOWN BUT IN THAT WAY THEY ARE SORT OF BEHAVING LIKE JOE PUBLIC YOU KNOW. THERE HAVE BEEN SOME GREAT INVESTMENT STORIES BASED ON PEOPLE WHO BOUGHT BACK STOCK INTELLIGENTLY WHICH MEANS BUYING IT AT A DISCOUNT FROM ITS INTRINSIC VALUE. WE WOULD BUY BACK STOCK BY THE BUSHELL BASKETS IF IT SOLD WELL BELOW INTRINSIC VALUE IT WOULD HAVE TO BE WELL BELOW INTRINSIC VALUE AND WE WON'T BUY A SHARE IF WE THINK WE ARE PAYING INTRINSIC VALUE OR MORE. IT IS NOT A COMPLICATED EQUATION BUT MANAGEMENTS WHEN SOMEBODY SAYS THEY ARE GOING TO HAVEA 5 BILLION DOLLAR BUYBACK THEY OUGHT TO SAY WE ARE HAVING A 5 BILLION DOLLAR BUYBACK IF WE CAN BUY IT AT X OR BELOW BUT THAT'S JUST NOT THE WAY IT OPERATES.
SULLIVAN: HAS IT BEEN AN EFFICIENT USE OF CAPITAL
BUFFETT: IT HAS BEEN A TERRIFICLY EFFICIENT USE OF CAPITAL FOR SOME COMPANIES AND BEEN A VERY STUPID USE OF CAPITAL FOR OTHER COMPANIES. I WOULD ARGUE THAT OUR BUYBACKS HAVE BEEN PEANUTS UNFORTUNATELY BUT OUR COUPLE OF BUYBACKS MADE GREAT SENSE. BUT WE COULDN'T DO IT ON SCALE.
SORKIN: AND WHAT DID YOU MAKE OF HILLARY CLINTONS PROPOSAL ON CAPITAL GAINS BUT SHE ALSO SAID I BELIEVE THAT SHE WANTS PEOPLE TO LOOK INTO BUYBACKS THEMSELVES IN TERMS OF HOW THEY SHOULD BE REGULATED. ELIZABETH WARREN AND OTHERS HAVE SUGGESTED THEY ARE EFFECTIVELY INSIDER TRADING BECAUSE THE COMPANIES KNOW ABOUT IT.
BUFFETT: WELL I WILL BE GLAD TO WRITE A PAPER ON IT SOMETIME. I HAVE WRITTEN ON IT ABOUT 20 TIMES OVER THE YEARS AND IN GENERAL VERY MUCH APPROVE OF WHERE HILLARY IS GOING IN TERMS OF FINE TUNING ALL THE POINTS WE'LL TALK ABOUT THAT AS THE CAMPAIGN PROGRESSES. BUT BUYBACKS ARE NOT NIRVANA AND THEY ARE NOT EVIL IT IS JUST A QUESTION OR WHETHER THEY MAKE SENSE AND IF OUR STOCK SELLS WELL BELOW INTRINSIC VALUE AND WE HAVE MONEY WE DON'T NEED FOR THE BUSINESS WE WILL BUY IT BACK JUST AS FAST AS WE CAN NOW UNFORTUNATELY WHENEVER I SAY THAT IT KEEPS IT FROM HAPPENING.
QUICK: WARREN WE KNOW THAT YOU ARE A SUPPORTER OF HILLARY CLINTON BUT DID YOU WATCH THE REPUBLICAN NATIONAL DEBATES THAT TOOK PLACE LAST WEEK?
BUFFETT: I WOULDN'T HAVE MISSED IT
QUICK: AND WHAT DID YOU THINK?
BUFFETT: I THOUGHT THAT IT WAS TERRIFIC TELEVISION AND I THINK THERE'S A SMALL CHANCE WITH PROPORTIONAL AWARDING DELEGATES IN A GREAT MANY OF THE PRIMARIES AND WITH SUPER PACKS ENABLING PEOPLE TO KEEP GETTING FINANCE WHERE AS OTHERWISE THEY WOULD DROP OUT FOR LACK OF MONEY IF THEY WEREN'T DOING THAT WELL. I THINK THERE IS ACTUALLY SOME CHANCE THAT WHEN THEY GO TO THE REPUBLICAN CONVENTION NO ONE WILL HAVE A MAJORITY GOING IN BUT I THINK IT WILL BE VERY VERY INTERESTING. DONALD TRUMP IS GOING TO HAVE A CERTAIN PERCENTAGE OF DELEGATES AND SO WILL A WHOLE BUNCH OF OTHERS AND IN THE PAST UNLESS YOU WERE IN THE TOP 2 OR 3 YOUR FUNDING DRIES UP AND YOU GET TO A COUPLE OF STATES AND THAT WAS WITH BUT WITH SUPER PACKS AROUND YOU CAN HAVE QUITE A FEW CANDIDATES IN IT FOR QUITE A BIT OF TIME AND THE PIE COULD GET DIVIDED IN SUCH A WAY THAT NOBODY HAS A MAJORITY. IT IS GOING TO BE VERY INTERESTING. IT IS A GREAT SPECTATOR SPORT.
QUICK: WE DID HAVE AN OVERNIGHT POLL AN NBC NEWS POLL THAT WAS CONDUCTED FROM FRIDAY INTO SATURDAY IT SHOWED THAT DONALD TRUMP IS STILL LEADING THE PACK WHICH MIGHT COME AS A SURPRISE TO SOME PUNDITS WHO HAD KIND OF WRITTEN HIM OFF AFTER THAT PERFORMANCE.
BUFFETT: YEH NO HE IF YOU CAN GET BY THE JOHN MCCAIN IS NOT A HERO AND A FEW THINGS AND NOT HAVE YOUR NUMBERS GO DOWN YOU HAVE A VERY SOLID BASE AND YOU KNOW I WOULDN'T BE SURPRISED IF HE MAINTAINS QUITE A SOLID BASE FOR A LONG TIME. AND THAT MEANS HE IS GOING TO GET A FAIR NUMBER OF DELEGATES IF YOU GET IT IN PROPORTIONAL STATES. AND HE IS NOT GOING TO RUN OUT OF MONEY SO IT IS GOING TO BE A LOT OF FUN TO WATCH PARTICULARLY IF YOU ARE A DEMOCRAT.
QUICK: I WAS GOING TO SAY AS A DEMOCRAT YOU MUST ENJOY HOW THIS PLAYS OUT. WHO WOULD YOU MOST LIKE TO SEE YOUR CANDIDATE RUN AGAINST?
BUFFETT: WELL I THINK IF I GAVE THAT PREDICTION IT WOULD BE SORT OF THE KISS OF DEATH ON THAT CANDIDATE. I WANT TO SEE HER RUN AGAINST THE WHOLE FIELD.
QUICK: YOU KNOW WARREN WE HAVE A WHOLE BUNCH OF OTHER THINGS WE WOULD LOVE TO TALK TO YOU ABOUT WE SAW THE JOBS NUMBER THAT CAME IN. THE JOBS REPORT WAS JUST AS EXPECTED ON FRIDAY 215,000 A LOT OF PEOPLE SPECULATING THAT THE FED WILL RAISE INTEREST RATES COME SEPTEMBER. YOU HAVE A VERY GOOD IDEA OF WHAT'S HAPPENING IN THE ECONOMY JUST BASED ON THE NUMBERS THAT YOU SEE AND THE BUSINESSES THAT YOU HAVE YOUR FINGER ON THE PULSE. WHAT DO YOU THINK IS HAPPENING IN THE ECONOMY. WHAT DO YOU THINK THE FED SHOULD DO IN SPETEMBER?
BUFFETT: I THINK WHAT'S HAPPENING WITH THE ECONOMY IS EXACTLY WHAT'S BEEN HAPPENING NOW FOR FIVE YEARS IS THAT IT IS MOVING AHEAD ROUGHLY AT 2% RATE AND IN CERTAIN INDUSTRIES A SPURT OCCASSIONALLY AUTOS ARE STRONG RIGHT NOW BUT IT HAS BEEN A VERY STEADY INCREASE AND PEOPLE HAVE TALKED ABOUT DOUBLE DIPS AND THEY'VE TALKED ABOUT ACCELERATION AND EVERY TIME THEY TALK ABOUT IT MOVING SHARPLY IN ONE DIRECTION IT DOESN'T DO IT. THE ECONOMY HAS COME BACK AND IT HAS COME BACK VERY WELL CONSIDERING THE KIND OF SHOCK THAT WE HAD 5 OR 6 YEARS AGO BUT I DON'T SEE IT PARTICULARLY ACCELERATING AND I DON'T SEE IT DECELERATING EITHER. I HAVE SAID BEFORE I THINK IT IS VERY TOUGH TO PUSH RATES HIGHER IN THE U.S. WHEN EUROPE NEEDS TO KEEP THEM ALL AND YOU'VE GOT THE SITUATION EXISTING AROUND THE WORLD BUT I KEEP HEARING THE VARIOUS GOVERNORS SAY IT IS GOING TO HAPPEN SOON SO BUT I DON'T THINK IT IS AN EASY DECISION WHEN RATES ARE CONSIDERABLY LOWER IN EUROPE AND YOU MAY BE AFFECTING EXPORTS AND IMPORTS VERY SIGNIFICANTLY IF YOU PUSH RATES HERE TO BE CONSIDERABLY HIGHER THAN THEY EXIST IN EUROPE.
QUICK: THERE HAVE BEEN A LOT OF PEOPLE WHO HAVE BEEN CONCERNED ABOUT THE MARKET LATELY IF YOU HAVE WATCHED WHAT HAS BEEN HAPPENING DURING EARNINGS SEASON SOME OF THE MOVES HAVE BEEN EXTRAORDINARY TO SEE PEOPLE MISSING BY SMALL AMOUNTS ON EARNINGS OR REVENUE LINES AND THEN COMING IN WITH DOUBLE DIGIT STOCK DECLINES YOU ALSO SAW WHAT HAPPENED WITH MEDIA STOCKS OVERALL MOVE THE ENTIRE SECTOR LOWER THAT HAS SOME PEOPLE THINKING THAT THERE IS A LOT OF WEAKNESS IN THE MARKET AND THAT THERE IS SOMETHING OF A CORRECTION THAT'S DUE. I AM GUESSING THAT I WOULDN'T PUT YOU IN THAT CAMP IF YOU ARE WILLING TO DO DEALS LIKE THIS OR DO YOU EVEN THINK ABOUT WHAT IS HAPPENING ON A DAY TO DAY BASIS?
BUFFETT: STOCKS ARE GOING TO BE HIGHER AND PERHAPS A LOT HIGHER 10 YEARS FROM NOW, 20 YEARS FROM NOW I AM NOT SMART ENOUGH TO PICK TIMES TO GET IN AND GET OUT IF YOU ARE IN SOMETHING THAT IS GOING TO BE A LOT HIGHER OVER TIME. IF YOU THOUGHT YOUR HOUSE WAS GOING TO GO DOWN 5% IN PRICE YOU WOULDN'T SELL YOUR HOUSE AND HOPE TO BUY IT BACK 5% CHEAPER. THAT'S NOT MY GAME. MY GAME IS TO OWN DECENT BUSINESSES AND OWN THEM AT DECENT PRICES AND YOU ARE GOING TO MAKE A LOT OF MONEY OVER TIME IF YOU DO IT BUT I THINK THE ABILITY OF PEOPLE TO DANCE IN AND OUT OF MARKETS IS QUITE LIMITED AND IN MY CASE IT IS ZERO.
QUICK: WARREN THERE IS A STORY ON THE FRONT PAGE OF THE NEW YORK TIMES TODAY ABOUT COCA COLA WHICH IS A COMPANY THAT YOU ALSO THE LARGEST SHAREHOLDER IN IT POINTS OUT THAT COCA COLA HAS TEAMED UP WITH SOME INFLUENTIAL SCIENTISTS TO TRY AND ADVANCE A MESSAGE IN MEDICAL JOURNALS THAT IT IS REALLY MORE ABOUT HOW MUCH YOU EXERCISE NOT WHAT YOU EAT THAT MATTERS. THE TIMES ACTUALLY KIND OF PUTS THIS AS SOMETHING WHERE THEY LOOK ASKANCE THE IDEA THAT BIG COPORATION IS FUNDING A MESSAGE LIKE THIS WHAT DO YOU SAY AS THE LARGEST SHAREHOLDER?
BUFFETT: WHAT HAPPENS TO YOUR WEIGHT DEPENDS ON HOW MUCH YOU TAKE IN AND HOW MUCH YOU BURN UP. AND IF YOU TAKE IN 2700 CALORIES AND YOU BURN UP 2700 YOUR WEIGHT ISN'T GOING TO CHANGE AND IF YOU TAKE IN 3500 AND BURN 2500 YOU ARE GOING TO GAIN WEIGHT. IT'S A MATHEMATICAL TYPE EQUATION AND IF YOU ARE LIKE ME AND DON'T LIKE TO EXERCISE MUCH THAN YOU BETTER NOT TAKE IN TOO MUCH. THERE IS NO MYSTERY TO WEIGHT. CALORIES ARE DEFINED THERE'S 4 PER GRAM IF YOU ARE DEALING WITH PROTEIN AND CARBOHYDRATES THERE'S 9 PER GRAM WITH FAT AND YOU'VE GOT TO FIGURE IT OUT IF YOU WANT TO LOSE WEIGHT SO YOUR BODY BURNS OFF AS MANY AS YOU ARE CONSUMING.
QUICK: WELL WARREN WE WANT TO THANK YOU FOR JOINING US THIS MORNING. AGAIN CONGRATULATIONS ON THE DEAL.
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As the White House descends further into chaos, no one can discern President Donald Trump's next move until he makes it.
But Trump and administration aides have signaled that he views a presidential declaration of emergency as an exit ramp from the standoff with Congress that has shut down a large chunk of the government for 18 days now. It would, simultaneously, let him assent to reopening federal agencies and assert unilateral authority to order construction of a wall along the U.S.-Mexico border.
Bracing for Trump's decision, congressional aides in both parties say the potential scope of presidential action ranges from very big to very small.
A president's authority to declare a national emergency gives him the power to redirect taxpayer funds Congress has already approved. In conversations with lawmakers, the White House has pointed toward two different pots of Pentagon money. One, containing less than $1 billion, is for curtailing drug shipments. The other, containing $22 billion, is for military construction projects.
The military construction pot might even be enough to pay for whatever barrier Trump wants across the 2,000-mile border, whether constructed of concrete or steel or something else. If Trump goes big, he could announce his intention to do exactly that.
Yet the bigger he goes, the bigger the backlash he risks.
An emergency declaration related to border control would face immediate legal challenges, just as his attempt to ban travel into the United States from some majority-Muslim countries did. The more miles of wall Trump attempts to build under an emergency declaration, the more potential challengers — Congress, private landowners, affected local governments.
Moreover, a recent 17-page report to Congress shows that the pot of military construction money contains funds previously designated for projects across the country. That would ensure resistance from both red and blue states eager for those projects. And at a time when Trump speaks openly about the prospect of impeachment proceedings, the weak factual basis for a border emergency claim would invite House Democrats to assert an unconstitutional abuse of executive power.
But a little-noticed administration maneuver last fall points to a far more limited possibility.
It could be completed by only touching the small pot of anti-drug money. It wouldn't require diverting cash from military construction projects elsewhere. It would only affect 31 miles of the Mexican border on a federal explosives-testing site in Arizona.
Last fall, the Pentagon informed Congress that the Navy had committed $7.5 million to ""advance planning and survey efforts"" for new and improved border barriers on the Barry M. Goldwater Range. Calling the range ""a known drug-smuggling corridor,"" Assistant Defense Secretary Kenneth Rapuano wrote that such barriers ""will both protect BMGR from such illegal activity and address human life and safety concerns by deterring unlawful entry onto an active bombing range.""
In an October letter to Democratic Rep. Adam Smith of Washington, who now chairs the House Armed Services Committee, Rapuano said no construction had occurred on the range. But he noted that the administration was ""reviewing its authority and funding options.""
Expressing strong opposition, Smith and his Democratic colleagues estimated that the 31 miles' worth of barrier along the range would cost $450 million. The anti-drug account that the Pentagon might try to tap contains $760 million, according to a Republican congressional aide.
Trump has the opportunity to clarify his intentions in a televised prime-time address on the issue Tuesday. If recent form holds, lawmakers will find out at the same time everyone else does.
Acting IMF Managing Director David Lipton, in a veiled appeal Thursday on CNBC, called on the U.S. and China to come to an agreement and end their yearlong trade war.
Lipton told ""Squawk on the Street"" that the global economic slowdown has been ""certainly affected by the trade tensions,"" though he did not mention the U.S. or China by name.
The latest round of trade talks between the world's two biggest economies on Tuesday and Wednesday in Shanghai made little progress. Negotiations are set to resume in September in Washington.
Tensions between the White House and Chinese technology giants may also be contributing to the global economic slowdown, Lipton said.
""It's time for the countries to have dialogue, to reach agreements, to try to find a way through this, since the global economy is fragile,"" he said.
Global trade has been lower in the first six months of this year compared with the same period in 2018, Lipton said, adding that it's a ""time for vigilance.""
""Global trade is actually contracting, and that is not a good situation,"" he warned.
Lipton said that if a global recession were to start, central banks, including the Federal Reserve, would be in weakened positions to fight it because of all the easy monetary policies.
Case in point, the Fed lowered interest rates by 0.25% on Wednesday.
Lipton moved into the acting director role after Christine Lagarde resigned as head of the International Monetary Fund. Largarde has been nominated to be the next president of the European Central Bank.
European stocks closed lower on Friday as investors monitored trade war developments and a possible collapse of the Italian government.
The pan-European Stoxx 600 was provisionally 0.9% lower at the closing bell, with most sectors and major bourses in the red.
Banking stocks shed 1.9%, dragged down by Italian lenders, while China-exposed basic resources and autos stocks led losses, with both sectors falling by more than 2.5%. Healthcare stocks bucked the trend, hovering just above the flatline.
Italy's coalition government imploded on Thursday, as deputy prime minister and leader of Italy's ruling Lega party, Matteo Salvini, declared the arrangement unworkable and called for fresh general elections.
Italy's FTSE MIB index was 2.5% lower by the end of Friday's session, as investors veered away from Italian assets amid the rising instability.
Italian bank stocks plunged, with Banco BPM shares tumbling 9%, while Unicredit and Ubi Banca fell by 5% and 8% respectively.
In the latest trade war developments, a majority of economists polled by Reuters said the recent escalation of tensions between the U.S. and China had brought forward the next U.S. recession, and indicated that the Federal Reserve is likely to cut rates again in September before a further cut next year.
Meanwhile, a Bloomberg report claimed Thursday that the U.S. is holding off on giving permission to U.S. companies to use Huawei products after China halted its buying of American agricultural produce.
Later, President Trump said the U.S. was not ready to do business with Huawei and he was not ready to do a trade deal with China.
China's currency remains in focus as the People's Bank of China (PBOC) again set the daily yuan midpoint weaker than the key barometer of 7 per dollar.
Stocks on Wall Street extended losses during Friday's trading session, dragged down by chip stocks which fell on the back of Trump's latest statement on China.
Back in Europe, official data showed that the British economy has shrunk for the first time since late 2012 after U.K. second quarter GDP (gross domestic product) contracted by 0.2%.
Sterling and the FTSE 100 were both trading lower on the news, with uncertainty increasing as British media speculated that a general election may be called in the U.K. by November.
Looking at individual stocks, London-listed WPP surged to the top of the Stoxx 600 after its earnings beat forecasts, with shares up more than 7%.
At the other end of the European benchmark were Italian lenders Ubi Banca and Banco BPM.
The tussling tycoons look like they're at it again.
In the latest salvo in the feud among some of the hedge fund industry's biggest players, Dan Loeb has offered up what appears to be a thinly veiled jab against archenemy Bill Ackman.
Loeb, of Third Point Capital, posted a quote on his Bloomberg terminal portal that looks like it is directed straight at Ackman, who helms Pershing Square Capital:
""Never interfere with an enemy when he is in the process of destroying himself.""
The quote is believed to have come from Napoleon.
More importantly, it marks a new taunt against Ackman, whose fortunes have soured lately as his short play on Herbalife and long bet on JCPenney both have gone terribly wrong.
(Read more: Why is everyone picking on Bill Ackman these days?)
Loeb and Ackman used to be friends, but a string of events soured the relationship.
Just a few weeks ago, Loeb posted a jab that read, ""New HLF product: The Herbalife Enema, administered by Uncle Carl.""
The ""Uncle Carl"" reference is to Carl Icahn, who was once friendly with Ackman but also has taken him on, in particular over Herbalife.
Ackman has enlisted few if any allies as the richest of the rich hedge fund players have sought to take him down.
However, actor George Clooney recently ripped into Loeb for his advocacy of breaking off Sony's entertainment division.
Clooney called Loeb a ""carpetbagger"" who is 'trying to manipulate the market.""
—By CNBC's Jeff Cox. Follow him @JeffCoxCNBCcom on Twitter.
Options experts are saying Thursday's record volume in volatility derivatives bets may signal a dangerous problem with the size of volatility-linked trading products.
The focus is on the CBOE volatility index, a key measure of market expectations for near-term volatility as conveyed by the price of S&P 500 index options. The CBOE announced VIX options volume hit 2.56 million contracts on Thursday, a record for a single day. In addition, VIX futures volume reached 939,000 contracts, another record.
The high volume coincided with a 44 percent spike in the VIX, to 16.04, its highest daily close for the year. The VIX recently hit a record intraday low of 8.84. On Friday afternoon, it was at 14.54.
The volume in VIX ""options and futures tells us that yesterday was potentially a more serious event, and validates some of what we have discussed in recent notes about the growing leverage in VIX-linked products,"" Macro Risk Advisors head derivatives strategist Pravit Chintawongvanich wrote in a note to clients Friday.
The strategist cited how large future moves in the VIX may be driven by the increased use of volatility exchange-traded products or ETPs.
""Volatility can quickly revert to 'normal' levels as we saw yesterday. But starting from low VIX futures levels, that translates into a large percentage move for the VIX ETPs – which in turn translates into a potentially large rebalance, and the potential for the inverse VIX ETPs to be stopped out,"" he added.
As a result, Chintawongvanich recommends investors buy put options on the SPDR S&P 500 ETF and the iShares iBoxx $ High Yield Corporate Bond ETF to hedge against further downside volatility. A put option gives the holder the chance to sell an asset at a set price at a point in the future. It's a bet the asset price will fall.
One accomplished options trader said the dramatic one-day VIX surge Thursday likely stemmed from traders being forced to close out losing volatility positions.
""When I see really out sized moves in VIX like yesterday I have to think the reason isn't just people scrambling for protection as much as some of the so-called smart money being forced to cover their naked shorts,"" CNBC contributor Jon Najarian, founder of Investitute.com, wrote in an email.
""If the market moves too quickly to the short strikes, the trader and or his or her clearing firm are forced to buy back the short positions at the worst possible time, when volatility is elevated,"" he added.
It is too soon to declare turmoil in financial markets over and while the U.S. economy should gradually recover, this outlook faces big risks, a top Federal Reserve policy-maker said Monday.
""Although conditions have improved on some fronts, I don't feel we can yet ""breathe easy."" The path of the economy is still enveloped in considerable uncertainty, and serious risks remain,"" Federal Reserve Bank of Atlanta President Dennis Lockhart said in prepared remarks.
A copy of his speech to a luncheon event for the Jacksonville Chamber of Commerce was made available to the media prior to delivery.
Lockhart is not a voting member of the Fed's interest-rate setting committee this year.
The Fed has slashed interest rates by 3.25 percentage points since last September to shield the economy from a global credit crunch. That squeeze was sparked by a U.S. housing crisis that has chilled growth and threatened to tip the economy into recession.
But Lockhart signaled he was optimistic that the country would escape this fate.
""On balance, I'm expecting a weak first half followed by some improvement in the second half as the drags on growth I mentioned earlier gradually diminish,"" he said.
But Lockhart also stressed that he was still concerned by the threat of renewed financial instability undermining growth.
""We remain in a period of considerable uncertainty. There are very real risks to this outlook,"" he said.
He said an oil price shock, further upsets in financial markets and a more severe-than-expected downturn in housing could all upset his forecast for U.S. growth to pick up somewhat in the second half of 2008.
Lockhart also said inflation was elevated ""with hints of rising inflation expectations,"" but said it should abate as energy and food prices moderate and a softer economy limits the ability of firms to pass on higher prices to customers.
""My base case for inflation assumes a fall-off from the current elevated level of inflation supported by some moderation of energy and food price increases,"" Lockhart said.
""I also expect soft economic growth to constrain the ability of businesses to pass through energy and other costs and raise prices in the coming months,"" he added.
CNBC first reported on issues within the VA Healthcare System last August, culminating in a documentary ""Death & Dishonor: Crisis at the VA"" that aired on Veterans Day.
The Department of Veterans Affairs is the second-largest federal agency, with a proposed 2015 budget of over $163 billion—a nearly 6.5 percent increase above 2014 funding levels of more than $152 billion.
The VA is the largest integrated health-care system in the country with over 1,700 hospitals, clinics, community centers and other facilities.
—By CNBC staff
Ping An Insurance, China's No. 2 insurer, said on Friday it was not concerned about a plan by Britain's Prudential to buy the Asia assets of U.S. insurer AIG, the market leader among foreign insurers in China.
Ping An does not believe Prudential's acquisition of AIG's Asia unit, AIA, would change China's insurance landscape, said Chairman Ma Mingzhe, speaking on the sidelines of the opening of the National People's Congress in Beijing.
""I believe domestic insurers are very competitive in China and we know our market very well,"" said Ma of Ping An, partly owned by HSBC Holdings Plc ""I think foreign insurers will still have much to learn in China,"" he added.
In what is the insurance industry's biggest acquisition, Prudential is buying American International Assurance in a big bet on soaring demand in Asia for personal financial services. AIA is regarded as AIG's crown jewel because of its size, cash generation and presence in fast-growth Asia.
Ma said Ping An was not interested in teaming with Prudential for the bid, amid some market expectations that Prudential may seek partners such as Asian sovereign funds and cash-rich large Chinese enterprises to help in its $35.5 billion acquisition plan due to the deal's size.
Ma's commments were in line with his counterpart Yang Chao, chairman of Ping An's bigger rival China Life who said the country's No.1 insurer was not considering involvement in the Prudential-AIG deal.
""Purely from the financial perspective, I think we can afford to do deals like that, but we are not considering it and Prudential didn't talk to us either,"" Yang told reporters in Beijing.
China Life was in talks to invest in AIA last year or to subscribe part of AIA's originally planned initial public offering of shares in Hong Kong but the talks failed to move forward, Chinese media reported.
China Legacy
Ping An's Ma, whose firm made huge losses from a wrong bet on its investments in Europe's Fortis amid the financial crisis, said he believed that domestic firms would continue to dominate China's insurance market for at least the next five to 10 years.
While AIG can trace its Asian roots back to 1919, when Cornelius Vander Starr started a small insurance agency in Shanghai, AIA started in China in 1992. AIA in China is 100 percent owned by AIG -- the only wholly-foreign owned insurer with special permission from Beijing to operate in the country.
Other foreign insurers have long complained to Beijing about AIA's exclusive ownership status as they seek a bigger share of the country's fast-expanding insurance business.
Prudential currently operates CITIC-Prudential Insurance Co in China, a 50-50 joint venture in China with CITIC Group, China's biggest financial conglomerate.
When asked for comments on the future of AIA's ownership status in China, Ma replied: ""I think this will be a problem for Prudential to deal with.""
Ma also noted Ping An would not be interested in AIA's China assets even if they were put up for sale.
AIA collected 8 billion yuan ($1.17 billion) in premiums in 2009, accounting for 18.9 percent market share among Sino-foreign joint-venture life insurers in China, or nearly 1 percent of total market share, according to official data.
China's top three insurers -- China Life, Ping An and China Pacific Insurance partly owned by the Carlyle Group -- currently control a combined over 50 percent share of China's life insurance market.
WASHINGTON -- Republican presidential contender Mitt Romney is promising to get tough on China to help American workers, but his plans could backfire.
Romney is pledging, on his first day in office, to designate China a currency manipulator, a step no administration has taken against any country for 18 years.
That could, eventually, lead to tariffs punishing China for policies that Americans believe unfairly keep Chinese products cheap, hurting U.S. manufacturers. Tariffs could trigger a trade war with a country that is the fastest-growing market for U.S. exports. Even if they don't, the designation would instantly set back relations with Asia's emerging superpower.
The U.S. seeks Chinese cooperation on international hot spots, such as North Korea and Iran, and wants to narrow differences over how to handle maritime territorial disputes in East Asia.
Given the potential repercussions, some foreign policy experts doubt Romney would carry out the currency threat. Other presidential candidates have made similar promises in order to appeal to voters who have seen manufacturing jobs migrate to China. But, once elected, they soften their approach.
""There's probably been wisdom in administrations in the past, Republican and Democrat, of not wanting to go there,"" said Jon Huntsman, who served as President Barack Obama's first ambassador to China before a failed bid for the Republican presidential nomination.
But the commitment to act on Inauguration Day doesn't appear to leave much room to back down.
Romney has also taken aim at Obama's ""pivot"" to Asia _ a strategy of deploying more forces and shoring up U.S. alliances there, in part to counter China's military buildup.
In a speech this week, Romney said China's recent assertiveness was ""sending chills through the region."" He said the pivot is under-resourced and has alienated U.S. allies elsewhere. He outlined plans to expand U.S. naval power _ although it's unclear how he'd pay for it since he also wants to slash government spending.
""What we have seen from the Obama administration has been acquiescence to China, not just on trade issues and currency issues, but on issues of security and human rights,"" said Romney foreign policy adviser Alex Wong. ""To protect our interests and those of our small businesses and of our economy, we have to take measures to make sure China does play by the rules.""
U.S.-Chinese relations are entering a critical juncture. Two days after the Nov. 6 vote, China will begin its own once-in-a-decade leadership transition. How the next U.S. administration gets on with the new guard in Beijing could determine whether the world's pre-eminent military powers can cooperate in the Asia-Pacific region or head on a path to confrontation.
Appreciation of those stakes tends to get lost in the fiercely fought election campaign.
Both Romney and Obama have TV spots with China as a foil. Romney accuses Obama of being soft on China's trade practices; Obama accuses Romney of outsourcing U.S. jobs to China when he ran the private equity firm Bain Capital.
The tone of the debate, labeling China a ""cheat,"" has drawn withering criticism from the architect of U.S. re-engagement with Beijing 40 years ago, former Secretary of State Henry Kissinger, who has nonetheless endorsed Romney. Kissinger said that avoiding conflict between the powers is the most fundamental challenge for U.S. foreign policy.
China's state media has weighed in with unusually direct criticism of a presidential candidate, suggesting that Beijing hopes Obama will win.
News agency Xinhua has accused Romney of hypocrisy, saying much of his wealth was made doing business with Chinese companies and warning that his ""mudslinging"" policies could spark a trade war.
Early in his presidency, Obama made warmer relations with China a priority, and ties have deepened. The two governments have navigated some rough patches _ such as the standoff over a blind activist, Chen Guangcheng, who sought refuge in the U.S. Embassy in Beijing and was then allowed to come to the U.S. to study. The Obama administration said that reflected a maturing relationship.
But diplomacy has failed to bridge fundamental differences on issues such as climate change, the civil war in Syria and China's territorial disputes with its neighbors. And as the U.S. has wound down its wars in Iraq and Afghanistan, its modest moves to deploy more forces around Asia have irritated Beijing.
Romney is calling for an even stronger U.S. presence in the Pacific. Wong said that would encourage the peaceful resolution of the region's many maritime territorial disputes, including one flaring between U.S. ally Japan and China over islands both claim. He said Romney would make clear it has a treaty alliance with Japan that covers the islands and has the naval power to back it up.
Those plans, though, could take years to implement. Addressing the currency issue on Day One would immediately affect relations.
Romney says he would designate China as a manipulator unless it stops currency manipulation by his January inauguration. Romney trade policy adviser Oren Cass said this would set a new tone and show the U.S. is willing to take China to task over a range of trade violations, including intellectual property theft and restrictions on market access for U.S. companies in China.
The designation itself would not mandate any sanctions, but would require that the U.S. hold consultations with China.
Cass said that if Beijing doesn't move toward changing its currency policies after consultations, the U.S. could impose so-called countervailing duties on Chinese products.
But Matthew Goodman, former director of international economics in the National Security Council under Obama, said the U.S. discretion to unilaterally impose retaliatory tariffs ended when it joined the World Trade Organization in 1995, and in practice it is difficult to take a currency dispute to the WTO for settlement. Cass says that under domestic law, the U.S. could impose countervailing duties, and it's an open legal question at the WTO whether member states can do so unilaterally to compensate for a currency subsidy.
How China would respond may be swayed by its leadership transition. The new guard would not want to appear weak. But neither would China want the dispute to escalate as it relies on exports and faces its own economic slowdown. If that translates into major job losses at home it could affect social stability, which is Beijing's biggest concern.
Obama has consistently opted against designation of China as a currency manipulator. Like President George W. Bush before him, he has preferred to wait while economic forces encourage Beijing to allow its currency to strengthen _ which it has done, although most economists still believe it is undervalued.
The Treasury is due to make its next six-month assessment on Monday, although it's not yet clear if it will be announced on that date. China is likely to get a pass.
Lululemon Athletica said on Wednesday that its chief product officer is leaving after just two years with the premium yogawear retailer, which has struggled in recent months with narrowing margins and supply-chain hiccups.
Tara Poseley, a former Kmart executive who was hired by Lululemon in October 2013, will leave ""after a transition period"" and her role will be eliminated, the Vancouver-based company said.
Poseley replaced Sheree Waterson, who departed earlier that year amid a backlash over the high profile recall of overly sheer yoga pants and concerns about product quality.
Analysts had lofty expectations for Poseley, who joined up a couple months ahead of new chief executive Laurent Potvin, and shares in the yogawear maker, which plunged through the end of 2013, climbed back up in 2014.
But supply-chain woes, concerns over dwindling margins and another recall has pushed the stock back down in recent months.
Lululemon, which said the leadership changes are aimed at reinforcing its brand, also announced a new creative director role, geared at bringing the design of the men's and women's product lines under the same organizational umbrella.
Lee Holman, who joined Lululemon in 2014 from Nike, was named to the newly-created executive vice president, creative director post.
Chief Financial Officer Stuart Haselden will gain broader responsibilities, including heading up operations, and the company has also created a new, still unfilled, chief supply chain officer role.
Analysts last month questioned Lululemon's margins, which have dwindled as the company has faced higher costs associated with its international expansion.
The company has also been hit hard by a series of quality lapses, including the high profile recall of overly sheer yoga pants in 2013 and a more recent recall of women's tops due to injury risks from their drawstrings.
I’m an engineer. I identify a problem and develop a solution.
I’d like to think that the success of companies like Dyson – based in the UK– have helped the country in more than a few ways, including boosting its exports and tax revenues.
Whether at home or abroad, politicians don’t really need me to identify new problems – they have enough of those. But where can I match my passion for a cause with some constructive ideas? I think it’s worth talking about.
Here’s the problem.
Both the US and UK economies rely too heavily on selling services. Financial services in particular, as the last two years have shown very dramatically. We all know that many products can be made cheaper and faster overseas. But now the large manufacturers such as China, India and South Korea are moving up the value chain.
The threat is no longer low-cost manufacturing; it’s high-tech and ideas. And the proof? As of this year, China has overtaken Germany as the world’s biggest exporter. And it’s not limited to less expensive products.
So, why have I decided on now to bang the drum? Well, now is the opportunity for change: we’re coming out of recession; our service-dependency has hurt us badly; and in the UK, there’s nothing like an election year to focus the minds of those who can change things.
In the UK, I’ve just produced a reportto help shape politicians’ thinking. The Conservatives have backed it and I’m hoping others will take my ideas on board. It’s about inspiring, supporting and investing to make best use of some superb resources already at our disposal. It’s not, however, about a quick fix, having an idea is easy, but making it work takes time.
The UK has a highly motivated workforce; the universities and academics are fantastic. We don’t always make the most of these - of which science and engineering are at the heart. I hope some of the ideas in Ingenious Britaincan be explored in the United States, too – as a society, a greater understanding of the importance of engineering; and a commitment to programs that excite students about science, math and technology.
From primary school pupils to graduates, teachers to government, we need more people to take up science, engineering and design. These are exciting and rewarding careers which can contribute hugely to our society and our economy. Government needs to take the lead in steering our brightest and best in this direction.
Educators should look again at how universities are funded and assessed. These places need the freedom and flexibility to identify what students and industry wants – such as shorter courses with industry experience. Potential science and engineering undergraduates need more access to industrial scholarships. Student loans might be written off. Postgraduates should be paid properly for their research.
Further down the line, access to capital is crucial. Government must examine better routes for debt financing to reach high tech companies. If possible, this should involve using the power of government guarantees to encourage lenders – existing banks or new entrants – to extend credit to innovative small businesses.
Once properly up and running, companies – both small and large – need more significant tax credits for research and development. In the UK, these should be increased by as much as a third to 200%. Such a move could have a huge impact on a company’s investment decisions and would send a clear signal to business leaders about the government’s belief in science and technology.
And what do I know, apart from making vacuum cleaners? Well, Dyson’s about a bit more than that these days. We make all sorts of new technology – fans, digital motors and more in the pipeline. That’s the point about R&D: we’re constantly looking at new inventions for the long term. When it comes to major UK companies filing patents, only Rolls-Royce is ahead of us.
We also know a bit about selling overseas: eight out of ten of our machines are exported. They reach 49 countries, with the US being our biggest market. There’s no doubt that production in Malaysia has helped us to expand faster – we employ more than 1,200 people in the UK, 300 in the US and 2,500 globally.
Dyson was built from scratch over 30 years. Parts of that time were slow and painful, but I know that the pace was quickened by employing graduates with the right skills and investing in R&D.
We need to make it much easier for other businesses to do the same.
- Could School Bus Ads Save School Budgets?
- Student Aid Linked to Health Care Gets a Trim
____________________
Sir James Dyson is the founder of Dyson Vacuums, based in the United Kingdom
Grubhub CEO Matt Maloney says his comments were misconstrued in an email Wednesday in which he strongly objected to President-elect Donald Trump's incendiary policies.
""I did not ask anyone to resign if they voted for Trump,"" he said in a blog post late Thursday. ""To the contrary, the message of the email is that we do not tolerate discriminatory activity or hateful commentary in the workplace, and that we will stand up for our employees.""
Some workers at the online food-delivery company said they were left with the impression they weren't welcome if they supported Trump.
In an email to the company's more than 1,000 employees on Wednesday, obtained by BuzzFeed News, Maloney said:
""I absolutely reject the nationalist, anti-immigrant and hateful politics of Donald Trump and will work to shield our community from this movement as best as I can. As we all try to understand what this vote means to us, I want to affirm to anyone on our team that is scared or feels personally exposed, that I (and) everyone else here at Grubhub will fight for your dignity and your right to make a better life for yourself and your family here in the United States.
Peter Thiel to join Trump transition team, report says
Americans really did crash the Canadian immigration site on Election Day
Jeff Bezos, who once joked about sending Trump to space, changes tune
""If you do not agree with this statement then please reply to this email with your resignation because you have no place here. We do not tolerate hateful attitudes on our team.""
Maloney, a supporter of Democratic presidential nominee Hillary Clinton, spared no words in his email Wednesday. He said Trump's words and actions would have earned him an ""immediate termination"" at the Chicago-based start-up, valued at more than $3 billion.
""While demeaning, insulting, and ridiculing minorities, immigrants, and the physically/mentally disabled worked for Mr. Trump, I want to be clear that this behavior — and these views — have no place at Grubhub,"" Maloney said in the email Wednesday.
A nascent recovery in euro zone business activity continued on Wednesday with data managing to beat analysts' expectations, despite slower growth in France and fears of falling prices weighing on sentiment.
Markit's flash purchasing managers' index (PMI) for April revealed that the euro zone's composite index rose to 54.0, up from 53.1 in March. A reading above 50 marks an expansion in the private sector.
The data was driven by strong growth in Germany, with the composite number rising to 56.3 in April, from 54.3 in March. France saw slower growth in its private sector, but output rose for a second month with a figure of 50.5, down from March's 51.8 reading. Output in the euro zone's second-largest economy was hit by new orders in manufacturing, which stagnated after rising in March. This caused French firms to once again cut back on their staffing levels, according to Markit, the London-based research company that collates the data.
The data provided proof that French growth was still ""fragile"", according to Howard Archer, an economist at IHS Global Insight. This was in marked contrast to the ""robust"" expansion he suggested the German numbers indicated.
Markit Tweet
The single currency rose to a session high of $1.3843 shortly after the data release. The euro had started the session at $1.3806. European stock markets showed little change with earnings release in the tech sector continuing to weigh on investor sentiment.
Despite the softer data from France, the private sector in the euro area grew at its fastest in just under three years in April, with the bloc as a whole showing signs of a return to job creation.
""With backlogs of work rising, albeit only modestly, firms took on more staff in order to expand capacity. The increase in employment was the largest since September 2011, and only the second since 2011. Rates of job creation in both the manufacturing and service sectors were nevertheless only modest as many firms continued to focus on keeping costs low to boost competitiveness,"" the company said in Wednesday's release.
Read MoreQE from ECB? May not be the panacea many hope
Chris Williamson, Markit's chief economist added that these PMIs mean that GDP (gross domestic product) for the euro zone is on course to rise by 0.5 percent in the second quarter, building on a 0.4 percent rise in the first quarter.
""Perhaps the best news came from the rest of the region, where the fastest rate of growth seen since early-2011 suggests that the recovery in the 'periphery' is gaining traction,"" he said.
As well as the worse-than-expected French data, Williamson said the outlook for prices is a concern. The euro bloc has recently posted some weak growth in consumer prices and market watchers have warned against the threat of dwindling inflation and the possibility of deflation - where consumer prices start to fall.
Read MorePortugal set for bond auction, first since bailout
The European Central Bank (ECB) has said that it is monitoring the situation and has hinted that it would be ready to act if this weakness continued. Williamson said that Markit's data showed prices falling at their fastest pace since last August despite the upturn in activity.
""There will be growing fears that deflationary pressures are intensifying and that the ECB needs to respond with more than just words to the recent appreciation of the exchange rate,"" he said.
Sure you've heard about those CSI shows on other networks. But at ""Mad Money,"" CSI stands for Cramer's stock investigation.
""This is where we do an in-depth analysis of groups that have been left for dead by the market,"" said Jim Cramer dressed suspiciously like Nick Stokes.
As we first discover Cramer, he's in his lab, err office, closely examining the flesh and bones of five familiar names: DSW, Sears, Lands' End, Abercrombie & Fitch and Ann Taylor.
""These are all stocks that, at some point this year, were brutally slaughtered. But that's where the similarity ends. Some of these retailers are knocking on death's door, while others are bouncing back to life with a vengeance."" Cramer said.
Following is Cramer's analysis:
DSW
For DSW shareholders, the crime occurred at the end of May when the shoe seller reported a disappointing quarter and shares fell from $32 down to $23 in a single session.
""Pretty much everybody bailed on DSW after that, Cramer said. But last month I told you DSW was merely the victim of transient fashion issues and bad weather and that a comeback was on the way. Sure enough, when last night, it blew away the numbers, beating Wall Street's sales and earnings forecasts and raising its full-year guidance.""
In turn, shares march sharply higher, gaining about 10 percent in a single session. ""No autopsy needed here."" added Cramer with a sly smile, ""except for those poor short sellers who are now in a world of hurt.""
Sears
Going into the quarter, Cramer said Sears didn't have much of a pulse. ""Then, the final blow was delivered last Thursday when the company reported a larger than expected loss and missed the estimates across the board, sending the stock down 7 percent in one day.""
Looking at the metrics, there appear to be few signs of health.
""This was the company's sixth consecutive , and they lost twice as much money as they did a year ago. And Sears is not just earnings challenged, it's sales challenged, too; its revenues were down 10 percent year over year.""
To make matters all the more concerning, the company reported a cash balance of $824 million. ""That may seem like a big improvement from the $671 million it had a year earlier, however, Sears spun-off its Lands' End business earlier this year, giving them a one-time windfall of $515 million. And Sears can only do that once. Back out that money, and the company would only have $314 million of cash, which is a pretty bleak.""
All told, Sears has seen healthier days.
""Put it all together, and you've got a retailer that just has too many problems. The stock is still a 'sell' even down here at just a couple points above its 52-week low,"" Cramer said
Lands' End
Once a feared goner, Cramer says Lands' End may be the proverbial victim who escaped the clutches of its captor. Well, that may be a little dramatic, but Cramer did say Lands' End looks much better now that it's wriggled free from Sears, which used to own the company.
""For years, Lands' End was stuck inside the Sears empire, passing along its profits and unable to control its own destiny. Now that it's been spun off as an independent company, I think it has a bright future. In its first quarter out of the gate, Lands' End delivered some excellent numbers, including a 48 percent jump in earnings per share. Lands' End now has the freedom and the resources to pursue faster growth, and its stock is cheap, trading at 15 times next year's earnings estimates. In the end, I think it's a survivor, one that's worth buying here.""
Abercrombie & Fitch
Cramer sees Abercrombie & Fitch as akin to the near-death character rising from the grave (and probably scantily clad too!)
""Inventory levels are starting to stabilize and Abercrombie, along with rivals, are closing stores which reduces supply,"" Cramer said. That bodes well.
""While Abercrombie just made a new 52-week high on Tuesday, it's still more than 30 points off its post great recession peak in 2011, and I think it could have a lot more upside.""
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Read more from Mad Money with Jim Cramer
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Ann Taylor
Ann Taylor may be like the victim who was rescued at the last minute, by two watchful strangers. However, in this case the strangers are Engine Capital and Red Alder, two large shareholders who have urged the board of ANN to, including selling itself, in order to unlock value.
""Over and over again this year we've seen activist investors push all sorts of companies to create value for their shareholders, so I'm intrigued by this situation, especially since the potential activists at Engine Capital believe ANN could be worth $50 to $55 a share, as much as 31 percent higher than where the stock's currently trading,"" Cramer said.
""Ann has historically been a pretty strong operator, and if the company doesn't want to sell itself, it has plenty of other options. For example, Ann has a pristine balance sheet, so it could easily borrow a ton of money at very low rates in order to finance a gigantic buyback. Just a lot that could go right here, although given the run-up over the last two days, I think you should wait for a pullback before you pull the trigger on this one.""
Australia's economy will undergo a crucial stress test in 2015, faced with a triple whammy from the lagged impact of plunging commodity prices, sharp declines in mining investment and renewed fiscal tightening, says Goldman Sachs.
""The challenges are now widely known…but these challenges still lie mainly ahead for Australia rather than behind,"" Tim Toohey, chief economist, Australia at Goldman Sachs wrote in a note on Wednesday.
On top of the these headwinds, the economy also needs to contend with tighter financial conditions and lower levels of housing investment, said Toohey, factors that had previously helped to offset the slump in the mining sector.
The bank expects gross domestic product (GDP) growth to average just 2.0 percent next year, down from an estimated 2.9 percent in 2014, as the economy continues to search for new growth drivers.
Read MoreAustralia's economy slows in Q3
The decline in mining investment will continue to be a major drag on the economy, leaving commodity exports and consumption to pick up the slack, the bank said.
Australia's third quarter GDP data published on Wednesday pointed to a sluggish domestic economy, suggesting rebalancing away from mining-driven growth is taking longer than hoped.
The economy expanded 2.7 percent on year in the three months to September, undershooting expectations for growth of 3.1 percent, as construction spending fell while sliding export prices hit incomes.
""This GDP result concurs broadly with the perceived wisdom on the Australian economy, albeit with perhaps a little more domestic weakness than expected, said David de Garis, director and senior economist at National Australia Bank.
""Investment is weakening as major mining projects complete, while an extended terms of trade fall is driving weakness in real domestic income,"" de Garis said.
RBA's next move
As Australia navigates a tricky rebalancing act, Goldman expects the Reserve Bank of Australia (RBA) to stand pat on monetary policy until March 2016, when it forecasts the central bank will commence raising interest rates.
The bank previously expected the RBA to hike rates by 25 basis points in the fourth quarter of 2015.
Read MoreAustralia holds rates as speculation for cuts mounts
The central bank on Tuesday kept rates at a record-low 2.5 percent, and maintained its rhetoric for a period of stability for rates.
However, some economists believe weak growth, slowing inflation and a rising jobless rate could pressure the RBA to ease monetary policy further.
Earlier this week, Deutsche Bank released a report titled ""Australia: Change of Call,"" which predicts the RBA will cut rates by 50 basis points to 2 percent next year, a shift from its earlier stance of no change.
Read MoreWhy RBA's move to cool housing could backfire
In this environment, the beleaguered Australian dollar is expected to remain on its downtrend.
Goldman expects the currency to fall to $0.86, $0.85 and $0.82 on 3, 6 and 12-month views, respectively, from $0.84 currently.
Meanwhile, the country's stock market is poised for moderate gains.
The benchmark ASX-200, among the worst performing markets this year, is forecast to rise 9 percent to 5,700 by end 2015, according to the bank.
Chief Executive Ton Buechner has stepped down with immediate effect due to health reasons, the company announced on Wednesday morning.
Thierry Vanlancker, previously the head of Specialty Chemicals at Akzo Nobel, will be the new CEO for the Dutch paints company.
Buechner joined the company in 2012 and has been responsible for ""significantly improving the performance of the company, increasing profitability and cash flow to record levels,"" Akzo Nobel said in a statement.
""It is with great regret that Ton is stepping down due to health reasons. He has been an outstanding leader for Akzo Nobel, transforming the company and setting it up for future success. His focus on delivering for our customers and operational excellence has driven profitability to record levels, increasing returns to shareholders,"" Chairman Antony Burgmans, said in a statement.
On a subsequent media call, Burgmans declined to go into details of Buechner's medical condition. ""I'm not a doctor and I don't speculate about his medical details,"" he said. ""It would be disrespectful if we went into details ... Considering the difficulty of the decision I think we have to respect that.""
Burgmans did explain that it was more of a preemptive decision that Buechner had taken very recently. Buechner felt that if he continued his work and subject himself to the pressure that the job entails then it could have had a detrimental effect on his health, according to the chairman.
The outgoing chief earlier this year repelled a takeover attempt from U.S. rival PPG Industries. In September 2012, Buechner stepped down briefly from his role after what was described as ""over-tiredness"", according to Reuters.
Republican presidential candidate Mitt Romney caused a stir in Britain on Thursday by questioning whether the country is prepared to host the Olympic Games without a hitch and scheduling a fundraiser with the former head of a troubled bank.
The former Massachusetts governor visited with British political leaders as part of a larger effort to show he has what it takes to represent the U.S. on the world stage. But instead of highlighting ties with the America's staunchest ally, Romney may have embarrassed the Brits instead.
British Prime Minister David Cameron offered a blunt retort to Romney and other doubters, saying they will ""see beyond doubt that Britain can deliver.""
The stir came on the first full day of Romney's first international tour as the GOP's presumptive presidential nominee. With the U.S. still fighting one war and facing foreign policy challenges across the globe, Romney is seeking to convince American voters that he's prepared to serve as commander and chief, despite limited foreign policy experience.
He is visiting three allies, including Israel and Poland, on the trip, appearing Friday at the Olympic opening ceremonies to help remind voters of his personal Olympic experience. Romney led the 2002 Winter Games in Salt Lake City, and used the games to launch his political career.
But his foreign trip got off to a shaky start.
openly doubted whether Britain could handle the games, saying it was unclear whether issues that have dogged the final preparations could be overcome.
""It's hard to know just how well it will turn out,"" Romney told NBC News in an interview on Wednesday, two days before the opening ceremonies.
He later met with Cameron and they discussed the Olympics as well as Afghanistan and Syria, among other countries.
Romney declined to answer questions on whether the West should do more to intervene in Syria, suggesting that he didn't ""want to describe foreign policy positions I may have while I'm on foreign soil.""
Earlier Thursday, Romney and Cameron seemed to address each other through the media after Romney doubted Britain's preparedness for the Olympics. Romney suggested it's impossible for any Olympic Games to go off without a hitch; Cameron said Romney and others would soon see that England is up to the challenge.
Romney backed off his initial comment after meeting with Cameron.
""I expect the games to be highly successful,"" Romney declared after the meeting.
At the same time, Romney faced scrutiny for a London fundraiser Thursday night that's expected to attract employees of Barclays, which has been in the spotlight after becoming the first bank to admit its employees were involved in manipulating a key interest rate.
Last month, U.S. and British agencies fined Barclays a total of $453 million. In the wake of that shock, chief executive . Diamond had been scheduled to attend the fundraiser at the Mandarin Oriental hotel in the tony Knightsbridge district, but has pulled out. He already had sent Romney a check for $2,500.
Romney sought to steer the conversation away from the controversies.
""The world is a tumultuous and dangerous place,"" Romney said Thursday. ""And certainly in many of the regions around the world we have great interests in having a common effort in seeing greater peace and prosperity.""
As he met with British leaders past and present, the Republican also praised ""the unique relationship that exists between our nations, our commitment to common values, our commitment to peace in the world and a desire to see a stronger and growing economy.""
Romney, whose decades in private business gave him ample exposure to international affairs, is a former one-term governor untested on the world's political stage. He hopes to convince voters back home that he is no novice on foreign affairs and that they should feel confident electing him as president in a complex world and with the U.S. facing a myriad of security threats.
During the public portion of his meeting with Cameron, Romney weighed in again after his comment about the Olympics drew attention across Britain. ""It is impossible for absolutely no mistakes to occur,"" he said. ""Of course there will be errors from time to time, but those are all overshadowed by the extraordinary demonstrations of courage, character and determination by the athletes.""
Meeting with British officials is typically one of the first priorities of any new president, and establishing those relationships beforehand can help smooth any transition. It's not unusual for American presidential candidates to meet with British leaders during the campaign; President Barack did so when he took a trip abroad as the likely Democratic nominee in 2008.
Romney's weeklong trip also will take him to Israel and Poland.
On Thursday, Romney also met with former Prime Minister Tony Blair; Ed Miliband, the current leader of the Labour Party — the opposition to Cameron's Conservative Party; and Foreign Secretary William Hague. The candidate also met with Nick Clegg, the deputy prime minister, and Chancellor of the Exchequer George Osborne, Britain's top financial official.
On Friday, Romney is scheduled to attend the opening ceremonies of the London Games.
This wasn't Romney's first meeting with Cameron; the two talked when Romney visited London in 2011. Cameron visited the U.S. earlier this year to meet with Obama and attended a White House state dinner, but he did not meet with Romney.
The meetings come a day after the Daily Telegraph published a story quoting an unidentified Romney campaign adviser saying the Republican believes the U.S. relationship with Britain is special because of shared ""Anglo-Saxon heritage"" that the adviser said the White House doesn't appreciate.
Romney, however, quickly distanced himself from any such view.
""I don't agree with whoever that adviser might be,"" Romney told NBC News, ""but do agree that we have a very common bond between ourselves and Great Britain.""
Nonetheless, Vice President Joe Biden and top Obama aides criticized Romney. ""The comments reported this morning are a disturbing start to a trip designed to demonstrate Gov. Romney's readiness to represent the United States on the world's stage,"" Biden said.
Accompanying Romney to some of his meetings Thursday were former Missouri Sen. Jim Talent, an adviser, and Kerry Healey, who served as lieutenant governor when Romney was governor of Massachusetts. Three of Romney's sons — Tagg, Josh and Craig — also have joined him in London.
The IRS isn't processing paper returns right now as they deal with distributing coronavirus stimulus checks.
While that's not an issue for most taxpayers, who currently have until July 15 to turn in their 2019 federal income tax returns and pay any amounts owed, it is a big problem for people who have to file amended returns. These can only be processed on paper.
The solution: if you owe something for prior years, pay it now as penalties and interest continue to pile up.
""I envision the paper returns in a mailroom somewhere in a big stack,"" said April Walker, CPA and lead manager for tax practice and ethics at the American Institute of CPAs.
""The IRS has also said that if you filed the paper return for whatever reason, be it current or amended, don't file another one and don't ask about the status because they won't know,"" she said.
Here's a surprise: Just because the IRS won't process your amended return from 2018 or 2017, it doesn't mean you get a break on the liability you may still owe from that year.
""If you have an amended return and you know you owe money but can only file on paper, then the interest is definitely accruing from the time the amended return was due,"" said Walker.
In addition to interest accruing on your balance owed, you could also be subject to a failure-to-pay penalty – 0.5% of the tax owed for each month or part of a month the tax remains unpaid, up to 25%.
If you're late submitting your return, you're also subject to a failure-to-file penalty. That adds up to 5% of the unpaid tax for each month or part of a month that your return is late.
Forget cutting a check at this point. Make a direct payment to the IRS electronically.
More from Smart Tax Planning:
Need a PPP loan? These applicants need to file their 2019 taxes first
Skipping a mandatory distribution from your IRA? What you should know
The PPP loan has run out, and these people were shut out
""Even though the amended return hasn't been filed, it'll be matched up later,"" said Walker. ""This is a way to help people who are worried about interest and penalties accruing.""
Alternatively, if the amount you owe is so large that you can't pay it in one fell swoop, you can enter an installment agreement with the IRS online. This way, you'll chip away at the balance owed every month.
If you have an amended return and you found out you're owed a refund from a prior year, congratulations! But you'll have to wait until the IRS begins processing paper returns again.
""These people have to be patient and wait for the service centers to open up,"" said Walker.
Markets are entering a dicey phase but most investors should not jump ship now, said index fund pioneer Jack Bogle.
The founder of The Vanguard Group, which manages about $2.5 trillion among its various funds, said in an interview on Monday's edition of ""Closing Bell"" that the underlying value of corporate America will continue to offer investors returns over the long term even if the market suffers a serious plunge.
While famed investor Seth Klarman has recently turned bearish, warning of a potentially catastrophic asset price bubble, Bogle thinks investors will be better off steeling their nerves and diversifying, rather than trying to time the market.
This is ""risky territory,"" and Klarman is ""heck of a lot smarter than I am,"" Bogle said. As the Fed tapers its asset-buying program and raises currently depressed interest rates, stocks could suffer a drop of as much as 20 or 25 percent, he said.
(Watch: Robert Schiller: We have a bubble)
But stock markets move in ""fits and starts,"" and the fundamentals underneath stocks are solid. Corporate operating earnings, for example, are up 25 percent from 2007, he said.
""What does not move in fits and starts is what the stock market enables you to do, which is own corporate America,"" he said.
And corporate America is likely to grow roughly as fast as nominal GNP—about 5 percent—and dividend yields will hover around 2 percent. Together, that should bring a return of about 7 percent over the long term, which should double an investor's money (before inflation) over the next 10 years, Bogle said.
(Watch: Are U.S. equities the biggest bubble?)
Rather than getting out of the market, investors should put some money into bonds, as ""ballast"" against any storms in equities, and prepare themselves psychologically for the trouble that may come.
But timing market entries and exits is a fool's errand, Bogle said.
—By Robert Ferris, Special to CNBC.com.
Suhail Doshi started software developer Mixpanel in 2009 after dropping his studies at Arizona State University to join the Y Combinator accelerator program. He was 20 years old.
Now, after more than nine years running the data analytics company and dealing with the many highs and lows of Silicon Valley entrepreneur life, Doshi is taking a step back.
On Tuesday, Doshi is informing Mixpanel's 300 employees at a companywide meeting that he's handing over the CEO role to Amir Movafaghi, the company's head of finance and operations. Doshi will become chairman of the board.
""I just need a break,"" Doshi told CNBC. ""It's been a marathon.""
With the help of an executive search firm, Doshi went looking for his successor, and in the end decided to promote Movafaghi, who joined the company last year. Prior to Mixpanel, Movafaghi was CFO at software company Spiceworks and before that spent five years at Twitter in finance and global operations.
Doshi said the one reference call he made before hiring Movafaghi was to former Twitter CEO Dick Costolo. At Twitter, Movafaghi was Costolo's right-hand man.
""He was the Mr. Fixit at Twitter when there were a whole bunch of problems that others weren't willing to fix,"" Doshi said. ""He's the perfect person to lead Mixpanel into the future.""
Mixpanel isn't confronting the kind of high-profile challenges Costolo faced at Twitter, which ranged from an abundance of bots and online bullying to slowing user growth and mounting losses. But the company has had its own set of hurdles.
In 2014, when venture capitalists were throwing cash at anything with momentum, Mixpanel raised a big financing round from Andreessen Horowitz at a valuation of over $800 million. At the time, Mixpanel was primarily serving small and medium-sized businesses and other Y Combinator grads with analytics software that helped them understand their customers' behavior so they could get them to stick around for longer periods of time.
But Mixpanel realized what so many business software start-ups eventually discover: The big money is in the enterprise. So in 2016, the company cut 19 jobs, or close to 10 percent of its workforce, almost exclusively in sales, and started to refocus on selling to bigger clients.
The company has also dealt with incidents of data leaks. Most recently, TechCrunch reported in February that some people using sites monitored by Mixpanel had their passwords ""mistakenly pulled into its software.""
Movafaghi said Mixpanel is ""in the ZIP code"" of $100 million in annual revenue after beating its internal fourth-quarter target by 54 percent. Close to half of its revenue now comes from companies with more than 1,000 employees, including BMW, Intuit, Samsung and Uber. Still, it's competing in a fragmented market against big companies like Google and Adobe as well as a host of start-ups.
Of the $77 million Mixpanel has raised in venture funding, $60 million is still in the bank, Movafaghi said. Additional private capital is a possibility but Movafaghi said he's in no rush to raise money just because it's readily available.
""One of the lessons learned over the last few years is companies were overcapitalized,"" he said. ""That has come back to really hurt a lot of businesses in the Valley.""
Among Movafaghi's upcoming tasks is finding a CFO to replace him. Doshi, meanwhile, plans to take some time off and then return to Mixpanel in the role of executive director, which could include working on products and helping with recruiting.
Doshi said he wasn't under any pressure from the board to step down, and that ""there were multiple moments when they asked me if I was sure."" The company's board includes Affirm CEO and PayPal co-founder Max Levchin, whom Doshi calls one of his mentors.
tweet
Doshi said he plans to spend more time tinkering around with side projects and getting back to programming. On Twitter, he often chimes in about his latest hobby — cryptocurrencies — though he's not ready to say if that will be part of his next gig.
""I do plan to code a lot,"" he said. ""But I'm not sure if it's crypto.""
TEMPLE CITY, Calif., Oct. 1, 2012 /PRNewswire/ -- Temple City Unified School District and Chevron Energy Solutions today announced the completion of a transformative solar and energy efficiency program expected to reduce energy costs at seven school sites and save the District more than $3.8 million. The project added a 400-kilowatt solar photovoltaic power system mounted on parking shade structures at Temple City High School; replaced the boiler and chiller at Longden Elementary School; installed high-efficiency pumping equipment at Temple City High School's pool; and added new windows at Oak Avenue Intermediate School.
Coupled with comprehensive energy education curriculum content, including teacher training workshops, the program is designed to inspire students to learn about – and experience – clean energy technologies and concepts. Teachers will receive instructional materials, including ready-to-launch lesson plans and math problems that relate to the installed solar electric system. Teachers will also have access to solar energy kits that will include scaled-down versions of a solar installation and provide activities for students.
The program is expected to cut Temple City Unified School District's electrical utility purchases by more than 33 percent and reduce annual carbon emissions by more than 800 metric tons, equal to removing about 158 cars from the road.
""Today marks the beginning of a new chapter for environmentally sustainable operations at Temple City Unified School District – one that allows the community to experience the benefits of clean power without negatively impacting limited resources,"" said school district Superintendent Dr. Chelsea Kang-Smith. ""We are pleased about the work Chevron Energy Solutions has completed to enable Temple City Unified School District to bring the benefits of solar energy to our community.""
Chevron Energy Solutions designed, engineered and installed the solar system, and will perform operation and maintenance services, as well as guaranteeing the system's performance. The company also installed District-wide energy-efficient lighting and control systems, which are expected to reduce the District's annual energy consumption, improve lighting quality and aesthetics, reduce maintenance costs and provide consistent indoor climate quality.
""Through this program, Chevron Energy Solutions is helping Temple City Unified School District demonstrate fiscal and environmental leadership,"" said Chevron Energy Solutions President Jim Davis. ""The District is investing in sustainable programs designed to deliver ongoing value and improve the learning environment for the community's students.""
The program completion will be commemorated today at 4:00 p.m. during a dedication ceremony held in the Rand Media Center at Temple City High School in Temple City. Students, district representatives, government, utility and business officials are expected to participate.
Southern California Edison is expected to present a rebate check exceeding $100,000 to the Temple City Unified School District from the utility energy efficiency rebate programs. In addition, as part of the California Solar Incentive, Temple City Unified School District expects to receive over $426,000 over five years as a result of the solar project.
About Chevron Energy Solutions
Chevron Energy Solutions is one of the largest installers of solar power in the U.S. education market and has developed hundreds of projects that improve energy efficiency and provide renewable power for education, government and business facilities. Chevron Energy Solutions develops and builds sustainable energy projects that increase energy efficiency and renewable power, reduce energy costs, and ensure reliable, high-quality energy for government, education and business facilities. Its parent, Chevron Corporation, is investing across the energy spectrum to develop energy sources for future generations by expanding the capabilities of alternative and renewable energy technologies.
Contact: Brent Andrew, Chevron Energy Solutions, 415.842.3398
SOURCE Chevron Energy Solutions
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If you sent us something in the last month or so and need a reply, please feel free to reach out again.
Chipmaker Ambarella may be small relative to its competitors, but the company is attracting more interest due to a surging stock and a few high-profile clients.
The company makes chips that process high-quality video for a variety of companies including camera maker GoPro—whose stock has surged since going public last week—and search giant Google. It's still small—its market cap is about $900 million—but the stock has soared more than 95 percent in the past 12 months as investors cheered its growth prospects.
Fermi Wang, the company's CEO, says he first met GoPro founder and CEO Nick Woodman five years ago at the Consumer Electronics Show.
""Since then, we have been working together closely with the GoPro team on all of their camera products,"" Wang tells CNBC. Wang founded Ambarella in 2004, and the company went public in 2012.
Kevin Cassidy at Stifel Nicolaus, who covers Ambarella, estimates that GoPro now represents about 25 percent of the company's business.
On Google wearables, Cassidy says Ambarella won a contract to be part of Google's ""Helpouts"" services, which include a customer service person helping with fixing your car, or taking Yoga or Piano lessons through a small video camera linked to a Wi-Fi or Bluetooth network.
Read MoreCramer: GoPro stock is in a ""sweet spot""
The main driver for Ambarella's business, however, is the security and surveillance market, said Wang. Clients such as FLIR Systems and leading surveillance equipment suppliers like Hikvision rely on Ambarella's technology.
IP security cameras constitute 45 percent of its business, and that segment—which is growing 25 percent year-over-year—is ""a bigger growth engine than GoPro,"" Cassidy said. Axis Communications of Sweden is its biggest customer, and it has some smaller clients in China, he said.
Dashboard cameras are for now a small part of its business, but growing popularity in China and Eastern Europe and the possibility that more auto manufacturers could begin installing them points to another potential big growth engine for the company, Cassidy said.
Wang also believes there is opportunity in the growing market for drones, as manufacturers increasingly look to equip these unmanned aerial vehicles with miniature HD-quality cameras.
Not everyone sees a completely rosy growth forecast for the company, though. After the stock's strong run, analysts at Deutsche Bank now argue that much of the good news in this story is already priced in. Plus, the entire semiconductor market has been on a tear lately, and some analysts believe that run is about over.
Read MoreWhy semiconductor stocks may be ready for a fall
Also, the company specializes in a very competitive market, where it has to go head-to-head with rivals such as Texas Instruments and Xilinx.
But other analysts such as Suji De Silva of Topeka Capital Markets say Ambarella has competitive advantages, for example chips that are more power efficient than competitors.
Bulls on the stock are also fans of Ambarella's management team. Wang boasts a strong background in semiconductor design, and he has already founded and sold one company called Afara Websystems.
So is Ambarella an acquisition target? Cassidy thinks that tech giants or other chip companies could be interested in buying the company.
Cassidy says that the Wang and his partner have sold two other companies and he sees Ambarella as a ""possible acquisition candidate.""
""Qualcomm, Nvidia or Intel are possible candidates, and I wouldn't rule out Google or Facebook, either,"" he said
A representative for Ambarella did not respond to requests for comment on whether they'd be willing to be acquired.
—By CNBC's Mark Berniker and Josh Lipton. Follow them @markberniker and @CNBCJosh
Art Cashin was only a few years into what would become a legendary career on Wall Street when John F. Kennedy was shot in Dallas.
Like virtually every American who was around then, he remembers where he was when he got the news.
More than that, though, he recalls the market impact before anyone even knew what was going on. Wall Street was in sell mode before it became clear what had happened that fateful day, according to a remembrance Cashin shared with clients Friday morning.
Cashin, now director of floor operations at UBS, had started at Thomas McKinnon—now part of Prudential—in 1959. The 1963 assassination happened a year before he would go on to become a member of the New York Stock Exchange and a partner at P.R. Herzig.
On the floor of the NYSE selling had begun before any headlines hit the tape. Months later I learned that was thanks to a savvy branch manager in Dallas.
The manager of whom Cashin spoke figured it would be a slow day in the city due to the Kennedy motorcade that was expected to pass through. Consequently, he decided to let most of this staff go watch the parade, keeping only a skeleton crew around the office.
But when the crew returned after hearing the event was canceled—without knowing why—the manager grew concerned, according to Cashin's knowledge of the story:
After questioning, he learned that they had heard the sirens accelerate, the police lights flare and the ""parade"" suddenly turn right. They were many blocks away and obviously heard no shots.
The savvy manager quickly asked—""Give me a bullish reason to pull a president out of a parade?"" ""It's not to sign a tax bill—that could wait."" No one could think of a bullish reason to divert a parade. Then they mulled bearish reasons. No one thought assassination. But they did think natural disaster, nuclear accident, missile threat and scores of others. That's when they decided something ""bad"" must have happened and began to sell.
As their sell orders poured onto the floor and prices began to melt, they were asked by brokers—""Why the selling?"" The response was the incomplete—""something about the President.""
The horror of what had actually happened soon hit.
Sometime later, the first headline hit—""Shots reported fired at President's motorcade!"" The selling broadened and accelerated. Rather quickly the next headline—""President reported hit.""
Exchange leaders hastily gathered and discussed closing the exchange. Then the headline ""Motorcade diverted to Parkland Hospital."" They rang the bell at 2:07 (EST).
The Dow fell the equivalent of what would be 460 points today. When we reopened Tuesday, there was such a sigh of relief that power had been transferred and the Constitution still functioned, that a massive rally erupted, soaring the equivalent of 710 points.
An unforgettable period.
—By CNBC's Jeff Cox. Follow him on Twitter @JeffCoxCNBCcom.
The Hwasong-15 missile that North Korea launched on Wednesday is a new type of intercontinental ballistic missile which can fly over 13,000 km (8,080 miles), a South Korean defense ministry spokesman told Reuters on Friday.
Earlier this week, Pyongyang said it had test-fired its most advanced missile, putting the U.S. mainland within range, and in violation of U.N. Security Council resolutions.
The latest provocation from the North prompted more insults from U.S. President Donald Trump, who referred to North Korea's leader Kim Jong Un as ""Little Rocket Man"" and a ""sick puppy"".
Trump had also dismissed a Chinese diplomatic effort to rein in North Korea's weapons program as a failure on Thursday, while Secretary of State Rex Tillerson said Beijing was doing a lot, but could do more to limit oil supplies to Pyongyang.
Despite international condemnation and sanctions, North Korea has continued on its path towards developing a nuclear-tipped missile that could hit the United States.
After North Korea released video footage and photographs of Hwasong-15, analysts have said they appeared to show the North was indeed capable of delivering a nuclear weapon anywhere in the United States and could only be two or three tests away from being combat ready.
South Korean President Moon Jae-in said on Thursday in a phone call with Trump that the new missile was North Korea's most advanced so far, but it still has some technical issues to settle, like re-entry and terminal guidance system technology.
Trump and Moon pledged to continue applying strong sanctions and pressure on North Korea to bring it to talks. Addressing an emergency U.N. Security Council meeting after this week's missile launch, the United States warned North Korea's leadership it would be ""utterly destroyed"" if war were to break out.
Pfizer sent out a press release this morning touting the findings of a company-sponsored European survey of ex-smokers.
The study found that 84 percent of the respondents in France, Germany, Italy, Spain and the UK who had consulted with a doctor or some other healthcare professional about quitting thought it was helpful.
However, only 13 percent of the nearly 1,000 participants had talked to a doc or someone else in the medical field. The press release quotes a doctor in The Netherlands who says that shows how important it is for people who want to quit to seek out a professional.
Of course, that's how potential quitters can get a prescription for the relatively new drug PFE makes to stop smoking. It's sold as Chantix in the U.S. and Champix overseas. The world's biggest drugmaker is pushing the drug in an ubiquitous ad campaign featuring the tortoise and the hare. In fact, as I'm writing this blog entry I'm watching the spot during a break on CNBC's ""Squawk on the Street"" at 10:15 a.m. ET.
And I've seen new internet ads saying, ""Resolve to quit in 2008."" Pfizer's apparently turning up the volume because Chantix is one of the few bright spots in its product portfolio these days. Lipitor sales are falling and it recently gave up on another once-promising new product--the inhalable insulin, Exubera.
PFE sold nearly a quarter-billion dollars worth of Chantix in the third quarter. But it will be interesting to see the fourth quarter numbers after the FDA and its UK equivalent recently told doctors to be on the lookout for abnormal behavior among their Chantix patients. Australia has already gone so far as to put a warning on the drug about the possibility of feeling depressed, agitated or thinking about suicide while taking Champix. Eventually, some say the same thing will happen here.
A couple of other noteworthy findings of the Pfizer survey: 45 percent said concerns about health problems were a major factor in their decision to quit and 28 percent said the cost of smokes influenced them. Not a coincidence, I'm guessing, that another new ad appears on ""The New York Times"" web site homepage today that says, ""Calculate how much your smoking habit costs."" The survey participants hadn't taken a puff for at least a year.
Interestingly, yesterday when the Dow and the American pharma sector tanked, PFE shares were up a fraction. Maybe it was a dog of the Dow thing on the first trading day of the year--Pfizer was one of the index's worst performers in 2007. It started this year not much off of its low of 22 bucks and change, so it could be investor bargain hunting and/or the still-attractive dividend. Pfizer's obviously hoping Chantix sales will help ""light up"" the stock this year.
Questions? Comments? Pharma@cnbc.com
Author Michael Lewis shared his views on Donald Trump's policies, Wall Street deregulation and his new book ""The Undoing Project"" in an extensive interview on CNBC's Power Lunch Tuesday.
Lewis' best-selling books include ""The Big Short,"" ""Moneyball"" and ""Liar's Poker.""
On Donald Trump's next moves: ""Predicting what he's going to do I know is a stupid thing. It's like predicting what the stock market is going to do tomorrow. Really. You're watching I think something with a large random component there. I don't think this is like some well-thought out strategy. You never know what he is going to do next,"" he said.
On Wall Street deregulation: ""When I'm watching the incoming Trump administration, that's the thing that terrifies me. They are going to reduce the capital requirements in banks. ... They already seem to be interested in rolling back the Volcker Rule,"" Lewis said.
He also discusses:
- Trump's criticisms of business leaders
- Flaws in decision-making based on intuition
- Best anecdotes from his new book
To watch the broadcast interview in its entirety, you must be a CNBC PRO subscriber.
FLORANGE, France, Oct 1 (Reuters) - Workers occupied thesite of two idle ArcelorMittal steel furnaces innortheastern France on Monday as management and unions met inParis to decide the fate of a plant that has become a symbol ofthe country's industrial decline.
Some 40 workers blocked access to management offices at thesteel mill in Florange, in France's traditional industrialheartland of Lorraine, where two blast furnaces have been out ofoperation since last year due to lack of demand.
Management was due to announce a decision on the fate of thefurnaces, which employ some 550 of the 2,800 workers at theFlorange plant, after a meeting with unions at its Frenchheadquarters.
The rest of the plant is operational.
Socialist President Francois Hollande, who visited Florangewhile campaigning for the May presidential election, met thesteelmaker's chief executive Lakshmi Mittal last week to ask himto either restart the furnaces or put the facility up for sale.
The daily Liberation reported that Mittal had given his""consent in principle"" to finding a buyer, citing a source inthe president's office.
Industry Minister Arnaud Montebourg said on Sunday thegovernment was seeking contacts with leading steelmakers.
With French unemployment breaking the psychological barrierof 3 million for the first time since June 1999, the Lorraineregion has been hard hit by a slump in industrial demand,particularly for the car sector, which has traditionallyconsumed much of Florange's output.
Frustration over Hollande's inability to stem job losses hastaken a toll on his approval ratings, which have slid to as lowas 43 percent in one survey.
(Reporting By Vincent Kessler and Gilbert Reilhac; Writing byDaniel Flynn; Editing by Kevin Liffey)
((daniel.flynn@thomsonreuters.com)(+33 1 49 49 5071)(ReutersMessaging: daniel.flynn.thomsonreuters.com@reuters.net))
Keywords: FRANCE ARCELORMITTAL/
New Dow component Nike on Thursday reported earnings that beat Wall Street forecasts, helped by lower costs for raw materials and higher futures orders in China, excluding currency.
Nike closed above $70 for the first time ever on Thursday and was the best performer on the Dow. Shares closed at $70.34 a share on the New York Stock Exchange, and jumped higher after the earnings beat. What is Nike stock doing now? (Click here to get the latest quote.)
Operating earnings rose to 86 cents a share in the fiscal first quarter from 64 cents a share a year earlier.
Revenue ticked higher to $6.97 billion from $6.47 billion a year ago.
Analysts had expected the athletic footwear and apparel maker to report earnings excluding items of 78 cents a share on $6.97 billion in revenue, according to a consensus estimate from Thomson Reuters.
The company has been dealing with Europe's fluctuating economy and a slowdown in growth in China. It's been working to reduce its inventory in China and reworking its offerings there to adapt to the changing tastes of Chinese consumers.
Meanwhile, it has been enjoying strong demand in North America, where it has been selling off less profitable brands like Umbro to focus on core brands like Nike.
Social Security provides about 38 percent of the income for the elderly, but most Americans would likely flunk a test on the program's basic details.
Only one person—a retired woman in the South—out of 1,513 surveyed recently by life insurer MassMutual answered all 12 questions right on an elementary test about Social Security retirement benefits. (Tweet This) More than seven out of 10 people received a failing grade.
(Take CNBC's quiz below to see how your Social Security knowledge stacks up.)
""Perhaps the greatest Social Security deficit in this country—and what's lost in today's discussions about Social Security—is how little most Americans even know about this retirement benefit,"" said Michael Fanning, MassMutual's executive vice president of the U.S. insurance group. ""While we didn't expect every person to get 100 percent correct, we certainly hoped that more would receive a passing grade.""
Read MoreHow to boost your Social Security check
Besides not knowing that the full retirement age varies, depending on the year you were born, and that non-U.S. citizens can be eligible for Social Security retirement benefits, 55 percent incorrectly said that they can continue working while collecting full Social Security retirement benefits regardless of their age.
While you can work and receive Social Security retirement benefits, if you have not reached full retirement age, your earnings will be subject to a retirement earnings test. If your income exceeds $15,720 for 2015, for example, the Social Security Administration will deduct $1 from your benefit payments for every $2 you earn above the annual limit.
Lack of knowledge did not diminish Americans optimism about receiving Social Security benefits. Sixty-three percent of people surveyed by MassMutual believe Social Security will be available to them when they retire, but only 45 percent think the program will have sufficient funding.
Read More29% of Americans 55+have no retirement savings
An earlier survey by the Pew Research Center found that 41 percent of Americans think there will be no Social Security benefits for them when they retire and nearly a third expect reduced levels of benefits.The Social Security and Medicare trustees' 2014 report projects that all the Social Security trust funds will be depleted by 2033. At that point, the agency will be able to pay out about 77 percent of retirement benefits from payroll taxes collected.
""The Social Security knowledge problem relates to a lack of basic financial literacy,"" said Anna Rappaport, chair of the Society of Actuaries' Committee on Post-Retirement Needs and Risks.
Since many workers receive retirement information at the workplace, Rappaport said, employers can be a valuable resource in improving financial literacy, including information on Social Security. In fact, more than 90 percent of 250 large employers said they want to introduce or expand their financial wellness programs this year, according to a survey by benefits consulting firm Aon Hewitt.
Read MoreFinancial wellness: Coming to an office near you
People's knowledge of Social Security tends to increase as they approach retirement, Rappaport said. Yet 40 percent of the people surveyed by MassMutual were 50 or older and among this group 62 percent failed the Social Security quiz.
""This is very concerning, as many Americans may be at risk of underutilizing a critical component of their income stream and leaving Social Security retirement benefits they're entitled to on the table,"" Fanning said. ""Many may be putting their retirement plans in jeopardy.""
The Federal Open Market Committee on Wednesday concludes its two-day policy-setting session, and is widely expected to continue its current path of tapering while holding its benchmark interest rate near zero.
The fireworks, if there are any, should come 30 minutes after the release of the FOMC decision, at the afternoon news conference, Janet Yellen's first press conference as Fed chair.
Stocks were largely flat in early trading Wednesday, as the market watched and waited.
""There are a number of things we're going to be looking for in the press release, but more importantly in the news conference after; this is a new Fed chairperson,"" said Paul Mangus, managing director of equity research and strategy at Wells Fargo Wealth Management.
The FOMC, which has held the benchmark interest rate at near zero since late 2008, is expected to continue that policy for an extended period while tapering its monthly asset purchases another $10 billion, to $55 billion.
But Yellen could signal a change in the threshold that the Fed has said would mark when it would start considering hiking the main interest rate from near zero.
Yellen could indicate ""a broader range of economic indicators is being discussed, such as underemployment, the labor participation rate and inflation, rather than focusing strictly on unemployment, currently at 6.7 percent, and the target at 6.5 percent. We're very close to that,"" said Mangus.
(Watch: Putin, the Fed and your money)
""I think the market could look at that in a positive way if it (the Fed) was looking at a broader range, since there are a lot of areas of the economy that are still recovering,"" Mangus added.
""Not that she is going to light it up with her comments, but it may signal a different way of delivering the Fed's message, so for that we are very interested,"" Kevin Giddis, head of fixed income capital markets at Raymond James, said in emailed comments.
The central bank's decision-making seems ""pretty straightforward, no moves on rates and the continuation of the reduction of stimulus,"" noted Giddis.
""We don't want to hear that they are not doing it, primarily because we need to get out of this painted corner,"" Chip Cobb, portfolio manager at BMT Asset Management, said of the Fed's tapering program.
(Read more: Wall St sharply divided on 2015: CNBC survey)
""We want to hear at least that the economy is headed in the right direction; we don't want to hear the Fed is more concerned than the last meeting,"" Cobb said.
Yellen ""seems to be the fairy godmother of the bull market because stock prices tend to rise on days that she speaks publicly about the economy and monetary policy,"" noted Ed Yardeni, chief investment strategist at Yardeni Research.
""I doubt she will say anything unexpected to rattle the market but after two consecutive days of big gains, 'a sell on the news' might be a scenario that could play out,"" offered Elliot Spar, market strategist at Stifel, Nicolaus & Co.
""By the way, I hate predicting the market on a Fed day,"" Spar added.
—By CNBC's Kate Gibson
Ukraine's prime minister said on Saturday Russian President Vladimir Putin aimed to destroy Ukraine as an independent country and said only NATO could defend the ex-Soviet republic from external aggression.
Kiev and its Western backers accuse Moscow of sending troops and tanks into eastern Ukraine in support of pro-Russian separatists battling Ukrainian forces in a conflict that has killed more than 3,000 people. Russia denies the accusations.
A fragile ceasefire negotiated by envoys from Ukraine, Russia, the separatists and Europe's OSCE security watchdog, has been in place in eastern Ukraine for more than a week and is broadly holding despite sporadic violations.
""We are still in a stage of war and the key aggressor is the Russian\ Federation ... Putin wants another frozen conflict (in eastern Ukraine),"" Prime Minister Arseny Yatseniuk told a conference attended by European and Ukrainian lawmakers and business leaders.
Yatseniuk said Putin would not be content only with Crimea - annexed by Moscow in March - and with Ukraine's mainly Russian-speaking eastern region.
Read MoreUS expands sanctions to Russia's biggest bank
""His goal is to take all of Ukraine ... Russia is a threat to the global order and to the security of the whole of Europe,"" said Yatseniuk, who is known for his hawkish rhetoric.
Asked about future NATO membership, a red line for Russia, Yatseniuk said he realized the alliance was not ready now to admit Kiev, but added: ""NATO in these particular circumstances is the only vehicle to protect Ukraine.""
There is no prospect of the Atlantic alliance admitting Ukraine, a sprawling country of 45 million people between central Europe and Russia, but Kiev has stepped up cooperation with NATO in a range of areas and has pressed member states to sell it weapons to help defeat the separatists.
Russia 'bluffing' over sanctions
Read MoreRussia Deputy PM: Sanctions not good for anybody
Yatseniuk also praised a new wave of economic sanctions imposed on Russia by the European Union and the United States and said they posed a major threat to the Russian economy.
""It is bluff (by Russia) to say it does not care about the sanctions,"" he said, noting that Russia relied heavily on its energy sector and some of the sanctions target its oil firms.
Western powers imposed new sanctions on Friday, tightening financial measures against Moscow in a move Putin called ""a bit strange"" in view of the ceasefire.
Yatseniuk defended his government's efforts, despite the conflict, to tackle rampant corruption and overhaul the creaking economy, adding: ""It is very hard to attract investors when you have Russian tanks and artillery in your country.""
Yatseniuk, whose centre-right People's Front party is expected to do well in a parliamentary election on Oct. 26, praised a decision on Friday to delay the implementation of a new trade pact with the European Union until the end of 2015.
Read More
Some have seen the decision to postpone the implementation of the deal as a diplomatic victory for Russia, which is opposed to closer economic ties between Kiev and the EU, but Yatseniuk said it would be good for Ukraine's own economy.
""We got a grace period. The EU opened its markets but Ukraine is still protected, so for Ukraine this is not a bad deal,"" he said.
Retailers such as Costco could see a big benefit as oil prices keep dropping, according to Jim Cramer.
""Raw costs are coming down, and at the same time there is more traffic,"" he said on CNBC's ""Squawk on the Street"" Thursday. ""People are spending again and that's the theme.""
Read More Why oil will go even lower
The retailer reported on Thursday its December same-store sales grew 3 percent, 0.2 percent above estimates.
Read More Don't fret over oil's effects... yet: McNamee
Cramer added ""there's way too much being talked about [that] capital expenditures in oil is coming down.
""That's really concentrated in Texas, Louisiana and North Dakota,"" he said. ""Let's not lose sight of the fact that $1,000 more in people's pocket is being spent in retail.""
Disclaimer
Richard Fisher, Dallas Fed president, explains his dissent on two more years of a zero interest rate target.
He believes the Fed has created enough liquidity, but it's tax and regulatory barriers that have blocked growth and job creation. He also responds to GOP attacks on the Fed.
You're looking at a future Treasury secretary here.
Questions? Comments, send your emails to: lkudlow@kudlow.com
When Tiger Woods returned from knee surgery a couple weeks ago, it seemed a bit strange that virtually everyone thought he immediately would be in championship form.
Had there ever been an athlete in the history of sports who came back from surgery -- after eight months off -- with fewer questions about the future of his performance?
Television ads ran promos of his weekend appearance and Nike showed its consumers what Tiger would be wearing. Then the world's No. 1 golfer lost in the second round of the WGC-Accenture Match Play Championship and didn't even make it to the weekend.
Just a little rusty? Sure. We'll give him a mulligan.
But we've been watching the leaderboard at WGC-CA Championship in Doral and it doesn't look good for Tiger to win this one either. Through 11 holes today, he's one under par and the current leaders, Jeev Milkha Singh and Prayad Marksaeng, are 11 strokes ahead.
So we're going ask the taboo question, and maybe it's a bit early: Is it possible Tiger isn't as good as he was when he left?
Questions? Comments? SportsBiz@cnbc.com
Commerce Secretary Wilbur Ross said Monday that already ""thrilled"" business executives should expect even more regulatory relief over the coming months.
""I believe a good portion of the reason for why the economy has gotten better is regulatory relief and there's going to be more to come,"" Ross told CNBC on Monday.
""Trump has cancelled 860 rules and regulations that had been imposed by the Obama administration and there's barely a single CEO that comes to my office who isn't thrilled with the regulatory relief,"" he said.
Ross said the Trump administration had been able to deliver on deregulation policies because the president was able to exercise his executive powers in order to achieve these aims. And while other campaign pledges were yet to come to fruition, the U.S. commerce secretary said it would be unfair to blame President Donald Trump ""when Congress fails to act on something.""
Trump is still searching for his first major legislative victory since becoming president.
House and Senate Republicans are currently on a fast-track to pass separate tax bills before the Thanksgiving holiday. Republican lawmakers would then look to iron out any differences in December and attempt to send a final version to Trump's desk before the year ends. Analysts say it is likely Trump's tax overhaul could be delayed until 2018.
Meanwhile, the U.S. president has sought to take credit for the uptick in economic growth from the first quarter of 2017 and last year. In a tweet on Saturday morning, the former New York businessman touted low unemployment figures and a roaring stock market.
Tweet 1
The U.S. economy has expanded at a steady pace in recent months, with gross domestic product (GDP) growing at an annual rate of 3 percent in the most recent quarter. Meantime, job growth has decelerated over the same period, with the hurricanes hastening this slowdown.
However, former Obama-era Treasury Secretary Jack Lew told CNBC on Wednesday that it is too early to tell whether those 3 percent levels would be here to stay.
""We've seen over the last five (or) 10 years a trend of quarters being very uneven,"" Lew said, pointing out that there were quarters during the Obama administration that were ""better than we just saw.""
— CNBC's Matthew J. Belvedere and Reuters contributed to this report.
Investors should prepare themselves for more stock market swings as a host of ""difficult crosscurrents"" weigh on equities, CNBC's Jim Cramer said Friday as stocks traded lower.
""Now that the has gone negative for the year, let me give you one warning: I think we're going to have to slog through these volatility sessions for a bit,"" Cramer, host of ""Mad Money,"" told investors.
""There are all sorts of difficult crosscurrents here: the trade war with China, the stunning weakness in stocks like bellwether Apple, which got a price target cut from the most influential analyst in the stock, Katy Huberty — it is now down for the year — and, of course, an errant Federal Reserve that's backed itself into a corner when it comes to the next rate hike,"" he said.
Any developments on these complicated issues have the power to sway entire market groups, so Cramer recommended that investors stay vigilant in this challenging layout.
""Get used to these crosscurrents, because this is the new normal, at least for now,"" he said.
With that in mind, here's Cramer's game plan for the week ahead:
Online personal shopping service Stitch Fix will report earnings on Monday, and Cramer will be keeping a close eye on the company's results.
""E-commerce has become one of the most volatile areas in this market. I'm always trying to get a feel for it. Why? Because it's a huge driver of the new economy,"" he said.
""Stitch Fix crashed into a retaining wall at 60 miles an hour the last time it reported, [with the] stock losing a third of its value in the same day,"" he continued. ""If Stitch Fix can turn itself around, that's good news for the e-commerce cohort.""
On Tuesday, investors will get a glimpse into the state of the experiential economy when Dave & Buster's reports its quarterly results.
""Dave & Buster's is also a terrific gauge of consumer spending, which, frankly, needs to stay strong here or else the economy is in real trouble,"" Cramer said. ""I'm going to be listening to that conference call.""
An Analyst Day at sports apparel maker Under Armour will tell Cramer if it's time for investors to ring the register on the company's stock, which the ""Mad Money"" host began recommending when shares were still in the low teens.
""I bet CEO Kevin Plank tells a terrific story,"" he said. ""I want to hear about the state of apparel and footwear both here and in China.""
Starbucks: The coffeemaker's Analyst Day will be nothing less than a ""lovefest,"" but an educational one, Cramer said. He'll be on the lookout for newsmaking events, employee benefit upgrades and other special initiatives.
""Starbucks is on a roll right now and I expect CEO Kevin Johnson will give us a road map for a return to robust growth in the United States,"" Cramer said. ""The company's putting up some excellent numbers in China, too. Let's see if they can keep it up, even with the escalating trade tensions.""
Ciena: Telecommunications equipment maker Ciena reports earnings on Thursday. Cramer wants insight into the ongoing rollout of fifth-generation wireless communications, also known as 5G, as well as the state of Ciena's Chinese competitors.
Costco: Wholesaler Costco may have a difficult time when it reports earnings after Thursday's closing bell, Cramer warned. Still, he was eager to hear the retailer's insight on e-commerce and competition in the food segment.
""This is a situation where no matter how good things are, no matter how good the numbers come out, I doubt it can move the needle because the stock's already run,"" he said. ""This week Costco gave us some spectacular November same-store sales figures, up 9.2 percent. I was looking for 5.4 percent. I don't see how they can top that number.""
The ""Mad Money"" host expected health insurance giant Centene's analyst meeting to be ""excellent"" as the government-sponsored health-care provider continues to win new states and contracts.
""I expect a darned good story,"" Cramer said. ""That whole segment, by the way, of the market, along with the hospital group, has really held up better than just about anything else because it does so well in a slowdown, which is what people are now worried about: a Fed-induced slowdown.""
Disclosure: Cramer's charitable trust owns shares of Apple.
As Iraq's mounting unrest pushes crude oil prices to a record high this year, a report Friday expects that global oil demand will increase and Iraq's production will be a vital component.
The International Energy Agency report forecasts a jump in global oil demand, which affects both oil and gasoline prices, from 91.4 million barrels per day in 2014's first quarter to 94 million during its last three months. It also says that Iraq was expected to account for 60 percent of the production growth from the Organization of Petroleum Exporting Countries for the rest of this decade. Iraq, which has the world's fifth-largest proven oil reserves, is now OPEC's second-largest producer.
(Where are oil prices now? Click here)
""While Iraq's production potential is huge, so are the political hurdles it is facing,"" the IEA says, noting the significant gains that Sunni insurgents have made in the country's north since launching a military campaign earlier this month. The IEA says news of the Sunni advance sent prices for Brent crude — a benchmark for international oils — to nearly $113 a barrel, their highest so far this year.
More from USAToday.com:
Five key questions about Iraq
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Why Friday the 13th is known as a day of bad luck
Yet unless the conflict spreads, the IEA says it may not ""put additional Iraqi oil supplies immediately at risk,"" because most of the recent production gains have occurred in the south. Iraq's oil production reached its highest level in three decades this year, but since March, it has fallen about 10 percent, and all its exports have come from southern terminals near Basra.
""The question is, who is going to fill the gap? Saudi Arabia? That's what the market is looking at,'' says John Kingston, global news director for industry tracker Platts Energy.
Read MoreOil could rise another $15: Oppenheimer expert
The surge in oil prices could set the stage for a spike in gasoline prices, already on the rise. While gasoline averaged $3.58 a gallon between Memorial Day and Labor Day last year, retail prices have averaged about $3.65 for the past month.
Oil price increases are likely to drive the price of regular unleaded gasoline up 5 to 10 cents per gallon in the coming days and keep summer prices elevated, says Tom Kloza, senior energy analyst at gasbuddy.com.
— By Wendy Koch and Gary Strauss, USA Today
Expectations for a June rate hike jumped as Federal Reserve meeting minutes released Wednesday showed that members would support it if economic data improved.
Ahead of the release, market expectations for a rate rise next month were 19 percent, while the markets were expecting the first rate hike of 2016 to take place in September, according to the CME Group's FedWatch tool.
After the statement, odds rose in all months tracked by CME:
- June: 34 percent chance, up from 19 percent before the 2 p.m. EDT release
- July: 51 percent chance, up from 38 percent
- September: 63 percent, up from 57 percent
- November: 65 percent, up from 60 percent
- December: 77 percent, up from 74 percent
- February 2017: 79 percent, up from 76 percent
The odds of rate hikes this year have risen broadly this week, as several Fed officials delivered hawkish remarks.
On Tuesday, three central bank officials indicated it may raise rates again soon.
Dallas Fed President Robert Kaplan said the U.S. economy is strong enough to justify an interest rate hike in the ""not too distant future,"" but increases will be very gradual.
San Francisco Fed President John Williams and Atlanta Fed President Dennis Lockhart both said the central bank's June meeting was a ""live"" one.
In Fed jargon, a ""live"" meeting is one at which officials could debate whether to raise their benchmark short-term interest rate, which since December has been in a range between 0.25 and 0.50 percent.
— Reuters contributed to this report.
A steam pipe exploded in midtown Manhattan on Wednesday, creating a roar and a huge plume of smoke and sending pedestrians fleeing from the area in scenes reminiscent of the Sept. 11 attacks.
Officials in New York and Washington promptly ruled out a terrorist attack. Police at the scene said 15 to 20 people had been taken to hospitals.
Boiling, brownish water and steam gushed geyser-like at least 120 feet high (36 metres) out of a crater about 20 feet wide (6 metres) on Lexington Avenue at 41st Street, one of the busiest areas of New York City near the Grand Central transportation hub.
The scene looked as if buildings were collapsing in a billow of debris as they did on Sept. 11, 2001 when the World Trade Center in lower Manhattan was destroyed.
""We ran down 43 floors thinking we were going to die,"" she said Megan Fletcher, 35. ""It looked like when the buildings collapsed on 9/11,"" said Fletcher, who works for an Australian company in the Chrysler Building. ""It was terrifying.""
Police at the scene raised the concern of asbestos being strewn into the air. Rescue workers and those covered in the debris were being decontaminated at the scene by hazardous materials specialists.
Power utility Consolidated Edison said an underground steam pipe had exploded.
Pedestrians sprinted from the scene, many with cell phones glued to their ears, some crying. Some were covered in white ash and soot, others in mud. A small, yellow school bus stood by, badly damaged by the geyser.
Havoc At Rush Hour
""It looked like the World Trade Center had exploded. I saw rocks and pebbles coming down. As I was running I got pelted in the head by rocks and concrete. Steam came up and then the ground started breaking up,"" said Reggie Evans, an office administrator who was covered in mud.
Authorities evacuated a wide area including the emblematic Chrysler Building.
""This is not a terrorist-related incident. It's a steam explosion,"" said Deputy New York Police Department Commissioner Paul Browne.
The blast created a havoc at rush hour. Nearly 200 firefighters rushed to the scene, which was crowded with ambulances and fire engines. People wore masks to avoid breathing pollutants.
Kwang Choi, 57, was working at a laundromat one block away when the explosion occurred. ""People just kept running. People were saying a building collapsed,"" he said. ""I looked outside -- huge smoke, just like 9/11. I just ran.""
Said 50-year-old computer worker Azad Mohamed: ""Of course, the first thing you think about is terrorism. It's pretty scary.""
Police insisted there was no building collapse. ""We have a building that's a bit shaky, but nothing has collapsed,"" a police spokeswoman said, contradicting early witness reports from the scene that a building had collapsed.
A hotly debated Republican memo about the FBI's probe into alleged connections between the Trump campaign and Russia could be released Friday, the White House said.
President Donald Trump is expected to declassify the note, but the White House said Trump will leave it to lawmakers to make it public. The president has yet to make a final decision.
The release could come despite the FBI's ""grave concerns"" and the Justice Department's objections. However, NBC News, citing White House officials, said that the White House has agreed to some redactions in the memo at the FBI's request. The redactions, though, would not fix Democrats and the FBI's central problem with the memo: that it leaves out important context and information, making it misleading.
An intelligence official told NBC that a formal declassification process is under way, with the Office of the Director of National Intelligence determining which agencies are implicated in the memo, particularly the FBI.
The document was penned by California Rep. Devin Nunes, the Republican chairman of the House Intelligence Committee, who also served on Trump's transition team.
White House press secretary Sarah Huckabee Sanders told CNBC that the release could happen Friday, although it's not set in stone. Trump has read the memo, NBC News reported, citing several White House officials.
The White House doesn't plan to directly release the memo, according to spokesman Raj Shah: ""That's not the plan right now.""
""It's a legislative document, and so, you know, we believe it's appropriate for the legislature to be the ones to roll it out,"" Shah said.
Shah also said the memo is going through a ""process"" led by the White House counsel's office that requires input from law enforcement and intelligence officials. Once Trump decides whether to release the memo, the White House counsel's office will let the House Intelligence Committee know.
The panel had voted along party lines to approve the release of the memo, which Nunes put together. The memo, which has been hyped by Trump supporters and partisan pundits, is said to focus on the FBI's alleged use of a dossier compiled by former British spy Christopher Steele, who was paid by Democrats for his investigation of Trump's interactions with Russians.
House Minority Leader Nancy Pelosi on Thursday demanded that House Speaker Paul Ryan remove Nunes as chairman of the intelligence panel, saying he has ""disgraced"" the panel.
The ranking Democratic member of the committee, Adam Schiff of California, released a statement late Wednesday that said Nunes altered the memo after the committee's vote to release it to the White House.
Schiff also wrote a memo to rival the Republicans' document, but the House intelligence panel voted against releasing the Democrat's document.
The driverless car will become like your mobile phone: Something that you'll much rather own than hire, leading carmakers told CNBC as they face the threat that ride-sharing apps such as Uber could disrupt the autonomous car space.
Last year, Uber, the world's most valuable start-up, announced it was developing autonomous vehicles. If you could order a self-driving taxi at the tap of a button, why would car ownership be necessary?
But two major auto giants aren't worried and said that while Uber will enjoy great success, the connected car will become a consumer device that people will want to own.
""If you think that you have a car only for mere cold transportation, then you can take bus, you can take a taxi, and Uber is going to develop the taxi system…then yes, right, you don't need to buy a car,"" Carlos Ghosn, the chief executive of Renault-Nissan, said during a CNBC technology event at Davos last week.
""But people use a car for many other things and with the connectivity coming, the car is going to become a kind of working space, it's going to become a living space. Because if in the car you can connect, interface, video conference… it becomes your own space, you're going to have your own photos, your own email, your own music, your own calls, your own everything, it becomes like your iPhone, you want something belonging to you.""
As well as the connected experience of cars, the use cases will continue to differ in the future. While Uber might be useful for ""megacities"" in which parking and congestion is a problem, other areas will still see car ownership continue, according to one Volvo Cars executive.
""You have a different transportation need when you go from the cities to the suburban areas and if you go to the countryside you have a different transportation need. And I think this is also part of the development of the automotive industry and ecosystem…addressing various needs from the consumer perspective,"" Klas Bendrik, chief information officer at Volvo Cars, told CNBC.
Volvo recently struck a partnership with Microsoft to use the U.S. company's HoloLens augmented reality headsets in its showrooms to help people buy and develop driverless car technology.
Analysts and carmakers are optimistic on the prospects of autonomous vehicles. Juniper Research forecasts almost 20 million fully autonomous or self-driving vehicles on the road by 2025, with consumer adoption set to take off in 2021.
Some however are predicting a much quicker adoption. Recently, Tesla boss Elon Musk said the company's cars could pick you up by themselves from the other side of the country by 2018.
But not all share Musk's very short timeline. Ghosn said that while Renault is testing autonomous vehicles in Palo Alto, California, regulation and reliability of the cars could stop them getting into consumers' hands any time soon.
""I'm a little bit skeptical when a carmaker…says we are going to be able to sell cars, autonomously driven, before 2020, in 2018, when the regulation is not ready. And we know the technology is still in a prototype phase,"" Ghosn said.
The Federal Reserve is expanding its municipal bond buying program as part of its efforts to keep money flowing for cash-strapped local and state governments.
As part of its Municipal Lending Facility, the Fed is buying up to $500 billion worth of state and local government bonds. In an announcement Monday, the central bank said the facility now will buy debt from counties and states with populations of at least 500,000 and cities with 250,000 residents or more.
In addition, the Fed expanded the duration of the bonds it will buy from two years under the previous announcement to three years. The program is limited to investment-grade debt.
The Fed also said it will consider in the future buying revenue bonds. Officials ""will continue to closely monitor conditions"" in local and state government debt markets"" as it determines whether to accept the revenue bonds, the announcement added.
Tonight, Cramer talks with Dan DiMicco, the CEO of Nucor about the state of the steel industry. With the Chinese putting the brakes on their economy and the lack of domestic orders here in the US, ""the steel business seems to be stuck between a rock and a hard place, even as steel prices rise around the world,"" Cramer said.
NUE reported a better than expected fourth quarter yesterday, but compared to a year ago things look rather dreary. The company’s average sales price per ton is down 35% year over year, total tons shipped to outside customers down 9% year over year and steel mill capacity utilization was at a historically low 54%.
Cramer has liked Nucor for its 3.4% dividend yield and last recommended it on December 23 at $46. The stock is down 8% since then, but investors have made a considerable amount of money over the long-term, returning 241% to shareholders over the past ten years or 297% if you reinvested the dividend. And within the same period, the S&P 500 was down 24%. This is looking like a difficult time in the steel industry. DiMicco himself has said that the recovery will be long and slow, especially with the employment picture so bleak and the Obama administration not doing enough to create jobs here in America. Cramer said this is something that’s become even more important now that the Chinese are slowing down their overheated economy.
So, is there a future for the steel industry? And why are earnings anemic despite all of the price increases? And can Dan DiMicco, who met with the President multiple times on these issues, give any behind the scenes input? To answer those questions and more Cramer welcomed back the CEO of Nucor, Dan DiMicco. Watch the video for the full interview.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
Gold settled at a three-week high on Tuesday after weak U.S. jobs figures raised expectations the Federal Reserve will keep its stimulus undiminished well into 2014.
Nonfarm payrolls rose by 148,000 in September, the Labor Department said, below the 180,000 forecast in a Reuters poll, increasing worries that the world's largest economy was losing momentum even before the government shutdown this month.
""We were not even close to the 180,000 number ... the main takeaway is that Fed tapering is still a long way away, probably not for this year and that's the reason why everything shot up—equities, commodities and gold in particular,'' Societe Generale analyst Robin Bhar said.
""The next 24 hours are crucial because on what we have just seen, gold should hold and even move higher if the dollar weakens.''
Spot gold, lower initially, rallied 2 percent to its highest since Oct. 1 at $1,344 an ounce. It was last trading 1.9 percent higher at $1,340 an ounce.
The metal has broken above technical resistance at its 100-day moving average of $1,325.
for December delivery settled 2.2 percent higher at $1,342.60 an ounce.
The dollar tumbled to a new eight-month low against a basket of currencies, while global stocks edged up on prospects of a longer spell of super-easy money from the Fed.
Analysts said investor sentiment was likely to remain subdued, however, after a big drop in holdings in the largest gold-backed exchange-traded fund (ETF), SPDR Gold Trust, which saw outflows of 10.51 tons to 871.72 tons on Monday.
That was the biggest one-day fall in the fund's holdings since early July.
For more information on commodities prices, please click here.
—By Reuters with CNBC.com.
The pace of growth in business activity in the U.S. Midwest slowed for a second month in December, signaling a cooling in the improvement of the region's manufacturing, a report showed on Tuesday.
The Institute for Supply Management-Chicago business barometer declined to 59.1 from 63.0 in November, falling short of economists' median forecast of 61.0. A year ago, the index was a tad below 50, which is the threshold that indicates expansion in the regional economy.
The gauge of new orders fell to 60.7 from 68.8 in November, as its production gauge fell to 57.9 from 64.3. The employment component retreated to 51.6, its lowest since April. In November, it hit 60.9 which was its highest since October 2011.
The report's prices paid reading slipped to 63.3 from 63.7 last month.
--By Reuters
U.S. mortgage applications rose last week, with demand hitting its highest level in nearly a year as interest rates hovered near recent lows, an industry group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended Nov. 9 increased 5.5 percent to 707.3, its highest since the week ended Dec. 8, 2006, when it touched 721.2.
Economists say that this data has been skewed in recent months, however, as prospective borrowers have been filing multiple applications to obtain a single loan due to widespread tightening of lending standards.
The MBA's data also counts all applications, including borrowers who are ultimately denied.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.19 percent, up 0.03 percentage point from the previous week. Two weeks prior, interest rates reached 6.15 percent, the lowest since the week ended May 11, when they stood at 6.13 percent.
Interest rates were above the year-ago level of 6.15 percent.
Fixed 15-year mortgage rates averaged 5.77 percent, unchanged from the previous week. Rates on one-year adjustable-rate mortgages (ARMs) increased to 5.98 percent from 5.94 percent.
Overall mortgage applications last week were 9.2 percent above their year-ago level. The four-week moving average of mortgage applications, which smoothes the volatile weekly figures, rose 1.9 percent to 679.0.
Demand for both home purchase and refinancing loans rose last week.
The MBA's seasonally adjusted purchase index, widely considered a timely gauge of U.S. home sales, rose 4.8 percent to 432.6. The index came in above its year-earlier level of 412.9, a rise of 4.8 percent.
The group's seasonally adjusted index of refinancing applications increased 6.4 percent to 2,315.7. The index was up 14.5 percent from a year ago when the index stood at 2,022.2.
The refinance share of applications increased to 50.2 percent from 49.1 percent the previous week.
Recent U.S. housing industry indexes, while volatile, generally point to a weak outlook for the industry, suggesting a delayed recovery for the hard-hit sector.
The National Association of Realtors said on Tuesday pending home sales rose 0.2 percent in September but were still more than 20 percent lower than they were a year ago. Wall Street economists had expected pending sales to fall 2.8 percent.
The ARM share of activity increased to 15.5 percent, up from 14.2 percent the previous week.
The MBA's survey covers about 50 percent of all U.S. retail residential loans. Respondents include mortgage banks, commercial banks and thrifts.
In the wake of Donald Trump's upset victory, advisors have floated the idea of naming Jamie Dimon as treasury secretary, according to two people familiar with the matter, but one of them added that the JPMorgan chief has said he would not be interested in the role.
A Trump spokesperson could not immediately be reached for comment, and a spokesman for Dimon declined to elaborate beyond his past remarks that he would not be interested.
It was unclear who within Trump's circle of advisors raised the idea or who else might be under consideration for treasury secretary. Trump campaign finance chief Steven Mnuchin, a former Goldman Sachs official, is reportedly considered to be the front runner.
Dimon has suggested repeatedly, including in an interview at the Economic Club of Washington in September, that he would not be interested in becoming treasury secretary.
The best and most expeditious way to clear the vast inventory of foreclosed properties weighing down today’s housing market is to get more investors in and sell them these properties at bulk discounts.
That’s what the Obama administration and Federal regulators are currently considering for the thousands of homes currently owned by Fannie Mae, Freddie Mac and the FHA.
While big private equity fundsare still largely in a very tedious deal-making stage with banks or waiting on the sidelines for a government program, smaller individual investors are getting in. Nearly 23 percent of home purchases in December were by investors, according to a new survey from Campbell/Inside Mortgage Finance. That is a slight increase from November, but the share has remained largely unchanged for the past year.
What has changed dramatically is how many of these investors are using all-cash…74 percent according to the survey, which also found that, “cash buyers are able to bid significantly lower—and successfully—on many properties because they offer a shorter and more reliable closing timeline.” That is precisely what mortgage servicers want.
“While investor bids may not be the first offers accepted, they often end up winning properties after other homebuyers are eliminated because of mortgage approval or timeline problems,” according to the survey authors. “Appraisals below the contracted price are a common reason for mortgage denials. Most mortgage financing timelines are now in excess of 30 days.”
There has been a lot of concern among industry analysts that bulk foreclosure sales would push home prices down further, but it appears that is already happening, as investors usually offer 10-20 percent below list price, while first time home buyers and current homeowners are generally offering list. If the offers are competitive, cash will prevail.
Questions? Comments? RealtyCheck@cnbc.comAnd follow me on
Check out which companies are making headlines before the bell:
Wal-Mart—The retail giant earned $1.15 per share for its latest quarter, 3 cents above estimates, with revenue and comparable store sales also above estimates. Wal-Mart's results were helped in part by a strong back-to-school season.
Kohl's—The retailer missed estimates by 4 cents with quarterly profit of 70 cents per share, with revenue also below forecasts and same-store sales falling more than expected.
Procter & Gamble—Berkshire Hathaway is buying P&G's Duracell battery business. Procter will receive $4.7 billion in P&G shares currently held by Berkshire, while a recapitalized Duracell will have $1.7 billion in cash when transferred to Berkshire.
Viacom—The media company reported an adjusted fiscal fourth quarter profit of $1.71 per share, excluding certain items, helped by increased revenue from filmed entertainment and its media networks.
Tyco—The maker of fire protection and security products matched estimates with adjusted quarterly profit of 56 cents per share, with revenue slightly below forecasts.
Cisco Systems—The company reported adjusted earnings of 54 cents per share beating estimates by 2 cents. Revenue was also above forecasts, as sales for some of its prominent networking products improved. However, Cisco gave a revenue forecast for the current quarter that falls below Street estimates. Cisco also announced that chief financial officer Frank Calderoni is stepping down at year's end, to be replaced by senior vice president Kelly Kramer.
DreamWorks—The movie studio is in talks to be bought by toymaker Hasbro, according to sources. CNBC's Andrew Ross Sorkin reports the talks are in an advanced stage.
JC Penney—The retailer reported a smaller than expected loss for its latest quarter, but its revenue was below estimates and comparable store sales were flat compared to the year before. Analysts had been expecting a jump in same-store sales, but warmer than usual weather cut into sales of fall and winter clothing.
NetApp—The cloud-related products maker beat estimates by 1 cent for its latest quarter with adjusted profit of 70 cents per share, with revenue very slightly below estimates. But NetApp gave a light forecast for the current quarter, as its sales to original equipment makers slide.
Rocket Fuel—The company posted an adjusted quarterly loss of 18 cents per share, smaller than the 30 cent loss predicted by analysts. The provider of advertising technology also had better than expected revenue and upbeat guidance for the current quarter, seeing strong sales growth.
Microsoft—The computer software and services company will buy Israeli cybersecurity start-up Aorato for about $200 million, according to Dow Jones.
Sony—The company unveiled PlayStation Vue, a new cloud-based television service. The service is expected to be launched during 2015's first quarter.
Knowledge is power.
Leverage is power.
Insight is power.
In the end, it all comes down to power, only here I’m not just talking about the power to buy and sell, or to hire and fire, or to beat on someone who does you dirt. After all, one some level, you start to think power is a kind of given. We expect it. We search for it in ourselves, and brace for it from our colleagues and competitors.
But if power itself is a given, where do we find our edge? These days, my take is that it’s the display of power, above all. The appearance of power – and knowing what to do with it. It took that first trip to Vegas for this notion to register. Specifically, it took pulling up at a stop light in a cab driven by a guy who knew a thing or two about power. Those Vegas cabbies, man…they’ve seen everything. I was heading over to the convention centre from my hotel. We pulled up alongside two antique Chevy sports coupes. Different colors, but the same model. One of the cars was being driven by a little old lady, just as polite as could be. The light turned green and you could see her ease gently back on the gas, but she was blocking traffic. And this other car was being driven by this young guy, looked to be about the same age as me, mid-twenties, and he was just cutting it up. Fishing-tailing, burning out, basically drag racing to each stoplight.
We caught up to the same two cars at the next light, and my philosophical cabbie turned back and said, “Look at that. Same two cars, but this one here, he’s gonna get a display of power ticket?” He pointed to the car being driven by the young guy.
I said, “What?”
And the cabbie explained that this little old lady didn’t have the slightest idea of the power she was sitting on, but this young kid was all full of adrenalin and ready to go. Same car, same engine, and this one’s just a beast.
I’d never heard the phrase before – display of power – and that’s when it hit me: two different people, all outward appearances they might look the same, but inside they just have no idea what they’re capable of. Inside, they’ve got the same ability to turn it on and fire it up, but it’s how we turn it on and fire it up that makes all the difference.
I’ve thought back to this exchange about a million times since that first Vegas trip, for the way it crystallizes the ways we set ourselves apart. We’ve all got the same package, more or less. We’re all operating with the same machinery under the hood, the same engines. But it’s what we do with those engines that determine whether we succeed or fail. It’s how we strut that gives us our edge.
To get a copy of the book, click here!
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Reprinted with permission from ""Display of Power: How FUBU changed a world of fashion, branding and lifestyle"". Published by NAKED INK. Copyright 2007, Daymond John.
Tamer inflation (somewhat): The dollar dropped, stock futures rose a point or so, as February Consumer Price Index came in at 0.4 percent, in line with expectations, with core at 0.1 percent, slightly below expectations.
Yields on the 10-year Treasury moved up to 2.33 percent. This has been a big week for bonds: The 10-year closed last Friday at 2.029 percent, it's up 15 percent in five days.
Stocks rally: The U.S. isn't the only stock market at new highs. The major stock indicies in Germany, France, the U.K., and Japan are at their best levels since July.
Elsewhere:
1) Where's the retail investor? Indices at new highs, but only modest retail interest.
It's a cliché by now: Retail investors have been taking money out of stocks since, oh, 2008. Almost every week last year, there were net outflows.
Now the major indices are back at multiyear highs. What's the story with retail investors?
If you look at the Lipper (AMG) equity fund flow numbers so far this year, it looks fairly positive: The four-week average for weekly equity flows shows inflows of anywhere from $600 million to $4.5 billion...healthy!
But look below the hood: If you remove exchange-traded funds (ETFs) , there are still inflows, but they are much more modest....anywhere from $200 million to $800 million.
Why look at equity flows ex-ETFs? Because ETFs are still largely used by professionals...not exclusively, of course, but largely.
Bottom line: Retail investors are still only slowly warming to stocks. But it's a start.
2) Global markets this week: Moving up!
Asia
Japanese stocks rose for a sixth straight week as technology firms boosted the Nikkei 225 index to its highest level since July.
Japan +2.0%
Australia +1.5%
Hong Kong +1.1%
Korea +0.8%
China -1.4%
Europe
Great Britain, Germany, and France all rally to eight-month highs on the back on strong performance from financials.
Germany +4.4%
France +3.0%
Italy +3.0%
Spain +1.7%
UK +1.4%
Greece +0.1%
U.S.
The S&P 500 index and Nasdaq Composite Index look to clinch a fifth-consecutive week of gains, with the S&P 500 on track to post its biggest weekly advance this year.
Dow Jones Industrial Average +2.6%
S&P 500 index +2.3%
Nasdaq Composite Index +2.3%
Russell 2000 Index +1.8%
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Storm season begins June 1st in the Atlantic. And if last year is any indication, the damage could be significant.
According to the website TheDailyGreen , ""Last year, the Atlantic saw 16 named tropical storms -- from Arthur on May 30, which killed five and caused $78 million in damages to Belize, to Hurricane Paloma, which formed Nov. 5 and struck Cuba as a Category 4 monster that was the second-most intense hurricane ever recorded in November. ""
All in all, there were eight Atlantic hurricanes and storms caused an estimated $41 billion in damages.
This year might be even worse. Famed Colorado State University hurricane forecaster Bill Gray predicts about 12 storm and says at least two will probably reach Category 3 status or higher.
How can you protect your portfolio for the unpredictable?
According to Emily French, Consiliagra managing director, get into commodities futures now ahead of the volatile summer season. She thinks too much rain -- or too little rain -- will wreak havoc with crops. French suggests looking at the November Soy Futures as well as the December Corn Futures.
Or if you’re not comfortable trading bushels of corn or beans, she also says the Powershares DB Agriculture Fund will get the job done.
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Trader disclosure: On May 29TH, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Grasso Owns (AMZN), (CSCO), (RIMM), (V), (KLF); Stuart Frankel Clients Own (SUN), (YHOO), (AAPL), (AMD) ,(BAC) ,(BHI) ,(BP), (C), (COP) ,(CVX) ,(F) ,(GS) ,(HAL) ,(PFE) ,(SLB) ,(SUN) ,(USO) ,(VLO) ,(WFC) ,(USB) ,(PBR), (JPM), (LMT), (GD), (AET), (GM); Finerman's Firm Owns (MRO); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO); Finerman's Firm And Finerman Own (BAC) Preferred Shares And Are Short (BAC); Finerman's Firm And Finerman Own (WFC) Preferred Shares, Finerman's Firm Is Short (WFC); Najarian Owns (PFE); Najarian Owns (BP) Call Spread; Najarian Owns (CLF) Call Spread; Najarian Owns (FCX) Call Spread; Najarian Owns (HIG) Put Spread; Najarian Owns (XHB) Call Spread; Najarian Owns (PCU) Calls; Finerman's Firm Owns (IBB), (XBI), (CSCO), Finerman's Firm And Finerman Own (FLS); Finerman's Firm Owns (BWA) Puts
Terranova Owns (XBI), (ABT), (RIMM), (HES), (TER), (BTU), (MS), (JPM), (MS), (HES); Terranova Is Short (XOM) Call Spreads; Terranova Owns (DIS) Call Spreads: Terranova Works For (VRTS); Terranova Is Chief Alternatives Strategist Of Virtus Investment Partners, Ltd.; Terranova Is Co-Portfolio Manager Of The Virtus Diversifier PHOLIO: Virtus Diversifier PHOLIO Owns (IGE), (DBC), (DBV); Virtus Investment Partners Owns More Than 1% Of (ABD),(ARE),(CAL),(DLR),(EPR),(EXR),(IGE),(MEE),(DBC),(DBV),(DBA),(SKT),(UA),(CLB), (WBMD); Virtus Investment Partners Owns More Than 1% Of St Mary Land & Exploration Co; Virtus Investment Partners Owns More Than 1% Of Seagate Tax Refund Rights
Postmaster General Louis DeJoy will testify Friday before the Senate Homeland Security and Governmental Affairs Committee as lawmakers speak out against his overhaul of the U.S. Postal Service.
The hearing, which is scheduled for 9 a.m. ET before the Republican-led panel, will mark DeJoy's first time directly answering questions from Congress about the post office, which has come under intense scrutiny in the runup to the 2020 presidential election.
""I am pleased to have secured an oversight hearing on Friday with Postmaster General DeJoy in order to address urgent questions on the Postal Service delays that are causing massive disruptions across the country,"" Sen. Gary Peters of Michigan, the ranking Democrat on the committee, said in a statement Tuesday.
""As Ranking Member on the only Senate Committee with oversight of the Postal Service, I will continue pressing for answers on Mr. DeJoy's recent directives and their impacts on all Americans, who rely on the Postal Service for prescriptions, running their small businesses, voting and other crucial purposes.""
DeJoy's cost-cutting measures at the ailing government agency reportedly include crackdowns on making late delivery trips and cuts to overtime pay and have led to claims of widespread mail delays.
Democrats have raised concerns that the changes made by DeJoy, a major donor to Republicans and committees supporting President Donald Trump's reelection, could impact the November election, where the coronavirus pandemic is expected to lead more Americans than ever before to cast their ballots by mail.
DeJoy has also come under fire for his business investments, which some Democrats say could pose conflicts of interest.
CNN reported last week that DeJoy continues to hold at least $30 million in holdings in his former company XPO Logistics, which is a United States Postal Service contractor. The New York Times, citing financial disclosure forms, reported on Monday that Dejoy received $1.2 million to $7 million in income last year from XPO Logisitics.
DeJoy was selected in May by the USPS Board of Governors, all of whom were appointed by Trump. DeJoy is reportedly the first postmaster general in nearly two decades who has not been a career employee of the agency.
Trump has repeatedly railed against so-called universal mail-in voting, claiming without evidence that it will lead to massive fraud and a ""rigged"" election. He has drawn a distinction between absentee voting — a system he has reportedly utilized as president — and the efforts by some governors to send out ballots to all eligible voters.
At the White House on Tuesday, Trump claimed again that widespread mail-in voting will lead to ""a disaster the likes of which our country has never seen.""
""It'll end up being a rigged election or they will never come out with an outcome. They'll have to do it again,"" Trump said. ""And nobody wants that, and I don't want that.""
Polls show Democrats are far more likely than Republicans to vote for president by mail, according to a recent Change Research/CNBC poll of likely voters in battleground states.
A spokesman for Sen. Ron Johnson of Wisconsin, the Republican chairman of the Homeland Security Committee, did not immediately respond to CNBC's request for comment.
Senate Minority Leader Chuck Schumer, D-N.Y., cheered the announcement of the hearing. ""I am pleased that immense pressure from Senate Democrats and the American people have forced Senate Republicans to confront Postmaster General DeJoy's ongoing sabotage of the Postal Service that threatens the integrity of our elections and delays vital services,"" Schumer said in a statement.
Schumer on Monday had pushed Johnson to schedule a hearing with DeJoy after the House Oversight Committee, led by Rep. Carolyn Maloney, D-N.Y., announced that the postmaster general would testify before her panel next week.
Robert Duncan, chairman of the USPS board, which selected DeJoy in May, will also testify before the House committee.
Peters was one of seven senators who sent a letter Monday urging the Postal Service's Board of Governors to reverse DeJoy's changes to the agency. That letter noted that if DeJoy refuses to cooperate with their proposed reversal, the board has the authority to remove him.
Goldman Sachs, which advised investors to sell oil in April and reversed its stance before prices rebounded a month later, is now the most bullish on four stocks in the industry.
The global investment bank is highest on Noble Energy , whose shares may rise 50 percent in the next six months, according to its forecast. Goldman Sachs says Brent crude oil should rise to about $130 a barrel within a year from $114 today, driven by demand in emerging economies.
A slowdown in economic growth has had analysts scrambling to alter their forecasts. Even the Federal Reserve has said the U.S. economy is growing more slowly than it had expected earlier in the year. The International Energy Agency last week reduced its oil demand estimate by 0.2 million barrels a day for 2011 and 0.4 million barrels a day for 2012. However, the agency still forecasts oil demand to be marginally higher than the current supply next year.
Analysts are bullish on select stocks as industry consolidation is ongoing, and because high growth rates in emerging markets provide a floor for share prices and oil stocks can serve as an inflation hedge. Some companies are paying outsized dividends, which are attractive as Treasury yields have fallen to less than 2 percent.
For example, Exxon Mobil carries a hefty 2.6 percent projected dividend yield, in addition to an estimated 35 percent stock-appreciation forecast over the next six months.
Oil and gas exploration and production companies' shares are down an average of 13 percent this year, according to Morningstar. That's three times as much as that of the benchmark S&P 500 Index. So anyone moving into oil stocks now must reconcile the fact that the industry has been a laggard.
Here are Goldman Sachs' current ""conviction list"" energy-stock picks:
1. Noble Energy is a Houston-based oil and gas producer in the U.S., with diverse developable resources including in Equatorial Guinea, the North Sea, Israel and China. It has extensive offshore operations in the Gulf of Mexico. About 30 percent of its natural gas production is in the U.S., including oil shale projects.
Goldman analysts said in a recent research note that Noble ""has a strong balance sheet, with a 16 percent net debt to tangible capital ratio even before substantial expected free cash flow in the next three years, as long lead time projects come online.""
Noble gets a six-month $121 price target from Goldman, which is a 50 percent premium to its current price. Its shares have a projected 1 percent dividend yield.
The company's shares are down 5 percent this year, but up 6 percent over the past 12 months, giving it a market valuation of $14 billion.
2. Exxon Mobil, one of the world's largest companies, is an integrated oil and gas producer and distributor and also the world's biggest refiner. It is also one of the world's top manufacturers of commodity and specialty chemicals.
Due to its operational efficiencies, it consistently delivers higher returns on capital relative to peers and its sheer size gives it leverage in the competition for developable oil projects worldwide. Its current production mix is evenly split between liquids and natural gas.
In its latest blockbuster deal, the company announced Sept. 2 that it had entered an agreement with the Russian-government owned oil company Rosneft, to jointly explore and develop oil and gas resources in Russia, the U.S., and other countries.
Its strong, steady cash flow assures increasing dividend payments and stock buy backs, even while funding huge capital-intensive projects.
Goldman has a six-month $97 price target on its shares, a 33 percent premium to its current price. Its shares are up 1 percent this year and 22 percent over the past 12 months, giving it a $356 billion market valuation.
3. CVR Energy is a nitrogen-fertilizer and petroleum-refining company. It also runs a crude-oil gathering system and storage facility in Kansas and a proprietary pipeline system that transports crude oil to its refinery.
Goldman has a six-month $32 price target on its shares, a 23 percent premium to the current price.
Its shares are up 65 percent this year and 207 percent over the past 12 months, giving it a $2.2 billion market value.
4. Hornbeck Offshore: The only repeat on the conviction list of three months ago is Hornbeck Offshore, a provider of offshore supply vessel fleets, which it uses to transport goods and supplies to and from offshore rigs and platforms, primarily in the Gulf of Mexico. It also has a large fleet of tug and tank barges, which mostly transport petroleum.
Goldman analysts say the company remains on their list based on the belief ""that the recovery in the Gulf of Mexico is under way.""
They write that ""earnings should accelerate sharply over the next few quarters as additional (offshore vessels) go to work. We expect Hornbeck to return to profitability as soon as the fourth quarter."" It posted a loss of 26 cents per share in the second quarter.
The firm has a $31 price target on its shares over the next six months, a 12 percent premium to its current price.
Its shares have a market value of $751 million. They've been rocketing, gaining 14 percent in the past month, 36 percent this year and 79 percent over the past 12 months.
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Back on Aug. 25, Cramer talked with Allscripts Chairman and CEO Glenn Tullman about an upcoming dividend payout that could hurt the stock. Sure enough, there’s been a precipitous drop over the past couple of weeks for just that reason.
Tullman returned to Mad Money Friday to fill in investors on the Allscripts’ latest happenings; most importantly that the decline does not represent a drop off in the business, but rather reflects that dividend payout. A quick look at a 30-day chart might confuse unknowing investors, so it’s important to be clear.
So what happened? Allscripts has new ownership. Mysis PLC, which trades on the London exchange, merged its Mysis Healthcare Systems division with Allscripts and, for an addition $330 million, took at 54.5% stake in the company. The dividend merger was a payout of this merger.
But the newly combined companies have a “shared vision,” Tullman said, and investors shouldn’t be worried about integration problems. So Allscripts, on top of the $70 million already invested in research and development and the one out of three doctors who use the company’s e-prescribing software, now has a better base to sell into and that should accelerate growth over time.
But why not just keep that money instead of paying that dividend?
“We like to take care of our shareholders,” Tullman said, “and we have what we need to grow today.”
Cramer is bullish on Allscripts, a stock he called “a pure Barack Obama play” because the company fits into the Democrat’s plans to cut healthcare costs.
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
The strike that crippled two of the nation's busiest shipping ports was settled this week, but the trend it spotlighted — the offshoring of service jobs — is expected to continue to grow across the USA.
The eight-day walkout by clerical workers at the ports of Los Angeles and Long Beach largely centered on the outsourcing of their jobs overseas and to elsewhere in the U.S., says Craig Merrilees, a spokesman for the International Longshore and Warehouse Union. Shippers denied outsourcing jobs, but the tentative settlement restricts the practice, according to the Associated Press.
Service companies have been sending jobs abroad in large numbers the past decade to cut labor costs — a trend that accelerated in the recession and is expected to continue the next few years before slowing after 2016. About 663,000 large-company jobs in information technology, human resources, finance and purchasing — the category that includes the port workers — have been offshored since 2002, according to The Hackett Group.
By 2016, the consulting firm estimates, another 375,000 jobs in the sectors will be moved abroad. More than a third of the U.S. jobs in those industries in 2002 will have moved offshore by 2016.
Most workers are employed directly by companies that previously used U.S. staffers, though some work for outsourcing firms. Hackett studied companies with at least $1 billion in annual revenue, noting they represent about 75% of the offshoring market.
India is the largest offshoring center. Service jobs also have gone to eastern Europe, the Philippines, China and Mexico.
(Read More: How Immigrants Are Changing U.S. Businesses)
In other sectors, initially low-level jobs were offshored, such as handling payroll or tracking purchase orders. Employers typically can cut labor costs by about 75 percent, Dorr says. In recent years, a growing number of higher-level jobs have moved overseas, such as benefits analysis and vendor management, though the cost savings for offshoring those positions is only about 25 percent.The trend took off after companies began contracting with programmers in India to help with the massive preparations for the Y2K computer bug in 2000, says Hackett research director Erik Dorr.
""Organizations now feel more comfortable moving up the value chain,"" Dorr says, noting, for example, that India's education system is improving and turning out top-notch job candidates.
Since 2005, legal services such as document review, contract drafting and regulatory communication increasingly have been offshored, particularly to India, says Greg McPolin, managing director of Pangea3, a legal outsourcing firm. Indian attorneys handle work that in the U.S. is sometimes done by paralegals and at a 40 to 60 percent cost savings, he says.
Several thousand legal jobs have been offshored, estimates Edward Brooks, founder of The LPO Program, a legal consulting firm.
""In the current environment, it is more important than ever that … the support we provide to clients adds value without adding unnecessary cost,"" law firm Clifford Chance said in a statement.
Once services are offshored, there's little chance they'll come back to the U.S., Dorr says. By contrast, manufacturers have returned some production to the U.S. recently, largely because of a narrowing wage gap between the U.S. and China, rising shipping costs and falling U.S. energy costs — factors that generally haven't affected service jobs.
One exception: call-centers. About 500,000 of these jobs were offshored from 2006 to 2010, according to the Communications Workers of America. Many have returned to the U.S. the last few years because of cultural gaps between representatives and customers that hurt sales, says Hal Sirkin, senior partner of Boston Consulting Group.
Still, CWA spokeswoman Candice Johnson called the jobs that have come back ""a drop in the bucket.""
(ALL TIMES ARE IN ET)
Saturday, 11/15/2014:
1:00 AM THE PROFIT #213 - WEST END COFFEE COMPANY (replaces THE PROFIT SOCIAL #212)
3:00 AM THE PROFIT #213 - WEST END COFFEE COMPANY (replaces THE PROFIT SOCIAL #212)
Sunday, 11/16/2014:
12:00 AM THE PROFIT #213 - WEST END COFFEE COMPANY (replaces THE CAR CHASERS # 303/#201)
1:00 AM THE CAR CHASERS #303 - THREE GREAT CARS - ONE BIG PROBLEM (replaces THE CAR CHASERS #202)
1:30 AM THE CAR CHASERS #215 - PUT YOUR MONEY WHERE YOUR MOUTH IS (replaces THE CAR CHASERS #203)
3:00 AM THE CAR CHASERS #303 - THREE GREAT CARS - ONE BIG PROBLEM (replaces THE CAR CHASERS #202)
3:30 AM THE CAR CHASERS #215 - PUT YOUR MONEY WHERE YOUR MOUTH IS (replaces THE CAR CHASERS #203)
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STOCKHOLM, Oct 2 (Reuters) - Operator TeliaSonerasaid on Tuesday it had supplied Swedish prosecutors withevidence that the Gibralter-based firm Takilant, from which itbought telecom licenses in Uzbekistan, was the rightful owner ofthese licenses.
""Following media reports that there is uncertaintysurrounding the ownership of the assets TeliaSonera acquiredfrom Takilant in 2007, TeliaSonera has today provided theprosecutor with documents which confirm that Takilant owned thelicenses and frequencies at the time of the acquisition,"" thecompany said in a statement.
Prosecutors have frozen a Swedish Takilant account as partof a preliminary investigation into TeliaSonera's purchase aftera Swedish television programme alleged the company had boughtthe license from a firm with close ties to the daughter of UzbekPresident Islam Karimov.
TeliaSonera, partially owned by the Swedish state, hasdenied it did anything wrong and has said it is co-operatingfully with authorities.
((Niklas.Pollard@thomsonreuters.com; +46 70721 1110; ReutersMessaging: niklas.pollard.reuters.com@reuters.net))
Keywords: TELIASONERA UZBEKISTAN/
* Foreign oil tankers help ease supply crunch in US Northeast
* Little focus on better-than-expected US jobs data for Oct
* Oil prices lose 2 pct on the day; Brent down 4 pct
* Gold hits 2-month low; copper ends down for 4th week
* Cocoa rallies on Ghana supply squeeze, bucking weak trend
NEW YORK, Nov 2 (Reuters) - Oil prices tumbled on Friday as foreign tankers were allowed to bring fuel from U.S. ports to the Northeast to ease a supply crunch after Hurricane Sandy, and metals and other key commodities fell on worries the devastation from the storm could hamper the economic recovery. The declines wiped out Thursday's gains that came after markets appeared to gain a sense of normalcy following the massive storm earlier this week that killed at least 102 people. Many in the stricken region were still without power, gasoline and information about when their shattered lives might return to normal. Oil prices fell more than 2 percent on the day, with U.S. crude settling below $85 a barrel and London's Brent finishing under $106. Brent, which affects global oil prices more than U.S. crude, fell nearly 4 percent on the week. Gasoline futures in New York also fell more than 2 percent, to below $2.58 per gallon, as oil tankers and pipelines supplying New Jersey and the New York Harbor - the delivery point for the U.S. contract - restored more operations that had been roiled by the hurricane. The Thomson Reuters-Jefferies CRB index, a bellwether for commodities, fell 1.6 percent after 14 of its 19 components settled in negative territory. The selloff came despite a stronger-than-expected U.S. jobs report for October which ordinarily would have sent prices rallying. While oil and gasoline fell over 2 percent, natural gas was the CRB's biggest loser for the day. It tumbled 4 percent on milder weather forecasts for the U.S. Northeast next week that reduced the potential demand for gas as a heating fuel. Oil came under pressure after the U.S. government temporarily waived Jones Act restrictions on tankers carrying fuel from the Gulf Coast refining hub to the hard-hit Northeast, increasing the fleet of ships that would normally be confined to domestic vessels and crews. ``I think economic uncertainty and next week's (U.S.) elections are weighing on oil prices. You also have the statement that the Jones Act is going to be waived for a week, suggesting some supplies are going to return,'' said analyst Gene McGillian at Tradition Energy in Stamford, Connecticut.
GOLD AT 2-MONTH LOW, COPPER DOWN U.S. gold futures hit a two-month low below $1,700 an ounce and were down almost 2 percent this week, settling at below $1,682 to mark a fourth consecutive weekly decline. Gold has erased all its gains made after the U.S. Federal Reserve announced its latest bond buybacks to boost the job market in September. ``Better-than-expected numbers reduced the risk demand for gold, and a drop below $1,700 an ounce triggered sell-stops and momentum selling,'' said James Steel, metals analyst at HSBC. ``There are also long liquidation ahead of elections triggered by the job number,'' Steel said. Copper prices fell for a fourth consecutive week. Three-month copper on the London Metal Exchange closed at $7,665.50 a tonne in official rings, down 2 percent from Thursday's close of $7,826 a tonne. Corn and soybeans fell about 2 percent each on Midwest harvest projections that suggested both crops may be larger than previously thought.
COCOA BUCKS LOWER TREND Cocoa bucked the weakness in other commodities, pushing above technical support levels as some exports faced a holdup and purchases slowed in the main West African growing region. New York-traded cocoa futures closed up $27, or 1.1 percent, at $2,447 per tonne, as traders watched the early progress of main crop harvests in West Africa. The market climbed for a second straight day after hitting its 200-day moving average around $2,352. Cocoa purchases in Ghana, the world's second-biggest producer of the crop, stood at 86,028 tonnes by Oct. 19 in the first week of the season, down 42 percent from the same period a year ago, trade data showed on Thursday. The numbers were lower than expected and were helping to underpin the market, traders said.
Prices at 4:30 p.m. EDT (2030 GMT)
The House passed a bill Thursday to fund the government for two months and avoid another shutdown.
The Democratic-held chamber approved the measure to keep the government running through Nov. 21 by a 301-123 margin. It now heads to the Senate, where Majority Leader Mitch McConnell, R-Ky., has signaled he will back a temporary spending plan.
Congress has until Sept. 30 to pass a funding bill and prevent a funding lapse. A shutdown would come only months after a partial government work stoppage in December and January that lasted a record 35 days.
Last month, lawmakers approved a two-year deal to set budget levels, suspend the U.S. debt ceiling and dodge automatic, across-the-board spending cuts. However, passing the appropriations bills to actually allocate the money to specific agencies has proven harder to do before the shutdown deadline.
So Congress decided to pass a so-called continuing resolution to extend funding at current levels and keep the government running through most of November. Democrats and Republicans will now have to come to agreement on long-term spending bills amid yet another dispute over border security and military funding.
On Wednesday, Senate Democrats blocked GOP efforts to move forward with spending bills for the Defense Department and other agencies. The party argues Republicans have neglected key domestic programs and military funding by yielding to Trump's demands for more funding for barriers on the U.S.-Mexico border.
Senate Appropriations Committee Chairman Sen. Richard Shelby, R-Ala., accused the party of playing ""partisan politics.""
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The preliminary reading for a key Chinese purchasing managers' index (PMI) fell to a near six-and-a-half-year low of 47.1 in August, below a Reuters forecast of 47.7, underscoring persistent sluggishness in country's vast factory sector.
The final Caixin China PMI dropped to a two-year low of 47.8 in July, while the official China PMI avoided falling into contraction territory by coming in at 50 for the month. Caixin's China PMI data tends to focus on smaller and medium-sized companies, filling a niche that isn't covered by the official data.
""The Caixin Flash China General Manufacturing PMI for August has fallen further from July's two-year low, indicating that the economy is still in the process of bottoming out,"" said He Fan, chief economist at Caixin Insight Group.
""There is still pressure on maintaining growth rates, and to realize the goal set for this year the government needs to fine tune fiscal and monetary policies to ensure macroeconomic stability and speed up the structural reform,"" added said.
A reading above 50 indicates expanding activity and one below 50 signals contraction.
Read MoreCaixin China PMI for July at two-year low
A breakdown of the August survey showed both the new orders and new export orders sub-indexes declining at a faster rate than in July – a sign of accelerating weakness in domestic and external demand.
Recent data out of the world's second largest economy have signaled weakening growth momentum in the second half of the year.
A spate of economic activity data for July published earlier this month - including industrial production, retail sales and fixed asset investment - came in below market expectations, underscoring the People's Bank of China's move to weaken the yuan. Last week, the central bank surprised markets by sharply devaluing the yuan, which the government said was part of reforms meant to make its exchange rate more market-oriented.
Bill Adams, senior international economist at PNC Financial Services Group, said August's flash PMI reading showed that China was adding to global inflation doldrums.
""At the margin, this additional evidence of China's weakening economy puts downward pressure on global prices of oil, coal, iron ore, steel and other basic materials. China is one more force for weak global inflation in late 2015 and 2016,"" he said.
Adams expects China's gross domestic product (GDP) growth may slip below 7.0 percent in the second half of 2015. The economy grew an annual 7.0 percent in both the first and second quarter of this year.
Julian Evans-Pritchard, China economist at Capital Economics, on the other hand, believes downside risks to growth in the short-run are now overstated.
""Credit growth has begun to accelerate on the back of recent policy easing, which should feed through into stronger activity, albeit with a lag,"" Evans-Pritchard said.
""The fiscal stance is also set to loosen in coming months as local governments accelerate spending to hit annual budget targets. Finally, the government still has plenty of policy ammunition and we think they would rather step up policy support rather than allow growth to slip much further,"" he added.
Stocks fluctuated and bonds rallied after the Federal Reserve held off on a first rate hike and said global economic and market developments threaten the U.S. economy.
""There is enough economic activity to allow the Fed to think about raising interest rates, but there's not enough inflationary pressure to allow them to do so,"" said Scott Clemons, chief investment strategist at Brown Brothers Harriman Wealth Management.
According to RBS, market expectations for the first full rate hike are now priced into March, and the odds of a December hike fell to 64 percent from 84 percent.
Read MoreFed leaves rates unchanged
""You've taken away the threat of rate hikes,"" said John Briggs, RBS head of strategy.
Clemons said the Fed was clearly responding to sluggishness in China but generally pinned it on international developments in its comments. ""I think this pushes it off until October. If between now and October, some of these developments abroad to which they refer—China—calm down, I think that will pave the path for an interest rate increase in October. It pushes out the inevitable,"" said Clemons.
The Fed raised its GDP forecast to 2.1 percent growth in 2015 but cut it for 2016—to 2.3 percent from 2.5 percent. It also lowered 2017 growth to 2.2 percent from 2.3 percent. Its 2015 inflation forecast fell from 0.8 percent in June to 0.4 percent, while 2016 slipped to 1.7 percent from 1.8 percent.
Read More Did the Federal Reserve make the right decision today?
The shorter end of the Treasury curve rallied hard, with yields falling in an inverse move. The was yielding 0.72 after holding above 0.80 percent for most of the day.
Stocks bounced around and briefly turned negative before trading became choppy. The market was slightly higher ahead of Fed Chair Janet Yellen's news briefing at 2:30 p.m. ET, rallied during her remarks and then closed mixed.
""It just prolongs the uncertainty with which we've been living,"" said Clemons. When the Fed ultimately raises rates, it will be a positive, he said. ""It will take the uncertainty off the table.""
Read MoreWhen do you think the Federal Reserve will hike rates?
Mesirow Financial's chief economist, Diane Swonk, said the most-telling aspect of the Fed release was the downward revisions in its economic forecasts and inflation outlook, signaling real concern about the impact of China and foreign exchange volatility on the U.S. economy.
Two Fed officials shifted their forecast for a first rate hike into 2016 bringing the total for next year to three. One member wants the first rate hike in 2017, and 13 remained in 2015. ""The most important thing here is the doves grew in ranks and their voice got louder than the hawks,"" she said.
Read MoreHere's what changed in the new Fed statement
""It's very important we have out there now that the Fed might not move in 2015. It's a probability now much higher than it was before. It was going to be tough to get all their ducks in a row by December. They'll still want to get there, but uncertainty is not something you want to raise rates into,"" Swonk said.
""Every central bank in the world is ultimately worried about getting inflation too cold or too hot, and right now the porridge is not just right.""
Thursday's Fed decision was one of the most anticipated in years, since there was a reasonable chance the central bank could have raised rates were it not for its concerns about international developments. About half of Wall Street's economists expected a rate hike, even though market expectations were just about 30 percent.
The Fed last raised rates nine years ago, and it has held the fed funds rate at zero to 0.25 percent since December 2008.
U.S. President Donald Trump's administration said on Monday that China was pursuing a ""blame game"" in recent public statements and a weekend white paper that misrepresented the trade negotiations between the world's two largest economies.
In a joint statement, the U.S. Trade Representative's (USTR) office and the U.S. Treasury reiterated their view that China's negotiators had ""backpedaled"" on important elements of a deal that had been largely agreed, including on an enforcement provision.
""Our insistence on detailed and enforceable commitments from the Chinese in no way constitutes a threat to Chinese sovereignty,"" USTR and the Treasury said. ""Rather, the issues discussed are common to trade agreements and are necessary to address the systemic issues that have contributed to persistent and unsustainable trade deficits.""
China on Sunday issued a government policy paper on the U.S.-China trade dispute in which it asserted that the United States bore responsibility for setbacks in the talks, citing three instances in which Washington had backtracked on commitments made during the negotiations.
China's Vice Commerce Minister Wang Shouwen, a prominent member of Beijing's negotiating team, said in presenting the paper to the media that it would be impossible for the United States to use ""extreme pressure"" to force concessions from China.
Acrimonious rhetoric between Beijing and Washington has steadily increased since talks broke down in early May over U.S. accusations that Beijing had backtracked on commitments to codify in law changes to its intellectual property and technology transfer practices to address U.S. demands.
President Donald Trump imposed an increase in tariffs to 25% on a $200 billion list of Chinese goods on May 10, saying that China ""broke the deal."" His administration later imposed severe sanctions against Huawei Technologies Co, China's premier telecommunications equipment firm.
""The United States is disappointed that the Chinese have chosen in the 'White Paper' issued (on Sunday) and recent public statements to pursue a blame game misrepresenting the nature and history of trade negotiations between the two countries,"" USTR and Treasury said in the statement.
The agencies, which have taken the lead in negotiations for the U.S. side, said that the impetus for the negotiations was
China's ""long history of unfair trade practices,"" and U.S. negotiating positions have been consistent throughout the talks.
There have been no talks scheduled since the last round ended in May, and it remains unclear whether Trump and Chinese President Xi Jinping will meet when they both attend the G20 leaders summit later this month in Japan.
China's Lenovo Group, the world's number one manufacturer of PCs, said net profit jumped 36 percent in its fiscal second quarter, beating estimates as it continues to chase growth through acquisitions.
Lenovo, with a 17.3 percent share of worldwide PC shipments according to research firm IDC, reported net profit of $219.7 million for the July-September period and said it remains confident the Chinese economy is recovering.
(Read more: Lenovo-Blackberry deal a worry for Chinese rivals?)
Marking more than three straight years of double-digit quarterly profit growth, Lenovo's second-quarter net profit compared with $162 million a year earlier, and a $199.12 million consensus forecast on Thomson Reuters Starmine SmartEstimate.
Lenovo has been aggressively pushing into smartphones and servers as it seeks alternative channels of income to the shrinking PC market, which contracted 7.6 percent in the quarter ending September according to IDC data.
Check out which companies are making headlines after the bell Thursday:
AIG - Shares dipped after the insurance provider reported earnings of 97 cents per share, versus expectations of $1.05 per share. The company also announced a $2.5 billion stock repurchase program.
CBS - The broadcast company beat expectations and its revenue grew, thanks to increased advertising sales.
Kraft Foods - Shares of the food producer fell about 1 percent it .
Groupon - Groupon easily topped Wall Street's earnings and revenue expectations, but its forecast for first-quarter results fell short of expectations. Shares of the e-commerce firm fell about 2 percent after the announcement.
King Digital - Shares of the ""Candy Crush"" maker after it beat expectations on the top and bottom lines.
Zynga - Shares plunged nearly 10 percent after the gamemaker missed Wall Street revenue and monthly active user estimates.
ConAgra Foods - Shares slipped about 3 percent after it announced changes in management and cut its full year 2015 earnings forecasts.
Hewlett-Packard CEO Meg Whitman said Wednesday the company embarked on another round of layoffs in part because the technology market is changing so rapidly.
""It's remarkable what's happening to our services business. As new technologies come in, we've got to restructure that labor force to low-cost locations, to much more automation than we have today,"" she told CNBC's ""Squawk on the Street.""
On Tuesday, Hewlett-Packard announced it would cut 25,000 to 30,000 positions as part of its restructuring, which will split the company into two separate firms, one focused on enterprise services and one dedicated to its legacy hardware business.
The reductions will primarily impact workers at HP Enterprise Services, the company's business and technology services unit.
Read More Charts: Chip stocks breaking out?
The layoffs come on top of 55,000 cuts announced in recent years and would further reduce Hewlett-Packard's 300,000-person workforce by about 10 percent.
The cuts over the last four years were focused on helping HP achieve a cost structure that was in line with its revenue trajectory, Whitman said. The reductions announced Tuesday will help HP expand its profit margins, she added
""These cuts are never easy, but it's the right thing to do because we have to now get to the next phase of the HP journey,"" she said.
Whitman will serve as CEO of the services-focused Hewlett-Packard Enterprise when it splits from its hardware business, which will be known as HP Inc, in November.
The company expects the layoffs will save about $2.7 billion a year, though Hewlett-Packard said it will take a $2.7 billion charge to carry out the reductions. Some of those costs will begin accruing in the fourth quarter of this year.
The company also expects the share of its workers employed overseas in low-cost locations to grow to 60 percent by 2018 from 42 percent today.
Read More Tencent's $1.6B plan to take on Alibaba, Amazon in cloud
Whitman said the companies would return Hewlett Packard to profit next year following the split. She had previously said that would happen prior to the separation.
Asked what makes her confident that growth will happen this time, she identified the separated companies' focus, their ""competitive sharpness,"" and their ability to achieve the right capital structure.
""It's hard to forecast in markets that are as changing, as fast as ours, but I think we have a good handle on this now."" she said. ""We feel really good about our product lineup, our services lineup, and our go-to-market strengths, which I think will stand us in good stead for FY 16.""
Germany, the euro zone's largest economy, should be prepared to take a downgrade to its AAA-rated debt to help save the single currency area, Charles Diebel, head of market strategy at Lloyds, told CNBC Wednesday.
""You have joined this club, and you had to realise there was a liability that went with it,"" he said. ""Germany should really be doing a cost-benefit analysis of what it costs them not to help.""
A break-up of the euro zone would be a ""cataclysmic scenario"" while a downgrade of Germany's AAA-related debt one notch would only mean a 30-50 basis points cut to its credit swaps, according to the Lloyds strategist.
""That's a lot better than your entire banking system getting into trouble from a break- up of the euro,"" he said. ""If you look at where European swaps are trading, that's effectively a proxy for the Bund anyway.""
EU leaders will meet Thursday to discuss the Greek debt crisis, with German Chancellor Angela Merkel and French President Nicolas Sarkozy meeting on Wednesday. Merkel has warned that there is ""not one spectacular result that will solve all problems"".
John M. Hydeskov, chief analyst at Danske Markets, said Nordic banks came particularly strongly out of the recent stress tests as Danske ran a harsher stress test over the Nordic banks which were put through the EBA stress tests.
""Markets have been impatient for quite a long time,"" Hydeskov told CNBC Wednesday.
Some of the smaller, steadier European economies, such as Holland, Finland and Austria, are worth investing in, according to Diebel. The current Italian and Spanish yields ""are not justified by the fundamental factors"", Hydeskov said.
""If you look at the private sector wealth in Italy it's pretty impressive,"" he said. The strength of domestic investment in Italy, where around half of government bonds are held by the domestic market, is viewed by many as strength relative to Greece and other peripheral euro zone economies.
""You can control the domestic market to some extent,"" Hydeskov added.
He said that domestic Italian investors were unlikely to suddenly switch from bonds, as ""now is not the time to switch investment strategy"".
Take a look at some of Wednesday's after-hours movers:
Disney gained in extended-hours trade on news that the company will increase its annual cash dividend by 34 percent, to $1.15 a share, payable on Jan. 8, 2015, to eligible shareholders.
Aeropostale fell more than 9 percent in after-hours trade after the teen retailer posted a loss for the eighth straight quarter, hurt by slower mall traffic, higher discounts and lower demand for its clothing.
Guess edged lower before turning slightly higher in extended-hours trade after posting third-quarter results that showed a decrease in revenues around the world and a weaker full-year outlook.
PVH, whose brands include Calvin Klein and Tommy Hilfiger, fell more than 1 percent in extended-hours trade on weak guidance.
Fluor edged higher in after-hours trade on the engineering and construction firm's announcement that ICA Fluor, its joint venture with Mexican infrastructure firm Empresas ICA, won a $1.3 billion contract to expand a refinery in Mexico.
Avago Technologies gained more than 5 percent in extended-hours trade after the Singapore-based chipmaker posted fourth-quarter earnings that beat expectations.
Verint Systems fell more than 3 percent in after-hours trade when the software firm narrowed its full-year revenue outlook.
Wires contributed to this report.
First Solar shares fell after short-seller James Chanos said insider stock selling and executives leaving the company is ""never a good combination.""
""You are seeing patterns that short sellers love,"" the president of Kynokos Associates told CNBC Thursday. ""There's been enormous insider selling. The chairman has gotten rid of most of his stock in the last year and a half. And lots of people are leaving.""
Shorting is selling assets, usually securities, that have been borrowed from a third party with the intention of buying identical assets back at a later date to return to the lender. Short sellers like Chanos want to profit from a decline in the price of the assets between the sale and the repurchase.
He is short alternative energy in general, he said. Some companies, such as First Solar, have specific issues while others are affected by cuts in solar development subsidies in Germany, Italy and Spain. The Japanese nuclear disaster helped solar stocks a bit, he said, but solar is still a costly way to provide energy compared with natural gas and nuclear power.
""You still need core power plants,"" he said.
He is also shorting Chinese residential real estate companies because he sees prices dropping in the major cities and building activity declining rather than accelerating.
Ad budgets were already shifting from TV to digital before the coronavirus pandemic, but that's going to speed up, according to a Europe-focused report by Goldman Sachs.
""Overall, we expect the crisis will only accelerate the secular shift in advertising budgets towards digital, while potentially also leading to more attempts by the EU broadcasters to seek further partnerships and M&A (mergers and acquisitions) to share costs and build scale,"" according to the company's Europe Media: Broadcasting report, seen by CNBC.
Brands are able to measure the impact of online ads more easily than those on TV, and digital ads tend to be cheaper — and it appears the pandemic has had more of an impact on TV ad revenue than digital. TV ad revenue in Europe was down by about 50% in April, while the results of the major digital players were generally above expectations, Goldman noted. Google search revenue was ""down mid-teens,"" while Facebook's revenue growth for the first three weeks of April was flat and Snap's went up 15% in April, the report added.
A separate report from the World Advertising Research Center (WARC) showed that global marketing budgets for digital advertising in April fell for the first time since WARC started tracking spend in 2012. Advertising in printed newspapers and magazines saw the steepest declines followed by outdoor billboards, radio and TV.
Advertising is typically one of the first things businesses cut back on during recessions and this year's TV Upfronts in the U.S., where broadcast networks woo marketers, have been delayed indefinitely. Many of the companies surveyed in a report by consultancy Advertiser Perceptions said they could replace the reach of traditional TV ads with those in streaming services or via digital video ads.
A lack of demand for media buys has also made ad spots cheaper, according to WARC data. For example, the cost of digital video ads was forecast to go up by 6.7% globally by media audit company ECI Media Management but is only likely to increase by 1.3%, per WARC.
In terms of recovery, ad spend has historically shown a good relationship with economic growth, Goldman noted, with every 1% change to GDP usually translating to ad revenue growth going up two to three times.
However, the post-pandemic recovery is likely to be less significant than the one after the 2008-2009 recession. The global TV ad market grew 14% in 2010 after a 7% decline in 2009 per figures from Magna Global, and Goldman expects European broadcasters to see growth of only 6% after an 18% decline this year.
Broadcasters are also likely to be more open to partnerships and M&A, Goldman noted, with Italian broadcaster Mediaset set to acquire a 25% stake in Germany's ProSieben this year, for example. The report's authors also expect more partnerships in streaming services — in the U.K., ITV and the BBC launched Britbox in November.
Broadcast stocks were the worst-performing sector in the European media market according to Goldman's report, down 41% on average year-to-date. This compares to a 27% decline for companies in the STOXX 600 Media, an index of European stocks.
Goldman expects net annualized returns to decline between 30% and 50% for European broadcasters in the second quarter, with French channels including TF1 and M6 decreasing the most, and German broadcasters RTL and ProSieben being impacted the least.
Europe could be looking at a Japan-style deflationary environment for the next five years, investor Marc Lasry told CNBC on Wednesday.
Read MoreEuro tests low last seen at its birth in1999
Lasry's Avenue Capital is continuing to buy credit-side debt at a discount in Europe. Over the last three or four years, the amount of debt that European banks have sold has increased by 100 percent, he said in a ""Squawk Box"" interview.
""The way that the banks were able to sell this debt is, they keep on buying sovereign debt, and then through that they make their profits, and then each year they end up using those profits to offset losses on that. And that's sort of of what happened in Japan over a 10 year period,"" said Lasry, who specializes in distressed debt investments.
Read More Can cash-strapped Europe prevent terrorism surge?
The way for Europe to avoid a deflationary period is to clock 4 to 5 percent GDP growth, he said.
""You're not having that. The reason everybody focuses on that is because GDP growth in Europe today is sort of, negative one, flat, up one. It's really not moving that much,"" he said.
The chairman and CEO of Avenue Capital said his firm is playing the credit side of the European debt market because the pressure is still on the banks to deleverage. ""This is sort of a five year process, so for us it's going to be the gift that keeps on giving,"" he said.
Lasry is personally invested in Greek debt, but Avenue Capital does not buy sovereign bonds, he said.
Read More Should markets fear Greece's radical Syriza party?
Europe is still in an investing phase because there is $2.5 trillion of debt, he said. ""The supply side in Europe is still so great relative to the demand side in Europe,"" he added.
As the death toll from a deadly strain of bird flu in China rises to 17, China watchers say they are closely following Beijing's handling of the outbreak although officials appear to have learned a trick or two from the SARS crisis a decade ago.
Eight fresh cases of the H7N9 bird flu virus have been reported in the eastern provinces of China this week, bringing the total figure of those infected to 82, Reuters reported. China is also investigating the possibility of human-to-human transmission of bird flu, a top Chinese health official was quoted as saying on Thursday.
Some analysts are drawing parallels with the outbreak of severe acute respiratory syndrome (SARS) between 2002 and 2003, which damaged international trade between China and other countries and led to the virtual shut down of Beijing, China's capital city.
If the bird flu epidemic accelerates in a similar fashion, investor sentiment could be severely damaged, said one analyst.
""The obvious benchmark is SARS. That was a catastrophe and the Chinese government learnt a lot of lessons from that,"" said Tim Condon, head of research for Asia at ING Financial Markets.
""At the moment the bird flu outbreak appears to be under control, but if it turns out to be much more virulent than expected you could see the same sort of reaction as we saw to SARS,"" he said.
The outbreak of SARS, a viral respiratory disease spread between humans, in South China and Hong Kong between the end of 2002 and the summer of 2003, affected around 8,000 and led to more than 700 deaths, according to the World Health Organization. Beijing was criticized at the time for its handling of the outbreak and downplaying the crisis, which led to panic and hurt China's economy.
(Read More: )
All About Confidence
Since the fresh strain of bird flu first emerged a few weeks ago China has slaughtered thousands of birds and closed some live poultry markets. YUM Brands, which runs the popular KFC brand in China, has said its March sales in its China restaurants fell 13 percent because of bird flu worries.
(Read More: Yum's China Sales Fall Sharply Amid Bird-Flu Scare)
Russia has started introducing medical check-ups for passengers returning from China, according to press reports, raising worries that China's tourism industry could be hurt by the bird-flu outbreak.
Condon said Beijing seems to be handling the outbreak differently in comparison to the SARS crisis and that was good for investor confidence.
""Back in 2003, they (Chinese authorities) were hiding the real numbers, and they even punished the doctor who revealed them. It was a real disaster. The authorities have now learned from that, and that means there is maybe a lower risk of a SARS level of panic,"" he added.
Alistair Chan, an economist at Moody's Analytics, agreed that the way China handles virus outbreaks has improved since SARS.
""The reaction seems much more mature,"" he said. ""The government is getting the U.S. and Australia to advise them on the issue and there is less of a cover up going on.""
So far the impact on Chinese markets appears to be limited although analysts say bird flu concerns could be a contributing factor to weakness in Chinese equities markets, which have taken a hit from news on Monday of an unexpected fall in China's first-quarter economic growth.
(Read More: Has China's Economy Hit a 'Dead End'?)
""There is some talk about it (bird flu) but people don't seem to be worried,"" said Michael Klibaner, head of Greater China research property company Jones Lang LaSalle in Shanghai, which has seen the most cases of bird flu in recent weeks. ""There is no evidence of human-to-human transmission. If I see evidence of that, then of course I would have a very different view.""
Patrick Chovanec, managing director and chief strategist at Silvercrest Asset Management, said he was carefully watching how bird flu outbreak would impact the economy.
""What is important to investors is how much this will disrupt the Chinese economy. Will it affect day-to-day business? Will it stop people transporting between cities? These practical implications are what will make people sit up and take notice,"" he added.
LONDON — British Airways has been fined £20 million ($26 million) by the Information Commissioner's Office (ICO) in the U.K. over a data breach in 2018 that left the personal and financial details of 429,612 BA customers exposed.
Following an investigation spanning almost two years, the ICO concluded that British Airways did not have sufficient security measures in place to process significant amounts of personal data.
The regulator said the failure broke data protection law.
While the fine is less than the £183 million the ICO said it would issue in 2019, it is still the largest-fine ever issued by the watchdog, which said the ""economic impact of Covid-19"" had to be taken into account.
The attacker is believed to have accessed the names, addresses, payment card numbers and CVV numbers of 244,000 British Airways customers.
A further 77,000 customers had their combined card and CVV numbers accessed, and an additional 108,000 customers had just their card numbers accessed.
The regulator said that the usernames and passwords of up to 612 BA Executive Club members may also have been compromised.
It took British Airways more than two months to realize it had suffered a data breach.
Information Commissioner Elizabeth Denham said in a statement: ""People entrusted their personal details to BA and BA failed to take adequate measures to keep those details secure.""
""Their failure to act was unacceptable and affected hundreds of thousands of people, which may have caused some anxiety and distress as a result. That's why we have issued BA with a £20 million fine – our biggest to date.""
""When organizations take poor decisions around people's personal data, that can have a real impact on people's lives. The law now gives us the tools to encourage businesses to make better decisions about data, including investing in up-to-date security.""
A British Airways spokesperson told CNBC: ""We alerted customers as soon as we became aware of the criminal attack on our systems in 2018 and are sorry we fell short of our customers' expectations.
""We are pleased the ICO recognizes that we have made considerable improvements to the security of our systems since the attack and that we fully co-operated with its investigation.""
In a shorter holiday week, U.S. stocks ended flat Friday, as positives struggled with the Dubai debt news. How should investors prepare for next week?
Alan Valdes, vice president at Kabrik Trading, and Doug Kreps, principal and managing director at Fort Pitt Capital Group, offered CNBC their portfolio advice. (See Kreps' stock picks, below.)
""Sometimes your best trade is no trade at all,"" Valdes said.
He believes that the Dubai frenzy will prove to be a ""one-day wonder,"" and suggested that no one should pass judgement on the markets until certain key economic reports are issued next week.
""My advice is, just sit tight and don't get crazy this weekend.""
He said investors ""might want to get defensive"" just to be safe, but declared optimistically, ""We still think markets are going to rally until the end of the year.""
Kreps echoed Valdes' message of calm:
""We tend to view trades in terms of more than just a day or two. We have a global theme that's very much still intact,"" Kreps declared.
""The global economy is still continuing to grow outside the U.S."" — and there are U.S.-based multinational stocks that harness such growth, Kreps said.
Kreps' Recommendations:
Microsoft
Boeing
Kimberley-Clark — the personal/household products maker is also a ""play on sonsumers in the developing world,"" Kreps said.
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Disclaimer
If you plan to relocate when you retire, don't wait until the last minute to hash out the specifics. You may need a decade or more to do it right.
A new address, whether out of state or close to home, can have major implications on your standard of living, target retirement date and potentially even the health of your marriage, said Craig Brimhall, vice president of wealth strategies for Ameriprise Financial.
Brimhall prompts his own clients to envision their future with a ""dream book.""
""It's good to have that conversation about where you plan to retire 10 to 15 years out, because it needs to be given a fair amount of thought,"" he said. ""The earlier you plan, the better.""
Before deciding where they'd like to live, for example, Brimhall encourages retirement planners to first determine what they hope to gain.
Read MoreSorry! You can't retire yet
""There are a lot of different reasons why people want to relocate, and answering the 'why' component is most important because it determines the next questions and what homework you need to do,"" he said.
For many, proximity to grandchildren is paramount, but that often translates into a higher cost of living.
Others live modestly during their working years but desire a more luxurious lifestyle after they stop punching the clock—which requires a more aggressive savings and investment strategy during their peak earning years.
And still others seek warmer weather or lower taxes, but many of the most popular states with coveted zero-income-tax status—such as Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming—aren't as retiree-friendly as they first appear.
Read MoreTest your Social Security smarts
""It's worth unwrapping that piece a little more and taking a more granular look,"" said Neil Krishnaswamy, a certified financial planner with Exencial Wealth Advisors. ""Some states that don't have an income tax may make up for it with higher sales or property taxes, so you want to look at the whole picture to determine true cost of living.""
Remember, too, that if you live half the year or less in an income tax–free state—like many 'snowbirds,' who flee to warmer climes during the winter months—you may still owe tax on retirement income earned in your home state.
Another consideration: If you plan to work even after you retire, out of necessity or by choice, you will want to consider employment opportunities when selecting a new locale.
The Center for a Secure Retirement reports that 28 percent of baby boomers who retired from their full-time career are either currently employed or have worked during retirement.
AARP's livability index scores neighborhoods and communities nationwide for the services and amenities that impact seniors most, including housing costs, social outlets, entertainment, work opportunities and access to medical care.
Seniors who are still in early retirement—when relocation decisions are usually made—often fail to consider the importance of public transportation, explains Rodney Harrell, director of Livable Communities for the AARP Public Policy Institute.
""A lot of people don't think about transportation, but when you can no longer drive, you need to have community amenities available, like alternative methods of transportation,"" to reach retailers, grocery stores and health-care providers, he said.
As you define your relocation goals with a financial advisor, said Krishnaswamy at Exencial Wealth Advisors, it's equally important to communicate with your spouse.
Read MoreIt's never too early to plan retirement
Married couples may agree on a destination but differ on the size of the home they feel they need—a one-bedroom condominium on the beach, a single-family home with grandkid-friendly guest rooms or a 55-plus community that will enable them to age in place.
Such decisions not only impact the couple's quality of life but their available cash flow, as well. And disagreement inevitably creates tension.
Relocation at any life stage is a major stressor, said Krishnaswamy, but the newly retired face the added pressure of leaving their professional careers behind, spending more time at home with their spouse and learning to live off their limited savings.
""Having the right expectations and conversations about what lifestyle you both envision can help prevent arguments and disagreements down the road,"" he added.
Krishnaswamy suggests that, before selling their home and leaving their social network behind, retirees who intend to relocate—especially to a city where they've only ever vacationed—might first consider testing the waters.
Try renting for part of the year to be sure the culture, climate and cost of living are a fit.
Indeed, the road to Florida is littered with so-called halfbacks—retirees who realized the Sunshine State wasn't for them and relocated a second time (and at no small expense) to a more active senior community in Georgia or the Carolinas.
Relocation during retirement does not necessarily solve any problems, and it can create new ones.
Read MoreSupporting adult children, aging parents
The most successful stories start with a solid plan and a heavy dose of due diligence.
""The best time to make these decisions is before you are in the moment or facing a new challenge,"" said Harrell at AARP. ""Many people wait, which adds to stress.""
—By Shelly Schwartz, special to CNBC.com
French President Francois Hollande said Thursday's lethal attack on the southern city of Nice was clearly a terrorist assault and that the state of emergency imposed since a previous attack on Paris last November would be extended for another three months.
Speaking after an emergency meeting in the early hours of Friday morning, Hollande said at least 77 people were killed in an attack in which the assailant drove a big truck at high speed into dense crowds who were watching a fireworks display on the country's national Bastille Day holiday.
""There's no denying the terrorist nature of this attack of yet again the most extreme form of violence,"" the French leader said in a national television address at 4 a.m. (0200 GMT), about five or six hours after the carnage in Nice.
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The number of mortgages in active pandemic-related bailout plans rose by 21,000 in the past week after declining for six straight weeks, according to Black Knight, a mortgage technology and analytics firm.
The increase was not across all mortgage types but among bank-held and private-labeled security loans (28,000), and, to a lesser extent, among FHA/VA loans (2,000). Those increases were offset by a decline of 9,000 Fannie Mae and Freddie Mac loans in forbearance.
The government and private sector forbearance programs, initiated at the start of the pandemic, allow borrowers to delay their monthly payments for at least three months and for up to a year. Forbearance is granted in three-month terms, and so far more than 75% of borrowers in bailouts are on extensions since March.
""As of the 29th [of September], nearly 800,000 forbearance plans were still set to expire in September, down from 2 million at the start of the month. The data is still coming in, but over the past week, we've seen a roughly 80% extension rate,"" said Andy Walden, director of market research at Black Knight. ""Given that there are another million plans for which October marks the last payment covered by forbearance, we should expect to see heightened levels of expiration/extension activity in the coming weeks.""
As of Tuesday, roughly 3.6 million homeowners remain in pandemic-related forbearance plans. That's 6.8% of all active mortgages, representing $751 billion in unpaid principal.
While the weekly turn is troubling, over the past month active forbearance volumes have fallen by 305,000, or 8%. FHA and VA loans, which generally go to borrowers with lower incomes and lower down payments, are not recovering as well as the rest of the market. It is likely those borrowers are in jobs that have been hardest hit by the pandemic.
It is impossible to know specifically why more borrowers suddenly needed help on their mortgages, but it is a sign that all is not improving in the housing market. Some borrowers have been dipping into savings to make their monthly payments, and that may have now run dry. While the economy is adding jobs again, the unemployment rate is still high, and some borrowers are still clearly struggling.
By loan type, 4.7% of all Fannie and Freddie-backed loans are in forbearance, while 11.2% of all FHA/VA loans are. For private label and bank-held loans, that share is 7.3%.
Legacy automakers Ford and General Motors are set to be industry leaders once again as electric vehicles and autonomous driving come into focus, according Wells Fargo.
The firm's analyst Colin Langan initiated coverage of both stocks on Monday with overweight ratings, praising the new and upcoming electric vehicles for the stalwart companies.
SAN FRANCISCO, Oct. 8, 2012 /PRNewswire/ -- TalentBin, the talent search engine that turbo-charges talent discovery across the web, today announced the launch of TalentBin Scores, a new addition to the company's flagship social recruiting solution, providing a relative weight for how intensely candidates exhibit a given professional interest or skill across the web. TalentBin Scores will be unveiled in Booth #955 at the 2012 HR Technology Conference and Exposition, where the company will also be showcased as one of the most innovative software solutions that promise to enhance and improve the HR function in the ""Awesome New Technologies for HR"" session presented by HR technology guru Bill Kutik.
Since its launch this spring, TalentBin has quickly demonstrated its strength at filling in information gaps for recruiters and hiring managers by scouring the web for clues left by candidates on social media sites and online professional communities – delivering a more complete and well-rounded web resume.
Unlike online profiles or traditional resumes that lack an expressed measure of depth in a particular professional interest, TalentBin Scores provide an indicator of intensity of a given professional interest, to better help recruiters and hiring managers quickly assess if a candidate could be the right fit – significantly streamlining the filtering process.
With the addition of TalentBin Scores, the company is going deeper into the candidate profile, to not only tell prospective employers what a candidate knows, but the intensity with which they demonstrate that know how. Drawn from observable online activity, these indicator levels can not only help recruiters see the relative intensities of a candidate's various professional interests, but also help them compare the intensities of the same interests between multiple candidates. Ultimately, TalentBin Scores are designed to enable employers to more quickly and efficiently zero in on candidates most likely to fit their specific skills requirements for their open positions.
""As part of the TalentBin process of interpreting online professional activity to identify the skills that would be relevant to an employer, we naturally discovered that the skills and interests we found were not all at equal strength,"" explained Peter Kazanjy, co-founder of TalentBin. ""When a recruiter is scanning LinkedIn or other professional profiles, they are lucky to get all the skills they are looking for listed – no less a scale of how deeply a candidate may be involved with a given skill or interest. TalentBin Score was created to solve that problem, providing a quick measure of the strength of those interests.""
Currently, more than 100 leading companies, including Facebook, Groupon, Dolby, and Yahoo!, rely on TalentBin for their online sourcing and social recruiting needs. TalentBin aggregates a candidate's ""implicit"" professional activity from the skills and interests they reveal across social networks like Facebook, Twitter, Google+, Meetup, Quora, and more, coupled with activity on other industry-specific social communities like GitHub, SourceForge, and Bitbucket for software engineering, for example. This additional information bolsters passive professional profiles with input that is vital to helping recruiters determine ideal job fit. The result is a more accurate, 360-degree view of a candidate that covers everything from professional skills to personal interests, information that does not usually appear on resumes or online professional profiles. TalentBin then takes it one step further, compiling all contact information such as email addresses, Twitter handles, and more to help facilitate direct candidate engagement.
TalentBin offers an API for seamless integrations with a wide range of software partners. The TalentBin solution already has over 200 million candidate profiles cultivated from the US Patent Database and over 30 professional social media communities, and growing. To make TalentBin a part of your talent sourcing and acquisition strategy, visit www.talentbin.com.
About TalentBin
Based in San Francisco, TalentBin is focused on turbo-charging talent acquisition for recruiters and hiring managers with its talent search engine, turning the web into a virtually endless talent sourcing database. By crawling targeted professional networking sites to pull together composite web resumes - adding vital skills and expertise to traditionally sparse profiles – it helps make fast and definitive job matches. TalentBin has aggregated over 200 million professional profiles to date, and provides user access from anywhere as a web application, as a browser plug-in for Google Chrome, or within existing Recruiting CRM, ATS, or HRIS system through an API. With staff hailing from VMWare, eBay, and LinkedIn, TalentBin is funded by First Round Capital, Charles River Ventures, and Ron Conway's SV Angel. For more, visit www.talentbin.com.
Press Contact:
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Resound Marketing
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Shares of pharmaceutical giants Pfizer and Merck both rose by about 1% Tuesday after reporting first-quarter financial results that beat Wall Street's expectations.
However, shares of drug giant Eli Lilly dropped as much as 3.5% after releasing first-quarter earnings that topped profit expectations, but missed on revenue. Sales of two of Lilly's key drugs, Trulicity and Alimta, fell short of Wall Street's forecasts. Merck's earnings got a slight lift from sales of cancer immunotherapy drug Keytruda and vaccines — amid the worst measles outbreak since health officials declared the disease eradicated from the U.S. in 2000.
Health care has been the worst-performing sector in the stock market this year on concerns about drug price reform and ""Medicare for All"" proposals from Democratic lawmakers. The Health Care Select Sector SPDR Fund, an ETF that tracks the health-care industry's biggest companies, had risen by just 2.7% year to date as of Monday, significantly lagging the broader market indexes. The Dow Jones Industrial Average was up 13% over the same period, and the S&P 500 was 17% higher.
Eli Lilly posted earnings $1.33 per share on revenue of $5.09 billion. Analysts had expected earnings of $1.31 a share on revenue of $5.12 billion.
The company said it expects further price declines in the United States this year as well as increased competition from generics, including for erectile dysfunction drug Cialis.
Trulicity, the company's top-selling diabetes drug, brought in $879.7 million in the quarter. That was an increase of 30% compared with the first quarter of 2018 but below the $952 million analysts had expected. Sales of cancer drug Alimta came in flat compared with last year at $499 million.
The U.S. drugmaker now expects full-year revenue between $22 billion and $22.5 billion, lower than a previous forecast of of $25.1 billion to $25.6 billion. However, it raised its adjusted full-year earnings forecast by 5 cents to $5.60 to $5.70 per share.
Lilly has been facing pressure from Congress to lower prescription drug costs. In March, the company disclosed for the first time what it charges wholesalers versus what many patients typically pay. It also announced plans to sell a half-price version of insulin injection Humalog.
The company reported first-quarter earnings of $1.22 per share, beating analysts' expectations of $1.06 a share. Revenue came in at $10.81 billion, topping estimates of $10.48 billion.
Merck said sales of Keytruda surged 55% in the quarter to $2.27 billion. Keytruda, which boosts the immune system to attack cancer, has driven growth for Merck and put pressure on Bristol-Myers Squibb's rival drug Opdivo.
Merck's Gardasil vaccine to prevent certain types of cancer also had a good quarter with sales up 27% to $838 million. Sales of children's vaccines, which includes the company's MMR vaccine for measles, jumped 27% to $496 million.
The drug giant raised its earnings guidance for the year. It now expects full-year adjusted earnings per share of between $4.67 and $4.79, up from its prior forecast of $4.57 to $4.72.
Pfizer earned 85 cents per share in the first quarter, beating Wall Street estimates by 10 cents. The company reported revenue of $13.12 billion, higher than the $12.99 billion forecast.
CEO Albert Bourla, who succeeded Ian Read on Jan. 1, shuffled the company's senior management team last year and is leading efforts to restructure the pharmaceutical giant into a more nimble company. Pfizer has been trying to bulk up its pipeline of drugs and therapies, especially in oncology, ahead of impending patent expirations.
Pfizer's blockbuster drug Lyrica, which treats nerve pain and is expected to face generic competition this year, brought in sales of $1.19 billion.
The New York-based drug company also raised its earnings per share forecast by a cent. It now expects between $2.83 to $2.93 per share.
For more on investing in health-care innovation, click here to join CNBC at our Healthy Returns Summit in New York City on May 21.
Erica Friedle had not missed a vote in seven years. Then came the coronavirus pandemic.
Friedle told CNBC she didn't receive her absentee ballot for April's Wisconsin presidential primary. And now she fears that a lack of preparation by state officials and the continued threat of the disease might force her to sit out the upcoming November election in the swing state.
As health officials predict that the pandemic might last into the fall, many states are beginning to plan for the likelihood of people opting to vote by mail instead of showing up in person, where the risk of contracting and spreading the coronavirus is greater.
For some people, the coronavirus has made voting a nerve-wracking action. Some Americans and voting rights groups are concerned that the pandemic is forcing voters to choose between avoiding contact with people to stay healthy and exercising their right to vote. Come November, these concerns might linger.
""Are people going to want to stay in line to vote? Are people going to be requesting absentee ballots? Do people even have the technology to request a ballot online?"" Friedle asked, listing out some of her immediate worries in an interview with CNBC. ""There are so many unknowns right now.""
The Wisconsin primary in particular has been criticized for its disorganization and last-minute changes, leading to voter confusion and disenfranchisement and serves as an example of what voting rights groups hope will not happen in November.
Complicating matters, President Donald Trump and members of the Republican Party are on the attack against widespread mail-in voting while Democrats push for expanded access. Late last month, Trump threatened to withhold funding from Michigan and Nevada for expanding their mail-in voting services in an effort to avoid crowded polling centers during the coronavirus pandemic.
""More and more states are allowing vote-by-mail without voters having to provide a reason or excuse for it,"" said Andrea Hailey, CEO of Vote.org, a nonprofit focusing on advancing voter ballot access. ""Other states are mailing applications to voters, which is critical for ensuring that all voters can participate in the electoral process.""
More than half, or 54%, of Americans said they would back voting by mail in the upcoming presidential election if the pandemic persists, according to an April Morning Consult poll. And 66% of surveyed Americans said in March that they were concerned about voting in person during the coronavirus outbreak.
""We are seeing signs that voters are registering at numbers unseen from our organization, and that they are very much interested in voting by absentee,"" Hailey told CNBC in an email.
But mail-in voting can bring its own concerns, especially if there are underlying circumstances that affect support, such as the potential for U.S. Postal Service operation failure or miscommunication between state officials and voters.
Friedle, a second-grade teacher, said she applied for an absentee ballot but did not receive it ahead of the Wisconsin presidential primary on April 7. She is a single mother with a 10-year-old child, sharing custody with her ex-husband, a scientist at a large pharmaceutical company who at the time of the primary had been working on a vaccine for Covid-19.
The combination of being unable to leave her child alone and fearing getting sick at the polls made Friedle miss the vote.
""I didn't want to put myself at risk for getting sick,"" she said. ""I've been taking care of my daughter the whole time. Her father works crazy hours, and at that time, he was telling me he might get locked out in his work, that he wouldn't be able to leave his work.""
She added: ""That just made me nervous. Who's gonna watch my daughter?""
Friedle, 41, is not within the most vulnerable age group for contracting the most severe form of the virus. But there's still a lot at stake for people like Friedle: parents with young kids or teachers whose students are relying on them even as online classes persist. Knowing the risks, Friedle chose instead to skip out on voting. She feared if she contracted the virus, she would pass it on to her daughter or potentially be unable to teach.
Voting rights groups stress that the most susceptible people are ""older voters and people with pre-existing conditions,"" according to Brett Edkins, political director at New York-based Stand Up America, a nonprofit focused on advancing Democratic goals. ""Children and younger parents are at relatively low risk of becoming seriously ill. Election experts across the partisan divide say that mail-in voting is the safest alternative to in-person voting.""
But Friedle's experience during the Wisconsin primary gave her a taste of what November might look like for her and other voters across the nation, she said.
She's hoping to see her state take action in the coming months to reduce the likelihood of people experiencing what she did. This includes ""having multiple ways to vote, whether you want to vote early, via an absentee ballot or in person.""
At the same time, she's concerned about whether officials are considering the feasibility of these moves. ""How can we do that? How can we do it safely so people aren't being exposed to germs or viruses?"" she asked. ""Lots of organizations are out there that drive people to the polls. Are people still organizing these things with Covid going on?""
In other states, some voters are concerned that there won't be enough done to make in-person voting safer.
Angel Wells, a frequent voter and a self-described human rights activist based in Arizona, said that's what's driving her fears today.
Voting can get chaotic in Arizona, said Wells, a veteran. In her voting area, ""there are 64 voting offices where you can cast your vote. But that's not enough when you live in a valley with millions of people.""
""When people go out to vote, those lines are long. The polling booths are close [together]. They're not six feet apart. How are we supposed to have this vote and keep within health guidelines?""
""People are rightly concerned about having to choose between their right to vote and their health,"" Edkins of Stand Up America said. ""I think we're hearing a lot of those concerns from our community and from voters everywhere.""
Friedle's experience illustrates that much of the burden to acquire an absentee ballot was placed on her. She said she emailed the city clerk when she realized she didn't have her absentee ballot, asking for guidance in obtaining one. The city clerk shot back an email the day of the election, she told CNBC, attaching a ballot that needed to be printed, filled out and hand-delivered. Handing in the ballot wasn't worth the risk to her health, she said.
The District of Columbia and 34 states, including five that conduct all-mail voting, use no-excuse absentee voting, according to the bipartisan National Conference of State Legislatures. But even so, a lot of those states don't typically send out absentee ballots unless a registered voter requests one. California is the most recent state to announce that all registered voters will receive a mail-in ballot for November's election because of the challenges brought on by the pandemic.
At the same time, voting rights groups and registered voters recognize that there will be people still opting to show up and vote at the polls in November.
""Expanding vote-by-mail options is exactly what more communities need, but we must also ensure that it is safe to vote in person,"" said Vote.org's Hailey. ""That is why it should be a top priority for governments at all levels to fully fund our elections, that we have at least 20 days of early voting and that poll workers can conduct our elections in sanitary, safe conditions for our communities to vote in person as well.""
That's the question many states are trying to answer right now, grappling with early preparations for the execution of the November election and trying to rethink voting.
""Nobody who's under 100 years old has run an election during a pandemic,"" Edkins of Stand Up America said. To decrease the risk of spreading the coronavirus, state officials are going to have to ""train on a very local level to prepare people,"" he told CNBC. That includes finding ways to maintain a standard six feet of distance between voters, having hand sanitizer and personal protective equipment readily available, regularly disinfecting voting booths and employing cough guards.
Officials also have to take into account how volunteers and poll workers will engage with voters, Edkins said. It's important to remember to keep ""distance from voters who are often right next to poll workers verifying their signatures and signing them in to vote. I think they're going to have to think through all those procedures.""
Already, there's been considerable advancement in the nationwide expansion of ballot access, Edkins said, adding that ""most states are making good progress.""
""Multiple states have added Covid as a reason and an excuse to get an absentee ballot.""
Many of the voting changes transcend party lines, Edkins said. Vote-by-mail expansion is coming ""not just from Democratic states, but also Republican states with local election officials that are making these changes as well.""
It's too early to tell how these changes will affect voter turnout in November. For some voters, the concern is that these changes may not be enough to get the highest participation level possible.
""Voting is incredibly important,"" Friedle said. ""It's our opportunity to put people in power to make a difference. The people who are making those choices have an impact in my life.""
A repeat of CNBC's ""Business Nation"" will air on Wednesday, April 18th at 9 PM and 12 AM ET. The original show aired on April 4th.
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Members of the media can receive more information about CNBC and its programming on the NBC Universal Media Village Web site at http://nbcumv.com/cnbc/.
Apple's big event may have failed to impress investors on Monday — but those investors are actually missing the point of the tech giant's new services, tech investor Gene Munster told CNBC on Monday.
Shares of Apple closed down 1.2 percent after the highly anticipated event, which introduced its streaming video service Apple TV+, a paid news service Apple News+ , a credit card and a gaming service called Arcade. Apple did not announce many details about the services, including pricing for TV+ and Arcade. But Munster says investors who focus on the missing details are missing the bigger picture.
""What Apple is saying is they are going to take things that we interact with every day -- whether it's the streaming service, gaming or our credit card – and we're going to try to change in terms how people use that. The language that they use is 'enriching people's lives,'"" said Munster, founder of the venture capitalist firm Loup Ventures.
That means creating content that isn't typical, gaming that's healthier, and a credit card that adds transparency, he added.
""That gets lost in the conversation today — these subtle little approaches that Apple does to make our lives just a little bit better. And I think that ultimately is going to yield a higher share price,"" Munster said on ""Fast Money.""
Apple is entering a crowded field of original programming, going up against established names like Netflix and Amazon. In its announcement on Monday, Apple called on big names like Steven Spielberg, Reese Witherspoon, Steve Carrell, Oprah Winfrey and Jennifer Aniston to discuss their upcoming shows.
The tech giant didn't say how many programs they have or how much the service would cost.
Munster said Apple probably has about 40 shows and movies — a ""far cry"" from Netflix's library. However, he still thinks Apple's foray into the space will hurt Netflix's stock.
""The quality of this is what is going to ultimately stand out and I suspect that the way that Apple is going to measure their success is the number of industry awards,"" he said. ""This content, this different approach is going to have an impact and I think that that could be a similar size as Netflix, call it $15 billion a year""
Munster is projecting the four services together will yield about $20 billion or so in revenues in the next five years.
—CNBC's Kif Leswing contributed to this report.
Disclaimer
If an article in Monday's Wall Street Journal is anything to go by, the U.S. Federal Reserve is getting ready to unwind its massive monetary stimulus program. And that prospect is unlikely to be as alarming for financial markets as feared, analysts tell CNBC.
Fed officials have mapped out a strategy to wind down its $85 billion-a-month bond-buying program in careful steps, although the timing of when that will start is still being debated, noted Fed watcher Jon Hilsenrath wrote in the WSJ.
Any unwinding of the Fed's quantitative easing (QE) program, which has fueled a rally in equity markets and other risk assets, is generally viewed as negative and any indication of this happening has been highly anticipated in the U.S. since late last week.
(Read More: If I Were 'Dictator,'QE Would End Now, Fed's Lacker Says)
""Having spent two New York sessions pricing in a sharp change in Fed stance, it is not obvious that the article was worth the wait,"" analysts at Westpac said in a note. ""The timing of the unwinding of QE remains data-dependent, not a serious prospect until perhaps late U.S. summer at the earliest.""
Analysts say that in essence, the Fed appears to be managing market expectations that its quantitative easing program will not last forever.
The Fed has said that it would maintain its key interest rate between zero and 0.25 percent until the unemployment rate fell to 6.5 percent. It has also committed to monthly purchases of bonds until labor market conditions improve substantially.
(Read More: Are Bond Vigilantes Taking On the Fed?)
And it is the recent signs of improvement in the jobs market that has renewed talk about a possible end to the quantitative easing.
The latest non-farm payrolls report showed the U.S. economy created 165,000 new jobs last month, much more than expected, helping push the unemployment rate down to 7.5 percent. Data last week meanwhile showed jobless claims at their lowest level in almost 5-1/2 years.
(Read More: Back in Business: Jobs Picture Brightens in April)
""The timing is still a bit uncertain, but our view is that there will be no more QE from the United States after December this year,"" said Geoff Lewis, global market strategist, J.P. Morgan Asset Management.
""They're [Fed officials] not going to raise interest rates they've told us that until unemployment comes down to 6.5 percent, but that could be as soon perhaps as the first half of next year,"" he added.
Lewis said that the Fed would have no choice but to taper off QE in the face of stronger economic news and that was unlikely to lead to alarm in equity markets that have thrived on the aggressive monetary stimulus.
U.S. stocks hit fresh highs on Friday, while markets in Asia and Europe have also seen stellar gains this year.
""That [an easing of QE] would be good for U.S. stocks because it would mean the U.S. economy is doing a lot better,"" he said.
Martin Lakos, division director, Macquarie Private Wealth told CNBC Asia's ""Squawk Box"" that he also remained positive on the outlook for stocks.
""The central bank is clearly trying to massage markets that QE is not going to be around there forever. I don't think that is a big risk as they [the Fed] are managing expectations,"" he said. ""We remain positive on equities over the next couple of years.""
— By CNBC.Com's Dhara Ranasinghe; Follow her on Twitter at @DharaCNBC
Ted Nugent says he'll meet with the Secret Service to explain his comments about President Barack Obama that some have interpreted as threatening.
The hard rocker says it will be obvious when he talks to agents on Thursday that he didn't make any threats. Nugent spoke to radio interviewer Glenn Beck about the controversy.
At last weekend's National Rifle Association convention, Nugent referred to what he called Obama's ""evil, America-hating administration"" and urged NRA members to ""to ride into that battlefield and chop their heads off in November.""
Nugent also said if Obama were re-elected, ""I will either be dead or in jail by this time next year.""
A Secret Service spokesman confirmed that the agency was following-up on the issue but would not give details.
— This is the script of CNBC's news report for China's CCTV on January 20, Tuesday.
2015 has not only been volatile for commodities, the foreign exchange market has been topsy turvy as well, with some calling it the currency war.
We've already seen cuts this year by India and Peru. The Swiss National Bank shocked markets last week by scrapping its 1,20 francs per euro cap. The Swiss central bank had earlier cut its rate down down to -1.25% to -0.25% range. Today, Denmark announced its own cut to its benchmark policy and lending rates and Japan's BoJ will announced their policy decision tomorrow, on the back of a two-day meeting.
All eyes are now on the ECB and their policy meeting on Thursday. 90% of analysts expect a QE program from Mario Draghi and his team, with a medium predict of at least 550 billion euro.
[Megan Greene, MD & Chief Economist, Manulife Asset Management] ""My big fear is they are gonna actually engage in QE, and that its gonna be a total damp squid 071632 and then they will have used up all of their dry powder, so what else can they bring out to fight deflation.""
[Sean Darby, Global Head of Equity Strategy, Jefferies] ""But the problem really is the central bank has got limited options to some extent in trying to increase inflation rate, and this one is the only one at the moment left on the menu card.""
The BOJ, though, is expected to keep its current QQE program and interest rate unchanged. With the U.S. economy back on track to stronger growth, the Fed is expected to raise interest rates around mid 2015, which will bring challenges to emerging markets. There's still just over more than 11 months left to this year and already, some analysts are saying that 2015 is going to be a year for Central Banks.
Britain is drawing up contingency plans for the unlikely event it has to walk away from divorce talks with the European Union without a deal, Brexit minister David Davis said on Sunday.
Prime Minister Theresa May is set to begin exit talks by the end of the month, kicking off Britain's most complex set of negotiations since the end of World War Two. The outcome will shape Britain's political and economic future.
Ahead of the start of negotiations, which could be triggered as early as Tuesday, a committee of lawmakers warned it would be a serious dereliction of duty if the government failed to plan for the possibility of not reaching an exit deal.
""I don't think, firstly, that is remotely likely,"" Davis told the BBC's Andrew Marr Show, responding to the report. ""It's in absolutely everybody's interest that we get a good outcome.""
Parliament's Foreign Affairs committee warned that a breakdown in negotiations would be a ""very destructive outcome"", causing economic harm to both sides as well as creating uncertainty and legal confusion for individuals and businesses.
""The simple truth is we have been planning for the contingency - all the various outcomes, all the possible outcomes of the negotiations,"" Davis said.
""One of the reasons we don't talk about the contingency plan too much is that we don't want people to think 'Oh, this is what we're trying to do.'""
Asked when May would trigger talks, Davis declined to name a specific date.
""Each date has different implications in terms of when it could be responded to by the (European) council ... I'm not going to get into the details why, but there's politics in terms of achieving success.""
Before May can begin negotiations, she must finish passing the legislation that gives her the right to formally notify the EU of Britain's intention to leave and start a two-year negotiating period as set out in the EU's Lisbon treaty.
The laws are expected to be finalised in a series of votes early next week, which will test May's authority over her Conservative Party as she seeks to overturn changes made to the draft bill by parliament's upper chamber.
The government suffered two heavy defeats in parliament during the legislative process, inserting conditions into the bill saying May must guarantee the rights of EU nationals living in Britain and give lawmakers more powers to reject the final terms she reaches with the EU.
Facing a possible rebellion from Conservatives who want to vote on the final Brexit terms, Davis urged lawmakers to back May's Brexit strategy and overturn those changes because they would tie the government's hands in the negotiations.
""What we can't have is either house of parliament reversing the decision of the British people - they haven't got a veto,"" Davis said.
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A southern Colorado county with two recreational marijuana stores has become the first in the state to announce tax totals from the new industry.
Pueblo County finance authorities announced Monday that its two shops had about $1 million in total sales in January, producing about $56,000 in local sales taxes.
Pueblo County is the only place between Denver and the New Mexico state line that currently allows recreational pot stores. Its two shops were joined by three more that opened in February.
(Watch: )
""We recognize that the eyes of the world are watching us, and we are proud to have erected a robust regulatory environment in Pueblo County,"" County Commissioner Sal Pace said in a statement Tuesday.
Pueblo County Clerk Gilbert ""Bo"" Ortiz projected the marijuana industry will generate roughly $670,000 in new tax revenue for his county this year. The money is a combination of a 3.5 percent pot sales tax approved by county voters last year, as well as ""share-backs"" from the state on general and pot-specific sales taxes.
If Pueblo's sales continue at the January pace, the county's pot industry will make about $11.2 million in gross sales in 2014, Ortiz projected. The county's total budget is about $165 million a year.
(Watch: How former DEA agents became pot proponents)
Colorado has more than 160 licensed recreational pot stores, all of whom had to report sales taxes Feb. 20. Most of the stores are in Denver County, which hasn't yet reported its January tax haul.
Pueblo County is the first local government to make its recreational marijuana sales tax totals public. Statewide totals are expected early next month.
Pueblo officials joked about the pot tax haul Monday in a county finance meeting.
(Read more: The go-to guy: A conversation with a drug dealer)
""The irony is that the only new revenue we have coming in is in marijuana, and yet we have to open a new judicial building,"" Commissioner Liane ""Buffie"" McFadyen quipped, according to a report Tuesday in The (Pueblo) Chieftain.
County Budget and Finance Director Cal Hamler replied, ""We're going to have to sell more weed.""
—By The Associated Press
The euro traded near a five-year peak against the yen and a one-month high against the dollar on Friday after euro zone economic data dented speculation about further monetary easing by the European Central Bank.
Annual euro zone consumer price inflation rose by 0.9 percent in November, slightly more than economists had predicted, while further data revealed the first fall in euro zone unemployment in almost three years.
Analysts said this should be sufficient to ease the ECB's concerns about low inflation and may cause them to hold off from a further interest rate cut as early as next week to follow an unexpected rate cut earlier this month.
The euro rose to as high as $1.3621, according to Reuters data, the strongest since the end of October, before easing to $1.3609, little changed on the day.
The euro gained 0.1 percent to 139.36 yen, having risen as high as 139.70, its strongest since the aftermath of the collapse of Lehman Brothers in late 2008.
On the month, the euro was on track for a gain of 0.2 percent against the dollar, its third straight month of advances. It rose 4.3 percent against the yen, on track for the best monthly performance since April.
The dollar hit a six-month high of 102.60 and was last up 0.1 percent at 102.41. It was on pace for a gain of 4 percent in November, the largest monthly rise since January.
The euro is up nearly 22 percent on the year against the yen. It has risen around 6.5 percent since the ECB unexpectedly cut interest rates on Nov. 7.
For more information on currency prices, please click here.
UPDATE: The Sara Lee story: it is likely about price and inflation
TheDeal.com report that a sale of SLE is unlikely dropped the stock about 4 percent. Reports abound that the Board is meeting today to consider selling pieces of the company, such as the meat or coffee division, or breaking it into separate pieces.
The likely problem: inability to agree on a price.
Why? Because food companies are in a tough environment, an environment that cannot be easily changed just by getting bigger.
The big issue for food companies: inflation.
Bernstein, in a recent note to clients, noted that cost of goods sold (COGS) inflation will average 6.7 percent for 2011 for the large food companies like SLE, Kraft , Kellogg and Campbell's . That is up from a 5 percent estimate that was done in October and way above the 3-5 percent sweet spot preferred by many management teams, they say.
Knock-on effects:
1) commodity inflation causes food stocks to underperform because margins get hit
2) when food prices go up, private labels gain market share
3) innovation becomes more important: the ability to raise prices often depends on the ability to introduce new products, rather than renovate existing ones.
-----
Sara Lee was down as much as 4 percent Thursday on a story in TheDeal.com that a sale of the company appears unlikely, citing unnamed sources.
The company has been widely believed to be a takeover target, or that it might separately sell its meat or beverage businesses. A number of players, including Apollo Global Management and KKR, have reportedly expressed interest in a buyout.
Recall that CEO Brenda Barnes stepped down in August for health reasons.
Though SLE has many well-known brand names (Jimmy Dean, Hillshire Farm), it's a tough sell: the food business is highly competitive, and as we have seen in other companies, it is tough to get pricing power. Higher commodity costs, as has been widely reported, add to the uncertainty.
More:
'Fast Money' Traders: What Commodities Are Saying Now
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Amazon is putting the finishing touches on a concept for new Seattle area grocery stores called AmazonFresh Pickup, according to permit filings reported by GeekWire.
E-commerce giant Amazon has filed permits for stores in the Seattle neighborhoods of Ballard and SoDo, according to GeekWire's images from the Seattle Department of Construction and Inspections.
Amazon did not formally announce the stores to the technology blog, but CNBC is reaching out for comment.
Signs for the store exteriors read, ""Shop online. Pick up here,"" and ""Relax while we load your groceries,"" according depictions in the permits. GeekWire also visited the planned locations of the stores, where there are awnings for drive-up grocery pickup.
Based on previous permits, GeekWire posits that there will be about 15 employees at each location, and three to five workers will be dedicated to bringing orders out to parked cars with an average wait time of 5 minutes.
Amazon has recently experimented with several retail concepts, including a smart convenience store, Amazon Go. Amazon has also explored permits for drive-up grocery stores in the Bay Area, according to Silicon Valley Business Journal.
Amazon CEO Jeff Bezos has said the company's tech savvy — especially artificial intelligence — allows the company to do things like sort fresh strawberries better than the human eye.
For more on the Amazon permits, including pictures, check out the article on GeekWire.com.
Googleshares dropped sharply in extended trading Thursday after the company reported a profit that failed to match what Wall Street hoped was coming, after a spike in expenses offset a 24 percent revenue jump.
The report marked a rare stumble for a company accustomed to shattering financial expectations.
Google, which is expanding into new products and markets in hopes of maintaining the growth momentum Wall Street also looks for, spent heavily on research and development and hired aggressively.
Some analysts said headwinds from weakening foreign currency did not hurt revenue growth as much as anticipated, as Google managed to surpass targets for net revenue.
""They're throwing more money into R&D than people were expecting and a little bit less into sales and marketing,"" said BGC Partners analyst Colin Gillis. ""Google has been pretty clear that it's going back into investment mode. They added 1,200 people in the quarter, which means more expenses are going to kick in in September.""
The Internet search and advertising giant said it earned $6.45 a share in the second quarter excluding one-time items, up from $5.36 a share last year.
Excluding traffic-acquisition costs (TAC), Google's revenue reached $5.1 billion in the most recent period, up from $4.073 billion last year.
A group of 36 equity analysts who follow Google expected on average for the company to report a profit of $6.51 a share and revenue, excluding TAC, of $4.985 billion.
Google shares dropped more than 4 percent in extended trading Thursday. Get after-hour quotes for Google here.
The stock finished Thursday's regular Nasdaq session up less than 1 percent at $494.02.
""It missed my non-GAAP estimates but revenues looked a little better than expected,"" Aaron Kessler, an analyst with Thinkequity, told Reuters. ""Research and development looked pretty high and general and administrative expenses were higher than I was expecting. Operating expenses overq;Ihigher than we had estimated which dragged down the earnings per share.""
Payroll Ballooning
Google has beaten Wall Street revenue expectations in five of the past seven quarters and exceeded profit estimates in each of the past seven.
Its shares sold off after its last two better-than-expected earnings reports when, analysts said, some investors' expectations of blow-out results were missed. Thursday's results were a rare outright earnings miss.
Google is increasingly pitting itself against rivals beyond its usual competitors Yahoo and Microsoft, as it ventures into smartphone operating systems, mobile advertising and other areas in search of future growth.
Google, which has made a string of acquistions in recent months, added more than 1,100 employees to its payroll during the second quarter.
Google's net earnings came in at $1.84 billion, or $5.71 per share, in the three months ending in June. That was up 24 percent from the same time last year, but lower than the rate of growth in the first three months of the year.
Total revenue, including money that Google shares with Web site partners, was $6.82 billion in the quarter.
In an encouraging sign for the overall economy, marketers paid more for the online ads that generate virtually all of Google's income. People also clicked on the ads more frequently.
Those trends indicate more companies and shoppers are feeling a little better as they recover from the worst economic downturn in more than 70 years.
- AP contributed to this report.
Find out what’s going up, what’s going down and whether our traders would double down, fade or run in the other direction!
The Mover: Harley Davidson (HOG) popped 5%.
Trader Comment: I’m a seller, says Pete Najarian, but then I’d buy it back lower.
The Mover: Mosaic (MOS) popped 6%.
Trader Comment: I’m looking for strength in this stock when the Cargill lockup ends, says Steve Grasso.
The Mover: American Express (AXP) popped 4%.
Trader Comment: I think this stock could do well into the holidays, says JJ Kinahan.
The Mover: Disney (DIS) popped 3%.
Trader Comment: I think it’s catching up to strength that’s been there all along, says Zach Karabell.
The Mover: Home Depot (HD) popped 2%.
Trader Comment: I look at as a safety name with limited downside, says Pete Najarian.
The Mover: Bank Of America (BAC) popped 2%.
Trader Comment: I’d wait for the stock to stabilize around $7 before I’d buy, says Steve Grasso.
The Mover: SanDisk (SNDK) popped 8%.
Trader Comment: The company came out with earnings, had a game plan and executed perfectly, says JJ Kinahan.
______________________________________________________
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More than seven-and-a-half million people -- or about 20,000 people a day -- will die of cancer this 2007.
That's the sobering new estimate from a first-of-its-kind global study out of the American Cancer Society.
The report says that nearly three million cancer deaths will occur in economically developed countries … and more than four-and-a-half million in developing countries.
The publication also includes scary projections about tobacco-related deaths.
The ACS estimates more than one billion people will die this century from tobacco use -- a ten-fold increase over the 20th century. Some of the most devastating projections are in China where 350 million people smoke cigarettes. That's more than the entire population of the United States.
The study says stopping tobacco use in the developing world should be ""an urgent global health priority"".
Twitter plans to sell its shares for anywhere from $17 to $20 per share in an initial public offering, the company said on Thursday.
Twitter is offering 70 million shares, suggesting the deal could raise up to $1.4 billion for the social media company.
At the top end of the range, Twitter would be worth some $10.9 billion.
(Read more: #TwitterIPO)
The company did not announce a date for the offering, but a source close to the matter said the shares were expected to price on Nov. 6, which would mean the stock would likely start trading on Nov. 7.
The stock will list on the New York Stock Exchange under the symbol ""TWTR.""
MONTCLAIR, N.J. -- Across New Jersey, most communities approached about hosting one of the state's first legal medical marijuana dispensaries in out-of-the-way industrial zones have just said no, after outpourings of public opposition.
Montclair is a different story.
The cosmopolitan suburb a half-hour train ride from Manhattan has not only allowed Greenleaf Compassion Center _ which last week received the state Health Department's first license to begin providing pot to patients _ but also let the business set up in the middle of the town's main drag, and with no fuss.
For plenty of people in the way left-of-center town, the situation is a source of both pride and nonchalance.
""Why are the other communities so closed-minded as to not accept something like that?"" said Peter Ryby, owner of Montclair Book Store, around the corner and down the block from the not-yet-opened alternative treatment center.
The town of 38,000 is sometimes called ""the Upper West Side of New Jersey,"" referring to the famously upscale and liberal part of Manhattan, but it's also reminiscent of well-heeled bohemian spots such as Boulder, Colo., and Berkeley, Calif. There's an art museum, an international film festival, a Whole Foods, Thai restaurants, racks for commuters' bikes, and the headquarters of Garden State Equality, New Jersey's largest gay-rights group.
The population _ 62 percent white, 27 percent black _ is racially integrated and largely well-to-do. The median household income is $140,000.
And the idea of tolerance is part of the town's identity. In a scene in ""Mad Men,"" a TV drama set in the 1960s, characters who went to Montclair for a party were stunned to see black and white revelers together _ and marijuana being passed around.
Medical marijuana is a dicey business. In the eyes of the federal government, the medicine is still an illegal drug.
Some patients say marijuana can ease symptoms associated with conditions ranging from multiple sclerosis to migraines. It has been used to treat pain, nausea and lack of appetite in cancer and AIDS patients.
Seventeen states and Washington, D.C., have flouted federal law and passed some sort of statute to allow patients access to the drug.
Each state has its own model for how the cannabis can be distributed. Some, like New Jersey _ where advocates lament and some officials brag that the laws are the nation's strictest _ are still in a startup phase.
So far, nine states _ Arizona, California, Colorado, Maine, Michigan, Montana, New Mexico, Oregon and Washington _ have dispensaries operating. Some states are still setting up distribution systems, and some use home-grown marijuana or other setups that do not include dispensaries.
Chris Goldstein, a spokesman for both the Philadelphia chapter of the pro-pot group NORML and the Coalition for Medical Marijuana of New Jersey, has visited dispensaries all over the country. He said most of the storefront operations look more like the one ready to open in Montclair than those proposed in industrial districts of New Jersey.
""The dispensaries are in the higher-end neighborhoods of California towns. There are people who are wealthy and who are poor who need to access medical marijuana,"" he said. ""In New Jersey, it's wherever the dispensary can get their location.""
New Jersey is not allowing registered patients to grow their own, and is limiting the potency, amount and variety of pot patients can buy. There's a relatively short list of conditions that qualify patients for the drug, and unlike some more lenient states, chronic pain and anxiety aren't on it.
Only New Jersey residents are eligible. New York, easily reachable by rail, does not allow medical marijuana, though lawmakers have proposed doing so.
Last year, the New Jersey Department of Health selected six nonprofit groups to pursue plans to grow and sell cannabis. The other five have struggled to find towns that will accept them, and none yet has permission to start growing marijuana, let alone sell it.
Groups are planning sites in Egg Harbor Township and Woodbridge. The other three groups have not announced their latest location plans.
Only Greenleaf has had a direct path. In its application, the group said it would meet patients in Montclair and grow its plants in another, undisclosed town. The group won't say where, citing security.
A year ago, Janice Talley, Montclair's director of planning and community development, found that the site on Bloomfield Avenue _ next door to an abortion clinic and three buildings down from an adult video store that has pipes and vaporizers displayed for sale _ would be a permissible for the new business under zoning laws.
Talley said she fielded complaints from some national anti-marijuana groups. ""Nobody from the town called me and complained why we had that facility,"" she said. ""It wasn't a huge issue here.""
Behind the counter at Health Love and Soul Juice Bar and Grill a couple doors down from Greenleaf, Jarisi Anderson, said he's all for the new establishment. ""It's a beautiful thing,"" he said.
His co-worker, Queen Townsend, fears the place could be a problem, but she believes she's in the minority. ""The people I've met in Montclair _ I don't want to stereotype _ a lot of people here smoke weed,"" she said. ""They don't have a problem with that.""
The guys smoking tobacco down the street at Fume, a cigar shop, said they aren't troubled by legalizing marijuana _ medicinal or not. ""It's a waste to lock somebody up for a nickel bag or a dime bag,"" said shop owner Ralph Alberto.
But the dispensary could give the non-Montclair residents who go there to protest another cause.
Last week, Bernadette Grant stood across the street from the dispensary's neighboring abortion clinic with rosary beads in one hand and anti-abortion pamphlets in the other. She said she considers medical marijuana in the same category as abortion.
""This is not pro-life ,"" she said. ""This is pro-death.""
___
Follow Mulvihill at http://www.twitter.com/geoffmulvihill
DUBLIN--(BUSINESS WIRE)-- Research and Markets (http://www.researchandmarkets.com/research/3clwfc/movies_and) has announced the addition of the ""Movies & Entertainment in the United States"" report to their offering.
Movies & Entertainment in the United States industry profile provides top-line qualitative and quantitative summary information including: market size (value 2007-11, and forecast to 2016).
The profile also contains descriptions of the leading players including key financial metrics and analysis of competitive pressures within the market. Includes market size data, textual and graphical analysis of market growth trends, leading companies and macroeconomic information.
Highlights
- The movies & entertainment market consists of both producers and distributors of entertainment formats, such as movies and music. The movie box office segment is valued as the revenues received by box offices from total annual admissions. The home video segment covers sales of Blu-Ray, DVDs and VHS at end-user (retail) prices including paid video downloads. The music segment is valued as the revenues accruing from the sale (at retail prices) of recorded music in any physical or digital format, but excludes revenues from live performances. Any currency conversions used in the creation of this report have been calculated using constant 2011 annual average exchange rates.
- The US movies & entertainment market had total revenues of $29.6 billion in 2011, representing a compound annual rate of change (CARC) of -5.5% between 2007 and 2011.
- Video sales were the most lucrative for the US movies & entertainment market in 2011, with total revenues of $11.5 billion, equivalent to 38.9% of the market's overall value.
- The performance of the market is forecast to decline further but with a slower pace, with an anticipated CARC of -1.6% for the five-year period 2011 - 2016, which is expected to drive the market to a value of $27.3 billion by the end of 2016.
Key Questions Answered
What was the size of the United States movies & entertainment market by value in 2011?
What will be the size of the United States movies & entertainment market in 2016?
What factors are affecting the strength of competition in the United States movies & entertainment market?
How has the market performed over the last five years?
For more information visit http://www.researchandmarkets.com/research/3clwfc/movies_and
Facebook's ability to manage its data scandal will ultimately determine its long-term future, according to Goldman Sachs.
Facebook was the worst-performing stock in the S&P 500 on Monday, posting its biggest one-day decline since March 2014. This followed reports over the weekend that political analytics firm Cambridge Analytica was able to collect data on 50 million people's profiles without their consent.
The London-based company worked on Facebook ads with the Trump campaign, providing details on American voters.
Facebook has come under fire for its role in the scandal and has been accused of mishandling users' data.
""It certainly introduces a level of uncertainty that we haven't seen with Facebook before,"" Heath Terry, lead internet research analyst at Goldman Sachs, told CNBC on Tuesday.
Terry said every fast-growing tech giant was likely to face a similar crisis, such as the so-called click fraud scandal that threatened Google's growth prospects in recent years.
""That's going to be the same here for Facebook. It's going to be how they manage through this that will ultimately determine their long-term future,"" Terry said.
Goldman Sachs has a buy rating on Facebook's stock.
Prior to revelations in recent days about the potential misuse of Facebook data, U.S. lawmakers had already grappled with social media platforms' growing political influence and whether it would be necessary to impose more stringent regulatory measures.
Terry said that while heightened regulatory measures regarding online political ads were now inevitable, the prospect of significantly onerous regulatory measures would be ""something we have got to watch.""
When asked whether such measures could then impact the growth story of Facebook, Terry replied: ""Certainly.""
The media firestorm surrounding Facebook and Cambridge Analytica comes after Britain's Channel 4 News carried out an undercover investigation into the London-based political data firm. Undercover filming appeared to show senior executives suggesting the firm could use sex workers, bribes, ex-spies and fake news to help candidates win votes around the world.
The Channel 4 News investigation, broadcast Monday, comes after articles published by The New York Times and U.K. newspaper The Observer, showed how the data of millions of Facebook profiles ended up being given to Cambridge Analytica.
Academician Aleksandr Kogan and his company Global Science Research created an app called ""thisisyourdigitallife"" in 2014. Users were paid to take a psychological test and the app collected the data. It also gathered data on a person's Facebook friends, according to the newspapers.
In this way, 50 million Facebook profiles were mined for data. Kogan then shared this with Cambridge Analytica, which allowed the firm to build a software solution to help influence choices in elections, according to whistleblower Christopher Wylie, who revealed the alleged practices to both newspapers.
Both Kogan and Cambridge Analytica have denied wrongdoing.
In a company statement, Cambridge Analytica said the Channel 4 News investigation had ""grossly misrepresented"" the conversations caught on camera.
""In playing along with this line of conversation, and partly to spare our 'client' from embarrassment, we entertained a series of ludicrous hypothetical scenarios,"" it said.
""Cambridge Analytica does not condone or engage in entrapment, bribes or so-called 'honeytraps',"" the firm added.
U.S. employers planned to cut nearly 50,000 positions in July, Challenger, Gray & Christmas reported Thursday, meting out 50 percent more job cuts than in the prior month.
The global outplacement firm said in its monthly layoff report that planned payroll reductions hit 46,887, the second highest level of the year. That compares with June's 31,434 cuts, which were the fewest of 2014. The firm added that massive staff reductions by Hewlett-Packard and Microsoft helped inflate this month's figure.
To date, employers have announced 292,921 job cuts, a level slightly below the comparable year-ago period, Challenger reported.
—By CNBC.com
* Upbeat U.S. private payrolls data boosts dollar
* Yen hampered by Japan's trade deficit, economic woes
* Euro has been hit by Greek court ruling on austerity steps
LONDON, Nov 2 (Reuters) - The dollar rose to a near four month-high against the yen on Friday as investors bet on an upbeat U.S. payrolls report after private employers added jobs at the fastest pace in eight months. The euro fell to a three-week low against the dollar on selling by long-term investors. The euro has also been under pressure since a Greek court ruled on Thursday that pension reform demanded by foreign lenders may be unconstitutional. That raised concerns about Athens' ability to implement the austerity measures needed to secure bailout funds. All these drove the dollar index to a seven-week high of 80.389, breaking above its 55-day moving average of 80.14. The dollar was up 0.2 percent on the day at 80.31 yen, just shy of last week's four-month high of 80.38. Traders reported an option barrier at 80.50 yen with hedge funds ready to buy the dollar on dips if the U.S. jobs numbers disappointed. A break of resistance at 80.60-65, a chart triple top marked between May and June and a 50 percent retracement of the dollar's March to September decline, could signal further gains. ``A good U.S. jobs number will no doubt give a leg up to dollar/yen,'' said John Hardy, currency strategist at Saxo Bank. ``From a medium-term view, we are bullish on dollar/yen and the pair has established a base around 79 yen for a rally to 88 yen in a year's time,'' he said. The yen has come under pressure because recent Japanese data and corporate earnings have been soft. Third-quarter economic output data, due on Nov. 11, is also likely to have contracted. Payrolls processor Automatic Data Processing said private employers added 158,000 workers last month, bolstering expectations that the non-farm payrolls report due at 1230 GMT may beat forecasts. A Reuters poll forecasts a rise of 125,000 U.S. non-farm payrolls in October. The unemployment rate is seen ticking up to 7.9 percent. Any market reaction to the jobs data may be short-lived given the uncertainty of the outcome of Tuesday's U.S. presidential election.
EURO ZONE STRUGGLES Some, however, are less sure about a sustained rise in the dollar as investors fret over the so-called ``fiscal cliff'' of looming tax rises and spending cuts in the United States. ``Over the course of the next month we would expect to move lower in dollar/yen, any upside above 81 would be surprising driven by U.S. negativity surrounding the fiscal cliff,'' said Christian Lawrence, currency strategist at Rabobank. The euro fell 0.4 percent to $1.2885, a three-week low, as traders sold the single currency, triggering an option barrier at $1.2880. Bids from Asian central banks and Middle East investors were cited below $1.2850. However, the euro held within the $1.2800-3200 range seen since September, underpinned by the European Central Bank's pledge to buy bonds of indebted euro zone countries that seek aid. Signals in the option market showed the pair was likely to trade in a range in coming weeks. The one-month implied volatility on euro/dollar options fell to fresh five-year lows around 7.50 percent. Data on Friday showed peripheral euro zone countries were still struggling. Spain's manufacturing sector shrank last month at it fastest pace since July, while Italian factory activity shrank in October for the 15th month running. Commodity currencies eased after rallying earlier in the day. The Australian dollar hit a five-week high of $1.0420 before giving up gains to stand at $1.0380 as caution set in before the U.S. jobs data. The currency was helped by Thursday's improvement in manufacturing data from China, Australia's main export market.
Industry veteran to accelerate growth and market awareness of B2B Purchase Behavior
BOCA RATON, Fla.--(BUSINESS WIRE)-- Cortera®, a provider of comprehensive business-to-business payment and purchase data and insights for U.S. companies, announced Gary Brooks has been named chief marketing officer (CMO).
Brooks brings more than 20 years of technology marketing experience to Cortera where he manages the development and execution of the company's marketing strategy. In this capacity, he focuses on expanding Cortera's leadership position and accelerating revenue growth through the management of strategic positioning, branding, demand generation and sales readiness.
Brooks most recently served as executive vice president of marketing for Bomgar Corp., which provides secure remote support solutions for businesses. Prior to that, he served in executive leadership roles with Servigistics (acquired by Marline Equity Partners), KnowledgeStorm (acquired by Tech Target), TRADEX (acquired by Ariba), Ariba, Fortress Technologies, AltaVista (acquired by Compaq) and Digital Equipment (acquired by Compaq).
""Gary's entrepreneurial spirit, results orientation and reputation for scaling revenue makes him the perfect fit for Cortera as we gear up for our next phase of growth,"" said Jim Swift, president and chief executive officer at Cortera. ""Gary joins the company at a pivotal moment in its history as leading companies increasingly understand how B2B purchase behavior—what companies buy and how their spending changes over time—can be used to dramatically increase revenue and reduce risk.”
“I’m thrilled to be part of an innovative organization that is enabling companies to use B2B purchase behavior data to improve sales and marketing effectiveness,” said Gary Brooks, CMO for Cortera. “Knowing a customer or prospects’ propensity to buy a particular product enables marketing and sales professionals to efficiently find new customers, retain existing customers and maximize revenue from both.”
Brooks holds a bachelor's degree from Northeastern University, a master's degree from Lesley University and has been an active leader in a variety of volunteer positions in the communities where he has resided.
About Cortera
Cortera is a provider of comprehensive business-to-business payment and purchase behavior insights on public and private companies. The company tracks $1.6 trillion in business-to-business purchases across 45 spend categories to deliver insights on 20 million U.S. business locations. Cortera’s solutions enable companies of all sizes to better understand their customers, suppliers and business partners by gaining visibility into what they purchase, how they pay and how their purchase and payment behavior changes over time. Thousands of companies across diverse industries use Cortera solutions to increase revenue, improve sales and marketing effectiveness, and reduce risk. Cortera is privately held with offices in Boca Raton, Fla.; Boston and Quincy Massachusetts and Bangalore, India.
Animation giant Pixar scored its ninth consecutive No. 1 Sunday with its robot love story ""WALL-E,"" while Angelina Jolie achieved a personal best with her violent assassination thriller ""Wanted."" ""WALL-E,"" bolstered by near-unanimous critical praise, sold an estimated $62.5 million of tickets in its first three days, said Pixar's Walt Disney Co parent.
It tied with 2001's ""Monsters, Inc."" to become Pixar's third-best opener.
Pixar has gone to No. 1 with all nine of its movies, an unprecedented run that begin in 1995 with ""Toy Story."" The company record of $70.5 million was set in 2004 by ""The Incredibles."" Industry pundits had forecast an opening for ""WALL-E"" in the $50 million to $60 million range.
""Anything north of 60 (million dollars), we were going to be ecstatic,"" said Mark Zoradi, president of Walt Disney Studios Motion Picture Group .
Meanwhile Jolie, whose career has been overshadowed in recent years by breathless tabloid coverage of her personal life, kicked off at No. 2 with ""Wanted."" The Universal Pictures release earned about $51.1 million, easily beating forecasts of an opening in the mid- to high-$30 million range.
Her previous record for a live-action movie was 2005's ""Mr. & Mrs. Smith,"" which opened to $50 million.
The General Electric Co-owned studio said ""Wanted"" ranks as the third-highest opening for an R-rated action film, behind ""The Matrix Reloaded ($91.7 million) and ""300"" ($70.9 million).
SALES SOAR
""WALL-E"" and ""Wanted,"" clearly aimed at disparate audiences, helped pushed overall sales to their highest level of the year, said tracking firm Media By Numbers.
The top 12 films grossed $179 million, up 29 percent from last weekend, and up 20 percent from the year-ago period, when Pixar's ""Ratatouille"" opened at No. 1 with $47 million on its way to $206 million.
Last weekend's champion, the Warner Bros spy comedy ""Get Smart,"" slipped to No. 3 with $20 million, taking its 10-day haul to $77.3 million.
The film, which stars Steve Carell as the inept hero Maxwell Smart, should finish up with about $130 million, said the Time Warner Inc-owned studio .
Rounding out the top five, Pixar rival DreamWorks Animation SKG Inc's ""Kung Fu Panda"" slipped one to No. 4 with $11.7 million, taking its total to $179.3 million.
The film opened four weeks ago to $60.2 million.
Marvel Entertainment Inc's ""The Incredible Hulk"" fell three to No. 5 with $9.2 million.
The superhero adaptation has earned $115.5 million after three weeks, roughly on par with its unloved 2003 predecessor ""The Hulk."" ""WALL-E,"" a space adventure mixing an unusual love story with somber messages about the future of Earth and humankind, was directed by Andrew Stanton, who won an Academy Award for Pixar's 2003 hit ""Finding Nemo."" The title character, or Waste Allocation Load Lifter Earth-Class, is the last of a cadre of robots tasked with cleaning up piles of trash discarded by humans who abandoned the planet centuries before.
The human race set off on a luxury space cruise during a planned five-year clean-up that lasts much longer and results in unfortunate changes in the human physique and psyche.
The arrival of a sleek girl robot named Eve, sent to Earth by the orbiting humans to look for plant life, sends Wall-E on an adventure that changes his own and humanity's destinies.
Critics heaped praise on the film.
According to Rotten Tomatoes, a Web site that collects reviews, an astonishing 96 percent of critics liked the film.
Michael Phillips of the Chicago Tribune said on TV's ""Ebert & Roeper"" that it was perhaps ""the best American studio picture of the year,"" but the Hollywood Reporter said ""it might be too clever to connect with mainstream audiences."" Disney's Zoradi said ""WALL-E"" was not a conventional cartoon, but the studio was ""confident from the get-go"" that it would work.
He declined to reveal the film's budget, in line with Disney's policy.
""WALL-E"" also opened at No. 1 in six small foreign markets, led by Brazil with $1.6 million, Zoradi said.
It will reach Russia and Mexico next weekend, followed by the U.K. in mid-July, timed with the school holidays in each market.
""Wanted,"" a $74 million comic book adaptation directed by Kazakhstan-born filmmaker Timur Bekmambetov, stars Scottish actor James McAvoy (""The Last King of Scotland"") as an office drone recruited to an elite order of assassins by Jolie and Morgan Freeman.
Critics were also enthused.
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An earlier version of this story had outdated box office information.
NEW YORK and LONDON, Oct. 1, 2012 /PRNewswire/ -- Standish Mellon Asset Management Company LLC, the Boston-based fixed income specialist for BNY Mellon, has hired Raman Srivastava as co-deputy chief investment officer and managing director of global fixed income, with responsibility for overseeing all global and non-U.S. fixed income strategies.
In this newly created position, Srivastava will report to David Leduc, Standish's chief investment officer. Srivastava, Leduc and David Horsfall, co-deputy chief investment officer will be responsible for managing Standish's multi-sector and absolute return fixed income strategies.
Brendan Murphy, director of global fixed income, and Rebecca Braeu, head of global sovereign research, will report to Srivastava.
""Raman Srivastava brings a wealth of global, absolute return and leadership experience to Standish and will be an important addition to our senior investment team,"" said Leduc. ""We are experiencing strong growth across a number of key strategies and Raman's addition will enhance our already strong team.""
Srivastava has spent his entire investment career focused on fixed income. He most recently was a senior investment professional and portfolio manager for Putnam's core plus, global fixed income and absolute returns teams. Earlier in his career, Srivastava was a fixed income analyst with Bank of Nova Scotia in Toronto. In May 2008, he was named one of the top 20 rising stars of fixed income by Institutional Investor magazine. He received his master's degree from Carnegie Mellon.
""Raman and the team will focus on developing innovative ways to meet the evolving needs of our clients,"" said Desmond MacIntyre, chairman and chief executive officer of Standish. ""They will build on the strength of our multi-sector capabilities, which account for nearly 50 percent of Standish's assets under management today.""
MacIntyre noted that Srivastava is one of several key hires underway to support the business' growth.
Notes to Editors:
Standish Mellon Asset Management Company LLC, with approximately $97.5 billion of assets under management, provides investment management services across a broad spectrum of fixed income asset classes. These include: Absolute Return (Opportunistic), Total Return (Global Core Plus, Core Plus, Core), Credit (Investment Grade, High Yield), Emerging Market Debt (Sovereign, Corporate), LDI Solutions, Insurance Client Strategies, Tax Sensitive and Crossover Strategies. The firm also includes assets managed by Standish personnel acting as dual officers of The Dreyfus Corporation and The Bank of New York Mellon.
BNY Mellon Investment Management is one of the world's leading investment management organizations and one of the top U.S. wealth managers, with $1.3 trillion in assets under management. It encompasses BNY Mellon's affiliated investment management firms, wealth management services and global distribution companies. More information can be found at www.bnymellon.com.
BNY Mellon is a global financial services company focused on helping clients manage and service their financial assets, operating in 36 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, offering superior investment management and investment services through a worldwide client-focused team. It has $27.1 trillion in assets under custody and administration and $1.3 trillion in assets under management, services $11.5 trillion in outstanding debt and processes global payments averaging $1.4 trillion per day. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on www.bnymellon.com or follow us on Twitter@BNYMellon.
All information source BNY Mellon as of June 30, 2012. This press release is qualified for issuance in the UK and US and is for information purposes only. It does not constitute an offer or solicitation of securities or investment services or an endorsement thereof in any jurisdiction or in any circumstance in which such offer or solicitation is unlawful or not authorized. This press release is issued by BNY Mellon Investment Management (US) and BNY Mellon Asset Management International Limited (ex-US) to members of the financial press and media and the information contained herein should not be construed as investment advice. Past performance is not a guide to future performance. The value of investments and the income from them is not guaranteed and can fall as well as rise due to stock market and currency movements. When you sell your investment you may get back less than you originally invested. Registered office of BNY Mellon Asset Management International Limited: BNY Mellon Centre, 160 Queen Victoria Street, London, EC4V 4LA. Registered in England no. 1118580. Authorized and regulated by the Financial Services Authority. A BNY Mellon Company
SOURCE BNY Mellon; Standish Mellon Asset Management Company LLC
Britain's impending exit from the European Union (EU) as well as the potential breakaway of Scotland would be ""a bad scenario"", according to the global head of sovereigns at Fitch Ratings.
""A fragmented U.K. is a bad scenario from a ratings perspective because it would raise the debt-to-GDP (gross domestic product) of the remaining U.K. government by somewhere around 8 to 10 percentage points of GDP,"" warned James McCormack, speaking to CNBC on Wednesday from the IIF G20 summit in Frankfurt.
""Last time there was a referendum we talked a lot about this, said there were potential negative ratings implications, the same would be true this time,"" added McCormack, the executive with chief responsibility for countries' debt ratings.
The Fitch executive highlighted that following the triggering of Article 50 to initiate the Brexit process - widely signaled to happen before the end of this month - all parties involved will be facing ""the great unknown"" in terms of how the decoupling of the U.K. from the trading bloc plays out.
""I think from the U.K.'s perspective they want to get as many things started as possible. From the European perspective, they want to go nice and slow and do things in the proper order,"" he opined.
This week's confirmation that Scotland's First Minister, Nicola Sturgeon, would seek to hold another referendum before the spring of 2019 asking her compatriots whether they would like to split off from the rest of the U.K., simply added a further twist to the complicated path ahead for the U.K. government, McCormack said.
While a lack of clarity over when exactly such a vote would be held was additionally unhelpful, the reality is that it would be difficult for the U.K. government no matter what the timing.
""A lot of political capital is going to be required on both fronts,"" he added.
Addressing the debt situation in the U.S., McCormack painted a mixed picture.
""There's really no denying the short-term growth impulse looks pretty positive. People are enthusiastic about regulatory reform and tax reform even though we don't have a lot of details,"" he began before cautioning on certain other proposals made by the current administration.
""The trade reforms may be positive for growth, maybe not, certainly not in the longer term we don't think,"" McCormack posited.
Nonetheless, although the Fitch team does expect U.S. debt balance to rise even without the implementation of any proposed changes and, indeed, more quickly with them, they are reasonably sanguine on the implications for U.S. ratings.
""It's not necessarily a rating issue because the U.S.'s AAA [rating] is supported by a number of very fundamental strengths: the role of the dollar, the US capital markets etc,"" McCormack outlined.
""So it's still in our view still a relatively strong AAA credit but some of these policies could lead to debt-to-GDP accelerating faster than we expect,"" he concluded.
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British Prime Minister Theresa May set out her vision on Friday for a Brexit deal deeper and wider than any free trade agreement in the world, telling the European Union it is in their ""shared
interest"".
Below are the highlights from her speech and a follow-up question-and-answer session with reporters:
""We are close to agreement on the terms of the implementation period which was a key element in the December deal.""
""Both the UK and EU are clear this implementation period must be time limited and cannot become a permanent solution.""
""We are now approaching a crucial moment. There is no escaping the complexity of the task ahead of us. We must not only negotiate our exit from an organisation that touches so many important parts of our national life, we must also build a new and lasting relationship while, given the uncertainty inherent in this negotiation, preparing for every scenario.""
""We will need an arbitration mechanism that is completely independent, something which again is common to free trade agreements. This will ensure that any disagreements about the purpose or scope of the agreement can be resolved fairly and promptly.""
""We will also want to explore with the EU how the UK could remain part of the EU agencies, such as the chemicals, medicines and aerospace industries.
""We would of course accept that this would mean abiding by the rules of those organisations and making an appropriate financial contribution.""
""Yes there will be ups and downs in the months ahead. As in any negotiation no-one will get everything they want, we will not be buffeted by the demands to talk tough or threaten a walkout, just as we will not accept the counsels of despair that this simply cannot be done.
""We will move forward by calm patient discussion of each other's positions.""
""We have a shared interest in getting this right so let's get on with it.""
""No we won't think again on Brexit. The British people voted for Brexit and I think it is incumbent on their politicians to deliver on the decision that we asked them to take. Parliament overwhelmingly voted for this to be a decision of the British people and I think it's right that parliament and politicians now deliver on that.""
""Successive British governments have worked tirelessly together with all the parties in Northern Ireland and with the Irish government to bring about the historic achievement of peace. This is an agreement that we have all worked hard to protect. That is why I have consistently put holding up the Belfast agreement at the heart of our approach.
""Our departure poses particular challenges for Northern Ireland and for Ireland. We joined the EU together 45 years ago and it's not surprising that our decision to leave has caused anxiety and a desire for concrete solutions.
""We have been clear all along that we don't want to go back to a hard border in Northern Ireland. We have ruled out any physical infrastructure at the border and related checks and controls, but it's not good enough to say ""we won't enforce it if the EU forces Ireland to do it, that's down to them"".
We chose to leave and we have a responsibility to help find a solution. But we can't do it on our own, it is for all of us to work together. And the Taoiseach and I agreed our teams should now do just that.
""Just as it would be unacceptable to go back to a hard border between Ireland and Northern Ireland, it would also be unacceptable to break up the United Kingdom's own common market by making a customs and regulatory border down the Irish sea.""
""People voted to take back control of our money, our laws and our borders and that's exactly what we will be doing. Yes there are some areas where, and ultimately parliament will always be sovereign, and it will be parliament that will make these decisions. There are some areas, as I've set out in the goods, er descriptions of goods, where from an economic point of view, businesses say it makes sense for us to operate on very much the same basis so that we can continue that good trading relationship, but the decision on those rules of course will be for parliament.""
Morgan Stanley's third-quarter revenue jumped 50 percent, helping adjusted earnings beat expectations, as higher income from equities sales and trading made up for a drop in the Wall Street bank and brokerage's fixed-income business.
Morgan Stanley reported net income of $888 million, or 44 cents per share, from continuing operations in the quarter. That compared with a loss of $1 billion, or 55 cents per share, a year earlier.
The year-earlier figure included a charge of $2.3 billion to reflect a rise in the value of Morgan Stanley's debt.
Excluding items, Morgan Stanley earned 50 cents per share, beating the average analyst estimate of 40 cents per share, according to Thomson Reuters I/B/E/S.
(Read more: Cashin: This reminds me of the dot-com bubble)
Overall revenue rose to $7.93 billion, from $5.28 billion in the same quarter last year, driven by equities trading and the company's fast-growing wealth management business.
Adjusted revenue from equities trading rose 31 percent to $1.7 billion, while revenue from fixed income, currency and commodities (FICC) trading fell 44 percent to $835 million.
""Our strategy to combine a world class investment bank with the stability of the largest U.S. wealth management franchise and strong investment management is enabling us to deliver exceptional advice and execution for our clients as well as stronger returns for our shareholders,"" Chairman and Chief Executive James Gorman said in a statement on Friday.
Gorman is scheduled to appear on CNBC to discuss the quarterly results at 11:30 a.m. ET.
Morgan Stanley has had difficulty with fixed-income trading for years, but the issues that affected the business in the latest quarter also shook most of its competitors.
Trading activity in the bond market slowed markedly during the period amid expectations the Federal Reserve would soon start to wind down its stimulative bond-buying program.
Goldman Sachs reported on Thursday that its revenue from FICC trading fell 44 percent in the quarter. Citigroup's fell 26 percent, Bank of America's 20 percent and JPMorgan Chase's 8 percent.
Revenue in Morgan Stanley's wealth management business increased 8 percent to $3.48 billion, while the business's pretax profit margin edged up to 19 percent, getting closer to Gorman's target of a minimum 20 percent.
Morgan Stanley completed its acquisition of brokerage Smith Barney from Citigroup in June. It now collects all of the earnings from the former joint venture but must wait until 2015 to accrue all of Smith Barney's client deposits.
(Read more: Did Wall Street make the next budget crisis worse?)
Shares of Morgan Stanley moved higher in pre-market trading immediately following the report. (Click here to get the latest quote.)
—By Reuters. CNBC contributed to this report.
Moody's Investors Service cut its outlook on Amazon.com from ""stable"" to ""negative"" on Monday, prompted by the online retailer's announcement that it was issuing new debt.
The credit rating agency also affirmed the company's Baa1 senior unsecured rating.
Following the news, Amazon stock dropped more than 3 percent.
Read More Moody's downgrades Japan as concerns grow
The size of Amazon's new senior unsecured notes is yet to be determined, said Moody's Vice President Charlie O'Shea in a release. It is the agency's expectation that the funds will be used for corporate purposes that will support growth initiatives, rather than for shareholder returns.
""The negative outlook reflects the impact the new debt will have on interest coverage that is already weak at 1.2 times for the LTM September 2014, as well as debt/EBITDA, which will increase meaningfully as well,"" Moody's said.
Read MoreChristmas came early for Amazon, time to sell?
""While the new debt will further exacerbate Amazon's already weak interest coverage due to, among other things, the lack of visibility surrounding the cadence for deployment of proceeds, potential areas of future growth and investment utilizing these proceeds, and the timing of potential positive returns, Moody's believes that the company's excellent liquidity provides sufficient cushion to affirm the Baa1 rating.""
On the last trading day of the month, the Dow and S&P turned sharply lower around lunchtime with investors eager to move to the sidelines.
Negative sentiment seemed to prevail after a Labor Department report showed personal spending dipped 0.5 percent in September, while personal income was flat.
Those figures again turned attention to the fragile state of the consumer – which is considered vital to a recovery because consumer spending accounts for more than two-thirds of all U.S. economic activity.
Also the dollar turned higher. Lately the greenback has had an inverse impact on equities.
On the final trading day of the month, the S&P 500 was down 0.99 percent for October. If the index is unable to hold onto the month's gains, it will snap a seven-month winning streak
What should you be watching?
I think we’re looking at more of a psychological phenomenon in the market than anything else, says Steve Grasso of Stuart Frankel. This is the last day of the fiscal year for most mutual funds. Usually we see losses in October and this time we’ve had gains. So money managers are locking in profits on the last day of the month.
But that doesn’t change the fact stocks are selling off. I’m watching 1042 on the S&P, he adds. If we close below that level, technically we open the door to S&P 1000.
I think the action is absolutely horrible, adds Joe Terranova. Technically it looks awful. If the E-Mini S&P futures break below 3700 I think we may have an ugly close.
Warren Buffett often says be fearful when other are greedy and greedy when other are fearful. I ‘do’ think you can dip your toe into best of breed names, especially in commodities, he adds. But only do it knowing that declines are coming from professional investors who are moving to the sidelines because they are fearful of what they’re seeing in the market.
The S&P hit my big upside target of 1100, adds Bill Strazzullo of Bell Curve. I think we could be putting in an intermediate top. If you’re long I’d be talking profits.
And if you’re a speculator, I also think you can be aggressive on the short side. Patterns in the S&P suggest to me that 1030 is a critical level. If we break that then I think we move down to 1000. And the move down could be as steep as 950 after that.
I watch volatility and it’s clearly returning to the market, adds Brian Stutland of Stutland Equities. If the Vix closes above 28 I’d be a buyer of volatility and prepare for swings in the market.
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FINANCIALS LEADING MARKET LOWER
Financials led the market lower on Friday after the economic data mentioned above renewed concerns about the public’s ability to make mortgages and credit card payments.
What’s the trade?
Since JPMorgan released earnings, the financials haven’t done much, explains Joe Terranova. The only stock in the space I’d consider is Goldman. Around $170, I’d consider buying. But I have to admit I'm long Goldman and I’m nervous.
I’m watching BofA, says Brian Stutland. I’m a buyer of the November 6/17.5 call spread.
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DOLLAR REBOUNDING
The U.S. dollar made gains on Friday after steep losses in the previous session as investors turned to the greenback as a safe-haven amid Friday’s sharp sell-off.
""We're seeing some weakness in equities probably due to some month-end selling and that pushed the dollar higher,"" explains Shaun Osborne, chief currency strategist at TD Securities.
Also, since the dollar sold off most of the month, fund managers may need to buy back the dolar to maintain hedge ratios at the end of the month.
Meanwhile, the stronger dollar dragged down the price of crude with investors also growing concerned that the recent pop may be ahead of supply and demand fundamentals.
What’s the trade?
I think the correlation between stronger dollar and weaker market is overdone, says Dennis Gartman. Germany has a stronger currency and a stronger market.
I think dollar weakness is probably presenting an opportunity for dipping a toe into best of breed names, especially in commodities, says Joe Terranova. But do it knowing that declines are coming from professional investors moving to the sidelines because they are fearful of what they’re seeing in the market.
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CALL THE CLOSE
Joe Terranova: I’d move the sidelines
Steve Grasso: I’m a seller. I don’t like the feel
Bill Strazzullo: I’m short and staying short.
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Trader disclosure: On Oct. 30th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders;; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Finerman Owns Puts (BAC); Finerman Owns (PDE), (FLS), (RIG), (WMT); Finerman's Firm Owns (MSFT), (NOK), (PDE), (RIG) (TGT), (WMT); Finerman's Firm Is Long Puts (AMZN); Finerman's Firm Is Long Puts (BAC); Finerman's Firm Is Long Call Spreads (BAC); Finerman's Firm Is Long (FLS); Finerman's Firm Is Short Calls (FLS); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (UNG), (USO, Terranova Owns(GS); Seymour Is Short Puts (AA); Seymour Is Long Puts (BAC); Seymour Is Long Puts (BX); Seymour Is Long Puts (EEM); Seymour Is Long Puts (F); Seymour Is Short Puts (FXI); Seymour Is Long Puts (LVS); Seymour Is Long Puts (MSFT); Seymour Is Short F (PBR); Seymour Is Long Puts (SBUX)
CNBC.com with wires
A daily morning look at the financial stories you need to know to start the day.
STOCKS/ ECONOMY
-Stock futures are a bit higher after Thursday's rally. Consumer sentiment numbers come out at 10 AM Eastern Time.
OIL/ ENERGY
-U.S. crude prices are up to the $53 a barrel level on news that OPEC has been complying with its production cut targets. But natural gas prices are close to falling back below the $3-level.
TRUMP FIRST 100 DAYS
-The Ninth Circuit Court of Appeals unanimously ruled against the Trump administration's new immigration and travel ban policy. The administration may now take this fight to the Supreme Court.
(This story is for CNBC Pro subscribers only.)
Apple's announcements from the WWDC conference — from its new software to a shift to in-house chips — are garnering praise from Wall Street analysts. Many of them hiked their forecast for the tech giant's stock.
During the remote event Monday, Apple introduced new software for its iPhones, iPads, Macs, Apple TV and Apple Watch. It also announced that future Macs will use chips made by Apple instead of Intel, a move that it said will mean faster laptops and desktops.
UBS said it's bullish on Apple's transition to its own chips, calling it ""a continuation of its strategy of vertical integration following years of convergence"" in its mobile and Macs. The bank increased it 12- month price target to $400 from $325, representing a near 12% upside from here.
If you are an Apple shareholder who wondered after last week's stellar earnings report why the value of your stock holding was going down rather than up, the reason given — that chip shortages will weigh on the short-term outlook — may not seem good enough. For a trader looking at every short-term opportunity to move portfolio money to where the next quick buck is likely to be, it doesn't take more than that ""sell on the news"" headline. Longer-term investors, though, might want to consider a recent fact about the company and negative headlines: Apple has overcome pretty much every short-term ""sell"" headline in recent years on its way to being a $2-trillion-plus company.
Trump's trade war with China? No problem. The surprise decision to stop offering iPhone unit guidance? Much ado about nothing as the iPhone super-cycle came along anyway. As for the global semiconductor chip shortage now being cited by Apple, it might be wise to keep in mind that Apple has a long history of being pretty conservative with its outlook — formal earnings guidance still has not returned. And one more thing: Tim Cook was elevated to the CEO post after Steve Jobs based on his mastery of global logistics.
""Let's face it, if Apple has any trouble getting chips, then every other company on the planet will have 10x those problems,"" said Nick Colas, co-founder of DataTrek Research. ""If you're really worried about chip supply, you want to own Apple because it is first in line at every chip fab.""
But there is a bigger question relevant to Apple and the rest of the market: Just how strong is the next leg of growth for the market going to be?
The immediate outlook for the market doesn't necessarily scream buy-on-the-dip after the big tech sell-on-the-news, according to Colas. Seasonality is an immediate risk, with market history showing the early August period to be a volatile one for the VIX volatility index.
""It's a valid trading question, where to go for the trading dollar in August,"" Colas said.
Since 1990, the early August period has been one into which the VIX peaks. Part of the reason is the lighter volumes in the market during the summer. ""It's a trough for liquidity, when people are on vacation ... a lower number of people trading and more volatility any news item will carry. I am telling clients to be careful,"" he said.
On Wednesday through Friday of last week, the S&P 500 trading volume was below its 30-day average.
For the short-term trader, a rotation away from the large-cap leaders into small-cap represented by the Russell 2000, which Colas described as being ""way oversold"" since its torrid hot streak in early 2021, could make sense. ""Small-caps went parabolic through March and April and have not worked since because they got so far ahead,"" he said.
That makes them, at least statistically, based on 100-day trailing returns, cheap right now.
But for investors not playing the market for a quick trade, Colas says the post-earnings disappointing trades from Apple, Facebook and Microsoft shouldn't weigh too heavily. Amazon was the outlier in actually missing revenue expectations rather than posting a big beat, making a selloff on the news a ""fair"" reaction, according to Colas.
It's also important to remember that the big beats from the rest of big tech were already embedded in most of the stocks as they had a strong June and July based on the market guessing right — that Q2 earnings would be stellar. ""The market was bidding up the names into the quarter. The market sniffed out the surprise and they all occurred, and when you see stocks all rally into a quarterly earnings, it's just hard to sustain that. That is 'sell on the news' unless there is a tremendous amount of good news and guidance,"" Colas said. ""That's normal capital markets behavior.""
He goes back to one important data point in assessing the strength of these companies: they have doubled their earnings power in the past two years. ""Which is astounding,"" he said. And that gives him more comfort in the longer-term picture. ""I don't see any change. Big tech is still the place to be.""
He cited two reasons.
Even as these companies have doubled earnings growth, he doesn't think they are anywhere near peak earnings. ""It's just a much higher base to build on.""
Second, these companies have definitive advantages in industries and don't directly compete against each other in a zero-sum game i many areas of strength.
These companies have grown earnings so much because the pandemic changed consumption patterns, made us all even more tech-centric, and the market made a lot of money betting on that playing out exactly as it did. But now the big question for big tech isn't about its dominance being threatened — though multiple antitrust battles loom — it is just figuring out how much more room they have to keep the earnings growth rate going higher.
""Tell me what you would pay for a company with a 30% return on investment and structural growth of 10% to 15%, and can do it for a decade? What is the multiple? Is it 30 times or 40 times? I have no idea,"" Colas said, ""but I know it's not 20 times.""
Apple was an example from this group of concerns about price-to-earnings multiples. It lagged the rest of the tech giants for years, seen as a hardware vendor and weighed down by that market view until the services business soared through the pandemic and the $2 trillion market cap was given to the company. And again this year, it was ""the one oddball laggard,"" in Colas's words, as its year-to-date return into earnings was roughly 10% versus roughly 30% for Facebook and Microsoft.
Apple trailed the S&P 500, too, ahead of the earnings. One reason: it sucked so much demand forward investors are rightly concerned posting good earnings comps will get harder. But, Colas said, that might also mean it has the most room left to go up, even in the short-term as a new iPhone launches in the fall and back-to-school boosts spending on consumer tech.
The broader global growth story the entire stock market is tied to isn't a lock. In fact, amid the panic over inflation earlier this year and expectations that the 10-year Treasury yield would go higher, it did the opposite. ""The market totally understood growth had peaked in Q1 and started trending down at the end of the quarter,"" Colas said.
The rate story was wrong, but slower economic growth is now higher up on the list of investor concerns for a U.S. market where P/E ratios are high. Big tech represents 23% of S&P 500 and that means whatever the market next decides about its lofty valuations will weigh on U.S. stocks overall.
But investors don't have that many great choices globally. With the situation in China between the government and its leading companies resulting in massive losses in recent weeks, there might be trading opportunities, but emerging markets are no place to be for anything but a trade. And even if there is potential opportunity in other international plays like European financials, it is going to take time for rates to move in a direction that benefits those stocks.
""What's left? It's U.S. and the top of the cap table,"" Colas said. ""That's what you need to own. Still back to the same names.""
Looking at sector weightings back to the 1970s and through the 1990s, he says there has never been a time when five companies had more weighting. ""It's just 5 names, and it's not like when Exxon was at its peak in the S&P. That was a commodity play. These companies have huge barriers to entry and very high structural returns.""
Even with those advantages, trying to figure out what their earnings power will be post-pandemic, or at least as the world transitions from the worst of the pandemic to the lingering effects, is the bigger issue for big tech.
""What is a fair growth rate for 2022? That is hard,"" Colas said.
For Alphabet — the only among the big tech names to report last week which rose after its earnings — and for Facebook, which reiterated a prior warning of slowing revenue growth, there is the cyclical nature of advertising market to rely on, and that has not changed all that much in recent decades. Apple, though, is a harder one, because even as it has made progress moving past the iPhone story and building its services business into a huge driver of growth, so much hardware demand was pulled forward.
For Amazon, Colas noted that e-commerce's share of demand when from 17% to 24% in Q2 2020, and then back down to 20%. And every percentage point in that band has huge leverage over Amazon's business model — in fact, he pointed to it as a reason why Amazon had been ""stuck in that band"" for nine months before it rallied into earnings. From October 2020 to June of this year Amazon had bounced around but didn't get bid up like the other names until the pre-earnings run. Year-to-date after its earnings fall, the stock is barely holding onto a gain, just under 3%.
What just occurred in all of these stocks was a peaking into earnings, but it's nowhere near peak earnings for these companies, Colas said. The concept of peak earnings, which has been a concern for investors, implies there is a point in the cycle when a company shows its highest earnings growth in absolute terms. ""That's what peak earnings are about, and no big tech company is near peak earnings on an absolute basis,"" Colas said. ""Because they continue to grow and their amount of earnings leverage is massive.""
That is more likely to be a buy on the future after the sell on the news has worn off.
Stocks pared their losses Tuesday as homebuilder, telecom and some consumer stocks recovered after a sharp drop triggered by a dismal report on home sales.
The Dow Jones Industrial Average was down about 90 points, led by Boeing, Caterpillar and GE, after being down nearly 200 earlier.
If it holds, this would be the fourth straight decline for the Dow, which has lost 2.3 percent in the past three sessions.
The CBOE volatility index, widely considered the best gauge of fear in the market, popped above 27.
Existing-home sales fell 27.2 percentin July to an annual rate of 3.83 million units, their lowest pace in 15 years. The prior month was revised lower to show a 5.26 million-unit pace.
This came a day after Kansas City Fed President Thomas Hoenig said housing prices are likely to stay low for some timeand Moody’s Analytics chief economist Mark Zandi said the U.S. housing market is already in a double-dip recession.
David Rosenberg, chief economist at Gluskin Sheff, went even further, using the ""D"" word in reference to the entire economy — not just the housing sector.
""[W]e are finally exiting the denial stage and heading towards acceptance,"" Rosenberg said in a note to clients. ""[T]his is a depression, and not just some garden-variety recession."" He argues that the Obama administration's stimulus measures aren't working and when the U.S. moves away from them, then they ""will likely have much more reason to turn optimistic.""
Of course, doom is a two-sided coin: Nobel-prize winning economist Joseph Stiglitz said Europe is at risk for a double-dip recession because of all the austerity measures there, in an interview with a radio station in Ireland.
The market's decline had initially accelerated after the housing report but soon snapped back as some pockets of gains began to emerge, most notably, in housing stocks. DR Horton, Pulte and Beazer were among the biggest gainers in the sector.
Among other notable gainers were Verizon and AT&T, Walmart and Transocean.
Medtronic skidded after the medical-device maker reported its earnings rose but sales fell amid softness in the global health-care market.
On the M&A front, Dell may raise its $18-a-share bid for 3Par to match or exceed Hewlett-Packard's $24-a-share counter offer, according to reports.
Technology, along with financials and industrials, has been leading the market lower in its August slump.
Market pros are getting increasingly worried about tech as even sector darling Apple has struggled. Apple shares are down over 1 percent today and have underperformed in the past month.
Analyst Dennis Gartman, in his daily Gartman Letter, noted Tuesday that ""since mid-June Apple has not only failed to make new highs, it has made lower highs and now lower lows. Having closed at $246 last evening, more than 10% below its all time high, the chart looks ominous.""
The latest news on the Potash front is that Rio Tinto may bid for fertilizer maker, along with a Chinese partner. Potash is talking with other potential suitors in a bid to get a better price than the nearly $39 billion being offered by Australia's BHP Billiton.
Genzyme and Sanofi-Aventis are continuing discussions about a Sanofi takeover of Genzyme, though they still haven't agreed on a price, according to the Wall Street Journal.
Pfizer shares slipped after the company said its lung cancer treatment Sutent failed to meet its goal for longer overall survival in a late-stage trial.
And Borders Group's chief financial officer Mark Bierley resigned to take another job, shortly after the book retailer named a new chief executive officer.
This Week:
TUESDAY: 2-year Treasury note auction; Earnings from Burger King
WEDNESDAY: MBA mortgage applications, advance report on durable sales, new home sales, weekly oil inventories, 5-year Treasury note auction; Earnings from BHP Billiton, Toll Brothers
THURSDAY: Weekly jobless claims, 7-year Treasury note auction.
FRIDAY: GDP, corporate profits, consumer sentiment; Earnings from Tiffany
More From CNBC.com:
At-home investors may be wondering how to find overlooked companies in which to buy shares at a time when a historic bull market enters another decade and concerns about valuations are present.
The way to start, according to CNBC's Jim Cramer, is a process called a ""read-through.""
""So much of successful investing is about read-throughs, dissecting the less obvious pin action when a company reports earnings,"" the ""Mad Money"" host said.
To illustrate the process, Cramer took a look at two of the best read-throughs of Thursday's session, which saw all three major averages again close at record highs.
Those companies are Micron, which rose almost 3%, and Darden Restaurants, the parent of Olive Garden, which closed down around 6% after a light quarter.
Successful read-throughs of a company start at the top, Cramer said. To make money, you have to be able to believe the CEO, he said.
""Otherwise it's all just blather,"" he said.
With Micron, President and CEO Sanjay Mehrotra has been a straight shooter about both the good and bad facing the company, Cramer said.
So when Mehrotra says the current quarter is the ""trough"" for the business, you can believe him, Cramer said.
And if Micron is expecting a pickup in business, Cramer said, other companies related to it in the semiconductor space could present attractive investing opportunities.
Western Digital is a name to look at, Cramer said. Mehrotra mentioned tightness in the flash memory category, and Western Digital is a competitor there.
While not all aspects of its business are winners, such as disk drives, Cramer said he thinks it can continue marching higher; it's up nearly 60% year to date.
""In the past, when the cycle's turned ... this $58 stock has rallied through $100 — it's hit those lofty levels twice in the last five years,"" he said. ""I think Western Digital can do it again.""
Micron also indicated softness around PCs, attributing it to Intel having trouble making chips, Cramer said.
What does that mean for those doing a read-through? Look to AMD, Intel's main competitor.
""Another reason to buy AMD,"" Cramer said.
Cramer said executing a read-through on Darden follows the same process, starting with credibility of management and analyzing what was said on the conference call.
Darden pointed to Olive Garden as the main culprit for its revenue coming in slightly below estimates.
""The stock got slammed [and] looked like it would take the whole restaurant cohort with it, given the pervasive presence of the bargain Italian chain,"" Cramer said.
It wouldn't have been a far-fetched assumption to attribute it to the consumer reining in its spending, Cramer said. But on the conference call, Darden CEO Gene Lee pointed to poor execution and promotion of Olive Garden.
Lee is trustworthy, though, Cramer said, and his clear-eyed assessment of the situation was valuable insight. It meant the casual dining segment remained strong. And what to do with that information?
You should buy Chipotle, Cramer said.
Cramer emphasized that the read-through process is just a starting point, and ""you never just buy any of these stocks.""
It's easier for professional analysts to spend more time assessing stocks, he said, and ""I know that's hard for people at home.""
""But the bottom line? Now you know at least what a read-through means, and if you've got the time, you can do this same analysis yourself to identify overlooked ugly ducklings that, down the road, turn into beautiful swans,"" he said.
* Rate rise of 25 basis points tied to inflation, retailprices hike
* Future policy moves hinge on inflation, fiscalconsolidation
(Updates with IMF report, background)
By Aleksandar Vasovic
BELGRADE, Oct 9 (Reuters) - Serbia's central bank raised itsbenchmark interest, already the region's highest, by 25 basispoints to 10.75 percent on Tuesday, reflecting rising inflationand debt concerns.
Other central banks in Central and Eastern Europe have cutrates over the past two weeks, as growth slows across theregion, although Poland bucked the trend last week by keepingrates flat due to concerns over inflation.
Serbia stands out as an exception because of a cocktail ofrising inflation and debt and an economy sliding into recessionamidst crisis in the euro-zone, its main trading partner.
""Considering that the increase of food prices andstate-controlled prices is higher than expected and thatinflationary expectations are on the rise, the Executive Boardhas decided to increase the benchmark rate toprevent the spillover... to other prices,"" the Serbian bank saidin a statement.
Serbian inflation in August rose to 7.9 percent, up from 6.1percent in July, due to a poor harvest and the government's bidto finance its 2012 budget gap amounting to 6.2 percent of GDPthrough a rise in value-added tax.
The central bank estimates that inflation should continue torise until mid-2013 and then slide back to its target band offour percent, give or take 1.5 percentage points, the same asfor 2012. However, some analysts voiced caution.
""That inflation is not driven by demand ... in that sense,the monetary policy is powerless,"" said Miladin Kovacevic, ananalyst with the Belgarde-based Economics Institute.
Djordje Djukic, a lecturer of economics with BelgradeUniversity, said Tuesday's rate hike was beneficial forportfolio investors, ""who will make profits on short-termmaturities, but bad for budget and debt"".
""The effects (of the rate hike) on inflation are veryuncertain as the Serbian economy is highly monopolised andplagued by high production costs, low productivity andcompetitiveness,"" Djukic said.
RISING DEBT
The deficit, inflation and rising social discontent haveprompted the coalition government of nationalists andSocialists, which came to power in July, to borrow more. Thatincluded a Sept. 27 issue of a $1 billion Eurobond and a $1billion loan from Russia, planned for this year and next.
Serbia's total public debt this year is expected to reach 60percent of GDP and the country wants a new stand-by loan dealwith the International Monetary Fund to reassure investors.
The Fund froze a 1-billion euro ($1.30 billion) loan dealwith Belgrade in February over inflated spending and debt andtold Serbia last month to restore the autonomy of the centralbank and rein in spending before any new loan talks.
In its October World Economic Outlook, the lender saidSerbia's economy was expected to contract by 0.5 percent thisyear and grow 2 percent in 2013.
In the statement, the central bank said its future policymoves would depend on inflationary expectations, externalinfluences and the effects of fiscal consolidation.
The dinar rallied versus the European commoncurrency last month after domestic banks started issuinggovernment-subsidised loans to aid exporters hit by the crisisin the euro zone, Serbia's main trade partner.
The dinar has been trading at an average of 115 dinars to oneeuro since, as opposed to an average 117.5 in the days beforeits recovery. By midday on Tuesday, following the rateannouncement, it firmed against the euro and was trading atbetween 114.56 and 114.76 to one euro.
($1 = 0.7711 euros)
(Reporting by Aleksandar Vasovic; Editing by ZoranRadosavljevic and Ron Askew)
((aleksandar.vasovic@thomsonreuters.com)(+381113044930))
Keywords: SERBIA RATES/
On a 1-10 scale: how do you respond to problems? Try this technique.
Whenever there's an earthquake——the first thing you wonder is, ""How bad was it on the Richter scale?""
I'm a big fan of the Richter scale, even though I don't really understand it. The scale goes from 1-10, but the smallest earthquake ""that can be felt"" (Webster's), only gets a 2.
If I were in an earthquake that could be felt and it only got a 2, I'd be extremely disappointed.
""Obviously,"" I'd say, ""whoever gave this thing a 2 is nowhere near the epicenter."" (I'd definitely say the word ""epicenter"" to indicate that I know a thing or two about earthquakes.)
But most earthquakes aren't 10's. This week's tremor was a 4.0. Our house shook for 10 seconds, then nothing.
Most problems aren't 10's either. That's why we ought to use a 1-10 scale for everything. Let's say you're stuck in traffic on the way to work. It may feel like a big deal at the time, but it probably isn't. In terms of problems, traffic is a 1.
The rational part of our brain knows that. The rational part is like a calm seismologist, unimpressed by most emotional tremors. We need to cultivate this part.
Stuck in a long meeting? ""WHEN WILL THIS END?"" you want to shout.
""Hold on a minute,"" the calm seismologist says, ""There are only a few thousand PowerPoint slides left. Therefore, we should be out of here, at the very latest, by next Wednesday. On a 1-10 scale, this meeting is a 1.2.""
Sometimes, our response to a problem is worse than the problem.
Tip: As soon as you feel triggered by a problem, score it on a 1-10 scale. And if you're going to imagine the worst, exaggerate. Then, realize how improbable the worst really is.
Consultant, author, speaker, and founder of express potential® (www.expresspotential.com), Paul Hellman has worked with CEOs, executives, and managers at leading companies for over 25 years to improve performance and productivity at work. His latest book is ""Naked at Work: How to Stay Sane When Your Job Drives You Crazy,"" and his columns have appeared in the Wall Street Journal, New York Times, Washington Post and other leading papers.
Comments? Send them to executivecareers@cnbc.com
Google's Nest Hub Max, a larger version of the Nest Hub that was announced during Google I/O in June, is now available for purchase. I've been using it for the past several days, so I wanted to let you know what it's like.
It's similar to the Nest Hub, which launched last year and serves as a smart display that lets you watch YouTube TV ($50 a month), stream music and speak to Google Assistant. It also helps you learn more about your day, with information on your commute to work, reminders and more.
The Nest Hub Max represents yet another way Google is getting into our homes, and this time with a camera. It's similar to the Facebook Portal+, but it has a smaller display and can do a lot more. It's also Google's answer to Amazon's line of Echo Show products, which range in size, price and capability.
While the $129 Nest Hub is best served in places like the bedroom, given its small 7-inch screen, Google wants the $229 Nest Hub Max and its larger 10-inch screen to take over your kitchen or living room. It has a camera for video chats with family or for monitoring your house while you're away. That camera can also recognize each member of your family's face, so it can display unique information for each person it sees.
Here's what you need to know.
I like the big screen on the Nest Hub Max, since I was able to watch a football game in the kitchen and still see the score. The bigger screen makes it easier to see menus, too, if you use the Hub Max for recipes (I'm a terrible cook, so I didn't try this) and for viewing photos.
That's one of the best parts of the Hub and Hub Max: It serves as a great digital photo frame for displaying any albums you want from Google Photos. My wife and I love seeing old memories pop up on the regular Hub when we walk into the kitchen, and now they're even bigger.
There's a built-in wide-angle camera that lets other people easily see you during a Google Duo video call. It follows you around the room, too, so you can walk and talk at the same time, much like the video chat feature on the Facebook Portal.
You can call people who have Duo installed on either an iPhone or an Android phone, and it's free. One problem, though. I tried calling someone on Duo who was using a phone rather than another Nest Hub Max, and the video on my end wasn't good, even with the big display.
They were able to see me and my entire kitchen, though, which means they benefited from my better camera. I think video chats would be most appealing between two Nest Hub Max owners, so I want to get a couple for my family over the holidays.
The camera can be added to your Nest account to double as a security device when you're away. I set it so it turned off when I was home, but it automatically switched on when I was away to let me check in on the kitchen from my smartphone. You can get alerts if someone walks into the room, and it synced well with my existing in-home and outdoor Nest cameras. If you're worried about the camera, you can turn it off. There's a switch on the back of the Hub Max to turn the camera and the microphones off. Google says it's a hardware switch, so, in theory, someone can't hack in and turn it back on.
Google Assistant is built in, so you can ask it to play music on Spotify, launch YouTube videos, play TV channels from YouTube TV, check the weather, call people and more. It understood me really well, even when I was across the room. And when you're blaring music, you can pause it by simply holding your hand in the air, or resume it doing the same gesture. This also works for timers, if you don't want to talk to Google but have a bunch of cake batter on your hands.
One of the most unique features is also a bit worrying, though.
The Nest Hub Max's camera can be used to recognize anyone who walks in the room. One morning, it showed me how long it was going to take me to get to work, recommended YouTube videos and Google News catered to me. It could do the same for my wife, switching up all of that information when it recognized her face.
Except my wife won't register her face. Even though Google says it keeps your facial recognition data locked down to the device and doesn't use it for anything else, I'm a bit skeptical. For one, you need to register your face on a phone, so it has to travel to Google's servers first before it lands on the Hub Max. My wife told me she thinks it's ""creepy."" Maybe your family will feel differently, but Google hasn't gained everyone's trust yet.
The speakers sound just OK. For $229, I expected something better, but they get irritating at high volumes. They're fine for just playing casual music in the kitchen, but you won't want to replace your Sonos speakers for this. That's kind of annoying, since I now have to keep a Sonos speaker in the kitchen in addition to a smart display, just to make sure I have good music in the room everyone hangs out in.
I like it a lot. The Nest Hub Max is a big screen for viewing photos, recipes, TV shows, your schedule and more, all wherever you decide to plug it in. It works well at what Google says it can do: The cameras are solid, it connects to Nest just fine, it's good at recognizing my face (even if it's creepy to my wife) and it's priced well for what you get. I like the information more than what the Echo Show can provide, but you should stick with that if you're already an Echo household. If that appeals to you, then yes it's a good buy.
If you're not wild about the $229 price and don't care about the camera features, then give the regular Nest Hub a try. It has a smaller 7-inch screen, costs $129 and is often on sale for about $99 but does most of the same things that the Hub Max can do.
Pride International : This is a contract driller and a stock that Cramer likes in this market. “Let’s buy it.”
American Software : It’s a fine tech company, Cramer said, but he’d rather go with names like Riverbed Technology , Cisco , Hewlett-Packard or Dell .
Peabody Energy : Even though oil is up, the government is not helping coal companies like Peabody, Cramer said. He has liked coal, but it’s not at the right level right now.
Foundry Networks : “This happens to be another stock in the sweet spot,” Cramer said. He believes stocks like FDRY, which didn’t go down at all today, are going to work in this environment because they don’t need debt, they don’t have to do a leveraged buyout and they don’t need the domestic consumer.
RPM International : “It’s not going to work, but it’s not going to hurt you either,” Cramer said.
Anadigics : If you look, you’ll see that most tech stocks, including ANAD are at or close to a 52-week high. “I can hold on to that,” Cramer said.
Applied Materials : A company with low valuation and a lot of cash, and it’s moving into solar. Cramer predicts one down and three up for AMAT, which to him says “buy, buy, buy.”
Immersion : Immersion has never made anyone money, Cramer said. Sell it.
Cumulus Media : It’s been straight down since it announced it would be bought out on Monday, Cramer said. “I need you out of Cumulus.”
Intel : Intel is one of the reasons why Cramer is so bullish on Dell and Hewlett-Packard, as they are big buyers of Intel chips. That being said, Cramer would “rather see you out of Intel and into Hewlett-Packard.”
Pfizer : “Pfizer doesn’t have it,” Cramer said. He would swap out of PFE and buy some Schering-Plough .
IHOP : It was a buy on the merger with Applebee’s , Cramer said, but now he’d take the gain. “It’s in the wrong group.”
Jim’s charitable trust owns Hewlett-Packard.
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
As the House impeachment inquiry enters a new, public phase, the White House communications office is expected to add two longtime Trump allies to its staff, where they will be tasked with running a proactive impeachment messaging operation, CNBC confirmed Tuesday.
Former Florida Attorney General Pam Bondi, a longtime Trump supporter, and Tony Sayegh, a former Treasury Department spokesman, are both expected to join the White House shortly to work specifically on impeachment related communications, in addition to other special projects as necessary, a senior administration official told CNBC. Bondi and Sayegh's jobs would be temporary,.
Acting White House chief of staff Mick Mulvaney is ""very pleased"" with the Bondi and Sayegh hires, a senior administration official told CNBC. Mulvaney believes they will ""help round things out"" as good communicators with strong political skills.
The hiring of Bondi and Sayegh, both high-profile political veterans, represents a new, more offensive posture from the White House, which has struggled to devise a cohesive strategy in response to the growing House impeachment inquiry.
Trump has so far been resistant to the idea of a special team of staffers who would focus solely on the impeachment, reportedly because he was concerned such an approach was passe in the age of Twitter and social media.
""Here's the thing: I don't have teams,"" Trump told reporters at the White House recently. ""Everyone is talking about teams. I'm the team. I did nothing wrong.""
The choices of Bondi and Sayegh come as little surprise to those in Trump's inner circle. Bondi's term as attorney general in Florida ended earlier this year, and in the ensuing months, her name has come up repeatedly as a potential Trump hire, either at the Justice Department or the White House.
Bondi made headlines during Trump's presidential campaign for accepting a $25,000 contribution to her political action committee from the Donald J. Trump Foundation, an apparent violation of rules prohibiting donations from nonprofits to PACs.
The money was donated in 2013, when the Florida Attorney General's office was considering whether to join a lawsuit against Trump's now-defunct Trump University. The donation came a few days after Bondi announced that Florida might join the suit. Bondi ultimately decided the state would not take part in the lawsuit.
Sayegh is a well-known Republican communications guru, having worked on several high-profile races and most recently as the most visible frontman for the GOP's 2017 Tax Cuts and Jobs Act, Trump's massive tax reform package. Within the White House, Sayegh is considered an ally of Jared Kushner, Trump's son-in-law and senior advisor.
Politico recently reported that Sayegh's potential hiring had set off a turf war inside the West Wing, with some factions strongly backing the choice and others fearful it would give Kushner and his allies too much power over the impeachment communications strategy.
— CNBC's Eamon Javers contributed to this report.
Add American Italian Pasta to Cramer’s list of trade-down plays. The company’s a leader in both the private-label and brand-name markets, he said, and the stock “has the potential to explode higher.”
American Italian Pasta is North America’s largest dry pasta maker and the largest private-label pasta maker in the U.S. The company’s name brands include Heartland, Golden Grain and Muellers among others, but also provide private label Great Value Pasta to Wal-Mart. In fact, AIPC is Wal-Mart’s sole supplier of pasta, which accounts for 22% of the discount giant’s sales, and that’s a huge boost to business.
The company gets 50% of its total volume from private-label sales and 67% of retail-sales volume. AIPC commands between two-thirds and three-quarters of the retail private-label past market. And management is putting its focus on developing its private-label products. As Cramer called it, AIPC is king of cheap pasta.
Declining raw costs will also be a boon to American Italian Pasta. Cramer expects the benefits from lower wheat prices to kick in by the second half of this year. Investors who like AIPC’s story should be in ahead of that.
The stock makes sense because pasta’s a cheap, easy dish for those who want to save money by eating at home. That’s why AIPC is up to $30 from $4 in the past year. But this is a small company with a market cap of only about $600 million. Only four analysts cover American Italian Pasta. And because of the big run, investors should at least wait for a pullback before buying. The stock’s cheap on a price-to-earnings basis, but that doesn’t always matter with these smaller names.
So use limit orders, Cramer said, and never buy all at once.
Cramer's charitable trust owns Wal-Mart.
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
A late-day rally gave the Dow industrials a triple-digit boost after a volatile session in which the blue-chip index swung within a 700-point range.
""I think this is bargain hunting and there are some bargains out there. Some of these stocks are at historic lows,"" Warren Simpson, managing director at Stephens Capital Management in Little Rock, Ark., told Reuters.
Traders said another cause for the day's wild swings was unwinding of hedged options on the S&P 500 ahead of October options expirations on Friday. The expirations triggered several big buys at the end of the day.
The day was book-ended with rallies. Stocks lurched out of the gate following some not-horrible economic reports: Consumer prices came in flatwhile weekly jobless claims fell. But that rally fizzled after mid-morning reports showed the Philadelphia Fed's index of mid-Atlantic factory activity fell much more than expected and industrial output hit a nearly 34-year low. The Dow Jones Industrial Average retested Friday's closing low around 8450, then fell through to a five-and-a-half year low.
""Looking at inflation right now is like looking in the rearview mirror while ignoring the train wreck dead ahead,"" said Chris Rupkey, an economist at Bank of Tokyo-Mitsubishi. ""Even Fed policy makers are saying the economy appears to be in a recession, and that is why the stock market has fallen more than 40% from the highs last year, it is discounting a recession if not outright depression.""
The Dow finished up 401.35, or 4.7 percent, to close at 8979.26. That makes 21 out of the past 24 sessions the Dow has made a triple-digit move.
As of today's close, the Dow is up about 530 points for the week. (Of course, at the rate we're going, that doesn't mean anything. Tune in tomorrow!)
The S&P 500 gained 4.3 percent, while the tech-heavyNasdaq advanced 5.5 percent.
The CBOE volatility index, widely considered the best gauge of fear in the market, soared to a new record above 80 before pulling back to 67.61.
With record levels of fear in the market, where do we go from here? History might offer some clues as to when the volatility will subside.
The price of a barrel of oil settled below $70for the first time since last Augustafter a report showed crude inventories rose by 5.6 million barrels, more than double the 2.2-million-increase expected.
The top three gainers on the Dow were: ExxonMobil , Wal-Mart and Alcoa .
Dow component Citigroup was one of the biggest decliners on the Dow, falling 2 percent, after the bank posted its fourth straight quarterly loss amid credit costs and writedowns totaling $13 billion. Citigroup said it's making good progress on shedding assets and cutting costs but warned that tight credit conditions and the potential global recession could cut into other businesses.
Merrill Lynch shares ended up 0.6 percent after the bank reported its fifth straight quarterly loss and missed analysts' target amid writedowns of $9 billion, most of which occurred in September.
Bank of New York Mellon gained 6.3 percent after the bank reported its profit was cut in halffrom a year earlier but still managed to beat expectations.
In the tech sector, the world's largest handset maker Nokia missed expectations as handset makers have taken the global slowdown on the chin. Its shares rose nearly 10 percent, however, after the company soothed concerns about the fourth quarter, saying it wouldn't be as bad as expected.
Yahoo jumped more than 10 percent amid buzz that a Microsoft deal — try to hold your sigh to the end of this song — is still a possibility. Apparently, Microsoft CEO Steve Ballmer said at an IT conference in Orlando that an acquisition of Yahoo would still ""make sense economically"" for both companies.
And, exhale ...
Diversified manufacturer United Tech reported a 6 percent rise in profit, boosted by continued strong demand for helicopters and products used in commercial construction. Its shares rose 7.4 percent.
Retailers recovered after an earlier selloff over concerns that this could be the toughest holiday for retailers in more than five years.
Consumers are expected to spend an average of $832.36 on holiday shopping this year, up just 1.9 percent from a year earlier, according to the National Retail Federation. That would be the smallest rise since 2002, when the NRF began conducting the survey. (Check out our Holiday Central blogfor the latest on how the holiday season is shaping up for retailers.)
Shares of discount and wholesale chains such as Wal-Mart , Target and Costco were some of the sector's biggest gainers — all three rose more than 6 percent — as that's where consumers shop during tough times.
Macy's was one of the sector's biggest gainers, climbing 16 percent.
Elsewhere, U.S. and European leaders agreed to meet this weekend to prepare for a summit to overhaul the global-financial system. Speculation is growing that the Fed will be forced to cut rates again as consumers struggle through the financial malaise.
-- Albert Bozzo contributed to this article.
Still to Come:
FRIDAY: Housing starts; consumer sentiment; Earnings from Gannett, Honeywell and Sony Ericsson
Send comments to cindy.perman@nbcuni.com.
DUBAI — Saudi Arabia's full oil production capacity will be recovered by the end of November, Saudi Aramco CEO Amin Nasser told CNBC on Wednesday.
""By September we will be, in terms of production capacity, at 11.3 (million barrels per day), by end of November we will be at 12 million barrels per day (bdp), which is our maximum sustained capacity,"" Nasser told CNBC's Steve Sedgwick during the Oil & Money Conference in London. Saudi Arabia is the world's largest exporter of oil.
The OPEC kingpin has been pumping significantly below that 12 million bpd level as part of a coordinated agreement OPEC and non-OPEC producers to lower output and keep a floor under falling oil prices.
Aramco's revenues were not reduced in the wake of the attacks, Nasser noted, and put its October production figure at 9.9 million bpd.
The CEO of the world's largest oil company expressed his concern over an ""absence of international resolve"" against the perpetrators of September 14 drone and missile attacks on Aramco facilities that forced the company to shut down half of its production and sent crude prices up nearly 20%.
""An absence of international resolve to take concrete action may embolden the attackers and indeed put the world's energy security at greater risk,"" Nasser said.
The attacks had ""no impact"" on the planned public listing of the state oil giant, the CEO added, saying that if anything, they strengthened the company's position with regard to the offering. The Saudi Aramco initial public offering (IPO), which has seen multiple delays since it was first suggested in 2016, would be the world's largest.
""We are ready whenever the shareholders decide it is the time to list,"" Nasser said.
Aramco is expected to file its IPO prospectus by the end of this month, according to reports.
The kingdom reportedly plans to list 1% of Aramco on its local stock exchange, the Tadawul, before the end of this year and another 1% in 2020 as first steps ahead of a public sale of roughly 5% of the company. Saudi Crown Prince Mohammed bin Salman has estimated the firm's value at $2 trillion, while analysts put the figure closer to $1.5 trillion.
The success of the IPO depends in part on the oil price, which is down some 30% in the last year, despite heightened geopolitical tensions in the Gulf region.
Brent crude futures were trading at $58.78 a barrel on Wednesday morning at 11:15 a.m. London time, up nearly 1% from the previous day. Still, the international oil benchmark's price is now lower than it was the day before the Aramco attacks, which Riyadh and Washington have blamed on Iran, a charge Tehran denies.
There are ""many factors"" impacting the oil price today, Nasser told CNBC's Sedgwick, noting that the global economic situation as a whole was affecting crude prices. ""I think market was very satisfied with Saudi Aramco's response (to the attacks), but also... there is a tariffs dispute ongoing between two super global economies. All of these things are impacting price of crude.""
The CEO added that there is ample oil supply on the market, and that he expects demand to average at 1 million bpd.
In earlier comments Wednesday, Nasser said that there was ""no doubt"" Iran was behind attacks on Saudi Arabia, which struck multiple points at two of Aramco's largest facilities: Abqaiq, the largest crude oil processing and stabilization plant in the world, and Khurais, the kingdom's second-largest oil field.
Yemen's Houthi rebels, who have been at war with the Saudis since 2015 and are backed by Iran, claimed responsibility for the strike, but numerous Western governments and security experts say the rebels could not have carried out such a sophisticated attack.
In late September, ratings agency Fitch downgraded Saudi Arabia's long-term foreign currency issuer default rating from A+ to A, citing the ""vulnerability of its economic infrastructure"" and ""deterioration in Saudi Arabia's fiscal and external balance sheets."" Riyadh was quick to reject the downgrade, calling it ""somewhat speculative.""
The Aramco IPO is part of the kingdom's Vision 2030, an initiative spearheaded by the 34-year-old crown prince to diversify the country's economy and reduce its reliance on hydrocarbon revenues.
GRAND RAPIDS, Michigan — The Trump Train's final stop was not a heartfelt appeal to voters in a crucial state on the GOP nominee's path to the White House.
Instead, it was a winding road of his greatest hits — the same riffs that earned him notoriety through the primaries and were pillars of his general election message, despite the efforts of advisers.
Assuming the stage for his fifth appearance of the day, Trump seemed worn but kept his usual confidence including the classic call-and-response: ""Who's going to pay for the wall? MEXICO!""
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Chance the Rapper Leads Voters on 'Parade to the Polls'
As Election Day Arrives, Plenty of Blame to Go Around
Trump on Clinton's Celebs: 'We Don't Need Lady Gaga'
Trump declared Tuesday ""our Independence Day"" and looked forward to closing ""the history books on the Clintons and their lies and schemes and corruption.""
""We are hours away from a once in a lifetime change,"" he said.
Trump swore an end to Syrian refugees being let into the U.S. and laid the groundwork for ""a lot"" more visits to the Mitten state as he works to bring jobs and factories back here.
A woman walking by the press pen apologized for fellow Americans who have lashed out over the course of the campaign. ""You don't deserve it,"" she said, before admitting she was attending as a Hillary supporter simply to confirm her choice. After her, a man passed and pointed to the press: ""You're terrible. Terrible."" A reporter wished him a good night in response.
Ali Vitali tweet 1
Ali Vitali tweet 2
As he closed, Trump trod a well-worn rhetorical path of asking his people to get out and vote. ""God bless you, everybody. Go to bed, go to bed right now,"" he said to those dedicated enough to wait an hour and a half beyond scheduled start time for their nominee to take the stage.
Ali Vitali tweet 3
IBM reported quarterly earnings thatbeat analysts' expectations, but missed slightly on revenue, sending its shares lower in after-hours trading on Tuesday.
The information technology company delivered first-quarter earnings excluding items of $2.78 per share, up from $2.41 per share in the year-earlier period.
Revenue was $24.70 billion, an increase from $24.61 billion a year ago.
Analysts had expected the company to report earnings excluding items of $2.65 per share on revenue of $24.78 billion, according to Thomson Reuters.
First-quarter net income was $3.1 billion compared with $2.9 billion in the first quarter of 2011, an increase of 7 percent, according to a company statement.
IBM has been shifting its focus from hardware to higher-margin services and software over the past decade, and has just raised its full year outlook. They expect at least $15 in adjusted earnings per share, up from its previous forecast of $14.85.
Sterne Agee analyst Shaw Wu wrote in a recent note that there was a ""fair likelihood"" IBM would ""modestly raise"" its outlook.
The blue chip company is closely watched as an indicator of enterprise IT spending, and competes with business software makers Oracle and SAP AG as well as outsourcing company Accentureand computing giant Hewlett Packard .
After the announcement, shares of IBM fell in after-hours trading.(Click here for after-hours quote)
European stocks rebounded Thursday as Germany's 5G auction drove the telecoms index higher, while a tanker incident caused oil prices to surge.
The pan-European Stoxx 600 recovered from a 0.2% fall after the opening bell to climb 0.1% during the afternoon session. Basic Resources led gains with a 1.6% rise, while media stocks traded down around 0.7%.
Oil prices rebounded nearly 3% Thursday amid reports of a tanker incident in the Gulf of Oman.
International benchmark Brent crude traded at around $61.65 during afternoon deals, up 2.8%, while U.S. West Texas Intermediate (WTI) stood at $52.76, up 3.2%.
U.S. President Donald Trump struck a slightly more positive tone on the U.S.-China trade war Wednesday, but again threatened to increase tariffs on Chinese goods if no deal is agreed, deeming relations between the world's two largest economies ""testy"" and doing little to assuage global trade fears.
In Asia, stocks mostly fell Thursday afternoon after a second straight day of declines on Wall Street. Hong Kong's Hang Seng index closed 1.73% lower amid violent clashes between protesters and riot police over a controversial extradition bill.
Back in Europe, Luxembourg Prime Minister Xavier Bettel told CNBC's Silvia Amaro on Thursday that there would be no renegotiation of the U.K.'s departure deal with the European Union. The reminder came as Conservative party candidates vying to replace Prime Minister Theresa May, each with their own lofty Brexit plan, faced a first vote among the party's MPs.
Eurosceptic former Foreign Secretary Boris Johnson, who launched his campaign with a promise to take Britain out of the EU on October 31 with or without a deal, secured the most secret ballots with 114, while his successor Jeremy Hunt came a distant second with 43 votes.
The Swiss National Bank (SNB) stuck to its ultra-loose monetary policy on Thursday and blamed rising trade tensions between the United States and China for a spike in the safe-haven Swiss franc.
In corporate news, Germany raised 6.55 billion euros ($7.4 billion) in its auction of spectrum for 5G mobile services, the Federal Network Regulator (BNetzA) said after a contest lasting nearly three months that will see a fourth operator enter the market.
That fourth operator was German telecommunications provider 1&1 Drillisch, which saw its share price climb 5% in afternoon trade as investors reacted to the news. Shares of United Internet, 1&1 Drillisch's parent company, also rose by 3.6%.
British plumbing company Ferguson topped the Stoxx 600 in afternoon deals, jumping 6.1% after activist fund Trian Fund Management announced it had built a 6% stake.
At the other end of Europe's blue chip index, British copper producer Aurubis was down 7.5% after its CEO was dismissed early amid rising project costs.
The photo-messaging app SnapChat is just getting started in erasable media, the company CEO Evan Spiegel said Monday on CNBC's Squawk on the Street.
""We really think this is a big idea...it's just the very, very beginning of something we call ephemeral media, media you share that disappears. So it's hard to say right now, but it's a really big space and we look forward to exploring it,"" Spiegel said.
For only being in the beginning stages, SnapChat certainly has a large base of users.
The app, which enables users to send photos, videos or messages that disappear 10 seconds after being viewed, has 1.7 million monthly Facebook users with over 60 million 'Snaps' sent daily.
(Read More: Facebook Is Giving Away Free Mobile Data to Some Users )
SnapChat is working to tap into its growing reach and is developing ways for companies to advertise on its picture-sharing platform, said Spiegel.
""There's a couple of things we are really excited about right now. There are a lot of businesses experimenting with SnapChat,"" Spiegel said. ""What I'm really excited about is this really awesome new ad format we've been experimenting with. We think it's really engaging. We think when ads are done right, they can be informative and delightful and we are really excited about that.""
Spiegel said that SnapChat is different from traditional social media because its a medium people can use to show more human moments.
(Read More: Facebook Is Tossing Your Old Pics Into 'Cold Storage' )
""Traditional social media is a place where people want to look very cool,"" he said. ""SnapChat is really a place where our users can send funny, interesting embarrassing photos.""
The app has gained a lot of attention recently for being a popular way for youths to sext, or send inappropriate pictures of themselves.
(Read More: Regretting That Sext You Just Sent? There's an App for That )
Spiegel, however, said he discourages any user of SnapChat from sending inappropriate image on the app.
""SnapChat is not a great way to send inappropriate content because any photo that I send to you can be saved by taking a screenshot or by taking a photo with another camera. So it's not a great way to send inappropriate photos,"" he said.
Amazon on Tuesday began rolling out Alexa Guard to all Echo devices, including older models that didn't originally get the feature when it was launched late last year.
Alexa Guard automatically listens for things like breaking glass and can alert you if it suspects someone is breaking into your home. If you have an ADT or Ring alarm system, it can also automatically set off the alarm. The feature was announced during Amazon's big Alexa event last September.
Alexa Guard is free but still needs to be manually activated by you. It requires you to first speak ""Alexa, I'm leaving"" to activate Guard on your Echo and to force Alexa to begin listening for more than just the ""Alexa"" wake word.
If an Echo hears a window break, it can send you an alert to your phone along with a live video feed if you have an Echo with a camera on it, like the Echo Show. An alert includes a 10-second audio recording of the glass breaking and anything else the Echo heard, but it otherwise doesn't listen unless you speak Alexa again.
It will also send alerts if a smart smoke alarm or carbon monoxide alarm goes off. If you configure it, Guard can also automatically turn on smart lights at certain times while you're away, and it will automatically turn them on and off on a schedule as if you're home.
""Alexa uses machine learning to determine the right lighting activity for your home based on lighting usage across customers,"" Amazon said.
Amazon said it ""hired licensed contractors to break real glass in a testing lab,"" to help prevent false positives and to detect the actual sound of breaking glass. ""This team broke hundreds of different windows, in different sizes, including single pane and double pane, with a variety of instruments including crow bars, hammers, bricks, baseball bats, and more,"" the company explained in an email to CNBC.
If you subscribe to ADT or use Amazon's Ring alarm system, Guard can automatically send alerts to professionals so that authorities arrive if a break-in is detected. If you don't have these systems, Alexa Guard won't call the police, it'll just notify you of a potential break-in.
Here's how to set it up:
- Open the Alexa app on your phone.
- Tap the menu button on the top left.
- Choose ""Settings.""
- Choose ""Guard.""
- Tap ""Set up Guard.""
- Tap ""Add"" to detect smart smoke alarms and carbon monoxide detectors in your home.
- Tap ""Add"" to activate smart alerts for detecting the sound of broken glass.
- Choose ""Add"" again to activate smart lighting.
- Enter your zip code, so smart lighting knows when to turn on.
- Choose ""Confirm.""
Now just speak ""Alexa, I'm leaving"" to activate Guard when you leave the house.
Uber raised a total of more than $2 billion from investors in June and December last year — and is now back for another round. The anonymous messaging start-up Yik Yak collected $73.5 million in three financing rounds in seven months, and Zenefits, a human resources start-up, raised more than $580 million in less than two years, with the latest deal done last week.
The pace of technological change has long been happening at the lightning-fast speed of the Internet. Now, start-up financing is increasingly taking place at that speed as well.
Read MoreUber's valuation may top $50B with new funding: WSJ
Uber is just one example of the quickening tempo. The ride-hailing company is in discussions to raise around $1.5 billion in financing, which could value it at $50 billion. Just five months ago the company collected$1.2 billion for its war chest, an amount that later swelled with the addition of a strategic investor.
And the rate of fund-raising by Uber — and across the start-up landscape — has little precedent, driven by money pouring in from hedge funds, strategic investors and more, and by the willingness of entrepreneurs to embrace the cash.
""When capital markets are this loose, people tap them, whether it's right to or not,"" said Mark Suster, a partner at the venture capital firm Upfront Ventures. ""Companies are raising rapid rounds of capital for only one reason: They can.""
The frequency of the fund-raising by many start-ups — now multiple rounds in months rather than years — is ""otherwise unheard-of,"" said Anand Sanwal, chief executive of CB Insights, a research firm that studies venture capital.
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The shrinking time between funding rounds shows how Silicon Valley's current boom is not just about start-ups reaching a high valuation but also about how fast they can pull that off. The tempo is in marked contrast to the pace of start-up fund-raising last decade, when many companies would typically leave a year or two between financing rounds. When LinkedIn, the professional social networking company, raised money as a start-up in the mid-2000s, it took more than three years for its first three rounds of financing.
Since the beginning of 2013, however, more than 20 tech start-ups have held three rounds of funding within a year and a half, according to CB Insights, which called the group the ""18-month sprint"" companies. Last year, nearly 500 tech start-ups did financing rounds less than one year apart, CB Insights estimated, more than any other year since at least 2011.
Among the companies that completed numerous financings in tight time frames was the fitness membership start-up ClassPass, which completed three rounds in nine and a half months, CB Insights said. Slack, the collaboration software start-up, last month took in $160 million; just six months earlier, it had received $120 million from investors. Snapchat in December raised nearly half a billion dollars from a bevy of financiers. Just three months later, the Chinese e-commerce company Alibaba poured $200 million into the messaging start-up.
Read MoreTravel hubs hitch a ride on Apple Watch bandwagon
Spurring the more frequent fund-raising is the desire of investors — including hedge funds, mutual funds and strategic investors — to put up money more often for fear of missing out on the next big thing. One reason Uber is in talks to raise money again just a few months after a prior round is because of an overwhelming amount of investor interest, said a person with knowledge of the company who spoke on the condition of anonymity because the process is confidential.
Uber did not immediately respond to a request for comment.
Many institutional funds and international companies have leapt into start-up investing as the number of initial public offerings has slowed, prompting investors to wade into private companies to find growth, according to Mark A. Siegel, managing director at the venture capital firm Menlo Ventures, which has invested in Uber.
""I don't blame entrepreneurs,"" Mr. Siegel said. ""This is something where investors are absolutely complicit in this, and in some ways are driving this.""
He added that the phenomenon of fast fund-raising appears largely limited to the club of ""unicorns,"" or the elite companies that are worth at least $1 billion. Investments in the later financing rounds for companies jumped to $4.2 billion in the first quarter, up 50 percent from a year ago, according to data from the National Venture Capital Association, making it the biggest quarter for such investments since late 2000.
Entrepreneurs are often happy to take up eager investors on their offers. Stewart Butterfield, chief executive of Slack, recently said that his start-up had more than enough money in the bank — just before collecting $160 million more.
""This is the best time to raise money ever,"" he said last month. ""It might be the best time for any kind of business, in any industry, to raise money for all of history, like since the time of the ancient Egyptians.""
Mr. Butterfield said Slack had ""no immediate use"" for the new money it had just raised. Still, the capital ""reinforces the perception for our larger customers that we'll be around for the long haul,"" he said.
Parker Conrad, chief executive of Zenefits, said rapid-fire fund-raising is necessary to quickly build up a company so it is large enough to take on competitors. With the money, Zenefits has been able to persuade more than 10,000 small and midsize businesses to use its service.
""We want to grow really big, really fast,"" Mr. Conrad said in an interview last week for the company's third round of fund-raising since early 2014. ""That requires a lot of capital.""
Even if the numerous rounds of new cash are not put to immediate use, the money may come in handy one day if — or when — the free-flowing capital faucets are shut off. Investors like Bill Gurley, a partner at the venture capital firm Benchmark, have warned of an eventual reckoning, a time when money is not as easy to come by, which will cause some companies to sputter out when their bank accounts empty.
Read More
It is to protect against this inflection point that some companies may be raising as frequently as they can, while they can, said Mr. Suster of Upfront Ventures.
""Some companies view these as war chests being raised to weather the inevitable corrections,"" he said. ""For now, the tide is high and nobody knows who's naked.""
The winter wallop may have chilled housing activity in some parts of the country, but overheated home prices are really what are slowing sales nationwide.
Home buyers signed 2.5 percent fewer contracts in January to buy existing homes compared to December. The expectation had been for a slight gain. The so-called pending home sales index from the National Association of Realtors, an indicator of future closed sales, is now just 1.4 percent higher than it was in January of 2015. Pending sales have been higher annually for 17 straight months, but this is the second smallest gain in that time.
""While January's blizzard possibly caused some of the pullback in the Northeast, the recent acceleration in home prices and minimal inventory throughout the country appears to be the primary obstacle holding back would-be buyers,"" said Lawrence Yun, chief economist for the Realtors. ""Additionally, some buyers could be waiting for a hike in listings come springtime.""
Pending home sales in the Northeast declined 3.2 percent in January, compared to December, but were 10.9 percent above a year ago. In the Midwest sales fell 4.9 percent monthly and are 1.4 percent above January, 2015. Sales in the South rose 0.3 percent for the month and are 1.3 percent lower than last January. In the West pending sales fell 4.5 percent in January and are just 0.4 percent above a year ago.
Tight supply has been plaguing the housing market for much of the past year. Inventory is lower now than a year ago, even as the spring housing market begins and more new listing come on. It is still not enough to meet demand.
An early read on February finds new listings that do come on the market are moving quickly. Housing inventory is moving six days faster than last year and four days faster than January, according to Realtor.com. Median listing prices are also up eight percent compared to a year ago.
""We don't usually see this type of acceleration until March or April. On a local level, the acceleration is really dramatic with nine of the top ten hottest markets shaving three weeks or more from their median age in January,"" said Jonathan Smoke, chief economist of Realtor.com
California markets continue to dominate Realtor.com's list of the hottest real estate markets, where homes for sale are selling fastest, but Dallas and Denver came in at numbers three and four. These cities are seeing new listings sell 44-78 days more quickly than the rest of the U.S.
The latest read on home prices nationally show them up 5.5 percent in December year-over-year, according to Black Knight Financial Services. As of the end of 2015, home prices were 27 percent above where they were at the bottom of the market in January, 2012, but still 5.3 percent off their peak of 2006.
Republicans and Democrats have until August 2nd to reach a deal on raising the $14.3 trillion debt ceiling. The Senate canceled its planned July 4 recess and lawmakers are racing against the clock to avert a debt default.
Lawmakers have been unable to reach a consensus, with Republicans and Democrats sharply divided over spending cuts and tax hikes. Republicans want Democrats to agree to $2 trillion in spending cuts and not to hike taxes. They've walked out on talks led by Vice President Joe Biden.
Meanwhile Democrats are looking at a scaled-back deal, which would raise the debt ceiling and buy enough time until after the 2012 Presidential election. Some analysts are worried that the game of brinkmanship between the two sides could lead to a default, even if it is for a few hours. Ratings agencies have warned that such a 'technical default' would hurt the U.S.'s Triple-A rating.
Time is running out and we want to know whether you think there's enough political will for a deal to be done in time.
Elon Musk testified under oath he's not sure know how much he's worth.
The Tesla and SpaceX CEO made the comment Wednesday in his second day of testimony in a defamation lawsuit filed by Vernon Unsworth, the British caver whom Musk called a ""pedo guy"" on Twitter.
Musk apologized for the tweet during his first day of testimony in U.S. District Court in Los Angeles on Tuesday. He also argued then, and reiterated on Wednesday, that when he wrote ""pedo guy"" he meant ""creepy old man."" Musk also argued that, essentially, Unsworth picked a fight with him.
Unsworth's attorney L. Lin Wood asked Musk on Wednesday whether Musk believed his ""pedo guy"" comment impacted Tesla shares. Musk said he had ""received concerned notes from shareholders."" The testimony ended with Wood asking about Musk's net worth. Over the objections of defense Alex Spiro, the judge allowed the question, saying ""Let's give everyone a headline.""
Musk testified that he didn't know his precise net worth, and the value fluctuates on a daily basis. He said he owns stock in Tesla and SpaceX and has debt against his stock but he does not have a lot of cash. Asked if $20 billion was a reasonable estimate, Musk said he didn't know, but ""I think SpaceX and Tesla stock probably amount to that.""
The dispute between Musk and Unsworth began in the summer of 2018, when Unsworth, a spelunker and expert diver, led the rescue of 12 boys and their soccer coach from a flooded cave in Thailand.
Before the rescue was completed, Musk had endeavored to involve himself, and employees from his companies SpaceX and Tesla, in the rescue. They created a rescue pod, or miniature submersible, that ultimately proved of no use in the rescue effort.
Musk and his team pressured Thai officials to make favorable public statements about their involvement, while the rescue was still in progress and the boys' lives were at risk.
Once the boys and their coach were safe, Unsworth was asked in an interview on CNN what he thought of Musk. He characterized Musk's efforts as a publicity stunt and said the Tesla CEO should ""stick his submarine where it hurts.""
In court this week, Musk contended that when he called the cave rescue hero a ""pedo guy"" on Twitter, he was just responding to Unsworth's ""unprovoked attack,"" with similarly heated rhetoric, not meant as a literal accusation of pedophilia.
At one point in his testimony, Musk said: ""I assume he literally didn't mean to sodomize me with a submarine. I literally didn't mean he was a pedophile.""
Judge Stephen Wilson emphasized that the outcome of the defamation case hinges on whether or not a reasonable person, given context, would interpret the ""pedo guy"" tweet as Musk labeling Unsworth an actual pedophile.
Unsworth will also have to prove that he suffered damages as a result of the alleged defamation.
In court on Tuesday and Wednesday, Musk clashed frequently with Wood, to the point where the judge warned ""Let's cut the repartee. ... That's an order, not an invitation to a dance.""
—CNBC's Jane Wells and Paul McNamara and Reuters contributed to this report.
Follow @CNBCtech on Twitter for the latest tech industry news.
Editor's Note
Airlines are now touting their summer fares to lure travelers. But they are also introducing a slate of fees for items and services that used to be free, including SpiritAirlines’ new policy of charging up to $45 for one oversize carry-on bag.
Ben Baldanza, president and CEO of Spirit told CNBC Wednesday that at the same time the company insituted the carry-on bag fee, it also lowered fares and checked-bag costs. As a result, he said, “Sales are up 50 percent.”
Spirit passengers are still allowed one carry-on for free, as long as the luggage fits under the seat in front of them. It's when the bag must go into the overhead bin that the fee is charged. The $45 fee applies at the gate; passengers are charged $15 less for the carry-on if they pay online or at the airport check-in counter.
Most airlines charge between $20 and $30 for checked bags and allow two free carry-ons. As Reuters reported Wednesday, the airlines been shoring up their nearly bare coffers by introducing auxiliary sources of revenue by charging customers for items and services, while also cutting capacity and adjusting their business models; in the last few years, the industry has been hammered by the combination of unpredictable fuel prices, a poor economy that has hindered travel and competition from budget carriers.
Spirit isn't the only airline getting more money from passengers: Travelers on other airlines now pay for in-flight blankets and pillows and even as much as $75 for an extra-legroom seat on a cross-country flight.
As outrageous as it sounds, Ryanair, a budget European carrier, has revived its much-debated plan to charge for a trip to the restroom by using coin-operated toilets.
JetBlue still gives you a free bag of blue potato chips, but it now charges for other perks, including, for April only at this point, whopping fees for extra-legroom seats. For a San Francisco to New York flight, for instance, more legroom will cost you $75 each way.
According to JetBlue, the airline is trying the fee structure to gauge demand and determine whether to replace the longstanding fees of between $10 and $40 per flight.
Here’s a sampling of other fees charged by airlines:
- Pillow and blanket, American, $8
- Wi-Fi, through gogoinflight.com, $4.99 for 1.5 hours to $39.95 for a 30-day unlimited pass good for multiple airlines that include AirTran , American, Delta and Virgin America.
- “Deluxe” sandwich, $10, JetBlue
- Headsets, $2, JetBlue
For a list of domestic baggage fees, check out airfarewatchdog.com’s chart (you can see it here). The site’s founder, George Hobica, recommended in a February post that heavy packers may want to fly Airtran, Alaska , Frontier and Southwest , due to their lower baggage fees, even if there’s a cheaper fare on another airline.
Bonnie Gray knows there are people out there who are worse off than she is. After all, at least she has a job.
It's just not a full-time gig.Like many other Americans, she works part time and it's barely enough to pay for food, fuel and shelter. Millions of Americans were working part time in November but they would like to have been working full time. These so-called ""involuntary part-time workers"" are an example of some of the stubborn pockets of weakness that remain in the labor market even as the jobs picture improves very slowly.
The Bureau of Labor Statistics reported Friday that nearly 8.2 million people classified themselves as involuntary part-time workers in November, meaning that they settled for less work because they couldn't get more. That's around double the number of involuntary part-timers in 2006, before the nation went into recession and entered a prolonged period of weak recovery.
A separate group of more than 18 million people were working part-time in November for non-economic reasons, either because they are in school or they want to spend more time with their children, for example.
The number of people who are involuntarily underemployed has gone down since it hit 9 million in the depths of the recession, but progress has been slow and rocky.
'A Demand Problem'
For people like Gray, 63, improvement can't come soon enough.
Gray, who lives in Cary, Ill., for years worked two jobs: a full-time administrative job and, for extra money, a part-time cashier job at a major home retailer. She was laid off from her full-time position, which paid close to $16 an hour, in January of 2012.
She was left with a part-time job that pays $12.40 an hour. That plus some unemployment compensation she receives is barely enough to cover her mortgage and other expenses. She sometimes relies on her church for food, and worries what will happen when the unemployment runs out at the end of the year.
She's spent nearly a year looking for another receptionist or administrative position.
""I'm on the computer, it seems, 24/7. I am networking. I've walked out my resume to 83 companies,"" she said. She's also taken classes on how to interview and on invoicing, and she plans to take another one on PowerPoint.
She's had many job interviews in the past 12 months, but no full-time job offer.
Gray said she can't work any more hours as a cashier because a tumor on her foot makes it difficult to stand for a long time.
According to her doctor, the mass isn't cancerous, she said, but she can't afford to have it removed. Her insurance as a part-time worker wouldn't be enough to cover the procedure and rehabilitation.
Gray will turn 64 in February, which means she won't qualify for Medicare for another year. Until then, she said, she needs a job that offers health insurance.
She's hoping to avoid dipping into Social Security for as long as possible because the longer she waits, the more she stands to collect.
""I was actually hoping to hang on until 70,"" she said.
She may still be in for a tough slog. Heidi Shierholz, a labor economist with the liberal-leaning Economic Policy Institute, said the basic issue plaguing involuntary part-time workers like Gray is the same one plaguing the overall labor market: There's just not enough demand to compel employers to add to their labor costs substantially.
Shierholz said she expects involuntary part-time workers to gradually see improvements but ""it is a going to take a long time.""
""I think by far the dominant reason that we aren't seeing employment in both dimensions — full (time) people or ramping up hours for workers that already are there — is just a demand problem,"" she said.
Once employers have more work that needs to be done, they'll add more hours for people to do it.
'Now I Have to Watch Everything'
Debbie Fiore doesn't see that happening any time soon at the small company where she works.
Fiore, who lives in Nottingham, Md., lost her full-time job with a long-term care company nearly two years ago, and has struggled for more than a year to find another job.
A friend connected her with a small company that hired and trained her for an accounts payable and receivable job. She works about 25 hours a week and makes about half what she used to.
Fiore, who turns 57 this week, and her husband struggle to pay their bills. It's not the situation she envisioned they would be in heading into their golden years.
""We're basically living paycheck to paycheck. We're not able to save anything for the future at this point. There's hardly any emergency money if an emergency comes up,"" she said.
She's immensely grateful for the job she has, and said she loves the work. But financial worries weigh heavily on her.
""I think my attitude, my demeanor has changed,"" she said. ""I used to be a very carefree, fun person, and now I have to watch everything.""
The ""Fast Money"" traders delivered their final trades of the day.
Tim Seymour was a buyer of Wal-Mart.
Dan Nathan was a buyer of Verizon.
Karen Finerman was a buyer of Apple.
Guy Adami was a buyer of Macy's.
Trader disclosure: On January 4, 2016 , the following stocks and commodities mentioned or intended to be mentioned on CNBC's ""Fast Money"" were owned by the ""Fast Money"" traders: Tim Seymour is long AAPL, BAC, CLF, DIS, F, FCX, GE, GM, GOOGL, INTC, JCP, JPM, KO, LGF, RL, T, TWTR, VRX. Tim's firm is long BABA, BIDU, MCD, NKE, SBUX, YHOO. Dan Nathan is long MCD Feb Put Spread, Long PFE buy-write, Long TWTR March Risk Reversal, Long UUP March call, Long XLU Feb Call spread, Long PYPL Jan Risk Reversal, Long M Jan16 call spread, Long NTAP Jan risk reversal, Long Len Jan Put Fly, Long QCOM feb calls, Short SPY, Long UUP. Karen Finerman is long BAC, C, FL, GOOG, GOOGL, JPM, KORS, KORS call spreads, M, SEDG, URI, she is short SPY, Her firm is long ANTM, AAPL, BAC, C, FL, FL calls, GOOG, GOOGL, JPM, KORS, LYV, M, MA, MOH, PLCE, URI, URI long puts, WFM, her firm is short IWM, MDY, SPY. Karen Finerman is on the board of GrafTech International. Guy Adami is long CELG, EXAS, GDX, INTC, Guy Adami's wife, Linda Snow, works at Merck.
WHEN: Today, Tuesday, September 13th
WHERE: CNBC's ""Squawk Box""
Following is the unofficial transcript of a CNBC EXCLUSIVE interview with Treasury Secretary Jack Lew live from the CNBC Institutional Investor Delivering Alpha conference in New York City on Tuesday, September 13th.
Following are links to the video of the interview on CNBC.com:http://video.cnbc.com/gallery/?video=3000550691, http://video.cnbc.com/gallery/?video=3000550692 and http://video.cnbc.com/gallery/?video=3000550696. Additional clips are available at CNBC.com.
Mandatory credit: CNBC Institutional Investor Delivering Alpha conference.
TYLER MATHISEN: Thank you, Mark. So this is Delivering Alpha Number 6. We're going to start using Roman numerals, so it's VI. We've had the privilege on five of -- this will be the fifth time -- save one of our Delivering Alphas, each time we've had the privilege of Treasury Secretary of the United States being with us, back to Mr. Geithner's term and now, for the third time, the 76th Treasury Secretary of the United States, please welcome to the stage, Jacob Lew and his interviewer, Steve Liesman, chief economics correspondent for CNBC. Got to get the title right.
STEVE LIESMAN: Mr. Secretary, thank you for continuing this tradition of kicking off Delivering Alpha with us.
JACOB LEW: Great to be with you this morning.
STEVE LIESMAN: Am I right that you were just a little late because you were meeting with the lyricist for the musical that's going to be made with your tenureship? Is that right?
JACOB LEW: Just like every other New Yorker, I was stuck in traffic.
STEVE LIESMAN: Will it be rap?
I want to start off with some of the headlines. I mean, it's been a series of headlines from your brief, so to speak, over the last several days.
This morning there's a story that an executive who oversaw some of the places where there was alleged phony accounts created at Wells Fargo made $125 million. Do you feel this is money that should be clawed back or there should be systems in place to claw this money back?
JACOB LEW: The consumer protection agency that took action against Wells Fargo is an important new addition to our protections for individuals and for the financial system. It didn't exist before financial reform. I think they uncovered practices that they have taken action against. I don't comment on specific regulatory matters. But what I can tell you is what I've seen from what they've done is bad behavior they were correct to take action against. And how that flows through in terms of next consequences is going to depend on the facts of the case.
What I can tell you is there's a lot of talk in Washington these days about rolling back Dodd-Frank, about rolling back the law, changing the law that created the agency that uncovered and took action against this. This ought to be a moment when people stop and remember how dangerous the system is when you don't have the proper protections in place.
This is something that our watchdogs found. If they were not there, they would still be going on. This is a wake-up call. It should remind all of us, and firms, that culture and compensation make a difference. How you reward people, how you motivate people, and what values you hold people to matter.
There's a public responsibility, and I think the CFCB took action reflecting the public responsibility, and there's a private responsibility. And we each have to do our part.
STEVE LIESMAN: But if culture and compensation make a difference, then why wouldn't you support a clawback of this?
JACOB LEW: I'm not commenting one way or the other on the clawback. I really am not going to comment on the facts of the specific case. It's being reviewed by an independent regulator. It wouldn't be appropriate for me to speculate on something that I don't know all the facts of. I think I'm addressing the issue in a pretty conclusive way. This is unacceptable behavior. And it's the kind of behavior that we need to be able to catch and stop.
STEVE LIESMAN: We've had billions of dollars of fines levied on financial institutions. And still this behavior is still being uncovered. Is Justice going far enough here? Do we need to be in a situation where, for example, companies are not allowed to plead that they didn't commit the alleged act and that there are individual indictments brought? We haven't seen that in any of these financial crimes, or very few of them.
JACOB LEW: We have, I think, taken action on a pretty dramatic basis to put fines, penalties in place for firms that have acted badly. The question of whether or not to pursue criminal prosecution is a decision that prosecutors ultimately make. We have made clear we don't believe that anyone is too big to jail. It's up to prosecutors to decide how you pursue the criminal charges. It's not up to regulators or the policymakers.
What I can say is that the pattern of behavior that we've seen here is something that needs to stop. It is not acceptable to do things that are designed to increase either an individual or a firm bottom line by deceiving consumers and passing along charges that are either invisible or they don't know about.
And this is not the same as a financial crisis issue. This is really a consumer protection issue. I don't think this is a moment where we have to ask the kinds of questions that we did in 2008 about what it means about the underpinnings of the financial system. But when I hear people say we want to roll back the statute that created the consumer protection bureau, this is yet another proof point that it was the right thing to create, it's the right thing to have an independent director, and it's the right thing to make sure that there's somebody, and an entity watching over our system, to make sure that individuals get clear information about their financial products and, when firms or individuals behave badly, that somebody finds out about it and takes action.
STEVE LIESMAN: Moving to another company story which is in the headlines, and you're doing specifically with this issue of Apple, an attempt by the European Union to get 14 1/2 billion dollars of back taxes.
Beyond the company-specific story, is this an attempt by the E.U. to essentially grab unpaid American taxes?
JACOB LEW: You know, Steve, I have an op-ed this morning in the ""Wall Street Journal"" where I went into some length describing our views on this. But let me briefly reprieve what I've said on this. We have for some time told the European Commission that we believe that this is an inappropriate approach. Why is it inappropriate? We agree with them that it's wrong for companies to avoid paying their fair share of taxes to get to zero or very low tax rates by taking advantage of tax havens.
But the action that the European Commission took is out of the framework of normal tax policy, a retroactive tax that reaches into another country, another jurisdiction's tax base, in order to make sure that a firm pays its taxes. We agree with them that firms should pay their taxes. But when it's U.S. income, we think that that tax should be paid in the United States.
We've done a lot of work over the last two years to work on an international basis to make sure that -- to share information better. And we have an ability to close several loopholes that have contributed to the erosion of tax bases around the world. We need to take action in the United States to decisively change and pushing firms to take their income overseas. We have a broken corporate tax code.
We have the highest statutory tax rate in the developed world. It's riddled with deductions and loopholes that give advantages that we don't really need or would design for for today's economy. And the result is we see U.S. companies trying to impart income in lower tax jurisdictions.
Now, those lower tax jurisdictions are for doing some things that aren't right also. The race to the bottom with low tax rates to be a magnet for those companies, that has to change too.
But what action do we need to take in the United States? We need to fix our tax system. We need to close the loopholes. We need to lower the statutory tax rate. And one of the things that we've proposed, which I believe is an idea that will still have resonance in the year to come is that the revenue that we get by putting a one-time tax on income that's parked overseas will produce one-time revenue that ought to be used to fund an investment in infrastructure in this country.
So we can do two things at the same time. We can fix a broken tax code. We can make it so that our companies don't feel they have to leave the United States to put their income overseas. And we can fix our broken infrastructure.
What I don't think is right is for tax authorities and other jurisdictions to reach into our tax base and to remove the ability for us to execute what I just described.
STEVE LIESMAN: So if they're reaching in on Apple, are there other company cases yet to come?
JACOB LEW: There are a number of pending matters --
STEVE LIESMAN: Pending, but what about ones that you think there's going to be more of a grab at this point?
JACOB LEW: I can't speak to the European Commission, but we have spoken on the policy. We don't address individual cases. As I mentioned before, I'm not addressing the individual case that they choose to act on.
STEVE LIESMAN: So does that mean you won't join as a party to the case in Europe, to join as an amicus, so to speak?
JACOB LEW: Well, the European procedure is a little bit different than ours. They are very aware of our views. We've submitted our views in a pretty formal way. The parties here are the government involved and the company involved. They've both indicated their intention to appeal. And we've made our views known to the authorities in Europe. And we've done it in a way that our views will be before the commission on future matters as well.
STEVE LIESMAN: Let's talk about the tax rate, the right corporate tax rate. 35% is the current top rate, just the federal part. There's another six points or so according to the OECD that would be added on some level. You proposed 28. It seems like the House Republicans wanted 25, and Donald Trump wants 15.
15 would be toward the lower end of the OECD. 12 1/2 is Ireland. Germany is around 15. Why wouldn't we want a rate that low that would make America very competitive?
JACOB LEW: The principle that's driven our work on tax reform is that it has to be revenue neutral. We are -- I don't think -- it would not be right for us to have individuals pay more taxes for us to lower the corporate tax rate.
What we've proposed doing is eliminating loopholes and deductions and using the revenues that we get by doing that to reduce the tax rate on the business side as much as we can. We got to 28% essentially because that was the amount of loopholes that we could close.
STEVE LIESMAN: I get what you're saying, and that makes perfect sense on one side of the ledger. But the other side of the ledger, at 28, you're still not competitive and there's still a 13-point incentive for companies to go overseas.
JACOB LEW: In the 25-28% range, we're getting pretty close to the average. And a few minutes ago, I talked about the race to the bottom. Some of the pressures on countries that cut their tax rates to low rates in order to be a magnet, if we, as we have discussed in the G20 and the OECD and other international bodies, truly believe that we need to close down the pathways to tax avoidance, we're going to need to conform to some norms. And having countries go to very low tax rates is part of the problem. We have our problem. We have a very high rate and a broken system. We need to fix our system and take a look at theirs as well.
STEVE LIESMAN: Is this a failure of the administration for corporate tax reform here?
JACOB LEW: I actually think that if you look at the history of tax reform, it often takes many years for it to kind of take hold. And it's not unusual for it to begin in one administration and finish in another. I feel we've made actually a great deal of progress working through bipartisan conversations to build a growing consensus around the kind of approach that I've described.
I think that there's an environment now where the political environment is not one where it has been ripe to take up something like this. But the ideas that we've been promoting will be the foundation for action in the future.
So I actually feel we've moved significantly toward tax reform. You know, it takes a desire on the part of Congress to do something hard. Hard things don't happen unless there's a real, real desire to do it. And you need a partner. We have had individual partners, but, as a whole, we have not had that commitment.
STEVE LIESMAN: But if you look at this issue from outside the Beltway, one guy is at 28, the other guy is at 25. Let's get in the room, spend 7 minutes, and we'll make a deal. It seems like you were impossibly close almost the entire time and didn't make it down there.
JACOB LEW: You and I have discussed this a number of times, Steve.
STEVE LIESMAN: And I still don't have a good -- not from you, but in general.
JACOB LEW: I do believe that the people that we've engaged with, who have been leaders on the Republican side, now Speaker Paul Ryan, some senators who have been engaged in it, we've had a lot of conversations that lead me to believe there is the basis for an agreement. I just think the time for that agreement is probably not the next four months.
STEVE LIESMAN: Do you look back --
JACOB LEW: In terms of need to do it, you look at the infrastructure component of this, I think there's an urgency right now to dealing with infrastructure. You look at the action taken by the European Commission, that's an urgency that we need to act if we want to protect our tax base.
You have an alignment of forces right now that I think create a real opportunity. And I certainly think that's an opportunity the American people would be well served if Congress takes advantage of.
STEVE LIESMAN: Let's talk about the Trans-Pacific Partnership. Again, that's another program or effort by the administration, worked hard on it, seemed to get agreement, and now can't get it through Congress. Do you regret that? Is that a failure of the administration?
JACOB LEW: Well, first, I wouldn't draw conclusions about what we can and can't get through.
STEVE LIESMAN: I'm watching my clock here.
JACOB LEW: There's still time for the TPP, Trans-Pacific Partnership, to be approved.
Let's start with the substance. TPP is a good economic deal for the United States. It's good for American workers. And it's good for U.S. security interests in the world. It means that they will have a more level playing field. American products and services, which are best in the world, will be able to compete on stronger ground. And it retains the U.S. leadership in the world on important strategic issues.
So I think it's vitally important that we get it approved. I believe there's still support for TPP. There's clearly opponents of TPP. I can't question that. We've passed through the Congress, about a year ago, the underlying legislation, Trade Promotion Authority, which provides the procedural basis to approve TPP. TPA, I believe, was a harder vote than TPP. It was an abstraction; it wasn't a specific agreement.
I can point in TPP to how it strengthens labor standards, how it strengthens environmental standards, how it raises business practices closer to our own. I can point around the world to countries that are already taking policy actions, whether it's Mexico or Vietnam, to meet some of those standards.
I think we have the substance profoundly on our side. What I think the challenge we have -- and this is a big challenge. We can make the case that it will improve growth in the United States, and more GDP should be good for everyone. Where we're running into a problem right now is the sense that is not just in the United States, but it's in other parts of the world, that more growth does not necessarily mean better wages or better opportunity for working people.
I think the issue that is the real issue that we're going to have to deal with is to show how the benefit gets to individuals. And that's bigger than TPP. I think we saw that in the United Kingdom in the vote recently on the referendum.
STEVE LIESMAN: And that's a failure at every level of leadership, when it comes to economic issues, the issue of trade and its benefits. The support of the American people has eroded almost across the board.
JACOB LEW: Right. But the point I just made, Steve, is it's broader than trade. I think it gets to the question of a social compact. I think it gets to the question of how free market capitalism and liberal democracy thrives. We have to ask some serious questions about what is it that's holding wages back? What is it that's preventing individuals from feeling that they have a share in growth?
I know what we can do at a public policy level. At a public policy level, talking about infrastructure, and we talk about skills. If you want to have working people feel that they have a stake in the future, they have to have the skills to get jobs in the economy of the future, and they have to have the ability to get to and from home and work. And they have to see a growing economy that's going to grow the kinds of jobs that they can take advantage of. That's bigger than trade.
I think we have a confluence of things that have been going on between technology and trade and the changing structure of our economy that are making it a challenging moment. But TPP on its face should be a clear plus. And we're going to continue to make that case. And I think we're going to have to demonstrate the commitment to working families.
STEVE LIESMAN: But, I mean, in that equation, you have to address the omnibus criticism of the Obama administration, which was one of regulation that tamped down on private enterprise, and too much government intrusion into the private sector that really kept some of the gains getting to individuals.
JACOB LEW: I think if you look at where the economy was when we took office just under eight years ago, it was in the middle of the greatest recession since the Great Depression. We were seeing unemployment at 10%. There was no bottom. We put in place an economic program that's lifted the United States out of that recession. We've seen sustained growth. We've seen 15 million new jobs. We're seeing wage growth. And some of these things that you're just labeling regulation are also why we're able to be in a place to meet our commitments to reduce our emissions and to meet the standards to make this a safer world by having our climate problems not engulf our future.
There's a lot of things going on inside the package that you call just more regulation. This economy is a stronger economy because of the policies we've pursued. It's not as strong an economy as we would like to see. A lot of what I see as having held back the U.S. economy is the headwinds internationally. We've seen probably a half a percentage point of GDP shaved off the U.S. economy because demand globally has been weak.
That's one of the reasons we put so much time into trying to help move the global debate towards using more policy tools to grow demand and grow the economy. And we've made progress there. I think we've made real progress. You are seeing a number of countries around the world put in place more aggressive policy using fiscal tools as well as monetary tools.
So I think there's a lot of things going on. And I think right now the United States is looked to in the world as being a resilient economy that's bounced back. What I tell my colleagues around the world is we can't be the only engine in the world economy. There need to be multiple engines.
STEVE LIESMAN: I want to get to the overall economy. But one of the things you've talked about is this need to invest in infrastructure. The Republican nominee has accomplished something like half a trillion dollars for spending on infrastructure. Do you think that's a good number?
JACOB LEW: I have to tell you, Steve, I haven't dissected any of the campaign proposals. I'm not doing politics in my current life. I'm happy to talk about our policies, but I haven't actually taken apart the campaign proposals.
STEVE LIESMAN: Well, what's the right number for infrastructure investment? I assume you're talking over a 10-year period.
JACOB LEW: Yeah, the right number is a very, very big one. We have trillions of dollars that need to be invested. It's not all public money. What we did a year ago, a little over a year ago, is we extended our surface transportation funding for five years, basically at level funding, a little bit of an increase. Enough to maintain what we're doing now, not enough to build the new facilities that we need to compete in the 21st century.
I think putting several hundred billion dollars of federal money into a commitment on a multiyear basis to build infrastructure would have an effect on state and local planning that would bring more state and local resources to bear and, just as importantly, would be a foundation for public-private partnerships, which is what gives you the ability to leverage the amount of resource you are putting in.
This is not all a question of just federal funding. But federal funding has been the foundation. One of the things that we do is we create a kind of certainty out there that there's steady flow to get projects off the drawing board. Without that, the whole system slows down. And I think we have taken some time off from driving that process forward, not to the point that it's irreparable, but we can't take another decade off.
STEVE LIESMAN: At the same time, when we look at overall economic growth, we're doing just around 1% the last three quarters. How much concern has this caused you that we can't even get to the new lower new normal of 2%?
JACOB LEW: I think when you go quarter to quarter, sometimes you can overexplain an individual quarter.
We've seen growth in the low 2% for a number of years now. We're continuing to see strong labor markets. We're continuing to see improvements in wage growth. Consumers in the U.S. are very strong. Housing is doing better. Autos have been doing very well.
The weak spot on the economic picture is investment. And I think that if we could figure out what it is that's going on in investment and productivity to drive the investment numbers forward, that would be very important. I mean, I think that there is a lingering lack of confidence in the global economy coming out of the economic crisis. It was a deep, deep economic crisis. It left concern. How do you know we're not snapping back?
I think in the United States we've demonstrated pretty decisively that we're not slipping back. There are other parts of the world where every three to six months you wonder, is it going one way or the other? There's a lot of geopolitical risks. I think we have to stabilize those risks.
One of the things we do when we meet in the G20 is focus on that. And just last week we met in China at the G20 leaders meeting. And I think you heard a few things at that meeting that were important and different.
One is what I just talked about in terms of inclusive growth, in terms of everybody sharing in it. We used to be a chorus of maybe one talking about inclusive growth. All the leaders were talking about inclusive growth. I think there's a clear understanding that we have to show that the benefits of growth get to working people globally right now.
Secondly, there was a commitment to using all policy tools that is much stronger than its been in the past, where heads of state are talking about using the fiscal space they have more vigorously. And I think on the exchange rate issues that have been so vexing for a long time, we have a clear agreement to refrain from competitive devaluation and to coordinate together so that, at moments of volatility, we don't see unilateral actions that destabilize the global economy.
STEVE LIESMAN: I just want to come back to one of the things you just talked about, which is using the fiscal side.
Is the fiscal side getting a message from the monetary side that there's only so far they're willing to go? Mario Draghi last week suggested, you know, we're at a negative place. We don't want to go more negative. Possibility of the feds discussing raising interest rates. Is the fiscal side getting a new message from the monetary side?
JACOB LEW: As you know, Steve, I don't comment on monetary policy, particularly not fed policy.
STEVE LIESMAN: We're talking about fiscal policy.
JACOB LEW: I don't think that fiscal authorities needed messages from anyone that the fiscal tools are important. We've been delivering that message consistently since 2009. I've been doing it as treasury secretary for the last three and a half years. What we've seen over the last three years is a shift in the debate.
When I became treasury secretary, there was a global debate about austerity versus growth. We went to G7 and G20 meetings and there would be debates about austerity versus growth. Those debates are over. There is no more focus on austerity qua austerity. There is a focus on making sure there are sustainable fiscal plans, but in terms of short-term programs, the global community has embraced the idea that we need to use all policy tools.
Now, if you look around the world, even in the last six months, you've seen from China to Canada, from South Korea to Japan, more use of fiscal tools in a responsible way. It doesn't mean build up debt that's unsustainable. But it does mean don't try to hit deficit targets and debt targets in the short term when you need to get your economic engine moving.
I think fiscal authorities during this recession put more pressure on monetary authorities than they should have. I've said that all along. Here in the United States, we went too fast in the terms of some of the fiscal consolidation. There was a big debate in the United States in 2011 and 2012 about this. We've done okay. We could have done better. We could have had a little more growth if we had put some of the savings a few years out and less of the savings in the front end. Other countries didn't do as much as we did. They didn't have the recovery. They didn't do a payroll tax. You know they didn't come back repeatedly and put more fiscal power to deal with economies that needed it.
It wasn't always pretty in the United States, but we used all of our policy tools. Our fed was aggressive, our fiscal program was big, and our reform to the financial system was a structural reform that we needed here in the United States.
There are still challenges in the future, but our call internationally is for all the tools to be used.
STEVE LIESMAN: I want to talk about the challenges in the future. Could you give us an idea -- maybe you've thought about this. What goes in the letter that you leave for your successor?
JACOB LEW: Well, this may surprise you, Steve, but that's something you think about when you get to the last day, in my experience. You don't write it four months in advance.
I think that we're still focused on the work we have to finish in these next four months. I think that the economy that we are working through now and that we will leave behind is much, much stronger in almost every dimension than the economy we inherited. I'm proud of that. That's something the American people are well served by.
That doesn't mean that all of the challenges of the future are addressed. I think these questions of income inequality are deep economic and social issues. And we've put proposals forward that we believe deal with that in a sensible way to pay for things like education, starting with preschool, community college education, and pay for infrastructure and to have an equitable distribution of tax burden to pay for it. Those debates aren't over.
I think that if we take a long break from dealing with all of those issues, we pay a price. It starts to stress both the economy and the social fabric.
I think we've done enormously important work. I don't think any administration finishes the job. You pass the baton, and you give some advice, and then you try from the sidelines to help move things in the right direction.
STEVE LIESMAN: So I wonder if, four months in advance, you think about what you'd do personally. Have you thought about going back to Wall Street or academia? What have you thought about?
JACOB LEW: I have made one key decision: To live in the same city as my wife for the next four years.
STEVE LIESMAN: I'm looking forward to Lew the Musical. And thank you very much for joining us.
JACOB LEW: Thanks, Steve.
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France's foreign minister said on Sunday a prisoner swap between Ukraine and Russia was an opportunity to find a solution to the crisis.
""There is an opportunity, a door opened to start making progress towards settling this conflict,"" Le Drian told Europe 1 radio,
Russia and Ukraine swapped dozens of prisoners on Saturday in a carefully-negotiated rapprochement that brought Western praise and could thaw a freeze in relations since Moscow's annexation of the Crimea region in 2014.
Starbucks' coffee isn't the only menu item to go blonde.
The coffee giant is now offering ""blonde espresso"" at all U.S. locations, marking the first time the company has given its consumers a chance to pick the espresso in their cup.
This new espresso, made with beans from Latin America, packs 10 more milligrams of caffeine per shot and has a distinctively crisp, citrus flavor and a creamy texture.
The company said it hopes offering customers a little more choice will make espresso more approachable to new coffee drinkers. This gateway espresso will be a permanent fixture on Starbucks' menu for the same price as Starbucks' Signature espresso shot.
The company introduced blonde espresso in Canada before testing it in Austin, Texas, and Tampa, Florida. Starbucks said that it was well-received by customers and its baristas.
Starbucks has worked hard to define itself as a go-to premium coffee destination, especially with its newer Roastery and Reserve Bar locations. Adding blonde espresso allows the company to appeal to consumers who haven't acquired a taste for strong and bold coffee flavors. Because of this, Starbucks said that it isn't worried about sales cannibalization.
This product launch, which started Tuesday, comes at a time when Starbucks is faced with increasing competition from coffee companies like Dunkin' Donuts, which has increased its number and variety of premium coffee items, and even fast-food chains like McDonald's, which has gained a foothold in the market with its $2 McCafe drinks.
Starbucks is also under pressure to revitalize its U.S. sales growth. In November, Starbucks reset its long-term financial targets, and now expects global same-store sales growth of 3 percent to 5 percent, down from a prior goal of mid-single digit growth.
Norway's StatoilHydro said currency gains boosted its third-quarter net profit, but lower oil and gas output and higher costs hit operating results and made the $110 billion group cautious on 2007 production targets.
Output fell 2 percent year-on-year to just over 1 million barrels of oil equivalent per day, a touch below forecasts and echoing industry trends seen at both Shell and BP, where production fell 4 percent.
Shares in StatoilHydro rose 1.6 percent to 185.7 crowns after a slow start to outpace the DJ Stoxx Oil and Gas Index, up 1.2 percent on the back of record oil prices.
Earnings before interest and tax fell to 24.4 billion crowns ($4.54 billion) in July-September from 30.2 billion a year ago, worse than all forecasts by 18 analysts in a Reuters poll, which ranged from 24.8 billion to 30.3 billion crowns.
""The decrease is mainly caused by lower downstream results, a 15 percent decrease in gas prices, as well as higher operational costs and exploration activity,"" Chief Executive Helge Lund told a news conference on Monday.
Net profit rose 26 percent to 10.7 billion crowns, beating an average forecast of 9.9 billion in the Reuters survey, ""mainly due to an increase in net financial items from currency gains,"" StatoilHydro said.
The third-quarter results are the last without the oil and gas assets of industrial group Norsk Hydro, which Statoil officially took over on Oct. 1 to become StatoilHydro.
""The numbers were worse than expected, and adjusted for one-off effects, they were even worse,"" said analyst Martin Moelsaeter at First Securities.
Foggy Guidance
Lund said he expected Statoil's production to be at the lower end of its 2007 target of 1.15-1.2 million boed, but offered little vision for beyond this year.
The group will give figures including output from the acquired Norsk Hydro assets on Nov. 12, and its production targets for 2008 are due out early next year.
Mark Bloomfield, analyst at Citigroup Global Markets, said StatoilHydro did not have a ""confidence-building quarter"" in terms of production, but he expected combined StatoilHydro production to grow by 8 percent in 2008.
""(StatoilHydro's investment) story may be hurt by near-term uncertainty over volume guidance, but this is presently outweighed by $90 a barrel plus oil price,"" Bloomfield said.
""StatoilHydro remains our top pick (in Europe's integrated oil and gas segment), reflecting attractive fundamental valuation and a 10 percent ... discount to the peer group.""
StatoilHydro's oil and gas production in the third quarter fell to 1.056 million barrels of oil equivalent per day, below the 1.08 million boed average forecast. Its production costs per barrel rose to 31.3 crowns for the 12 months ended Sept. 30, from 26.2 crowns for all of 2006.
Russian Hopes
Last week StatoilHydro agreed with Russia's Gazprom to become a partner in the giant Shtokman gas field in the Russian part of the Barents Sea.
Lund said costs stemming from the deal will come later. ""We have not paid one crown at this stage,"" Lund told Reuters, rejecting Russian newspaper reports that his group had paid hundreds of millions to participate in the project.
StatoilHydro has said project expenses are limited initially to the costs of planning and studies, until a final investment decision is made, probably in the second half of 2009.
In a research note on Friday, HSBC said if the Shtokman deal went ahead it could be worth an additional 2.5-5 crowns per StatoilHydro share.
StatoilHydro gets 24 percent of the company that will develop the Arctic field, by far the biggest in Europe, and will probably be able to book reserves from it despite not being a direct owner of the field. It joins France's Total as a second western partner in Shtokman.
Shares in StatoilHydro have surged by 22 percent since mid-August lows, outpacing an 18 percent rise by the DJ Stoxx Oil and Gas Index.
According to Reuters Knowledge, StatoilHydro trades at around 11.5 times forecast 2008 earnings, below the 12.9 times average in the Integrated Oil and Gas sector.
Microsoft owns a number of under-appreciated businesses in the under-appreciated tech sector, and the stock is cheap right now, CNBC's Jim Cramer said Monday.
""What's so interesting is that the cheapest stocks are tech. They are cheap and people want to have cheap,"" Cramer said on ""Squawk on the Street.""
""I see value in tech. The difficult thing is that if you want to sell in May, there are other people who are hoping you'll sell in May in order to get that performance.""
With several Wall Street firms downgrading Microsoft shares because of expected weakness in earnings, Cramer said ""it was just the opposite. They were strong. The entertainment and device business is terrific. ... I thought that the quarter was excellent.""
With a new Xbox on the way, Cramer said Microsoft CEO Steve Ballmer ""has changed the way that people look at that company. It's maybe late in the game for him, but I like the fact that the company has, to me, been proving the doubters wrong.""
(Related: Cramer: What You Absolutely Must Know about Street Analysis)
""I like the idea that there's a 'sum of the parts' here that is much bigger than people realize,"" he said. With the company's cloud business and entertainment business surfacing as multibillion dollar brands, ""suddenly you have to look at this company as a different animal.""
""I would love, love, love a piece, if they were to spin out Xbox,"" he said. ""Xbox plus Netflix, if they bought Netflix then you would see that this company has a lot of weapons. It's certainly better than Hewlett-Packard.""
Although many still see Microsoft as a ""PC company,"" Cramer also likes the cash position and the component businesses.
(Read More: Bill Gates on Microsoft's Apple Attack Plan)
Cramer said he sees this as an execution story, which has also helped companies like Xilinx, Texas Instruments, BMC Software and Adobe. ""This is an undervalued sector,"" he said, comparing the group to consumer products names that are relatively much more expensive.
With earnings around 12 times earnings in tech, Cramer pointed to multiples in consumer names like Kellogg and General Mills at around 19 times earnings. He said that he would be more comfortable owning Microsoft at these levels than consumer companies at more expensive levels.
Talk of a suspension of bailout money to struggling euro zone country Greece is ""premature"", according to a senior International Monetary Fund (IMF) official.
""The story is premature. We are still having discussions with Greece. Provided that we can reach agreement with them before the end of July , there's financing for the subsequent year,"" David Lipton, the deputy managing director of the IMF told CNBC at the St. Petersburg International Economic Forum.
(Read More: )
Officials involved in the Greek bailout told the Financial Times on Thursday that the IMF is preparing to withdraw its monetary support from the end of July unless euro zone leaders plug a 3 - 4 billion euro funding gap that has opened up in Greece's 172 billion bailout program.
According to reports, the gap has emerged because euro zone central banks have refused to roll over Greek debt that they hold - refusing to buy new bonds when older bonds mature. Reuters reported Wednesday that foot-dragging could leave Greece some 2 billion euros ($2.7 billion) short this year.
""The central banks will make their own decisions. They've made pledges in the way in which they are going to help Greece and we're pretty sure that they are going to carry out those pledges,"" Lipton said.
(Read More: EU to Decide Who Pays When Banks Fail)
The Financial Times article is a story of European provision of finance and not specially about the Greek bailout, he said, adding that he doubted that the suggestion was purposely leaked to journalists to place pressure on Greece to deliver its reforms.
""We have to count on the fact that markets are generally deep enough, that if some participants have a game and they want to get out and get yields back up, there will be somebody else willing to come in and buy who realizes that prices have gotten out of line,"" he said.
(Read More: For Hard-Hit Greeks, IMF Culpa Comes Too Late)
Greece is making progress but there are still some issues to be resolved, Lipton said, adding that Greece's measures to privatize certain sectors were one issue but numerous steps still needed to be taken.
""Our job is to go out and fight the crisis of the day. We know crises always throw you curve balls...so we have to kind of do a ruthless re-examination of everything we do. We do it periodically. We're not trying to criticize anyone,"" he said.
—By CNBC.com's Matt Clinch. Follow him on Twitter @mattclinch81.
Hedge-fund investor Aaron Stern is a big believer in the German utility E.ON's turnaround.
E.ON's ""management team has [been] engulfed in a multiyear transformation, which has been nothing short of spectacular but has yet to be rewarded by the market,"" he said on CNBC's ""Worldwide Exchange"" Wednesday.
The investor said the company has sold off its legacy coal business, spun out its noncore assets and trades at a ""significant discount"" to its industry peers.
""Yes we do believe [E.ON shares] could double over the next two years,"" he said.
He recommended the investment at Sohn Tel Aviv conference Wednesday.
Stern is a managing director and partner at Fir Tree Partners. He manages the firm's international and emerging markets investments. Fir Tree has $8 billion of assets under management.
Sohn is a series of widely anticipated hedge-fund conferences, where managers volunteer their time and best investment ideas to raise money in the fight against childhood cancer.
Here’s our Fast Money Final Trade. Our gang gives you tomorrow’s best trades, right now.
Guy Adami thinks the market is going lower. “Trade that,” he says.
Steve Grasso is equally bearish. He’s concerned that the S&P is weak into the end of month and the end of quarter. “Not a good sign.”
Joe Terranova says if you’re worried about a sharp decline in the market, “Get defensive with long positions in MUB or LQD.”
Click here to see other Final Trade posts.
______________________________________________________
Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to .
Trader disclosure: On Sep 28, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s ""Fast Money"" were owned by the ""Fast Money"" traders; Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Terranova is long VRTS; Terranova is long OXY; Terranova is long HOS; Terranova is long OIH; Terranova is long CVI; Terranova is long AXP; Terranova is long EMC; Terranova is long F; Terranova is long AMZN; Terranova is long WFC; Terranova is long AAPL; Terranova is long IBM; Terranova is long Silver puts; Terranova is long PCP; Terranova is long MS; Terranova is long GS; Terranova is long WFM; Grasso owns AKS; Grasso owns AMD; Grasso owns ASTM; Grasso owns BA; Grasso owns BAC; Grasso owns C; Grasso owns D; Grasso owns JPM; Grasso owns LIT; Grasso owns LPX; Grasso owns MAR; Grasso owns MHY; Grasso owns NDAQ; Grasso owns PFE; Grasso owns PRST; Grasso owns S; Grasso owns XHB; Grasso owns XLB; Grasso owns XLI
For Steve Grasso
Stuart Frankel & Co and it’s partners own CSCO
Stuart Frankel & Co and it’s partners own CUBA
Stuart Frankel & Co and it’s partners own FDX
Stuart Frankel & Co and it’s partners own GERN
Stuart Frankel & Co and it’s partners own HPQ
Stuart Frankel & Co and it’s partners own HSPO
Stuart Frankel & Co and it’s partners own JPM
Stuart Frankel & Co and it’s partners own MET
Stuart Frankel & Co and it’s partners own MSFT
Stuart Frankel & Co and it’s partners own MU
Stuart Frankel & Co and it’s partners own NYX
Stuart Frankel & Co and it’s partners own PFE
Stuart Frankel & Co and it’s partners own PRST
Stuart Frankel & Co and it’s partners own RHT
Stuart Frankel & Co and it’s partners own SDS
Stuart Frankel & Co and it’s partners own UAL
Stuart Frankel & Co and it’s partners own XRX
Stuart Frankel & Co and it’s partners are short QQQQ
For Kevin Kerr
Kerr is long XLB ETF Options
Kerr is long GLD ETF Options
For Jim Iuorio
Iuorio is long TBT
Iuorio is long TBT (calls)
For Larry Mcdonald
No disclosures
For Anthony Scaramucci
No disclosures
For Gene Munster
No disclosures
The engineers at Cadillac say they've found the key to further eliminating a driver's blind spot.
Starting with its newest model, the 2016 CT6, the automaker will incorporate streaming video into the vehicle's rearview mirror, which will be fed by a high-definition camera embedded in the center of the trunk.
The technology will give CT6 drivers an immediate view of what's behind them in all lanes, and improve their field of vision by 300 percent, according to Cadillac.
Read MoreBig 3 dominance slips amid competition
""The closest comparison to this kind of rear vision would be driving a convertible with the top down,"" said Travis Hester, the vehicle's executive chief engineer.
Cadillac and industry experts said this will be one of the first models to stream video to eliminate the blind spot. In recent years, cameras mounted just above or below the license plate have shown drivers what's behind them when they're backing up.
""The technology eliminates any rear-seat, rear-pillar or passenger obstructions, allowing the driver an unimpeded view of the lanes behind and traditional blind spots,"" Hester said.
Read MoreThe BMW you can park with a smart watch
If drivers don't want to see the streaming video, they can flip a switch to return to their traditional rearview mirror.
Cadillac will debut the CT6, its new high-end model, at the New York Auto Show in 2015. Pricing on the vehicle won't be released until a few weeks before it hits showrooms late next year.
Questions? Comments? BehindTheWheel@cnbc.com.
Israel's Teva Pharmaceuticals, the biggest generic drug company in the world, in what became one of the world's worst-kept secrets this week is buying the American Barr Pharmaceuticals.
The price is $66.50 a share, which really isn't much a premium based on Thursday's closing price.
But it's a huge markup from where BRL'sstock was sitting earlier this week before the rumors and media reports started swirling about a deal being in the works.
Barr's Chairman and CEO Bruce Downey told me Teva's CEO Schlomo Yanai made the first move. But it didn't happen in a long-distance phone call from Tel Aviv to New Jersey. They say they were at an industry conference in Palm Beach outside some burger joint when the subject came up.
On the conference call this morning during the question and answer period, one analyst (I'd like to give him credit for his sense of humor, but I can't remember who it was and because I'm under deadline I don't have time to go back and listen to the replay) joked to Mr. Downey, ""You got reimbursed for lunch in this deal."" The CEO shot back, ""And I can afford the next one, too.""
I got to know Mr. Downey when he was fighting to win Food and Drug Administration approval of over-the-counter sales for the somewhat controversial Plan B or so-called ""Morning After Pill"". The social implications of its eventual behind-the-counter approval were much bigger than the financial implications for BRL.
But Mr. Downey maintained he personally believed the drug should be more easily accessible and that he was on a mission to make it happen. In the first quarter of this year, BRL took in nearly 600 million bucks. Less than a hundred million of that was from a number of proprietary products, which includes Plan B.
He also volunteered during his interview with me on CNBC this morning that during his tenure he'd been approached 12 times about doing a deal like this one. A dozen offers! Wow. Both Downey and Yanai said they think the generic drug sector will continue to consolidate. Among the American players still out there are Mylan Labs,Watson Pharmaceuticalsand King Pharmaceuticals, just to name a few.
What's pushing the companies together? Yes, tens of billions of dollars worth of brand-name drugs are going generic. But there are so many generic drug companies around the world that start making the same plain-wrap version of a former blockbuster, prices and profit margins fall even more. And David Maris, who used to cover the sector at Bank of America but now works for a hedge fund, told me over the phone this morning that something new is at work, too.
The likes of Wal-Mart with its $4 generic drug prescriptions and CVS Caremark, which Maris said is now responsible for 20 percent of the drugs purchased in the U.S., are driving hard bargains.
Gold steadied on Wednesday after hitting a five-month peak as political tensions simmered, leaving investor interest in safe havens like the precious metal largely intact.
Tarnishing an otherwise brightening outlook for global growth, tensions continued to boil in the Korean peninsula and the Middle East, while worries over the upcoming French presidential election persisted.
Spot gold inched down 0.11 percent to $1,272.71 per ounce after hitting its strongest since Nov. 10 at 1,279.80 earlier in the session.
U.S. gold futures for June delivery rose $3.90 to settle at $1,278.31 after hitting $1,281.80 earlier in the session, the highest level since Nov. 10.
""The short term geopolitical impact will likely fade but( gold) was oversold on expectations of rate hikes and the reality of muted rate hikes sets up the potential for (further) upside,"" said Hamza Khan, head of commodities strategy at ING.
Gold tends to gain when rate hike expectations recede because lower rates reduce the opportunity cost of holding non-yielding bullion.
The dollar was flat versus a currency basket after falling on Tuesday, though a general risk-off mood that has prompted investors to sell the greenback prevailed. Chinese President Xi Jinping on Wednesday stressed the need for a peaceful solution for the Korean peninsula on a call with U.S President Donald Trump.
On Tuesday North Korea warned of a nuclear attack on the United States at any sign of American aggression, as a U.S. Navy strike group steamed towards the western Pacific.
Elsewhere, Vladimir Putin said on Wednesday trust had eroded between the United States and Russia, as Moscow delivered an unusually hostile reception to U.S. Secretary of State Rex Tillerson in a face-off over Syria.
In France's presidential race, centrist Emmanuel Macron and far-right leader Marine Le Pen clung on as frontrunners, but a far-left veteran has surged into the top four, pushing some pollsters to calculate the most extreme run-off scenarios.
Gold could resume its rise ahead of the Easter long-weekend, Jeffrey Halley, senior market analyst at OANDA, said.
""Gold has finally broken and closed above its 200-day moving average at $1,257.50, which now becomes a support. From a technical perspective, the way is now clear for a run at $1,300 and possibly higher,"" Halley said.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund (ETF), rose 0.50 percent to 842.41 tons on Tuesday. The ETF has seen about six tons of inflows this week.
Among other precious metals, dipped 0.22 at $18.26 an ounce.
fell 0.48 percent to $962.40 per ounce after rising over 3 percent in the previous session, while dropped 0.69 percent to $796.50.
Prior to returning to Harvard and the Belfer Center, Sherwood-Randall served as Deputy Secretary at the U.S. Department of Energy from October 10, 2014, to January 20, 2017. In her capacity as Deputy Secretary, she was the department's chief operating officer, overseeing a budget of nearly $30 billion and a workforce of more than 113,000 people. She provided strategic direction for DOE's broad missions in nuclear deterrence and proliferation prevention, science and energy, environmental management, emergency response and grid security. While at DOE, she developed and implemented a new approach to fulfilling the agency's growing responsibilities for grid resilience and emergency response to meet growing natural, physical and cyber threats.
Earlier, in the Obama administration, she was the White House Coordinator for Defense Policy, Countering Weapons of Mass Destruction, and Arms Control in 2013–2014, with responsibility for U.S. defense strategy, policy and budget planning. She served from 2009–2013 as Special Assistant to the President and senior director for European Affairs at the National Security Council, where she led the revitalization of America's alliances and partnerships in Europe.
In the Clinton administration, Sherwood-Randall served as Deputy Assistant Secretary of Defense for Russia, Ukraine and Eurasia from 1994–1996. She led the effort to denuclearize three former Soviet states, for which she was awarded the Department of Defense Medal for Distinguished Public Service and the Nunn-Lugar Trailblazer Award.
Sherwood-Randall worked at the Kennedy School on two prior projects. She was a founding principal of the Harvard-Stanford Preventive Defense Project, where she worked with current Belfer Center Director Ash Carter from 1997–2008. Between 1990 and 1993, she was associate director of the Belfer Center's Strengthening Democratic Institutions Project, which she co-founded with former center director Graham Allison.
Sherwood-Randall attended college at Harvard and then earned a graduate degree at Oxford University, where she was among the early ranks of female Rhodes Scholars. After finishing her education, she began her career working for then-Sen. Joe Biden as his chief advisor on foreign and defense policy. She has also worked at Stanford University, the Council on Foreign Relations and The Brookings Institution.
Born and raised in California, she is married to Jeff Randall, a neurosurgeon. They have two sons.
Despite all signs from Fed Chair Janet Yellen that there will be an interest rate hike this summer, one trader insists the U.S. central bank is on hold, and that means good news for the commodities sector.
""You'll notice that after that disastrous 38,000 jobs added [in May], you saw big moves up in the commodities space and a move down in the dollar,"" Todd Gordon of TradingAnalysis.com told CNBC's ""Trading Nation"" on Monday. ""That's reflecting the Fed sitting on the beach on their hands for the summer.""
Gordon took a look at the market overall and identified the lead sectors kicking off the week on Monday. While the S&P 500 is up, he noted that the leading sectors in the marketplace appear to be industrials, materials and energy, with oil leading the way. Crude was up more than one percent midday.
The trend has Gordon willing to bet on the oil and gas production ETF (XOP) breaking through to new highs. More specifically, Gordon believes that the XOP is actually set to break above the $37 mark and has set $36.50 as the key level to watch for in the next coming days.
If the XOP does move to $36.50, Gordon predicts that oil will keep moving up.
""If we can get up to the $36.50 mark, it looks like XOP, along with crude oil, should be able to move up through the next several days,"" Gordon said.
From picking perceived outsiders for Cabinet positions to calling out certain American companies, nothing Donald Trump has done as president-elect should come as a surprise, former Commerce Secretary Carlos Gutierrez told CNBC on Monday.
Agree with Trump or not, he's making moves based on promises he made during the campaign, said Gutierrez, who headed Commerce for President George W. Bush.
""[Trump] is behaving like an executive. This is like executive basics. You have a strategy and you put the right skills in a job to implement your strategy,"" Gutierrez, formerly CEO of Kellogg, said on ""Squawk Box.""
For example, he pointed to Trump's decision to chose Tom Price to head the Health and Human Services Department due to the Georgia congressman's intimate knowledge of Obamacare and how to dismantle it.
While Price was also a doctor, ""conventional wisdom"" might have pointed to retired neurosurgeon and former GOP rival Ben Carson for HHS, Gutierrez said. But Carson was selected for secretary of Housing and Urban Development.
Gutierrez also spoke highly of Exxon Mobil Chairman and CEO Rex Tillerson, who's said to be Trump's choice for secretary of State. He called ""unfair"" aspersions about the oilman being a friend of Russian President Vladimir Putin just because he's negotiated business contracts with Moscow.
""A lot of what's happening, whether it's happening in an orderly fashion or now, are things he ran on,"" argued Gutierrez, who said he did not support Trump during the campaign but aims to be objective.
""During the campaign, he said he's going to go after companies that outsource and export back in. That's what he's doing,"" Gutierrez said, referring to the deal Trump helped craft earlier this month with United Technologies to keep the firm's Carrier unit from closing a plant in Indianapolis.
Trump has also called out other American companies that have big government contracts. In a Monday morning tweet, Trump took a swipe at Lockheed Martin's F-35 program, saying the cost was ""out of control."" Last week, Trump tweeted a shot at Boeing, threatening to cancel its 747 Air Force One program.
Check out which companies are making headlines before the bell:
Lorillard, Reynolds American–The two U.S. tobacco companies issued a statement confirming merger talks, and that they are also talking to Britain's Imperial Tobacco about selling various assets and brands. CNBC had reported the talks last Friday and that a deal was likely to emerge within weeks. Imperial also issued a statement acknowledging the negotiations.
Procter & Gamble–Wells Fargo downgraded the stock to ""market perform"" from ""outperform"", citing a lack of progress in improvement for P & G's fundamentals.
Qualcomm–Goldman Sachs removed the chip maker's stock from its ""conviction buy"" list, noting that the catalysts for an improved stock price laid out in a November report have largely played out.
Fastenal–The industrial supplier reported second quarter profit of 44 cents per share, matching estimates, though revenue fell short of consensus.
Amazon.com–The online retailer responded to an FTC suit involving allegedly unauthorized purchases by children on their parents' credit cards. Amazon said it had refunded such purchases, and called the FTC's action ""deeply disappointing.""
Chevron–Chevron expects second quarter profit to be higher than it was during the first quarter, with downstream profits comparable to last quarter. Chevron is scheduled to report its full second quarter results on August 1.
Gap–The retailer reported same-store sales fell two percent in June, shy of estimates for a 0.7 percent gain. Gap chief executive Glenn Murphy did call sales at the company's Old Navy chain ""stellar"" and that the momentum is continuing into July.
Rent-A-Center – The company is forecasting second quarter profit of 36 to 38 cents per share, short of the consensus estimate of 48 cents. The rent-to-own chain also predicts second quarter sales below forecasts, saying macroeconomic pressures are hurting its customers. CEO Robert Davis said the company is not satisfied with its results and holds itself accountable.
Darden Restaurants– Darden won dismissal of a New York lawsuit involving automatic tips on customer checks. The parent of Olive Garden and Red Lobster had been accused of violating New York consumer protection laws.
Whirlpool– Whirlpool will buy a 66.8 percent stake in Italy's Indesit Company for a little over $1 billion. Whirlpool said the deal is intended to strengthen its European manufacturing operation.
—By CNBC's Peter Schacknow
Questions? Comments? Email us at marketinsider@cnbc.com
The Environmental Protection Agency and the Food and Drug Administration say that very low levels of radiation have turned up in a sample of milk from Washington state. But federal officials say consumers should not worry.
The FDA said such findings are to be expected in the coming days because of the nuclear crisis in Japan, and that the levels are expected to drop relatively quickly.
Results from a March 25 milk sample taken from Spokane, Wash., show levels of radioactive Iodine-131 that are still 5,000 times below levels of concern set by the FDA, including levels set for infants and children.
The EPA said it is increasing the level of nationwide monitoring of milk, precipitation and drinking water following the crisis at the Japanese nuclear power plant.
The dollar was largely down against other major currencies, although a surprisingly strong rise in new home sales helped the dollar reverse some of its losses.
The government reported that new home sales beat expectations and rose 3.4 percent in November to an annual pace of 1.047 million units, which eased concerns about the extent of the housing market's slowdown and tempered expectations that the Federal Reserve could cut interest rates early next year to stimulate growth.
""The new home sales report did beat the consensus forecast, and that, I think, provides further evidence to support the view that the worst of the housing downturn may have passed,"" said Alex Beuzelin, senior market analyst for Ruesch International in Washington, D.C.
With the European Central Bank widely expected to keep raising rates and the Bank of Japan possibly discussing tighter monetary policy at its meeting in January, the dollar slipped as investors returned from the Christmas holiday with more conviction that the U.S. currency's yield advantage will fade next year.
Data showing weaker-than-expected Japan retail sales was overshadowed by a media report that the Bank of Japan will probably discuss raising interest rates at next month's policy meeting.
Currency trading in Asia was disrupted after strong earthquakes near Taiwan damaged undersea telecommunications cables, restricting international telephone traffic and Internet speeds, but trade in the North American markets was not affected.
U.S. benchmark Treasury note prices, meanwhile, were off almost a full point on the day at 99 27/32, bringing yields up to 4.64%, taking their lead from a fall in European government bond prices and the stronger housing data.
Port clerks and their employers at the nation's largest port complex tentatively agreed on a new contract Thursday, preventing a strike that could have crippled shipping and cost billions of dollars, a negotiator said.
""The employers are pleased that the union recognized the substantial investment that (employers) have made and agreed to their last wage proposal,"" said Steve Berry, a negotiator for the shippers.
John Fageaux Jr., president of the union local, said he was satisfied with the tentative agreement.
The 15,000-member International Longshore and Warehouse Union had indicated that longshoremen would honor picket lines if the 750 clerical workers went on strike. Such a move would have effectively stopped the loading and unloading of cargo at the ports of Long Beach and Los Angeles.
If that happened, it could have effectively stopped the loading and unloading of cargo at the ports of Long Beach and Los Angeles, a complex that accounts for more than 40 percent of all the cargo container traffic coming into the United States.
""We think it's in everyone's interest -- the consumers, the city -- that we don't have a work stoppage,"" Berry said.
The Office Clerical Unit, Local 63, of the ILWU represents workers for 17 shipping companies and other cargo firms at the twin ports. Its clerks work at marine terminals and handle bookings for the export of cargo and other transport documents.
Their last contract, which expired June 30, gave full-time clerical workers about $37.50 an hour, or $78,000 a year, plus a pension, health care benefits free of premiums, and 20 paid holidays a year.
Under the tentative deal reached Thursday, the workers will receive a wage increase of 7 percent over the three-year contract. That includes a 50-cents-per-hour increase in the first year and $1-per-hour increase in each subsequent year. The employers also agreed to pay $3.4 million to establish a trust fund to manage employees' health and welfare and pensions plans.
Fageaux said he expects the union membership to vote on the tentative deal some time next week.
""Both sides negotiated hard for their positions, and both sides recognized what the other side needed,"" he said.
A broad coalition of mortgage and finance industry leaders on Saturday sent a plea to federal regulators, asking for desperately needed cash to keep the mortgage system running during the coronavirus pandemic, as requests from borrowers for the federal mortgage forbearance program are pouring in at an alarming rate.
The Cares Act, which seeks to limit the economic damage from COVID-19, mandates that all borrowers with government-backed mortgages — about 62% of all first lien mortgages according to Urban Institute — be allowed to delay at least 90 days of monthly payments and possibly up to a year's worth.
Those payments would then have to be made at a later time through a payment plan. Servicers are granting the payment deferrals to borrowers with no questions asked, as is required by the law, but the servicers still have to pay mortgage bond holders.
In normal times, they have enough to cover these payments, and, in fact, at the end of last year the mortgage delinquency rate was near a record low, according to CoreLogic. Now that rate is skyrocketing, and servicers do not have nearly enough cash to cover those payments to bondholders.
The coalition, which includes the Mortgage Bankers Association, the National Association of Home Builders, the National Association of Realtors, the Independent Community Bankers of America, U.S. Mortgage Insurers and the National Apartment Association, issued a press release Saturday saying, ""The scale of this forbearance program could not have been foreseen by mortgage servicers, or fully anticipated by regulators ... it is therefore incumbent upon the government to provide a liquidity facility for single-family and multifamily servicers ... any further delay could lead to greater uncertainty and volatility in the market.""
Mr. Cooper, the largest nonbank servicer in the nation, with close to 4 million mostly government-backed loans has already granted more than 80,000 forbearances, and the requests keep flooding in. Jay Bray, Mr. Cooper's CEO, helped federal regulators set up the plan. He said he was told there would be federal cash for servicers, but that part of the deal never made it to the final act.
""It's frankly frustrating and ridiculous that we do not have a solution in place,"" said Bray. ""There is going to be complete chaos. We're the largest nonbank. We have a strong balance sheet, but for the industry as a whole you're going to start seeing problems soon.""
In an interview Wednesday on CNBC, Mark Calabria, director of the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, said he estimated about 2 million borrowers would seek forbearance by May. He did not agree that servicers need liquidity now, only later.
""If this goes beyond two or three months, and we start to get worse than that, then that's going to be a lot of strain, and certainly we're going to start to see some firms get into a lot of liquidity trouble,"" Calabria said.
Others, however, have much higher estimates for the forbearance program. Laurie Goodman, co-director of the Housing Finance Policy Center at Urban Institute, predicted a worst-case scenario of nearly 12 million borrowers receiving some kind of forbearance at a cost of $66 billion for six months. Mark Zandi, chief economist at Moody's Analytics, predicted about 15 million households would receive some forbearance on their home loans.
""We had a tremendous surge in April, you're going to see another massive surge in the middle of the month when they [borrowers] are considered late, and another massive surge in May,"" said Bray. ""They're going to need these forbearance plans, and it's going to continue to grow at a pace that, frankly, some people don't understand and are dismissing how big a problem it's going to be.""
Even as Americans begin to receive checks from the government, there is no guarantee they will use that money to pay their mortgages. The forbearance program forbids servicers from asking for any proof of hardship. Bray said that was the right course.
""I do not believe it is a moral hazard. It's not a payment forgiveness plan. Let's say it's three month, at the end of that time they can repay, go onto partial payment, or go into some type of modification, and then there will be some kind of documentation required,"" said Bray.
But others disagree.
""Throwing this out there without showing evidence of hardship was an outrageous move, outrageous,"" said David Stevens, who headed the Federal Housing Administration during the subprime mortgage crisis and is a former CEO of the Mortgage Bankers Association. ""The administration made a huge mistake bringing moral hazard in and thrust extraordinary risk into the private sector that could collapse the mortgage market.""
Stevens said borrowers should have been required to show at least some proof of hardship, which they had to do during subprime mortgage bailout. Moral hazard aside, he, too, contended a liquidity facility for servicers is essential.
""This is a crisis so easily correctable,"" he said. ""The GSEs [Fannie Mae and Freddie Mac] for years have always assured the servicing community that in the event of a major credit event, they'll be there to make sure they provide the liquidity. From what we are hearing, and we can't verify it, the FHFA director instructed the GSEs not to set up a liquidity or advance facility.""
When asked for a response to the industry plea, Calabria on Monday declined to comment.
Both Stevens and Bray said that because of this new and momentous risk in the mortgage market, it is suddenly much harder for borrowers to get new loans or refinance current mortgages. Wells Fargo is already placing restrictions on jumbo lending to its customers.
""It's just going to create more fear within the nonbank servicing sector. The banks that service them are going to start to not lend,"" said Bray. ""Ultimately that impacts homeowners. They won't be able to be served because these companies will be in the middle of a crisis. We've seen a lot of businesses close their doors, and if you start closing the doors of servicers you're impacting people's lives much more than other sectors. You're talking about their homes. It's the largest asset they have.""
Internet search company Google Inc bought a 5.94 percent stake in China's Lenovo Group last month for $750 million, according to a disclosure on the Hong Kong stock exchange.
Google acquired 618.3 million Lenovo shares at $1.213 per share on Jan. 30, the stock exchange said late on Thursday.
Lenovo agreed to buy Google's Motorola handset division last week for $2.91 billion in a cash and stock deal.
The U.S. government has authorized limited crude oil exports to Europe for the first time in years, raising new questions about how companies are testing the limits of a controversial, decades-old exports ban.
The Commerce Department has granted two licenses to export U.S. crude to the U.K. since last year and another two to Italy, according to data Reuters obtained through a Freedom of Information Act request.
One application for German exports was filed in January and is awaiting a decision by the Bureau of Industry and Security (BIS), which is responsible for reviewing requests to export crude under a 1975 law that bans most shipments with a few exceptions, including sales to Canada and re-export of foreign oil.
(Read more: )
These are the first permits for shipments to Britain since at least 2000 and the first to any European country since 2008, according to data from the BIS. The bureau has approved 120 licenses since January 2013, nearly 90 percent of which were for sales to Canada, the data show.
It was not immediately clear under which provisions BIS granted the European export licenses. The current regulation allows foreign crude to be re-exported from the United States if it is not commingled with U.S. crude, an option that some Canadian producers are said to be using.
In rare cases, the regulation permits the exchange of U.S. oil for foreign crude or refined products of higher value, which has become an attractive option with the growing surplus of light, sweet shale oil.
Whatever the case, the licenses could add to the growing debate in Washington on the benefits and pitfalls of lifting the ban, among the year's most urgent energy policy questions, as the relentless rise in shale oil production threatens to saturate domestic refiners as soon as this year.
They may add to expectations that the Obama administration will allow companies to use provisions in the existing regulation to slowly increase exports, while stalling on a decision on whether to scrap the ban.
With U.S. oil production at a 25-year high, many oil producers are eyeing other markets and have called for an end to the ban on exports, which they consider a relic of the 1970s, when the Arab oil embargo led to steep prices at the pump.
Alaskan Republican Lisa Murkowski, the Senate Energy and Natural Resource Committee's top Republican, has backed that position.
(Read more: All 50 states have gas prices above $3 per gallon)
On the other side, independent U.S. refiners, which stand to benefit from cheaper domestic crude, have argued against easing restrictions.
Sen. Ron Wyden, chairman of the Energy and Natural Resources Committee and an Oregon Democrat, warned at a hearing last week that ""a number of influential voices"" that want to export oil could drown out the risks for the average consumer.
If more exports to Europe are allowed, refiners across the Atlantic may have cause to celebrate since access to cheap, high-quality U.S. shale oil would help revive their margins.
The BIS did not respond to frequent requests for information on the nature of the licenses. It declined to comment on the identity of the exporting companies, citing exceptions in the Export Administration Act.
The bureau's data do not show which permits were used, and the Energy Department's oil export data do not show any crude shipments to Europe through November 2013.
European exports a rarity
Exports of crude to Canada were initially approved by President Ronald Reagan in the 1980s, and have picked up rapidly in recent years. The United States sent about 200,000 barrels of oil a day to Canada in November, the highest volume since 1999, data from the Department of Energy shows.
A handful of licenses have also been regularly approved over the past decade for countries in Central America or Asia, either for the export of heavy California crude or the re-export of foreign-origin oil, according to a BIS statement released last year.
(Read more: Keystone XL oil pipeline clears significant hurdle)
But European countries have rarely appeared on the list. Two permit applications filed in 2011 for exports to Switzerland and one for exports to the Netherlands were not approved.
The two approved U.K. permits were for shipments with a total maximum value of $1.8 billion, while those to Italy were valued at $3.12 billion. The application for German exports was worth $2.6 billion, the data show.
Theodore Kassinger, a partner with the law firm O'Melveny and Myers in Washington who previously served as the deputy secretary and general counsel of the Department of Commerce, said the bureau likely stuck to existing provisions to allow exports to Europe.
""The licenses were likely within the confines of the current law and so they may have involved re-exports of foreign-origin oil,"" he said.
Without established trade routes or tanker rates, it is difficult to compare the economics of exporting Canadian heavy oil sands versus shipments of U.S. light-sweet oil to Europe. Few traders have examined the value of such unprecedented shipments.
While Canadian crude trades at deep discounts to the U.S. benchmark futures contract, most European refiners are not configured to process the heavy oil.
Ultra light, low-sulfur Bakken, on the other hand, would be welcome in Europe, but trades at relatively higher prices in the United States where local refiners are still eager to replace imported crude with the domestic grade.
Export expansion suggests oil swaps
Others said oil volume swaps—whereby companies can export U.S. light oil for a higher quality or volume of crude or refined fuels—may be behind the recent expansion in export licenses to Europe.
""The implication is that we are not exchanging a higher value item for a lower value,"" said Ed Morse, global head of commodity research at Citi, while noting that re-exports of Canadian heavy oil from U.S. shores are on the rise.
Applicants for such licenses have to demonstrate that the trade is part of an overall transaction in the nation's interest and the oil cannot be sold for a reasonable price in the United States.
Sellers also have to prove that exports will be terminated if U.S. supplies are seriously threatened.
""I am skeptical that it was a swap because tests for such exports are very complicated,"" Kassinger said, referring to sellers' onus to prove that they can't sell the oil at a profit within the country.
""But the time will not be very far when it will not be commercially viable to market the crude in the country,"" he said.
—By Reuters
European markets closed slightly higher on Thursday after the European Central Bank said it was keeping its rates unchanged and vowed to carry on with its asset-purchasing program.
The pan-European Stoxx 600 ended 0.08 percent higher with most sectors in positive territory and major bourses mixed. Insurance stocks were among the best performers on earnings news. Aviva ended close to the top of the STOXX 600, up by 6.4 percent, after announcing a strong full-year operating profit.
Basic resources, by contrast, slumped more than 3 percent by Thursday's close, on soft consumer price data in China and a weakening of the yuan.
The oil and gas sector was also down by 1.5 percent after another drop in oil prices. This came after data from the Energy Information Administration showed inventories rose by 8.2 million barrels last week. Brent crude dropped 2.2 percent to $51.91 a barrel and WTI fell 2.41 percent to $49.07 a barrel.
At the top of the European benchmark was Akzo Nobel, the Dutch paints and chemicals maker rejected a $22 billion offer from a U.S. firm on Thursday. Its shares ended 12.9 percent higher on the news. The French publisher Lagardere jumped 10.25 percent after posting a 13.5 percent increase in earning before interest and tax.
Domino's sank 13.1 percent with the pizza group announcing an expansion in the Norwegian market and an intention to open 80 new stores in the U.K. It also stated Thursday that its full-year profit rose 17 percent in 2016.
Meanwhile, in the U.S., the Dow Jones industrial average and broader S&P 500 continued slightly higher ahead of a probable interest rate hike next week.
After solid U.S. jobs figures released Wednesday, expectations of a rate hike by the U.S. Federal Reserve next week have become even stronger.
However, the main focus in Europe was on the European Central Bank. The bank kept rates unchanged on Thursday and promised to keep its massive stimulus program.
The bank also revised its inflation forecasts upwards. It sees headline inflation at 1.6 percent at the end of 2018 compared to the 1.5 percent projected last December. In terms of growth, the bank has also revised its forecasts upwards for this year from 1.7 percent to 1.8 percent. However, it called on all euro area countries to step up reforms to ensure stable growth.
European Central Bank President Mario Draghi declared the euro ""irrevocable"" at Thursday's press conference ahead of key elections this summer. As a consequence, German 10-year bond yields spiked to hit a one-month high of 0.43 percent and the euro hit session high of $1.0605.
In corporate news, the Danish firm Novo Nordisk has begun talks with Global Blood Therapeutics, a U.S. company, for a potential acquisition, Reuters reported. Rio Tinto's chairman Jan du Plessis has said he will step down in the coming year after more than eight years in the job.
On the data front, Greece's unemployment rate fell to 23.1 percent in December from 24.1 percent for the same time in 2015. Elsewhere, European leaders are gathering in Brussels for a two-day summit.
On a mile-long assembly line in Ft. Worth, Texas, Lockheed Martin is putting together a jet fighter that no one can match. The F-35 Joint Strike Fighter will be stealthier, smarter, more capable, and more flexible than any aircraft ever built.
It better be. It's costing American taxpayers close to $1 billion. A month.
""It is a flying computer,"" said Steve O'Bryan, vice president of the F-35's integration and business development at Lockheed Martin. ""Where technology goes, where software goes, the F-35 will be flexible with it.""
That's important for an aircraft which the U.S. military and its allies are counting on to be the backbone of air defenses for the next half-century.
Read MoreThis is what caused the LA air traffic system crash
For example, the F-35 currently isn't configured to control another aircraft, such as an unmanned plane that may fly in formation with it, since no UAV—unmanned aerial vehicle—has yet been created that can keep pace with the F-35. That will probably change over the next quarter century, and, conceivably, the software could be easily added.
""The future would bring you an F-35 operating UAVs,"" said O'Bryan.
A lot is riding on the Joint Strike Fighter's success. A hundred jets have been built so far, and they are being tested by the military. The first combat-ready airplane is slated to be delivered next year. Eventually there will be more than 2,400 flying for the U.S. military, with allies buying hundreds more.
However, the non-partisan Government Accountability Office found that issues remain with some of the jet's software, a problem that could again delay the rollout of an aircraft that has already dealt with an array of problems and seen its original price tag double. Developing, buying, and maintaining the F-35 program over the next half century will cost about $1 trillion, with a ""T.""
Still, the military remains committed to the plane. ""They're still working on the software,"" said Lt. Col. Matt Renbarger, who is test-flying the aircraft at Eglin Air Force Base in Florida.
""Apple and IBM, when they build new computers, have to work through software things when they start things up—we're working through the same issues on our end, too,"" he said. ""I'm confident the entire team is going to be able to put together a very good airplane.""
There are many firsts with the F-35. It will be the first fighter jet made of composite material. It consolidates a seemingly endless amount of information onto a couple of screens inside the cockpit...or onto the pilot's visor inside a custom-fitted helmet. In addition, external cameras around the jet can transmit pictures onto the visor so that when a pilot looks down, it will be as if he or she is looking right through the bottom of the plane.
Read MoreThe city that may be Ukraine's line in the sand
""If the radar sees something, the electronic warfare system sees something, your wingman sees something in his airplane, all of that stuff gets poured in, and you look on your display, and you just have one picture of the battlespace,"" said former F-35 test pilot Art Tomassetti, who now helps manage the program at Lockheed.
That's a lot of information for one pilot to process, and as much as the aircraft of the future is changing, so are the skills needed in pilots.
""The stick and rudder skills that used to be so important, we've minimized, because we've made the airplane easy to fly,"" said Tomassetti. ""What if we could teach anybody to fly the airplane? Think about the spectrum (of pilots) that might open up for us."" The best pilots in 25 years, he said, will be the best tacticians.
""We've trained 50 pilots here over the last year, and everyone has said it's the easiest airplane they've ever flown,"" said Lt. Col. Renbarger, who used to fly F-16s.
Read More
With so much data streaming in from so many sources, what's the risk of information overload?
""We did have some concerns about that when we first started flying the jet, but once we got into it and saw how much human factors engineering had been put into the airplane, those concerns have been allayed."" He added, ""All I have to worry about is putting the cursors on something I want to shoot a missile at or drop a bomb on...and it works.""
Perhaps that's why the biggest threat to the best jet fighter ever conceived isn't a Chinese warplane or a Russian missile—the biggest threat could be far more potent: the budget ax.
The Pentagon is insisting Lockheed bring down the F-35's costs. and there has been some progress on that front. For example, all three variations of the jet are being built along the same assembly line in Ft. Worth, which saves money.
Read More
""We also shrink the amount of time it takes to build an F-35,"" said Steve O'Bryan. ""We only use about 15 percent of the labor force it took to build that same number of F-16s.""
The F-35 has also created another trend we may see more of in 25 years: Bringing in international partners from the beginning to help share the costs. Ten countries have invested in and/or plan to buy the fighter.
Other trends include the ability of planes like the F-35 to carry more bombs, but smaller, lighter bombs, which allow planes to fly further and hit more targets. The entire military is also pushing defense companies to build products that can operate on a single software platform.
O'Bryan said the air defense system of the future will include fewer single-mission aircraft—planes that really only have one job—in favor of aircraft with multiple roles. ""Ninety percent of every aircraft's lifetime is peacetime, and it also has to contribute in that time as well, whether it be intelligence-gathering or surveillance.""
It's a big shift from when he started flying F-18s a quarter century ago.
Read More
""When I flew, it was 'speed is life,'"" said O'Bryan. ""In today's fifth generation (aircraft), it's 'information is life.'""
He said the old days of aerial dogfighting are over. If an F-35 pilot is ever actually seen by an enemy, he or she has done something wrong. There's no need to ever get that close.
""It's probably less romantic,"" O'Bryan said, ""but I never met a fighter pilot who wanted a fair fight.""
Read MoreMeet the man with the Pentagon checkbook
Correction: An earlier version of this story incorrectly stated that the F-35 is the only active fighter line in production in the United States. In fact, Boeing still produces F/A-18s and F-15 fighters in St. Louis, Missouri.
WikiLeaks founder Julian Assange is promising ""significant"" disclosures on subjects including the U.S. election and Google in the coming weeks as the organization marks its 10th anniversary.
Assange, speaking by video link to an anniversary news conference in Berlin, said Tuesday that WikiLeaks plans to start a series of publications this week, but wouldn't specify the timing and subject. He says the group hopes ""to be publishing every week for the next 10 weeks"" and the leaks include ""significant material"" on war, arms, oil, Google and the U.S. election.
Sweden is seeking Assange's extradition in a rape investigation. He hasn't left the Ecuadorean Embassy in London since 2012. Assange denies the rape allegation and says he fears being extradited to the U.S. to face espionage charges if he leaves.
Coca-Cola CEO James Quincey said he is feeling confident about the state of the consumer in 2020, even as trade tensions and concerns about sluggish economic growth continue.
""You walk around Davos and there are some sectors that are feeling the pressure coming out of 2019 and into 2020 — more on the manufacturing side, some of the big trade sectors,"" Quincey said on CNBC's ""Squawk Box"" on Wednesday. ""But the consumer seems to be robust around the world — yes, ups and downs, but they're doing pretty well.""
The International Monetary Fund on Monday revised its forecasts downward for 2019 and 2020, mostly due to slowing growth in India. The IMF also warned about uncertainty related to trade, which would weigh on the global economy.
At the World Economic Forum in Davos, Switzerland, business leaders have expressed doubts that China and the United States will reach phase two of a trade deal before the end of President Donald Trump's first term.
Still, Quincey said that the company is confident about consumer spending in 2019 and sees momentum heading into 2020. In October, Coke's third-quarter revenue beat analyst estimates as consumers spent money on healthier options, like Zero Sugar soda and smaller size cans.
The beverage giant will report its fourth-quarter earnings on Jan. 30.
If you're an investor avoiding the oil space, you could be missing out on the best opportunity in years.
That's what one veteran investment manager is arguing — comparing the oil glut to the opportunity presented to investors during the depths of the housing crisis.
""There is enormous opportunity in the oil area. We are doing a lot of research there. We look at it kind of like housing in 2010,"" Ross Gerber, CEO of Gerber Kawasaki Wealth and Investment Management , said Tuesday on CNBC's ""Futures Now.""
In the past six years, the SPDR S&P Homebuilders ETF has rallied by more than 100 percent. Gerber believes the oil sector could be positioning itself for similar gains.
""The market has been totally beholden to oil over the last three to six months. ... We're exiting a period where we feared total devastation in the oil patch leading to bankruptcies and defaults,"" he said, even as volatility continues to grip the area. ""It's only the beginning of the fixing of this process.""
Crude oil, which has surged by nearly 25 percent in the past eight weeks, has been under pressure again this week due to oversupply concerns. But it's not discouraging Gerber from sticking to his bullish case.
""The supply and demand imbalance still exists currently. But we've seen some supply come off the market, and we've seen an increase in demand, which has created a little more of a perception of stability,"" he said. ""We think oil will probably sit around the $40 to $45 which we're fine with. It's the best benefit to the economy and the oil producers can continue to exist.""
Ubisoft, the maker of video games including ""Assassin's Creed"" and ""Just Dance,"" plans to build a games-themed amusement park in Malaysia, the company announced this week.
The 10,000-square meter park will be based in Malaysia's capital city of Kuala Lumpur and will open in 2020, according to Ubisoft. It will feature rides based on the French company's popular franchises, such as Rayman Raving Rabbids.
The project is being led by Ubisoft Motion Pictures, the company's film and TV division, which has partnered with Malaysian theme park developer RSG.
""Together, we are creating a place where every guest is a player, every ride is a playground, every visit is a game,"" Jean de Rivieres, senior vice-president of Ubisoft Motion Pictures, said in a press release on Monday.
RSG has already co-developed another theme park in Malaysia, called Movie Animation Park Studios.
""In RSG, we've found a partner with a successful track record in working with international brands, a shared ambition to design the family destination of the future and a wealth of expertise in theme park development,"" said de Rivieres.
Ubisoft's park will not be the first video game-based theme park. Angry Birds Land (based on the popular mobile game developed by Finnish company Rovio Entertainment) opened in 2012 in Finland and the U.K. also hosts an Angry Birds Activity Park.
In addition, long-standing Japanese video game developer Nintendo announced in May that it was developing rides with Comcast-owned Universal Parks & Resorts.
—Disclosure: Universal Parks & Resorts is a division of NBCUniversal, the parent company of CNBC. and CNBC.com.
A stronger euro, weaker dollar has helped equities all day as the markets believe a Greek deal is imminent. At 2 PM ET the Greek Prime Minister spoke, appealing for passage of the unpopular austerity act, and markets rose to the high of the day.
The big picture soon will turn to earnings....there has been no appreciable change in earnings expectations for the S&P 500 in the past two months, either for Q2 or the full year...but the S&P 500 is down 6% from the highs at the end of April...the market is telling us earnings expectations seem too high.
We are expecting fairly robust Q2 numbers: revenue growth of 10 percent for the S&P 500, earnings growth of 16 percent.
Sixteen percent is definitely robust earnings growth...and to top it off companies are consistently beating the estimates. In Q1, for example, analysts were looking for 13 percent earnings growth, we got close to 20 percent.
Can that trend continue in Q2 and the rest of the year?
Traders are very skeptical it can. One complaint: much of the earnings growth in Q2 is coming from energy and materials sector—thanks to higher commodity prices!
Those prices, it appear, are moderating. That's good news for consumers, but it will likely keep guidance from commodity producers on the conservative side.
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The U.S. Federal Reserve should raise interest rates slowly even as fiscal policies under President Donald Trump are likely to help push economic growth beyond sustainable levels, Chicago Federal Reserve Bank President Charles Evans said on Friday.
""Appropriate policy calls for a slow pace of normalization in order to give the real economy an adequate growth buffer to withstand downside shocks,"" Evans said in remarks prepared for delivery at Prairie State College in Olympia Fields, south of Chicago. ""I favor taking a gradual path for the adjustment of the funds rate back toward its long-run level.""
The Fed in December raised rates for only the second time since the financial crisis, and this week held them steady to give labor markets and inflation a chance to strengthen further.
Most Fed officials see three rate hikes this year, a pace considerably faster than in 2016 and 2015 but much slower than in past rate-hike cycles. Evans, who votes this year on Fed policy, did not specify a preferred number of rate hikes for this year in his prepared remarks, though a few weeks ago said three is not ""implausible.""
Evans said he expects the economy to grow at a 2 percent to 2.5 percent annual pace for the next couple of years, faster than its long-run sustainable pace of about 1.75 percent. Evans said he raised his estimate for growth because of expected tax cuts and other stimulus under Trump and the new Congress.
Unemployment will fall to 4.25 percent over the next couple years, he predicted, well below its long-run sustainable rate of 4.7 percent. And that will help push inflation, now at about 1.7 percent, back up towards the Fed's 2 percent goal by 2019.
Some analysts have speculated that the expansionary fiscal policies Trump has promised would light such a fire under an economy essentially already at full employment that the Fed would have no choice but to hike rates faster to brake growth.
Evans on Friday did not seem too concerned about such a prospect. He warned, as he has before, that if the economy is pushed to grow at 4 percent for more than a couple years without structural reforms that boost productivity and labor force growth, inflationary pressures would build and would ultimately force the Fed to tighten financial conditions.
But he also said his estimates are for a much more moderate fiscal boost, though he added it is early in the legislative process and ""there certainly is a possibility of larger temporary stimulus, as well as some policies that might influence longer-run growth.""
A government report early Friday showing U.S. employers added more jobs than expected last month was ""very good"" news, Evans said.
The unemployment rate moved up to 4.8 percent from 4.7 percent, but that was likely because of more people entering the workforce, a good sign for labor market health, Evans said at an event to benefit Prairie State College in Olympia Fields, south of Chicago.
He made a pretty penny shorting real estate ahead of the housing bubble. Find out where top investor Whitney Tilson of T2 Partners sees opportunity in real estate, now!
In a live interview on CNBC’s Fast Money Tilson presents the desk with two trading ideas.
Long Howard Hughes
On the bullish side, Tilson is very enthusiastic about Howard Hughes Corp. “It’s a collection of more than 30 assets that were part of General Growth Properties,” he says.
”We think there’s a lot of potential to develop many of these properties. We’re not quite sure what it’s worth on the upside but we don’t think there’s much downside.""
And he adds top hedge fund manager Bill Ackman is the chairman, which makes him confident that management is aligned with shareholder interest.
Short St. Joe
Meanwhile on the bearish side, Tilson doesn’t like St. Joe.
“We are short St. Joe. It’s our largest short position,” Tilson says. “We think David Einhorn’s thesis is correct and the stock is worth a half to a third it’s current price.”
As you may remember David Einhorn made headlines last year with his negative thesis on St. Joe and his criticism of St. Joe’s largest investor, Bruce Berkowitz.
Tilson tells Fast Money he’s done additional research and has found even more reasons to be bearish.”If you go visit these developments many of them are literally ghost towns. Information we’re presenting shows the sale prices of lots and homes are being done at 10 or 20% of the peak valuation. St. Joe hasn’t taken any impairment on these assets and we think they’re going to have to.”
Click here for a complimentary look at Tilson's presentation at the 7th annual Value Investing Congress.
Click here to learn more about the Value Investing Congress
______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment, but not have it published on our Web site, send those e-mails to
Trader disclosure: On May 4, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s ""Fast Money"" were owned by the ""Fast Money"" traders; Adami owns (AGU); Adami owns (C); Adami owns (GS); Adami owns (INTC); Adami owns (MSFT); Adami owns (NUE); Adami owns (BTU); Finerman and Finerman's firm own (AAPL); Finerman and Finerman's firm own (BP); Finerman owns (C); Finreman and Finerman's firm own (CVS); Finerman's firm owns (IBM); Finerman's firm owns (JPM) and is long (JPM) leaps; Finerman owns (JPM); Finerman and Finerman's firm own (MSFT); Finerman's firm owns (TGT); Finerman owns (UNG); Finerman owns (USO); Finerman's firm is short (IWM), (SPY), (MDY); Finerman's firm owns s&p puts; Finerman's firm owns Russel 200 puts; Terranova owns (XOM); Terranova owns (BAX); Terranova owns (SLV); Terranova owns (TCK); Terranova owns (APA); Terranova owns (HOC); Terranova owns (OXY); Terranova owns (UPL); Terranova owns (FCX); Terranova owns (BX); Terranova owns (V); Terranova owns (VRTS); Terranova owns (JPM); Terranova is short (NFLX); Terranova is short S&P Futures; Terranova is Chief Market Strategist of Virtus Investment Partners, LTD; Karabell owns (AAPL); Karabell owns (EMC); Karabell owns (GS); Karabell owns (IBM); Karabell owns (GOOG); Karabell owns (GE); Karabell owns (POT)
For Brian Kelly
Accounts Managed by Brian Kelly Capital own (EBAY)
Accounts Managed by Brian Kelly Capital own (GLD)
Accounts Managed by Brian Kelly Capital own (SLV)
Accounts Managed by Brian Kelly Capital own (DIA)
Accounts Managed by Brian Kelly Capital are long gold, natural gas
For Zachary Karabell
River Twice Capital owns (EMC), (GS), (IBM), (JCI), (SBUX), (POT), (QCOM)
River Twice Capital is short (AA) calls in fund
River Twice Capital is short (XLF), (SPY), (SMH)
For Joe Terranova
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (KRC)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (NRCI)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of DOMINO'S PIZZA UK &
URL PLC
Virtus Investment Partners Owns More Than 1% Of (DRYS)
For Peter Shiff
Schiff Owns Gold
Schiff Owns Silver
For Colin Langan
(GM) Is Or In Past 12 Months Has Been An Investment Banking Client Of UBS Securities LLC
(GM) Is Or In Past 12 Months Has Been A Non-Investment Banking Client Of UBS Securities LLC (Securities-Related Services, Non-Securities Services)
UBS Securities LLC Has Received Compensation From (GM) In Past 12 Months
For John Stephenson
**No Disclosures
For Whitney Tilson
Funds Managed by Whitney Tilson are Short St. Joe (JOE)
Funds Managed by Whitney Tilson own Berkshire Hathaway Shares
Funds Managed by Whitney Tilson are long Howard Hughes Corporation (HHC)
CNBC.com with wires.
Billionaire Mario Gabelli told CNBC on Thursday that he is making a bet on infrastructure even if the Trump administration doesn't deliver on its $1 trillion plan to improve roads, tunnels and bridges.
In an appearance on CNBC's ""Halftime Report,"" the CEO, founder and chairman of Gamco Investors said the U.S. has to make investments in its crumbling infrastructure. He said President Donald Trump's proposed infrastructure plan will act as ""extra tail wind"" to the sector that is already likely to succeed.
""I think housing is going to do well. I think industrial construction is going to do OK, independent"" of Trump's plan, Gabelli said.
Gabelli specifically likes Atlanta-based company Mueller Water, a major manufacturer and distributor of fire hydrants, gate valves and other water-related infrastructure products in North America. He said the company has recently come under new leadership and is responsible for providing at least half of the hydrants in the U.S.
He has previously spoken favorably of infrastructure saying, ""Infrastructure is important because it helps fiscal stimulation, it offsets monetary policy, it helps the jobs in the middle of the country, it helps everyone.""
Gabelli comments came after Trump, who has struggled to get certain policy proposals off the ground, has vowed to cut red tape to speed up approval of infrastructure projects.
Disclosures: Gabelli owns Mueller Water Products in his funds.
Watch: Gabelli & O'Leary on stocks
The European Central Bank (ECB) and European Banking Authority (EBA) are aiming to carry out a joint stress test on Europe's major banks in September, sources told Reuters.
Austria's FMA markets watchdog said on Wednesday that the EBA plans stress tests this year even as the European Central Bank prepares to take on supervision of top lenders from 2014.
Sources told Reuters that the ECB, which was involved in the background of the last round of EBA stress tests, was set to take a more central role before it assumes supervisory powers over the euro zone's banks.
""The preference is to have the EBA and ECB run together, rather than have the reputational damage of having two (different) ones,"" said a central bank source.
The tests are ""likely to be in September"", he added. Other sources said they also expected the tests in September, though the date has not yet been finalized.
The EBA's predecessor the Committee of European Banking Supervisors (CEBS) started conducting stress tests on major lenders such as Deutsche Bank, Santander and Unicredit in 2010.
But the shortcomings of the probes were laid bare when Ireland's banking system came close to collapse only four months after being given a clean bill of health.
""As we said last year, we expect a new round of stress tests in 2013 and discussions are on-going,"" an EBA spokeswoman said.
ECB Governing Council member Ewald Nowotny said last month that Europe wanted the ECB and the EBA to conduct coordinated stress tests.
EBA Chairman Andrea Enria has said that a key addition to the next test willbe an examination of the quality of assets held by banks to ensure they canabsorb losses properly in a crisis and leave taxpayers off the hook.
The discussions between the ECB and EBA partly focus on working out how tomeasure the quality of banks' loans.
""There will be a stress test this year from the EBA. That is the current status of the decision,"" Financial Markets Authority co-head Helmut Ettl told a news conference on Wednesday, adding details were still under discussion.
He said Austrian lenders Raiffeisen Zentralbank - the unlisted parent of Raiffeisen Bank International -and Erste Group Bank would be tested.
Europe agreed a deal last month to give the ECB new powers to supervise euro zone banks from 2014, embarking on the first step in a new phase of closer integration to help underpin the euro.
The EBA monitors banks in all 27 EU member states.
(The following statement was released by the rating agency)Overview
-- U.S. tower operator Crown Castle has agreed to acquire rights to about7,200 T-Mobile USA towers for $2.4 billion in cash.
-- We expect leverage to increase to nearly 8x at the end of 2012, proforma for the transaction, and decline modestly to the mid-7x area in 2013.
-- We are revising our outlook on the company to stable from positivesince we no longer expect it to achieve leverage of 7x within our two-yearrating horizon.
-- We are affirming all ratings on the company, including our 'B+'corporate credit rating;
-- Issue and recovery ratings for Crown and its related entities remainunchanged at present, but will be re-evaluated when the company outlines adefinitive financing plan for the T-Mobile transaction.
Rating ActionOn Oct. 2, 2012, Standard & Poor's Ratings Services revised its outlook onCrown Castle International Corp.
to stable from positive as a result ofthe company's announced agreement to acquire rights to T-Mobile's 7,200 towersin a debt-financed transaction valued at about $2.4 billion. At the same time,we affirmed all of Crown's ratings, including the 'B+' corporate credit rating.
Rationale
The outlook revision reflects our view that there is no longer a one-thirdprobability of an upgrade given the additional debt associated with theacquisition. We now expect leverage, including our adjustments for operatingleases, to be nearly 8x as of the end of 2012, pro forma for the EBITDAcontribution from the T-Mobile towers. While we believe that the combinationof contractual rent increases, additional tenant colocation revenues on itsexisting towers, and somewhat faster revenue growth on the T-Mobile towerswill contribute to a low- to mid-teen percent increase in EBITDA in 2013, wedon't expect leverage to drop to 7x or below before 2014 at the earliest. Ourpositive outlook had incorporated the possibility that Crown's leverage wouldimprove to 7x or less within our two-year rating horizon, which we no longerbelieve is achievable.
The ratings on Crown reflect the company's aggressive financial policy, givenits historical use of debt and excess cash flow to fund large stockrepurchases. As a result, adjusted leverage is high, at about 7x for the 12months ended June 30, 2012. We anticipate that the company will benefit fromtower leasing revenue growth over the next year due to price increases in itscontracts and the addition of new tenants on its tower sites, which shouldcontribute to an increase in EBITDA in the mid- to high-single-digit area for2012 and 2013. The T-Mobile towers, which have a lower tenancy per tower thanCrown's own business, have somewhat higher growth potential, although ourassumption for the addition of tenants on these towers is fairly conservative.Moreover, given the company's aggressive financial policy, we believe it mayuse excess cash flow to repurchase stock rather than repay debt, especiallysince it has no near-term maturities.
Crown is one of the largest independent tower operators in the U.S., with atotal portfolio of approximately 24,000 towers, in addition to variousdistributed antennae systems. Pro forma for the T-Mobile transaction, thecompany will operate a portfolio of over 30,000 towers.
We view the business risk profile as ""strong.""The business generates cashflows with a high degree of stability, given the long-term nature of thewireless carrier contracts and high renewal rates. In addition, there has beena trend toward longer term contracts in this business and carriers have littleto no flexibility to terminate early without fully honoring the contract.Typical of the tower leasing industry, the high operating leverage of thebusiness also contributes to extremely healthy tower gross profit and overallunadjusted EBITDA margins, which were 74.6% and 62.6%, respectively, for thesecond quarter of 2012. A high percentage of the business' EBITDA cantranslate into discretionary free cash flow, given very modest maintenancecapital expenditures. However, we expect Crown to use a significant amount ofits discretionary cash flows to continue to repurchase its common stock.
Crown benefits from continued subscriber growth in the wireless communicationsindustry, which has expanded both in terms of absolute subscribers andper-subscriber minutes of use. These trends and the need for more coverage andcapacity to accommodate demand have translated into additional tenants leasingspace on existing towers, a trend known as colocation. Moreover, the majorcarriers have upgraded their networks to provide higher speed wireless datacapabilities, which in many cases, has required additional tower equipment.The regional carriers also have increasingly added to their coverage areas tooffer plans competitive with the national players, which, in turn, haveboosted tower leasing revenues.
Crown also benefits from stable monthly cash flows from carriers withsubstantial financial resources, including Verizon Wireless and AT&T Mobility.These long-term contracts have very high renewal rates and average annual rentincreases of 3%. Moreover, the towers have the capacity to support multipletenants, providing additional upside to cash flows per tower, particularlybecause adding tenants to existing towers involves minimal incrementaloperating expense.
Liquidity
We consider Crown's liquidity ""adequate."" Sources of liquidity includeavailability of $1 billion under the revolving credit facility, coupled withthe expectation that the company will generate about $960 million of fundsfrom operations in 2012. We note that the company has not yet identified aspecific financing plan to fund the T-Mobile acquisition, although our""adequate"" liquidity assessment assumes it will be able to access the capitalmarkets for the transaction. We may revisit this assessment if the companydelays a financing plan or has difficulty in accessing the market.
We expect that sources of liquidity will provide at least 1.2x coverage ofuses. We also expect Crown will continue to repurchase common stock, as wellas incur capital expenditures for land purchases, tower improvements, and newtower builds. The company is likely to maintain at least 15% minimum EBITDAcushion under its 6x total leverage covenant, which does not step down untilMarch 2014.
Recovery analysisFor the complete recovery analysis, seethe recovery report on Crown, publishedAug. 2, 2012, on RatingsDirect.
Outlook
The outlook is stable. As a result of Crown's acquisition of the leasingrights to the T-Mobile towers, we expect that its debt to EBITDA will benearly 8x for 2012, pro forma for the T-Mobile transaction. We expect thisleverage to decline to the mid-7x area by the end of 2013.
The rating could be raised if we came to expect a leverage reduction to 7x orlower on a sustained basis, which could occur if EBITDA increases at around a13% rate in 2013 rather than the low- to mid-teen percent area we currentlyassume in our base-case scenario. Conversely, and less likely, in our view, wecould lower the rating if Crown were to become more aggressive in itsfinancial policy such that it used debt to repurchase stock for in excess of$5 billion, since this would increase leverage to the 10x area.
Related Criteria And Research
-- Business Risk/Financial Risk Matrix Expanded, Sept. 18, 2012
-- U.S. Telecom And Cable Companies' Maturities Are Manageable, ButLower-Rated Issuers Face Some Liquidity Challenges, July 23, 2012
-- U.S. Telecom And Cable Companies, Strongest To Weakest, July 13, 2012
-- U.S. Telecom And Cable Ratings Should Be Stable Overall During WeakEconomic Recovery, July 13, 2012
-- A Matter of Policy: U.S. Telecom Companies Maintain High DividendPayouts, But For How Long?, May 30, 2012
-- A Matter of Policy: U.S. Cable And Satellite-TV Companies Ratchet UpShareholder Payouts, May 16, 2012
-- Top 10 Investor Questions: U.S. Telecom and Cable Industries, May 10,2012
-- Assessing The Four-Notch Rating Gap Between The Two U.S.Direct-To-Home Satellite Video Operators, May 9, 2012
-- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011
Ratings List
Ratings Affirmed; Outlook Action
To From
Crown Castle International Corp.
Corporate Credit Rating B+/Stable/-- B+/Positive/--
Ratings Affirmed; Recovery Ratings Unchanged
Crown Castle International Corp.
Senior Unsecured B-Recovery Rating 6CC Holdings GS V LLCCrown Castle GS III Corp.Senior Secured BBRecovery Rating 1Crown Castle Operating Co.Senior Secured B+Recovery Rating 4
Complete ratings information is available to subscribers of RatingsDirect onthe Global Credit Portal at
. All ratings affectedby this rating action can be found on Standard & Poor's public Web site at. Use the Ratings search box located in the leftcolumn.(New York Ratings Team)
((e-mail: pam.niimi@thomsonreuters.com; Reuters Messaging:pam.niimi.reuters.com@reuters.net; Tel:1-646-223-6330;))
GoPro Inc.: ""I think that GoPro's going to have a good holiday season. They've got all new stuff. I think it could trade to $8, but I don't think it's getting more than that because it's pretty darn speculative.""
Eli Lilly and Co.: ""I think Eli Lilly is very good, but it has had such a run that I can no longer countenance buying it up at these levels.""
HealthEquity Inc.: ""I think it's interesting. I mean, look, I think that if Paychex decided they wanted to get into that business, exactly in that niche, I think that they could do great and they could actually do it pretty well through corporations, so I don't know if there's a big enough moat there.""
General Mills Inc.: ""They bought this Blue Buffalo. Here's the problem: I don't like the stock because they took down too much money to pay for Blue Buffalo. They overpaid. They've bought a lot of stock much higher and then they're selling lower. That is not my kind of company.""
Marriott Intl.: ""This is just people just saying the business cycle's reaching a conclusion. It's all about the Fed, otherwise Marriott would be higher because [CEO] Arne [Sorenson]'s doing a great job.""
Take a look at some of Tuesday's midday movers:
Carnival - The cruise operator declined after projecting a full-year profit beneath estimates.
United States Steel and AK Steel Holding - Both rose after Goldman Sachs repeated buy ratings.
Chipotle Mexican Grill - The momentum stock continued to fall, after rising more than 80 percent over the past year.
Netflix - Shares of the momentum stock fell, after rising more than 100 percent over the past year.
SolarCity - Shares climbed on news it received a $250 million loan from a group of lenders to help finance solar projects for homeowners and businesses.
EBay - Shares fell. The company urged shareholders to vote against Carl Icahn's proposal to spin off the company's PayPal unit.
Pfizer - Shares gained after the company said its cancer drug was superior to chemotherapy as a first-line treatment for a certain type of lung cancer in a late-stage study.
The Carlyle Group - Shares rose after the company said Michael Cavanagh would join the company this summer. At JPMorgan until Tuesday, Cavanagh was considered a possible successor to JPMorgan CEO Jamie Dimon.
Paccar - Shares rose after Goldman Sachs upgraded the semi-truck maker to buy from neutral.
Navistar International - Shares fell after UBS downgraded the truck maker to neutral from buy.
NPS Pharmaceuticals - Shares rose after Goldman Sachs began coverage with a buy rating.
G-III Apparel Group - Shares fell after the women's sportswear company said it could report a loss in the current quarter and forecast full-year results below expectations.
Himax Technologies - Shares slid after Bank of America/Merrill Lynch downgraded the stock to underperform from buy.
KBR - Shares fell after Goldman Sachs downgraded the engineering and construction firm to neutral from buy.
(Read More: )
—By CNBC's Rich Fisherman.
Questions? Comments? Email us at marketinsider@cnbc.com
While the impact of the Fannie Mae-Freddie Mac bailout on stocks is less than certain, the rescue plan has created a new enthusiasm for bonds.
In particular, mortgage-backed securities have regained favor with investors after the government seized the two mortgage giants, effectively taking over their $5 trillion in debt and pledging $200 billion in capital to cover expected losses.
At the same time, investors are also preparing to step up buying of corporate bonds as well as Treasurys after the government intervention assuaged uncertainty about the security of the debt instruments.
""I was a big buyer of (mortgage-backed) bonds until a couple months ago. I took a six- to nine-week vacation from buying just in case,"" says Dennis J. Barba, managing partner of the Oxford Group of Raymond James Associates in Cleveland. ""With what just happened we'll start purchasing those bonds again for our clients. I think it's a little safer to go in the water than it was a few weeks ago.""
Barba is not alone in his enthusiasm for mortgage debt.
The $4.5 trillion industry had what some analysts believed to be its biggest day Monday, the first trading day after the bailout announcement.
Banks made about $20 billion selling the holdings as risk premiums over Treasurys fell by 40 basis points. The trade surged in part after two of the nation's leading bond traders, Pimco's Bill Gross and The Vanguard Group's Kenneth Volpert, said on CNBC that they would be buyers.
""Stick with the partner that brought you to the dance,"" Gross said. ""Basically mortgage securities are attractive here because the Treasury announced that they were going to be buying them in the future. You want to buy them now and sell them back to the Treasury in the future at a higher price.""
Watch video at left for analysis from Gross and Volpert.
But Barba advises caution in the trade and said he is buying mostly short maturities and not going into the long end of the market, on the belief that there's more trouble ahead for mortgages that will send risk premiums higher.
""What the Treasury announced doesn't end this mess,"" he says. ""It just takes a little bit of the gray out of the equation.""
Mortgage-backed debt can be purchased through brokerages and comes mostly from Fannie and Freddie.
Corporate Bonds Also Attractive
A newfound appetite for debt also is helping corporate bonds prosper.
The average corporate bond yield of nearly 6 percent is an attractive enticement for investors amid a wobbly stock market, and some money managers have been parking their assets there until the equity storm and the credit crunch blow over. The bailout news helped sweeten the pot.
""At this point we're still staying away from financial service corporate bonds, but we do like those of industrial companies and other industries that aren't really tied into the financial crisis at the moment,"" says Emily Sanders, president and CEO at Sanders Financial Management in Atlanta.
Barba also likes corporate debt, and said he has bought short-term notes for his clients in companies including Goldman Sachs, Merrill Lynch, Citigroup, CNBC.com owner General Electric and Hartford Financial ServicesGroup.
One obstacle to investing in such debt, though, is you generally need pretty deep pockets. Most corporate debt is bought in increments of $5,000 or $10,000, and the cost can get much higher for mortgage securities.
The difficulty in making investments in smaller denominations comes in part because of the markup, or the price that a dealer charges compared to the actual price of the bond. High markups for corporate debt make the investment profitable only in considerable volume.
To make the trade, Sanders says smaller investors can buy exchange-traded funds that don't have all the cost, risks and restrictions of the various debt types but track their movements.
One such ETF is the iShares Lehman Credit Bond fund that reflects the U.S. investment-grade credit sector of the bond market as defined by the Lehman Brothers U.S. Credit index. Sanders Financial has purchased the ETF for its clients.
""Particularly for retail investors that are either on fixed incomes or fully retired or nearing retirement, corporate bonds can be a good way to bring in some steady interest income without taking on as much volatility in the equity markets,"" Sanders says. ""There's a lot of solid companies that issue corporate debt.""
Benefits For Banks
Financial institutions that had been taking a beating over their mortgage losses have been the primary beneficiaries of the Fannie-Freddie bailout, although their shares were mostly lower in Tuesday trading after huge gains the day before.
Lenders have posted more than $500 billion in credit losses and writedowns during the credit crunch as foreclosures have hit record levels in some areas and property values have tumbled.
""Banks had been a little over $40 billion under water relative to their book costs for securities overall, and with (Monday's) move and the tightening in mortgages, we estimate that helps bring that to only about $20 billion under water,"" says Matthew Jozoff, head of mortgage strategy at JP Morgan.
Real estate investment trusts also have benefited as the veil of uncertainty was removed from the market. The handful of REITs that invest in Fannie and Freddie debt had ""outperform"" ratings reaffirmed by a KBW analyst after the bailout took hold.
""There has been a lot of demand on the sidelines, and this brings clarity to bring those buyers off the sidelines,"" says Michael Hough, chairman and CEO of Hatteras Financial .
Hatteras shattered quarterly earnings expectations and on Monday posted its highest single-day gain in nearly three months.
-- Reuters contributed to this report.
Many American parents are financially supporting their adult children at the expense of their own financial wellness.
Almost half, or 45%, of parents with adult offspring have given their children money during the coronavirus pandemic and of those 79% said the funds would have otherwise gone towards their own personal finances, a survey from CreditCards.com found.
It wasn't just chump change, either. Those with an annual household income of less than $40,000 gave an average of $1,403, while those with a household income of $40,000 to $80,000 gave $2,170 on average. Parents who had an annual household income of more than $80,000 gave their kids an average $8,530.
""This is holding them back from paying off their own credit card debt,"" said Ted Rossman, senior industry analyst at CreditCards.com. ""It is impacting their ability to save for the future.""
In fact, parents who gave money that would have normally been used for their own finances said they would have otherwise used the money to pay down their own debt, for day-to-day expenses and to boost their emergency savings, as well as put money towards retirement.
Most of the money parents gave their children was used for food and housing, and also included a cell phone or wireless plan, a car, paying off debt and entertainment.
It's only natural that parents want to help their children, especially during a pandemic, said certified financial planner Lawrence Sprung, president of Hauppauge, New York-based Mitlin Financial. However, they should be careful about setting a precedent, especially with your younger adult kids.
""We want to ultimately help our children to become self-sustaining members of society and not rely on mom and dad every time they make a misstep,"" Sprung said.
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He suggests having an agreement, particularly with older adult children, on how the help will be repaid. Also include some educational guidance so your children can prepare themselves for the future and avoid finding themselves in a similar position again, he said.
However, a loan may not always be the wisest idea, Rossman said. He suggests making it a gift, if you can afford it, to avoid damaging your relationship in the future.
A 2019 Bankrate survey found that of the 60% of Americans who lent a loved one cash, 46% lost money and/or saw their relationship with the borrower harmed.
As 2020 Election Day nears, technology companies like Facebook are doing a better job than they did in 2016 in fighting the social media misinformation campaigns of foreign adversaries like Russia and Iran, according to Alex Stamos. He should know — Stamos was a former security chief for the world's largest social media platform.
But the cybersecurity expert, who now is director of the Stanford Internet Observatory, says the toughest misinformation threat technology companies face, and can't solve, is from within the U.S. — disinformation sowed by U.S. politicians, and one figure, in particular.
""What's changed in 2020 versus 2016 is the massive amount of cooperation between large and small technology platforms and the government. In 2016, it was really no one's job to think about how Russia or others might use online to cause chaos in the election,"" Stamos said at the CNBC Technology Executive Council virtual summit on Thursday.
""Now there is a dedicated group between the government and tech and massive takedowns of Russian assets and also Iran. A huge difference,"" he said.
Stamos also pointed to efforts like the election integrity site EI Partnership, with which he works. But making sure voters get the elections information they need to make informed decisions is being made harder by the threat from within our own borders.
""The most important disinformation this cycle is coming from domestic sources, and that is huge problem for technology companies,"" Stamos said. ""They are loathe to wade into democratic processes in the U.S.""
""It's wonderful tech companies have war rooms and counter disinformation efforts, but we also need to see leadership from the federal government, but we're seeing the federal government sowing misinformation, spreading misinformation, and it's very significant in terms of causing nervousness and lack of confidence in the voting process,"" said Alexis Wichowski, Deputy CTO for Innovation, New York City Mayor's Office of the CTO, who spoke on the CNBC TEC virtual summit with Stamos.
The former Facebook security chief said the collaboration between tech platforms and units within the federal government, such as the Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA), which didn't exist in 2016, as well as offensive operations from the military's Cyber Command, are working against the foreign disinformation.
""But at the same time, there is election disinformation out of the White House, out of the Twitter account of the president himself and then also from theses influencers around him trying to amplify election disinformation,"" Stamos said. ""I'm not sure we have a good solution between now and Election Day.""
He used an early claim of victory in the president election as an example of why censorship won't work.
Claims made online can be labeled or taken down, but if President Trump goes to a White House podium and declares victory, it will be covered by every major news organization.
""There is only so much they can do if the president gets on a podium of the White House. ... that is newsworthy and will be run on TV and everywhere and they can't censor it.""
This week, the top executives from the biggest tech companies including Facebook, Twitter and Alphabet, were grilled by Senate Republicans over claims of bias.
President Trump has railed against technology companies and signed an executive order last May targeting Twitter and others after the social media company fact-checked some of his tweeted claims, which he called ""censorship.""
The Senate hearing was focused on Section 230 of the Communications Decency Act, and threats to alter the Act as a response to social media company actions. Facebook and Twitter recently limited access to a New York Post story claiming corrupt actions involving Democratic Party candidate Joe Biden and his son Hunter, which Twitter CEO Jack Dorsey later said was the wrong move.
""Section 230 is one of the most understood laws about the internet and cited by everyone as too important, and cause of lots of behavior. But the truth is the vast majority of stuff people don't like online is protected under the First Amendment,"" Stamos said.
What technology companies can do, Stamos said, is add context, like news organizations would, and he said that makes more sense than trying to block claims entirely.
In the end, Stamos said individuals need to make sure they are very careful about what they look at, and where they get information online, and rely on state and local election officials and authorities, of which there are roughly 8,000 in the U.S., and get information on voting directly from them.
They may even turn to non-traditional sources of information online, and given the situation, Wichowski said that is a reasonable option. ""In the absence of leadership from the White House or confusing leadership messaging from all levels of government, people look to whomever they can trust,"" Wichowski said.
That can even include celebrities and social media influencers, she added, ""if they don't trust elected officials. ... can't just rely on traditional sources of power.""
The New York City technology officer said one thing citizens should not worry about is the processing of ballots. ""From an election perspective, decentralization is a strength. It may take more time to process ballots, but we want to protect system integrity from outside actors and each region and district have a solid handle on their own slice of the pie, and decentralization is the way to go about it.""
Stamos said after Election Day, one major issue a new Congress should take up is how to structure more federal support for local agencies to make sure disinformation is not promulgated by politicians.
Soaring shares of are set to stream even higher, according to Rob Sanderson, a research analyst who covers the stock for MKM Partners.
Ahead of Thursday's bell, Sanderson raised his 12-month price target on the then-$158 stock to $195. His bullish report appeared to put a bit more wind in Netflix's sails, as the tech giant rose a bit more than 3 percent in the session to close at $163. But if the analyst is right in his long-term call, the stock has even more substantial gains ahead than his current price target implies.
To be sure, his target change did not rest on any massive reworking of expectations. Actually, the methodology that leads to his $195 price is almost pleasantly clinical.
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Sanderson continues to expects the stock to earn $12.12 per share in 2021, and to trade at a forward price target of 22.5 in 2020 — leading to an expectation that the stock will trade at $273 in two and a half years' time. He expects investors to ""discount"" this price by 25 percent for every year in the future it is (as a way to be compensated for the risk of Netflix not achieving those earnings and/or multiple).
At the end of January, when Sanderson slapped his prior one-year price target on the stock, one year from then was about two years away from 2020 — so $273 was divided by 1 plus 25 percent, raised to the second power. Now, a year from now is about a year and a half from 2020, so $273 is divided by 1 plus 25 percent, raised to the 1.5st power. Hence the price target moves from $175 to $195.
This simple arithmetic can cause one to forget the fact Sanderson is forecasting that Netflix's earnings will explode from about $0.50 in 2016 to more than $12 in five years' time. And to further forecast that even after the stock does so, investors will still be sufficiently optimistic about future profits to slap a high earnings multiple on the company.
Sanderson said in an interview Thursday on CNBC's ""Power Lunch"" that the company has ""more than ample opportunity to continue to scale up [its] content investment on a global basis,"" and that ""the subscriber opportunity is sufficiently large.""
While some might be tempted to bet against such heady expectations, Dennis Davitt of Harvest Volatility Management uses the harshest language to warn against doing so.
""I've seen a lot of really good investors lose a great amount of money on stocks like Netflix, and that usually comes from when they short them,"" Davitt said Thursday on ""Power Lunch."" ""It's a momentum stock.""
However, Davitt says it would be prudent for Netflix investors to buy a downside put on the stock, in order to maintain their upside while protecting themselves from the potential for great downside.
""I think Rob's right, personally,"" he said. ""But if Rob's not right, it costs you 5 percent to own the 'insurance policy' on the stock.""
Netflix is up more than 30 percent year-to-date.
Britain formally left the European Union's trade bloc on Dec. 31, marking a new era for the U.K.-EU relationship.
After months of wrangling, new rules for trade were finally agreed just days before the year-end deadline. But in a document spanning over 1,200 pages, there was very little mention of financial services: a sector which accounts for 7% of the U.K.'s economy and 10% of its tax receipts.
One particular issue that arises is the clearing of euro-denominated derivatives.
The size of the European derivatives market topped 680 trillion euros ($834 trillion) in 2019, and the majority of European clearing activity takes place on London-based exchanges such as LCH.
So far, the European Securities and Markets Authority has agreed to roll over current clearing arrangements for these derivatives until June 22, giving more time for EU-based institutions to decrease their reliance on the British-based clearers. It has previously said it wants euro-denominated derivative trading to only take place within the EU, or somewhere with ""equivalent"" regulations.
The two sides have committed to releasing a memo of understanding within twelve weeks that will give further clarity on these equivalence rules. They are especially important for the financial industry as they enable U.K.-based companies to sell services into Europe, as long as the regulations don't diverge substantially from Brussels.
Douglas Flint, chairman of Standard Life Aberdeen, told CNBC's Squawk Box that there does appear to be ""a general recognition that financial stability is too important to risk by having a clumsy exit.""
""There has been a discussion of mutual recognition or equivalence for the last four and a half years, so it would take a fresh approach between the U.K.and EU to agree what is important and how the infrastructure can continue to operate,"" he said on Monday.
The current arrangement allows for the EU to withdraw equivalence rights for U.K. institutions with only 30 days' notice, a decision that the U.K. has no right to contest.
""Europe has always been very defensive against external providers, so when the U.K. counts as an external provider it will have to take what it's given,"" Simon Gleeson, partner at Clifford Chance, told CNBC. ""The regulatory response therefore needs to be a cooperative response between national regulators.""
The approach so far has been piecemeal and on a temporary bilateral basis. For instance, Italy on Sunday announced that it is allowing U.K. financial companies to keep operating as they are in the country for another six months.
Leaving it up to each individual regulator to make arrangements has also complicated the setup on the ground. Many U.K-based banks have moved personnel covering the Dutch, French, Spanish and German markets to the continent, while those covering Italian and Scandinavian markets have been able to remain in the U.K.
The loss of ""passporting"" — or the ability to trade freely — post-Brexit also means that the days of financial advisors being able to fly in and out of Europe to operate have come to an end. This has prompted many senior staff to relocate to other European hubs such Frankfurt and Paris, the latter being attractive because of the prospect of lower income taxes.
In October, EY estimated that the total number of financial services jobs to have left the country since the Brexit referendum was just over 7,500, an estimate that falls short of the gloomy scenario of hundreds of thousands that was forecast by some think tanks in 2016.
As for bank preparedness, NatWest Chairman Howard Davies told CNBC's Street Signs on Monday that while U.K.-focused banks were largely prepared for a ""hard"" Brexit by setting up subsidiaries on the continent, ""what we can't prepare for is the uncertainty which persists.""
""At the moment we don't know what the future arrangement or the regulation of cross border entities in Europe will be. So there is a limit to what financial institutions can do when there are still very significant moving parts here,"" he added.
Long term, industry players are still positive on London's fortunes as a global financial hub, with one hedge fund manager telling CNBC that he would still be willing to back the U.K. as ""our business is largely immune to the changes and most aspects of the City are very reliant on talent, knowledge and relationships and for a lot of reasons this is embedded in the U.K.""
Natwest's Davies echoes this view, saying London will remain the largest financial center in Europe for the foreseeable future, but the extent that it can ""retain intra-EU business will depend on the new arrangements on regulatory cooperation and equivalence.""
Former trade minister and Senior Advisor at Covington, Francis Maude, agreed. ""London is not just a European financial center but a global center. I hope this will be dealt with in a pragmatic way with regulators operating in a non-political"", he told CNBC last week, concluding that, ""this is not the end of a story, it's the beginning of a different story.""
She wanted a job, but it seemed the hiring partner wanted more.
Olivia, a young consultant, was searching for a job in Washington when a firm expressed interest.
But she remembers that the man interviewing her for the job, a senior partner, quickly veered into different territory. He insisted on taking her out for meals, with dinners accompanied by several bottles of wine.
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""Every time I wanted to talk about work, or the position, or the job, he'd grab my hand and tell me, 'I just want to tell you how beautiful you are,' "" she said.
""I was contemplating it as an opportunity, as a viable opportunity. It's ridiculous that I would consider something that would subject me to sexual harassment for higher title and higher pay,"" she said.
On K Street — the term for Washington's cadre of lobbyists, political operatives and people working in public relations — deals are often done over dinner or drinks, on business travel or retreats.
Much like Capitol Hill, the influence industry remains dominated by men, creating an environment where women say they are often subject to harassment and worse. Unlike in other industries, however, few women have been willing to come forward to talk about it.
The Hill began reaching out to women on K Street last year, asking whether they had similar stories to those surfacing as part of the ""Me Too"" movement.
More than a dozen women spoke about instances of sexual harassment or assault they say they have faced while working in the influence industry.
Everyone interviewed by The Hill asked to talk anonymously in order to speak freely about their experiences, fearing they will be blacklisted in Washington. Their names have been changed to protect them.
The employers are not named, nor are the men who they allege acted inappropriately.
In addition to being apprehensive of hurting their future career prospects, some of the women are also worried about retaliation from the men themselves.
""Everything in this town is predicated on relationships,"" said one woman who works in public relations (PR). ""Why make waves? That could be the next person to hire you.""
Several of the women said working on K Street requires them to routinely deal with unwanted touching, inappropriate comments or text messages, and suggestive remarks about their bodies and appearances.
All of them said they hoped sharing their experiences, however, would start a much-needed discussion about behavior by men in the influence industry and hopefully begin, as one woman described it, ""a course correction.""
A lobbyist's job routinely involves travel around the country for fundraisers, advocacy and events. Women recounted experiences where, on occasion, alcohol-fueled socializing led to unwanted advances from colleagues, bosses and public officials.
""When they are away from their district or on the road, they think it's a free-for-all, and their manners or morality is gone. It's out the window,"" said Allison, a lobbyist in her early 30s who said she has been harassed or assaulted by almost a dozen men, including other lobbyists and public officials, mostly when outside of Washington.
During one trip to a political conference, Allison recalled how she and about 10 others decided to hang out poolside after a dinner and people went up to their hotel rooms to change.
As she was getting ready with a friend, there was a knock at the door; it was another lobbyist attending the trip. Thinking he was there to walk down to the pool as a group, she opened the door to find him wearing an open robe with nothing underneath.
""Let's go skinny dipping,"" Allison recounts him saying.
When she recoiled, saying ""What the f---?,"" the lobbyist laughed and said the whole thing was a joke.
""Harassment is sometimes about power,"" said Lisa Banks, a partner at Katz, Marshall & Banks who specializes in workplace harassment. ""There's a power differential in Washington, and most of those people are men. It's certainly an environment that's ripe for this, but it's also a horrible scenario.""
Banks says her firm has recently seen an influx of complaints from women about experiences of harassment, but about half of the accusations have gone beyond the statute of limitations. Some women, she says, call to report things that happened decades ago.
(Disclosure: Katz, Marshall & Banks recently represented a woman who accused D.C. celebrity chef Mike Isabella and other higher-ups in the restaurant group of harassment. This writer formerly worked at Kapnos, an Isabella-owned restaurant, but left before the suit began and was not involved.)
Whether working in Washington or elsewhere, all the women who spoke with The Hill say that it is common for their colleagues to laugh off bad behavior, blaming it on alcohol or a ""boys will be boys"" attitude.
Though some of the unsavory conduct described to The Hill occurred when alcohol was involved, other incidents did not.
One month into a new trade association job, a board member invited Olivia to his hometown, a cross-country trip that was purportedly for work, where they were supposed to be setting the association's goals and strategizing for the next year. He asked her to pick out some things to do and shows to see while she was there.
Once she arrived, the two began working in the hotel suite, and when it came time to go out for the evening, he asked to change in the bathroom.
The executive, who was married, emerged from the bathroom shortly after that with his pants undone, according to Olivia.
""He didn't solicit anything, but the innuendo was there,"" she added.
While she managed to fend off his advances, she said his inappropriate behavior continued even after she returned home. He eventually ""got the hint,"" she says, though the two still had to work together.
""It was one of the more horrifying experiences, because you just don't know how to rectify it,"" she said. ""I did tell colleagues and my immediate boss about it, and they laughed it off and said, 'That's how he is.' ""
""I feel fortunate that I had the confidence and the voice"" to push back, Olivia added. ""Not everyone has that luxury.""
When women are harassed by board members or elected officials — those not employed by their own organization — coming forward about abuse can be complicated.
After two receptions one night, a trade association lobbyist named Leslie recalled heading to another event in a group. A board member sat next to her and, despite being surrounded by others, tried to get her to kiss him.
""He kept saying things like 'Why won't you just kiss me?' and 'Seriously, just kiss me right now,' "" she said. ""I climbed literally all the way over to the other side of the Uber. I was screaming 'I have a boyfriend! I have a boyfriend!' ""
""Not that [having a boyfriend] means anything,"" Leslie added.
Employers are legally obligated to protect employees from abuse, regardless of whether the harasser is part of an organization, said Debra Katz, of Katz Marshall & Banks.
""If they become aware that a board member, an elected official or even a [client] has acted inappropriately or sexually harassed an employee, the employer has the obligation to take corrective measures,"" Katz said. The employee must also agree on whatever actions are taken by the employer.
In the corporate world, employers are seeking out answers on how to deal with harassment and make sure policies around it are ""state of the art,"" said Jason Schwartz, a lawyer specializing in employment law at Gibson Dunn.
""A lot of lobbying and PR shops may not have a sophisticated, built-out [human resources] HR operation. A lot of this is unfamiliar territory to them,"" he said. ""People are struggling to figure out how to respond.""
Rather than relying on a HR or legal department, Schwartz said some employers have opted to have an anonymous reporting system or designate a rotating employee as a safe person to confide in. Punishments are also important, he says.
Some of Schwartz's clients have implemented a clause that employees' bonuses could be taken away should a negative report be made against them.
""These kinds of concerns are being taken far more seriously now than they ever were,"" Schwartz said.
But punishments become all the more complicated when it's the men in senior roles who are accused of misconduct, which makes reporting their behavior difficult.
Some K Street offices, women say, have a hypermasculine culture that makes it hard to come forward.
Human resources is there ""to protect management, they're not here to protect the people who report to them,"" said Liz, who worked for a trade association at the time. Her sentiment was echoed by nearly every woman who spoke to The Hill.
""Anything you said to HR went immediately back to the manager, and you'd get called into the manager's office and get screamed at for going to HR.""
Several women told The Hill that they've worked at firms where the men leading it talk repeatedly and openly about the women in the office, commenting on their bodies and their clothing in ways that go beyond innocent compliments.
During presentations led by a woman at a large trade group, the men in the room would allegedly send each other explicit and vulgar text messages, according to a woman shown those messages by one of the men.
Male members of the association allegedly passed a list ranking how much they wanted to sleep with women from the Washington office. It was called the ""f---ability factor"" list.
They would ""love to come up and tell you if you've dropped off the list"" or if you've been relegated to a lower ranking by, for example, getting married, Liz recalled.
Three other women told The Hill that men, including high-ranking government officials and executives, would send them explicit text messages — occasionally with graphic photos — talking about their bodies and what it would be like to have sex with them.
In a trade association's Washington office, a man would habitually engage in phone sex during work hours, according to another man in the office who witnessed it.
""Every afternoon, like clockwork, I would hear panting, heavy breathing,"" said Brandon, whose desk was near the executive's office. ""There were these conversations that registered above a whisper. ... When I listened closer, they were phone sex conversations.""
A second person who worked in that office at the time described to The Hill similar conduct by this person. Allegedly, once a complaint had been filed, the man was made to reimburse the group for the cost of the calls.
Margaret, a woman who then worked at a consulting firm, recalled that high-ranking executives would come to her office and talk about sexual conquests and whom they found attractive, sometimes giving unsolicited shoulder rubs.
She called it ""harassment creep,"" where actions start small and escalate into increasingly inappropriate behavior.
One ""would put his leg up on my desk and 'it' would be directly eye level with me,"" Margaret said. ""They want to see your reaction, to see how far they can take it with you.""
Two women described a tactic utilized during greetings or staged photo ops with clients and association members — each pointing to elected officials as the worst offenders.
""Rather than putting a hand here [while posing for a photo],"" said Margaret, grabbing her waist, ""it'll be up here."" She put her hand much higher, discreetly cupping the side of her breast.
Another woman said one particular K Street executive would hug her in a similar way.
""I call it the side-boob hug,"" she said. ""It is a pro trick. … I think they teach this when they get inaugurated. It has happened a bunch with elected officials. Or they find a way to grab your ass. It's amazing how often it happens.""
One of the biggest issues surrounding the debate over sexual harassment in every industry is that women have different interpretations of what crosses the line.
In an occupation where the job description involves being nice in order to push a cause or raise money, one lobbyist named Jennifer said that men often get the wrong impression. She said that other lobbyists she knows have propositioned her for sex.
""I think it's terrible, but I feel less harassed and more like they are testing the waters because it must have worked for them before. As soon as I'm like, 'Uh, no,' they apologize,"" Jennifer said, adding, ""That's happened quite often, actually.""
Legally, in most cases, unwanted comments or inappropriate touching must be continuous for an individual to file a lawsuit. The accusers must also show that the harmful environment was ""severe and pervasive,"" Katz said.
One woman who worked at trade associations before joining a large K Street firm says she faced retaliation after coming forward about being harassed by a fellow lobbyist.
An outside lobbyist hired by the organization where she worked pushed her against the wall of an elevator and tried to kiss her. Although he pulled back when she told him to stop, he began to send her a stream of text messages talking about how he wanted to be with her and how he was unhappy in his marriage.
The lobbyist was close with other men in her office, and after she complained, her boss began to schedule lobbying outings involving things she hated and wouldn't do: golf and cigar smoking.
""You don't have to terminate someone, but you can make their workplace a living hell,"" she said.
More than 190 Democratic lawmakers sued President Donald Trump in federal court on Wednesday, saying he had accepted funds from foreign governments through his businesses without congressional consent in violation of the U.S. Constitution.
The complaint said Trump had not sought congressional approval for any of the payments his hundreds of businesses had received from foreign governments since he took office in January, even though the Constitution requires him to do so.
The White House did not immediately respond to requests for comment but has said Trump's business interests do not violate the Constitution. The Trump Organization has said it will donate profits from customers representing foreign governments to the U.S. Treasury but will not require such customers to identify themselves.
At least 30 U.S. senators and 166 representatives are plaintiffs in Wednesday's lawsuit, representing the largest number of legislators ever to sue a U.S. president, according to two lawmakers who are among the plaintiffs.
The Constitution's ""foreign emoluments"" clause bars U.S. officeholders from accepting payments and various other gifts from foreign governments without congressional approval.
""The president's failure to tell us about these emoluments, to disclose the payments and benefits that he is receiving, mean that we cannot do our job. We cannot consent to what we don't know,"" said Senator Richard Blumenthal, one of the lawmakers bringing the lawsuit, in a conference call on Tuesday.
Representative John Conyers, another plaintiff, added: ""President Trump has conflicts of interest in at least 25 countries, and it appears he's using his presidency to maximize his profits.""
The Justice Department declined to comment.
Similar lawsuits have been filed in recent months by parties including a nonprofit ethics group, a restaurant trade group, and the attorneys general of Maryland and the District of Columbia.
They allege that Trump's acceptance of payments from foreign and U.S. governments through his hospitality empire puts other hotel and restaurant owners at an unfair disadvantage and provides governments an incentive to give Trump-owned businesses special treatment.
Rare to sue president
In a motion to dismiss one such lawsuit on Friday, the Justice Department argued that the plaintiffs had not shown any specific harm to their businesses, and that Trump was only banned from receiving foreign government gifts if they arose from his service as president.
On Monday, White House press secretary Sean Spicer said ""partisan politics"" was behind the lawsuit by the Maryland and District of Columbia officials.
Lawmakers rarely sue the president, so there are few federal court decisions the legislators can cite to prove their legal standing to bring Wednesday's case, said Leah Litman, an assistant professor specializing in constitutional law at the University of California, Irvine.
""But the constitutional provision they're suing to enforce gives them a role in how it's carried out, and that gives them a powerful standing argument,"" Litman said.
The lawmakers in Wednesday's lawsuit will be represented in court by the Constitutional Accountability Center, a public interest law firm in Washington.
Each lawmaker is paying a share of the legal fees from personal or campaign accounts.
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Blockbuster, the largest U.S. movie rental chain, posted a higher-than-expected quarterly profit as it cut costs by closing stores, reducing advertising and overhead expenses.
Blockbuster's shares rose 33 cents, or nearly 11 percent, to $3.40 in premarket trading Thursday.
Blockbuster, which has offered to buy Circuit City Stores for up to $1.3 billion, said sales at domestic stores open at least a year improved for the first time in five years due to a better line-up of new movies, improved in-store merchandising and more effective pricing.
Net profit was $45.4 million, or 20 cents per share, for its fiscal first quarter that ended April 6, compared with a year-earlier loss of $49 million or 27 cents per share.
Adjusted earnings from continuing operations were 21 cents in the quarter, beating the average Wall Street forecast of 16 cents, according to Reuters Estimates.
While quarterly revenue missed expectations, Blockbuster managed to cut selling, general and administrative expenses by $100.5 million on reduced advertising and lower overheads.
Blockbuster is repositioning itself to compete with new video distribution models provided by companies like Netflix and Apple.
Chairman and Chief Executive Jim Keyes said in a statement that the company's Total Access program, which lets subscribers swap DVDs at Blockbuster stores for unlimited free rentals, was now profitable.
Domestic same-store sales rose 2.9 percent, driven by a 19.7 percent rise in merchandise sales and a 0.4 increase in rental revenue, the company said.
Overall quarterly revenue fell 5.4 percent to $1.39 billion as Blockbuster closed stores, compared to the average analyst forecast of $1.44 billion, according to Reuters Estimates.
Blockbuster said its gross margin rose 1.5 percentage points to 53.2 percent in the quarter.
After resisting requests for months, Circuit City last week finally said it would open its books to Blockbuster and its largest shareholder, billionaire investor Carl Icahn.
But Blockbuster's bid continues to draw skepticism from some analysts who question the strategic fit of the two struggling companies just as Blockbuster is staging a turnaround.
Oct 5 (Reuters) - Denison Mines Corp :
* Announces bought deal private placement of flow-through shares
* Offer and sale of 4.14 million flow through shares of Denison on a private
placement basis
* Flow-through shares shall be offered at a price of $1.69 per share for
aggregate gross proceeds of about $7.0 million
* Proceeds will also be used to explore, advance the wheeler river project in
the athabasca region of Saskatchewan
* Says proceeds will be used to incur eligible Canadian exploration expenses
for purposes of income tax act(Canada)
((Bangalore Newsroom; +91 80 4135 5800; within U.S. +1 646 223 8780))
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Donald Trump made a rare allowance on CNBC on Thursday that he may lose the presidential election, but he said he will not back away from his uncensored style.
""I'm a truth teller. All I do is tell the truth,"" Trump said on ""Squawk Box"" in a phone interview. ""And if at the end of 90 days, I've fallen short ... it's OK. I go back to a very good way of life.""
Trump has previously questioned the integrity of the electoral system, which had some outsiders wondering if he was preparing an explanation for a potential loss.
""I'm afraid the election's going to be rigged, I have to be honest,"" Trump recently told an Ohio crowd.
However, in his comments Thursday he seemed to be preparing for a loss with a more conciliatory tone.
""I think we're going to have victory, but we'll see,"" Trump said. ""At the end its either going to work or I'm going to, you know, I'm going to have a very, very nice long vacation.""
Deutsche Bank strategist David Bianco told investors the market will rally over the next two years on optimism about President-elect Donald Trump's economic agenda.
""We think the market is under appreciating the likely big boost to S&P EPS from a lower corporate tax rate and the boost to bank profits from rising yields (and lower pension expense) and the much higher chance now of a long-lasting economic expansion that rivals the 10-year U.S. record,"" Bianco wrote in a note to clients Friday.
""We're more confident now that the S&P will reach 2,500 in 2018 before suffering its next bear market.""
Oil prices on Tuesday fell more than 3%, although closed off their lowest levels of the day, on worries about the outlook for fuel demand as Europe and the United States grappled with a surge in new coronavirus infections.
Stock and commodities investors remained cautious ahead of the first U.S. presidential debate between Democrat Joe Biden and Republican Donald Trump later on Tuesday.
The energy market was also waiting for weekly updates on U.S. crude stockpiles from the American Petroleum Institute (API) on Tuesday and the Energy Information Administration (EIA) on Wednesday.
Analysts polled by Reuters forecast U.S. crude inventories increased 1.6 million barrels last week.
On its second to last day as the front-month, Brent futures for November delivery fell $1.60, or 3.8%, to $40.83 a barrel, while the more active Brent contract for December fell 3.6% to $41.33.
West Texas Intermediate crude fell $1.31, or 3.2%, to settle at $39.29 per barrel.
More than a million people worldwide have died from COVID-19, according to a Reuters tally, a bleak milestone in a pandemic that has devastated the global economy and demand for fuel.
New York City will impose fines on people who refuse to wear a face covering as the rate of positive coronavirus tests climbed above 3% for the first time in months, Mayor Bill de Blasio said on Tuesday.
""The evolving COVID landscape is a massive downside risk for crude prices,"" said Craig Erlam, senior analyst at OANDA.
The heads of the world's largest trading houses predicted tepid oil demand recovery and flat prices in the coming months and possibly even years.
Clashes between Armenia and Azerbaijan over the Nagorno-Karabakh region have also kept markets on edge. If the conflict escalates, it could affect oil and gas exports from Azerbaijan.
In Libya, meanwhile, the Sarir oilfield has restarted production, the head of the company that operates it said on Tuesday, after eastern forces lifted an eight-month blockade on energy facilities.
Later on today, Donald Trump will become the 45th President of the United States.
With his inauguration now just hours away, CNBC's Sustainable Energy is taking a look at how environmental and climate organizations are assessing his potential impact on the planet.
Trump's previous statements on the environment and climate change – many of them via Twitter – have not sat well with many.
To give just one example, in 2012 he famously described the concept of global warming as having been ""created by and for the Chinese in order to make U.S. manufacturing non-competitive.""
Trump has also threatened to pull the U.S. out of the historic Paris Agreement, reached at the COP21 summit in Paris back in 2015, although he told the New York Times in November that he was ""going to take a look at it.""
For Ottmar Edenhofer, chief economist at the Potsdam Institute for Climate Impact Research, there could well be issues ahead.
""Trump will have substantial potential to cause trouble on climate policy,"" Edenhofer said in a statement released on Thursday, before going on to state that Trump could attempt to ""drive the export of coal.""
""The economic policy of the new president could also lead to rising interest rates, which would compromise the competitiveness of renewable energies,"" he added.
The profitability of climate-friendly technologies was primarily determined by investment costs, which are dependent on the interest rate, Edenhofer added.
The actions Trump takes in office with regards to the environment will impact people living both in the United States and the rest of the world.
On Friday, the chief executive of Friends of the Earth in England, Wales and Northern Ireland, was forthright in his opinion.
""The battle to prevent the world spinning towards catastrophic climate change is going to be a tough challenge – and, with a cheer-leader for the fossil fuel industry sitting in the Whitehouse, it's going to be tougher still,"" Craig Bennett said in a statement.
""Donald Trump won't 'make America great again' if he ditches action on climate change and boosts his nation's addiction to dirty gas, coal and oil,"" Bennett added.
Investors should stay away from financial stocks and be cautious about commodity and material investments as well, according to one money manager.
""This credit unwinding has a lot further to go,"" Jack De Gan, chief investment officer of Boston-based Harbor Advisory told CNBC. He recalled Goldman CEO Lloyd Blankfein's observation that the low point in financial securities won't be reached with the markdowns, but with the liquidations, which he thinks are still to come.
He made an exception for Berkshire Hathaway , his firm's largest holding, which is 25 percent higher than it was in August, when news of the credit crunch started to break.
De Gan is also reluctant to venture into larger industrials. ""If credit does contract the way we think it will, the financials will have to contract their balance sheets, and that will slow the general economy,"" he said.
So where's an investor to go?
""I'd want to buy the technology stocks which are smaller, more 'nichey,' focused in an area where they can take market share and grow, even if the overall market is stagnant,"" De Gan said.
He suggested that investors who bought consumer products stocks like Clorox several months ago stay with those stocks, even though they have become quite pricey.
""They're a safe haven,"" he said. ""There are going to be very good buying opportunities, for instance in the financials, in the next six to 12 months, so I think the consumer staples are a safe place to hide. They are not credit sensitive. Their business is very durable. You can stay there and watch for other opportunities.""
He also cautioned against going into basic material or commodity investments, noting that they are showing signs of overinvestment similar to the housing and technology bubbles of years past.
BAKU, Oct 4 (Reuters) - BP-Azerbajan said on Thursdaythe gas flows from Azeri Shah Deniz fields to Turkey were haltedlast night due to an ""an incident"" after reports of a pipelineblast.
""Last night we stopped gas supplies to the system of(Turkish company) Botas, on request of this company, due to anincident. But gas flows to Georgia, Azerbaijan as well as topumping stations of Baku-Tbilici-Ceyhan oil pipeline continue,""BP-Azerbaijan's spokeswoman Tamam Bayatly told Reuters.
She declined to say whether a blast in Turkey caused the gasflows stoppage. Earlier on Thursday Turkish energy officialssaid the gas supplies were stopped due to an explosion inTurkey.
BP-Azerbaijan is the operator of Shah Deniz, which producesabout 25 million cubic metres of gas per day.
(Reporting by Lada Yevgrashina; writing by Vladimir Soldatkin)
((vladimir.soldatkin@thomsonreuters.com)(+7 495 775 1242)(Reuters Messaging:vladimir.soldatkin.thomsonreuters.com@reuters.net))
Keywords: AZERBAIJAN GAS/BLAST
The yuan has had a big move against the dollar, and this strategist says there is more to come.
It's not every day the yuan rises to a record high against the dollar, but itposted its biggest gain in two months today - possibly thanks to central bank intervention. Greg Salvaggio, senior vice president of capital markets at Tempest Consulting, thinks the move is only logical.
""We think what the Chinese are doing is really what they've always done - a gradual, managed appreciation of their currency,"" he says. ""What they did is come in overnight and really demonstrate to people 'Hey, we're committed to this appreciation.'""
Salvaggio told CNBC's Scott Wapner he thinks the yuan could rise five to seven percent against the dollar in 2012.
The euro is a more complicated story, Salvaggio says. In the long term, Tempest is bearish on the single currency, but for now, ""in the short run, buying the euro at levels near 1.3050 is an excellent trade,"" he says, pointing to improved risk appetite, some positive developments in Europe, and the possibility that traders will have to cover short euro positions.
Salvaggio recommends buying the euro at 1.3050 with a stop at 1.2950 and a target of 1.3230.
Step lively, though - Salvaggio expects the euro be be at 1.17 in six months. ""We think there's a high probability that we will not see the same numbers in the euro zone next year that are in it right now.""
You can watch the whole discussion on the videotape, starting at 1:01.
Tune In: CNBC's ""Money in Motion Currency Trading"" airs on Fridays at 5:30pm and repeats on Saturdays at 7pm.
Learn more: The essential vocabulary for currency trading is on Key Currency Terms. Top currency strategies are broken down for you in Currency Class.
Talk back: Tell us what you want to hear about - email us at moneyinmotion@cnbc.com.
With individual tax rates down, a new boogeyman is haunting investors: inflation worries.
Those were the findings from the American Institute of CPAs' Personal Financial Satisfaction Index, which measures investors' ""financial pleasure"" or ""financial pain"" based on a range of economic factors, including personal taxes, inflation, job openings and real home equity.
Overall, the Personal Financial Satisfaction Index has crept up to 27.7 in the second quarter, from 27.0 in the first three months of the year. This reflects increased job openings and strong stock market performance.
However, inflation took the lead as a source of financial ""pain,"" edging out worries about taxes. The AICPA's blended inflation measure in the second quarter was 2.3 percent, up 0.6 percent from the first quarter.
Up until the second quarter, taxes were the leading cause of ""pain"" for the prior eight quarters.
""Even though inflation has gone up, it's still pretty darn low, relatively speaking,"" said Michael Eisenberg, a CPA, personal financial specialist and member of the American Institute of CPAs Consumer Financial Education Advocates.
""People get nervous when they see or hear about inflation,"" he said. ""It eats away your purchasing power over time.""
Here's what rising inflation means for your finances.
Though inflation rises incrementally from one year to the next, the real concern is what it means, long-term, for your ability to pay for goods and services.
It's one of the reasons why a pound of ground beef was $1.80 in June 1998 and why it's now $3.82 as of this June, according to the Bureau of Labor Statistics.
From a financial planning perspective, savers approaching retirement ought to identify the three biggest inflation threats facing them and prepare accordingly, said Thomas Scanlon, a CPA with Borgida & Co. in Manchester, Connecticut.
""My big three are housing, education and medical,"" he said. ""Medical expenses are the runaway train and will affect everyone.""
In order to safeguard against inflation in retirement, investors should work with their advisors to reevaluate their allocation toward equities so that they can keep up with rising expenses – particularly the cost of health care.
""You could be in retirement for 30 years if you think about it, so even with benign inflation, you have to invest to protect yourself those last 15 years,"" said Scanlon.
Shares of Stellantis – the merged automaker of Fiat Chrysler and France-based Groupe PSA – jumped by more than 11% in their trading debut on the New York Stock Exchange on Tuesday.
The $52 billion merger was finalized Saturday, and the combined company's shares started trading Monday under STLA on Euronext in Paris and the Borsa Italiana in Milan. Trading of U.S.-based shares, under the same ticker symbol, were delayed a day because the U.S. markets were closed Monday for the Martin Luther King Jr. holiday.
Stellantis is the world's fourth-largest automaker by volume. The company's operations, including its 400,000 employees, will largely be in North America and Europe.
Here's what else you should know about the company:
Shares
After the completion of the merger, Groupe PSA shareholders received about 1.7 shares of Stellantis for each PSA share, while Fiat Chrysler shareholders received one share of Stellantis for each of their shares.
In a virtual launch on the Borsa Italiana website, Stellantis CEO Carlos Tavares, former chief executive of Groupe PSA, said the merger would add 25 billion euros ($30.3 billion) in value to shareholders over the coming years due to projected cost cuts.
""All of our employees and our management teams are totally focused on the value creation that is embedded on the merger of FCA-PSA and the creation of Stellantis,"" he said.
Cost-cutting
The merger is expected to provide about 5 billion euros, or $6.1 billion, in annual cost savings, according to officials.
Stellantis
The company's name is rooted in the Latin verb ""stello"" meaning ""to brighten with stars,"" the companies have said.
The name Stellantis will be used for the umbrella corporation, but not for its vehicles. The company's 14 individual auto brands such as Alfa Romeo, Chrysler, Fiat, Jeep and Peugeot – all which have historical significance in their respective countries – will remain unchanged.
Board of directors
The Stellantis board of directors is composed of two executive directors, Tavares and former Fiat Chrysler Chairman John Elkann.
The companies nonexecutive directors are:
- Robert Peugeot, of the French automaker's Peugeot family
- Henri de Castries, former CEO of insurer Axa SA.
- Andrea Agnelli, Elkann's cousin and a member of the family that controls Fiat Chrysler
- Fiona Clare Cicconi, chief human resources officer at AstraZeneca PLC
- Nicolas Dufourcq, CEO of French investment bank Bpifrance SA.
- Ann Frances Godbehere, director at Royal Dutch Shell PLC
- Wan Ling Martello, partner and co-founder of private equity firm BayPine
- Jacques de Saint-Exupery, head of the workers' council at PSA
- Kevin Scott, chief technology officer at Microsoft
– CNBC's Elliot Smith contributed to this report.
Scientists are making strides in growing food in space, and their efforts could be critical to eventually supporting a permanent human colony on Mars.
""We can grow plants on Mars just by compressing the atmosphere,"" SpaceX founder and CEO Elon Musk said Tuesday in a long-awaited speech detailing his vision for sending humans to Mars by 2025. The billionaire engineer said the Red Planet is ""resource rich"" with water ice and compounds necessary to support plants, such as nitrogen.
Experts say astronauts could pack enough packaged or freeze-dried food to get to Mars and back, although living on the planet for extended periods would get increasingly difficult without regular food-supply missions. Mars would require a six-month journey to the planet, an 18-month stay and a six-month trip back.
NASA has a stated goal for a manned Mars mission in the 2030s. The agency is studying the effects of long-duration space exploration on astronauts as well as learning how to best grow vegetables or other plants aboard a spacecraft or on Mars. The tests on plants, part of NASA's ""Veggie"" program, have been conducted in a pressurized space garden aboard the International Space Station as well as in terrestrial laboratories.
At present, red romaine lettuce is the only food grown in space that NASA has approved for astronaut consumption. The lettuce's antioxidant properties could reduce the consequences of humans getting radiation exposure in space. Researchers also are testing cabbage and peppers.
""For the astronauts to grow a portion of their food to augment their diet with fresh, nutritious food, I think would be a tremendous benefit and savings overall,"" said Trent Smith, Veggie project manager at NASA's Kennedy Space Center in Florida. He said the cost and weight to deliver food to Mars ""is pretty significant"" and indicated that plants could also grow aboard the spacecraft on the long journey to Mars.
In recent years, NASA has relied on private companies such as SpaceX, Orbital Sciences and others to resupply the Space Station with a cargo load of supplies, including freeze-dried food that has a long shelf life. These cargo deliveries have taken place roughly around every three months, but when astronauts go outside of low Earth orbit in long duration missions on Mars, it will not be practical to resupply missions every few months.
Musk this week estimated that a one-way trip to Mars for one person would cost about $10 billion and indicated there were ways to reduce that cost drastically by refilling the spaceship tanks in orbit. He also talked about the need to build a methane-based propellant production plant on Mars for the spaceships.
The methane could be created through the extraction of ice water on Mars and combining it with the planet's abundant carbon dioxide. Having the local propellant source and fresh food production could go a long way to creating a self-sustaining colony on the Red Planet located 33.9 million miles from Earth.
Moreover, chemical plants could use some of the compounds found on Mars to create plastics that might be used to build shelters, greenhouses, vehicles and high-tech potting systems for growing food.
""On Mars it will be easier to grow plants, and we can use a lot of advanced hydroponics and aeroponics systems that we currently have on Earth and grow plants in lava tubes or any other place where we can keep an atmosphere,"" said Robert Ferl, a professor of Horticultural Sciences at the University of Florida in Gainesville. Both hydroponic and aeroponic gardening can be done without any soil.
The surface gravity on Mars is about one-third of that on Earth, but that is not a major concern when it comes to growing plants. The same cannot be said for growing plants aboard the Space Station in microgravity, where it's a challenge getting the air and water mixture just right for the plant's roots.
Plants under zero gravity conditions can suffer from either flood or droughts since there's no natural convection and the water can stick around the roots or edges of the pot.
One way around the microgravity is to use a pillow-like technology developed by NASA. Seed and soil-like particles are put into the pillow chamber where they can be more efficiently controlled in zero gravity conditions to support plant growth.
""Turns out that managing water and managing fluids, especially around the roots of plants, is fairly tricky stuff in the absence of gravity,"" said Ferl, who has conducted NASA-funded experiments on plants.
Space agriculture, whether aboard the space station or in an extraterrestrial habitat, can provide food and recycling benefits for crews. The plants recycle the astronaut's exhaled carbon dioxide and also can use the excreted water. LED lights are used for sunlight to increase the photosynthetic activity by the plants.
The public's awareness of the possibilities of space farming may be limited to what they saw in the 2015 Hollywood blockbuster movie ""The Martian,"" starring Matt Damon. His character is a botanist who gets stranded on the planet and grows food to survive using Martian soil mixed with a fertilizer made of human manure.
Experts say there's some truth in the movie but suggest using untreated human excrement as a fertilizer on Mars would be dangerous. They also suggest that the Martian soil contains toxic elements that also would need to be removed.
""Matt Damon would have had to clean the soil a little bit and remove all these toxic things before using it to grow plants,"" said Lucie Poulet, who has conducted research simulating Martian soil. She recently published a space agriculture research paper in Botany Letters with colleagues from France's University Blaise Pascal.
Astronaut Mark Watney, Damon's character in the movie, harvested Martian potatoes. Turns out potatoes and sweet potatoes are on the list of vegetables that could be grown in space, according to NASA. Tomatoes, wheat and soybeans also have been mentioned by plant researchers as a crop that offers the potential for space gardens in the future.
Tomato seeds were tested aboard space shuttle missions but didn't produce fruit as it would have required pollination. Some have raised the possibility of sending bees or other insects into space to pollinate plants in space gardens, although there are other solutions.
""The astronauts are going to have to become the bees for the testing,"" said NASA's plant expert Smith. ""My hope is we'll be able to do some of this robotically. There's no reason why you can't have a robotic system with sensors to cross-pollinate the plants.""
For deep space travelers, growing plants isn't just a source of food but could have less obvious benefits, too. Caring for plants could offer a psychological boost as astronauts go to Mars and see the Earth getting smaller and smaller.
""Having that little piece of Earth while they're on the journey to Mars to remind them of the smells and the sights of home will be very important,"" said Smith.
The Seattle Mariners may not win Major League Baseball's Western Division this year but there is one category where they can challenge any team in baseball: beer variety at the ball park.
Thanks to the efforts of Safeco Field stadium concessionaire Centerplate, fans attending a Mariners game can choose from more than 50 different varieties of beer sold on draft, in bottles and even limited-release, 22-ounce ""bomber"" bottles. —
The beer list at Safeco is simply a reflection of the culture of the Pacific Northwest, Centerplate said. The Mariners play in Seattle, and Washington State has more than 150 different breweries.
""We have a unique demographic that's very highly educated about beer,"" said Steve Dominguez, Centerplate general manager. ""They tell us what they are looking for and we seek to meet that demand with the right variety of flavors.""
While a beer list boasting more than 50 options for any one game is impressive, dig a little deeper and it's clear just how serious the Mariners and Centerplate take their beer offerings. As the weather changes during the months-long Major League seball season, so too do the beer offerings.
""Attend a game in April or May when the weather is still cold and damp and the list will be full of IPA's,"" said Adrian Dishington, Centerplate regional vice president, referring to India Pale Ales, which tend to have a stronger hops flavor. ""As the season moves into the warmer months, we'll be offering more Hefeweizens (wheat-based beers) and lighter beers. Toward the end of the season, as the weather turns colder again, we'll be more focused on heavy and heartier beers, more Oktoberfest's, things like that.""
The Safeco beer list is mix of big national brands like MillerCoors and small local favorites like Fremont Brewery and Skagit River Brewery.
(Read More: The World's Best Beers)
While MillerCoors is the main beer sponsor at Safeco, Centerplate officials said the conglomerate has no problem sharing the stage with the region's smaller brewers.
In fact, Dominguez said MillerCoors uses Safeco to showcase the variety in its beer portfolio by offering the usual ballpark staples like Miller Lite and Coors Light, as well as beers from its craft beer division, which includes Blue Moon, Leinenkugel and Batch 19.
While MillerCoors may have deep pockets, that's not the case with a majority of the brewers found at the stadium.
""Ninety-nine percent of the beers on our list don't pay to play,"" said Dishington.
While breweries like Elysian Brewing and Silver City may be smaller in size, they are not small in impact. Centerplate officials said craft beer brands outsell the larger domestic brands by a four-to-one ratio.
(Read More: CNBC Beer Label Madness Champion Crowned)
Fans can expect to pay the typical ballpark premium when buying a craft beer: a 12-ounce craft draft costs $7.75, a 20-ounce craft draft $9.75 and a 22- to 24-ounce bomber bottle costs $11.50.
Much of the beer in the ball park is sold via ""craft carts,"" the 25 beer carts located throughout the stadium, which sell these specialty brews.
Pyramid Brewing, located across the street from the Safeco, even goes so far as to use its craft cart as a laboratory of sorts, brewing 25-barrel test batches of beer and selling it at its craft cart to gauge customer reaction.
While that type of attention is enough to win over most beer fans, Dishington joked not every fan is convinced the Safeco beer selection is a home run.
""You look at our list and it seems massive, but because there so many local options in this market, we still have people complaining we don't have their particular favorite!"" he laughed.
-By CNBC's Tom Rotunno; Follow him on Twitter @TomRotunno
Questions? Comments? Email us at consumernation@cnbc.com.
CHICAGO, Oct. 4, 2012 /PRNewswire/ -- The Canada-U.S. Free Trade Agreement (FTA), signed 25 years ago, has played a critical role in the expansion of trade with our northern neighbors, both for Illinois and the United States as a whole, according to BMO Economics.
""Trade between Canada and the United States has grown at an annualized rate of 5 percent since 1990,"" said Doug Porter, Deputy Chief Economist, BMO Capital Markets. ""Despite currency fluctuations, global commodity prices, and two deep downturns, trade between the two countries has strengthened considerably since the start of the FTA.""
""Trade between Canada and Illinois has increased at an annualized rate of 8 percent since the FTA came into effect,"" said Chris McComish, Executive Vice President, Personal Banking, BMO Harris Bank. ""Free trade has clearly been a success for Illinois businesses, placing them in a strong position for future growth.""
Mr. Porter also noted that foreign direct investment between the two countries has grown considerably since the signing of the FTA. ""U.S. direct investment in Canada has jumped from $63 billion at the end of 1988 to $319 billion by the end of 2011. As well, the stock of Canadian FDI in the U.S. has risen from $42 billion to $270 billion.""
Canadian Trade
Value With U.S.
States (1990-2011)
% chng a.r.
WYOMING
18.3
NEW HAMPSHIRE
13.1
NEW MEXICO
12.2
OKLAHOMA
11.6
MONTANA
10.6
NEVADA
9.7
LOUISIANA
9.0
NEBRASKA
8.8
IDAHO
8.6
KENTUCKY
8.3
MINNESOTA
8.2
TEXAS
8.1
ILLINOIS
8.0
WEST VIRGINIA
7.9
NORTH DAKOTA
7.9
SOUTH DAKOTA
7.9
TENNESSEE
7.8
IOWA
7.7
ALABAMA
7.7
ARKANSAS
7.5
UTAH
7.3
INDIANA
7.1
RHODE ISLAND
6.8
MISSOURI
6.8
GEORGIA
6.7
SOUTH CAROLINA
6.6
ALASKA
6.4
MISSISSIPPI
6.3
ARIZONA
6.1
NORTH CAROLINA
5.9
WASHINGTON
5.8
CALIFORNIA
5.6
NEW JERSEY
5.5
MARYLAND
5.4
OHIO
5.3
HAWAII
5.2
FLORIDA
5.2
OREGON
5.1
PENNSYLVANIA
4.9
WISCONSIN
4.9
VIRGINIA
4.2
VERMONT
4.0
NEW YORK
3.7
MASSACHUSETTS
3.3
MAINE
3.0
CONNECTICUT
2.4
KANSAS
2.3
MICHIGAN
2.1
DELAWARE
1.4
COLORADO
0.7
About BMO Harris Bank
Based in Chicago, BMO Harris Bank N.A. provides a broad range of personal banking products and solutions through over 600 branches and approximately 1,300 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. BMO Harris Bank's commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. Deposit and loan products and services provided by BMO Harris Bank N.A. Member FDIC. BMO Harris BankSM is a trade name used by BMO Harris Bank N.A. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with 1,600 branches, and a retail deposit base of approximately $180 billion.
SOURCE BMO Harris Bank
It's one thing to say gold is going higher. But, when Jeffrey Gundlach, manager of the $49 billion DoubleLine, says he thinks gold will hit $1,500 per ounce by the end of this year, that's something people pay attention to.
In a webcasted presentation called ""Penny For Your Thoughts"", Gundalch noted the 96 percent reduction in the U.S. dollar's purchasing power since the Federal Reserve Bank was established a century ago, likening the end of the gold standard to the silver debasement of the Roman denarius from 64 to 270 AD. During the question and answer period, Gundlach said he thought gold could move to $1,500 this year.
The last time gold was at $1,500 was in April, 2013. Gold traded at $1,260 per ounce on Wednesday.
(Watch: Stocks slide; worst hit in 3 weeks for Dow, S&P 500)
""Of course, there's a chance [Gundlach] could be right and gold could go higher,"" said Richard Ross, global technical strategist at Auerbach Grayson. ""But, there's very little in the short-term technicals to suggest that move has begun in earnest.""
Gold has been trading in a range between $1,180 and $1,400 for much of the past year, notes Ross. For the short-term, he is keeping an eye on the $1,270 line, which is close to the current 150-day moving average. ""A break back above that level could set us up for a retest of that resistance around 1,400,"" said Ross.
However, that range should be seen in the context of the longer-term chart, according to Ross, a ""Talking Numbers"" contributor. ""We're still in a downtrend from the highs that we established back around 1,900,"" he said.
Ross sees gold's break below its 150-week moving average as technically significant. Since the start of 2013, the 150-week moving average has been relatively flat, near the $1,525 level.
""You've got to get through 1,400 before you can trade 1,500, clearly,"" said Ross. ""And, in the shorter term, you've got through 1,270 before you can trade 1,400. So, there's a lot of ifs and buts here in that argument. We really need to see a base breakout before we can call this a base.""
Gina Sanchez, founder of Chantico Global, said that while there's a possibility that gold could go higher, she thinks the chances are low. The World Bank's reduction of global growth from 3.2 percent to 2.8 percent may cause some flight-to-safety buying of bullion. And, global interest rates are low, which traditionally augurs well for the yellow metal. But, Sanchez believes that won't last.
(Watch: World Bank: 'Now is the time to prepare for next crisis')
""Even though we're in a benign interest rate environment in the U.S. – and certainly within Europe and Japan – I do think that in the U.S., rates will likely start to trend higher by the end of the year or into 2015,"" said Sanchez, a CNBC contributor. ""That's not great for gold. We don't see a ton of inflation. If anything, maybe there's some deflationary pressures, particularly in Europe.""
Gold needs to feed on something, said Sanchez, but she doesn't see a lot of major economic pessimism or inflation worries.
""I'm not sure that I see why gold, except for some short-term reasons, might pop a little,"" added Sanchez.
To see the full discussion on gold, with Ross on the technicals and Sanchez on the fundamentals, watch the above video.
-----
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Lowe's on Thursday reported third-quarter earnings and sales that outpaced analysts' expectations, as more shoppers turned up for emergency supplies and repairs following devastating hurricanes and wildfires.
Here's what Lowe's reported, compared with what Wall Street was expecting, based on a Thomson Reuters survey of analysts:
- Earnings of $1.05 a share, excluding items, compared with $1.02 per share.
- Revenue was $16.77 billion, versus $16.59 billion.
- Same-store sales climbed 5.7 percent, compared with an anticipated increase of 4.6 percent.
Net income climbed to $872 million, or $1.05 a share, in the fiscal third quarter, from $379 million, or 43 cents, a year earlier. The year-ago period included $462 million of noncash pretax charges.
The home improvement retailer's sales rose 6.5 percent, to $16.8 billion from $15.7 billion in the period last year. Hurricane-related sales totaled roughly $200 million in the third quarter, Lowe's said.
Sales at Lowe's stores open at least a year climbed 5.7 percent, also topping Street expectations. Lumber, appliances and plumbing and electrical materials were top sellers.
""Repairs resulting from the hurricanes have blown Lowe's sales into much firmer growth territory,"" GlobalData Retail Managing Director Neil Saunders wrote in a note to clients.
""It is not just natural disasters that are keeping Lowe's numbers aloft, solid levels of activity in the housing market and a willingness among consumers to invest in the home also continue to drive the DIY market,"" Saunders added. ""This is benefiting Lowe's, although not quite as much as it is Home Depot — which remains the destination of choice for many casual improvers and professionals.""
After initially rising following the earnings report, Lowe's shares fell less than 1 percent Tuesday morning.
Looking to the full year, Lowe's still expects revenue to increase roughly 5 percent by the end of fiscal 2017, with sales at its established stores rising 3.5 percent. Lowe's is also on track to have added about 25 home improvement and hardware stores before the year is over.
The current fourth quarter brings ""tough comps,"" unknown impacts from weather and heavy holiday promotions in certain categories, CEO Robert Niblock told CNBC. Considering those factors, it made sense for the company to reaffirm its prior financial outlook, he added.
Management also said on a call with analysts and investors that it expects some incremental hurricane-related sales in the fourth quarter.
""Looking at Lowe's in isolation, this is a good report today,"" Oppenheimer & Co. analyst Brian Nagel told CNBC's ""Squawk Box.""
The one ""negative,"" according to Nagel, would be rival Home Depot reporting even better same-store sales growth of 7.9 percent last week.
Lowe's also announced that Chief Operating Officer Rick Damron will retire and be replaced by the president of the company's international business, Richard Maltsbarger, effective Feb. 3.
In his new role, Maltsbarger will lead Lowe's push into creating more ways to reach customers whether they are buying online or in stores.
In an attempt to lure younger shoppers, Lowe's has been experimenting with technology and opened up ""smart home centers"" at some locations ahead of the holidays.
Earlier this year, Lowe's rolled out a virtual reality experience that offers do-it-yourself assistance through tutorials inside Lowe's Holoroom. Then, in September, Lowe's launched two new augmented reality apps — one for measuring an object, or distance, within the phone's camera view, and one for viewing images of furnishings, at scale, within a user's own home.
""We drove traffic in-store and online with compelling messaging,"" Niblock said in a statement Tuesday. He added the company continues to invest in these efforts.
Lowe's also said Tuesday it bought back $500 million in stock during the third quarter.
Lowe's shares have climbed a little more than 14 percent in 2017.
Cramer recommended e-commerce company GSI Commerce as a Christmas play. Now that the stock is up 17% since then, the Mad Money maven is wondering if it’s time to take profits. He got Chairman, CEO and President Michael Rubin on the phone to figure it out.
Rubin notes that GSI is barely eight years old – and e-commerce, for that matter, is only 10. For that reason, “There’s so much growth ahead of us,” he says. The CEO predicts comp-store sales will more than double the business over the next five years. Also, an increase in new partners, marketing services and internationalization are all contributing to the growth spurt.
Cramer liked what he heard. He recommends holding on to the stock – and buying it if it dips below $20.
Questions? Comments?
What is the best trade on Treasurys? Dan Greenhaus, chief economic strategist at Miller Tabak, and George Goncalves, head of U.S. interest rates strategy in the Americas at Nomura Securities, shared their insights.
""We're coming toward the end of a bond market rally that has been in motion for over 30 years,"" Goncalves told CNBC.
""The question is, how long can rates stay low and does the Fed have the ability to keep them anchored?""
Goncalves said investors should lighten up on their bond holdings and wait for yields to pop.
Greenhaus' View:
In the meantime, Greenhaus said now is not a good time to short bonds.
""We are shifting from the secular bull market in bonds into the next secular bear...and timing that shift will be very difficult, especially when you have every class of investor increasing their exposure to bonds, and Ben Bernanke with an unlimited paper machine coming in and buying what will be at least $1 to $2 trillion worth of additional Treasurys over the next couple of years.""
Forget the thermometer, in January you should check the barometer. According to Gary Kaminsky January sets the tone for the entire year.
The phenomenon is known as the January Barometer and it’s only been wrong 5 times since 1950.
How does it work?
""Traditionally January is a month of inflows into equity funds"", explains veteran trader Gary Kaminsky. ""That’s something you’ve got to watch.""
This year you would look at the flows and ask yourself, “Is this the best the equity market can do?”
""It does have ramification on the way people think about putting money into stocks for the year,"" Kaminsky adds.
The statistics support Kaminsky's thesis.
If you take a look at the January Barometer for the past 113 years since the Dow started trading it’s been right 64% of the time, says host Melissa Lee.
Fast Money's Chairwoman Karen Finerman doesn’t buy it.
She thinks it's a fun fact, but not much more. ""We’re in such extraordinary times you can’t extrapolate anything. Flow of funds change on a hair trigger,"" she counters.
Joe Terranova finds it tough to get on board, too. ""If you played that theory last year you would have missed out on sharp gains in the equity market,"" he adds.
What do you think? We want to know!
______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .
Trader disclosure: On January 29th, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders Finerman's Firm Is Short (IJR), (IWM), (MDY), (SPY), (UNG), (USO); Finerman Owns (AAPL); Finerman's Firm Owns (BAC), (BAC) Leaps; Finerman Owns (BAC), (BAC) Preferred; Finerman's Firm And Finerman Own (CVS); Finerman's Firm And Finerman Own (GOOG); Finerman's Firm Owns (IBM), (KFT), (MSFT), (WMT); Finerman's Firm And Finerman Own (RIG); Finerman's Firm Owns (PLCE); Seymour Owns (AAPL), (BA), (F), (INTC), (PBR); Terranova Owns (BAC), (JPM), (XOM), (HAL), (OIH), (FCX), (GOOG), (FMC), (AAPL), (DELL), (MSFT), (QCOM); Terranova Is Long March British Pound Futures; Terranova Owns (XLF) Feb. Calls; Terranova Is Short (AAPL) Feb. Calls
For Tim Seymour
Seygem Asset Management Is Short (VALE)
Seygem Asset Management Owns (POT)
Seygem Asset Management Owns (FCX) Calls
Seygem Asset Management Owns (PBR)
For Joe-Terranova
Terranova Works For (VRTS)
Terranova Is Chief Market Strategist Of Virtus Investment Partners, Ltd.
Virtus Investment Partners Owns More Than 1% Of (CLB)
Virtus Investment Partners Owns More Than 1% Of (DLR)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (UA)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (SKT)
For Brian Stutland
Stutland Owns (XOM)
Stutland Is Short (SPY) Directional Position, Long Volatility
Stutland Is Long VXX
Stutland's Firm Is A Market Maker In VIX And SPX
Stutland's Firm Is Short VIX Directional Position, Short Volatility
Stutland's Firm Is Short S&P 500 Directional Position, Short Time Spreads
Other Relevant Disclosures:
Seymour Owned (GOOG) On 1/21/10
Terranova Was Short Feb. Crude Oil Futures On 1/11/10
Finerman's Firm Owned (AXL), (AXL) Calls On 1/8/10
Kaminsky Was Short (QQQ) On 1/7/10
Terranova Was Short Feb. Crude Oil Futures On 1/11/10
Finerman's Firm Owned (TGT), (TJX) On 1/12/10
CNBC.com with wires
A senior lawyer for the Securities and Exchange Commission recently took center stage in a major case involving a controversial mortgage security sold by Goldman Sachs.
There was just one slight twist in the legal proceedings. The S.E.C. lawyer was not the prosecutor taking the deposition. He was the witness.
This summer, Adam Glass — who joined the agency two years ago and is now co-chief counsel in charge of helping write the rules for the complex financial instruments known as derivatives — testified in a deposition about Goldman’s Abacus, a mortgage investment that the government argues was designed to fail.
It turns out that Mr. Glass has a unique perspective on Wall Street exotica. Before working on the financial crisis cleanup, he helped create the opaque securities that contributed to the mess.
For many years, Mr. Glass served as the outside counsel to Paulson & Company, the giant New York hedge fund firm run by John Paulson, who made billions betting against the housing market. And yes, Mr. Glass, in that role, signed off on Abacus, which was created specifically for the hedge fund to short subprime mortgages. Mr. Paulson handpicked some of the underlying investments in the derivative.
The government, in its complaint, claimed that Goldman had “misstated and omitted key facts regarding” Abacus, including disclosing Mr. Paulson’s role in its creation. The firm paid $550 million to settle the case, without admitting or denying guilt. Mr. Paulson was never accused of any wrongdoing.
Mr. Glass’s recent deposition was for a separate S.E.C. case against Fabrice Tourre, the young Goldman trader who had developed and marketed Abacus to investors. Mr. Tourre, 31, has denied the accusations.
The revelation of Mr. Glass’s involvement in the Abacus deal could undermine the S.E.C.’s case — or at least prove to be a distracting embarrassment.
Perhaps more important, his role once again raises questions about the revolving door between Washington and Wall Street at a time when public distrust about the agency and its lack of enforcement action against the culprits of the crisis is running high.
“There are a lot of talented people out there you could hire who weren’t necessarily part of the problem,” said Mary Kreiner Ramirez, a professor at Washburn University School of Law. “If he was involved in Abacus, how is he supposed to police it?”
It is a common question as the government increasingly looks to fill its ranks with regulatory officials proficient in the language of Wall Street. Robert S. Khuzami, the S.E.C.’s director of enforcement, was previously the general counsel of Deutsche Bank. The agency tapped Eileen Rominger, the former global chief investment officer at Goldman Sachs Asset Management, as its director of investment management.
“The revolving door is such a dominant fact about the S.E.C.’s culture,” said John C. Coffee Jr., a Columbia Law School professor. “You get people who go to Washington for one to three years and then go back to Wall Street.”
The pattern has been well documented. According to the Project on Government Oversight, 219 former S.E.C. staff members filed 789 “postemployment statements indicating their intent to represent an outside client before the commission” from 2006 to 2010. In other words, the one-time government officials are representing Wall Street clients with matters before the agency.
While clearly there are questions about whether the public wants someone in government who just came from industry, the opposite argument can be made, too: It may be better to have the fox in the henhouse.
President Franklin D. Roosevelt “justified appointing Joe Kennedy as chairman of the S.E.C. with the line: ‘You need to set a thief to catch a thief,’ ” said Professor Coffee. “That is the case for bringing in an industry expert.”
After all, the best way for the government to stay ahead of financial innovations — or at least not fall too far behind — is to employ people who know them best.
After the government’s bailout of A.I.G. , some said the insurer should keep paying bonuses to employees, as they were among the few who understood how to unwind some of the company’s complex trades.
Mr. Glass, who has long advocated more regulation of derivatives in certain instances, came to the S.E.C. with a strong finance pedigree. A graduate of Harvard and of Stanford Law School, Mr. Glass was a partner at Linklaters, where he founded the firm’s structured finance and derivatives practice.
In addition to Paulson & Company, he counted Deutsche Bank and Lehman Brothers among his top clients. Mr. Glass was not involved in the controversial opinion that Linklaters issued to Lehman about a practice known as Repo 105 that has come under scrutiny. The tactic allowed Lehman to conceal billions of dollars on its balance sheet.
Mr. Glass took a big pay cut to become a civil servant. The average Linklaters partner made about $2.3 million in 2008, the year before he left, according to Legal Week, an industry publication. The most Mr. Glass could make at the S.E.C. is $233,000.
When I asked Mr. Glass about his deposition in the Tourre case and his role as the lawyer for Mr. Paulson in the Abacus transaction, he said, “Yes, that would be true.” He then directed me to the S.E.C.’s spokesman, who quickly issued a “no comment.” Spokesmen for Mr. Tourre and Mr. Paulson also declined to comment.
Mr. Glass was involved in reviewing the Abacus deal. He reviewed and commented on an “engagement letter” between Goldman and ACA, the firm that insured the deal, said three people with knowledge of his testimony and e-mails. He also received a draft copy of the “offering circular” and term sheet provided to outside investors, but those documents did not include disclosures about how Mr. Paulson’s firm had selected certain mortgage-backed securities for the investment vehicle that he was betting against. The offering circular stated that ACA would select the initial portfolio.
The potential obfuscation of Mr. Paulson’s role is at the center of the case against Mr. Tourre. Mr. Glass, who testified that he did not recall seeing the offering document, did not ask for additional disclosure about Mr. Paulson’s role or comment on the disclosure language, said the people briefed on his deposition. But Mr. Glass had no legal duty to Goldman’s clients.
Mr. Glass worked with Mr. Paulson’s firm to help structure similar mortgage deals, and in one instance he pushed for additional disclosures. On a Deutsche Bank derivatives deal, Mr. Glass suggested that the bank might want to include more explicit disclosure language for its clients, according to a person briefed on the deal. Deutsche Bank did not take Mr. Glass’s advice.
In the end, Mr. Glass is tangential to the S.E.C.’s case against Mr. Tourre. But he is a central example in the age-old debate about the benefits and costs of Washington’s revolving door.
“I don’t think Mr. Glass has done anything unethical in helping Mr. Paulson structure this product,” Professor Coffee said.
“But it is a case that will raise further questions about the S.E.C.”
The Bernanke speech: The consensus is often wrong, but this time they hit it pretty close to the mark.
While stocks initially sold off, they have now made a modest comeback.
For the first time in a while, there's no real gaming of the Fed, and many traders think that is a good thing. ""True equity bulls don't want people buying because of (quantitative easing) in there with them... they want other true bulls and strong hands,"" one trader wrote to me.
Bernanke did not make any new policy pronouncements, as expected.
He did say that the meeting in September would be two days instead of one; that may give room for discussion of a larger range of policy responses.
Bernanke reiterated that the Fed had ""a range of tools that could be used to provide additional monetary stimulus.""
He kicked the ball into the court of President Obama and the Congress: ""Most of the economic policies that support robust economic growth in the long run are outside the province of the central bank...""
In other words, he's telling the executive and legislative branches to do their job.
European Central Bank President Trichet is also speaking in Jackson Hole Saturday, and Bernanke lobbed a little grenade in his direction as well: """"I have confidence that our European colleagues fully appreciate what is at stake in the difficult issues they are now confronting, and that, over time, they will take all necessary and appropriate steps to address those issues effectively and comprehensively.""
Some are expecting Trichet to signal a more dovish position on rates. _____________________________
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As Amazon bolsters its PillPack business to take on the prescription drug market, industry stalwarts CVS and Walgreens are vigorously defending their turf, setting up a protracted battle between the old guard and the new.
Amazon bought internet pharmacy PillPack last year, a deal that sent shares of pharmacy companies tumbling. To get people onto its mail-delivery service, PillPack needs patients to switch from their existing pharmacy, which often means transferring prescriptions from CVS or Walgreens, the two largest chains in the U.S.
But PillPack has run into a significant roadblock in getting those transfers approved. CVS and Walgreens are rejecting an increasing number of their requests, claiming that PillPack isn't getting proper consent from patients. PillPack says it always gets patient approval before making transfer requests and blames the pharmacy giants for unfairly refusing to honor them, sometimes hanging up on PillPack's pharmacists or throwing the request forms in the trash.
""While incumbent pharmacies may be disappointed in the loss of business, it is unacceptable to make unsubstantiated allegations about PillPack's practices while simultaneously creating systemic barriers that make it harder for a customer to switch pharmacies,"" PillPack spokeswoman Jacquelyn Miller told CNBC.
The conflict has continued to escalate, with a source familiar with the matter telling CNBC that Amazon is documenting all cases of refused transfers. The incumbents are unwilling to roll over for Amazon in a market where a single customer, who often has chronic conditions and requires regular refills, can represent thousands of dollars of revenue a year through copayments and insurance coverage.
PillPack, a licensed pharmacy service in 49 of 50 states, launched in 2014 with a service that neatly packages, labels and delivers medications every month with free shipping. CVS has followed with its own multi-dose packaging option for patients who need help taking multiple medications. Walgreens also has a home delivery program.
The intensifying spat over transfers offers a window into the larger challenge Amazon faces as it tries to mimic its e-commerce playbook in the prescription medication world, where spending in the U.S. is approaching $500 billion a year. The company is already battling Surescripts, an e-prescribing network part-owned by CVS and Express Scripts, over a patient data dispute. Last month, Surescripts threatened to cut off a contract with a third party called ReMy Health, which gave PillPack access to data about patient prescription histories, and said it would turn the case over to the FBI.
CVS says it's not indiscriminately rejecting transfer orders, but rather is calling patients when a request is submitted to make sure the customer has asked for it. Many of these patients are older and unfamiliar with the new world of online shopping and mobile apps.
The pharmacies say they're only denying transfers when patients tell them they never signed up for PillPack or have never even heard of it. The issue can be particularly challenging for people with dementia who may not have intended to sign up or not remembered doing so. Brian Caswell, the owner of Wolkar Drug in Kansas, said he's called patients about PillPack requests only to have them deny ever providing consent.
""Could they have clicked on something online and forgot about it?"" Caswell said. ""It's possible.""
There could also be patients who did request a transfer to PillPack but are embarrassed to admit it when their pharmacist calls for confirmation.
The fight with the big pharmacies began almost immediately after Amazon announced the PillPack acquisition in June 2018, for $753 million (though the price wasn't disclosed until later). A month after the deal, CVS sent a cease-and-desist letter to PillPack's lawyers, and Walgreens sent a strongly-worded warning in August, according to people familiar with the matter who asked not be named because the letters were confidential.
Both CVS and Walgreens confirmed that they reached out to PillPack but didn't specify the exact nature of the correspondence.
""We've communicated our concerns directly to PillPack,"" a Walgreens spokesperson said. ""We respect our patients' privacy rights, and strongly believe that patients are entitled to, and benefit from a personal and trusted relationship with their pharmacist.""
A CVS spokesperson said that while it's ""common practice"" for pharmacists to legitimately request prescription transfers from its pharmacies, the company ""notified PillPack to stop any activity to initiate prescription transfers without the informed consent of our pharmacy patients.""
PillPack responded at the time to both CVS and Walgreens, denying that the company was doing anything wrong.
Here's how a transfer works. A CVS or Walgreens customer sees a PillPack ad on television or online and pulls up the PillPack website or calls a company representative. By phone, PillPack says, patients are asked explicitly if they give the company consent to transfer prescriptions from their current pharmacy. From the website, the patient fills out personal information, includes relevant prescriptions and then clicks a blue button to complete the signup.
Just below the blue button, here's what the fine print says:
""By clicking the 'Finish Signing Up' button above, you consent to PillPack transferring your prescriptions from your existing pharmacies to PillPack and/or contacting your doctors to request new prescription and refills.""
From there, a PillPack representative calls or faxes the existing pharmacy and requests the transfer. It's a straightforward process that happens all the time when patients move or when they're traveling and need to pick up a refill before returning home. In the U.S., there are federal and state laws that, with some exceptions, require pharmacists to transfer prescription information to another pharmacy.
However, PillPack said its pharmacists began reporting challenges with patient transfer requests in the weeks after the acquisition was announced. Additionally, the company said it heard reports in July 2018, that CVS hosted a training session for pharmacists, informing them that they should not transfer to PillPack until after they notified patients about the company's rival service.
CVS told CNBC that, starting last year, it recommended its pharmacists check in with customers following a PillPack transfer request after hearing a series of complaints about the company's practices. CVS also said representatives tell customers about the company's own mail-order service but that its pharmacies will facilitate a transfer to PillPack if the patient still wants it.
CVS and Walgreens aren't the only pharmacies concerned about PillPack's actions. Douglas Hoey, chief executive officer of the National Community Pharmacists Association, which represents U.S. pharmacy owners and is one of the owners of Surescripts, said his team has heard from 20 to 30 pharmacists who said they were concerned after patients told them they never authorized transfers to PillPack. Pharmacists have also been vocal on internet forum Reddit, where in several threads some have admitted that they automatically throw PillPack faxes ""in the shred bin,"" or call patients to get confirmation.
Update: This story was updated to say that the National Community Pharmacists Association is a part owner of Surescripts.
WATCH: How Amazon could change the pharmacy business
Scientists have used Ebola disease spread patterns and airline traffic data to predict a 75 percent chance the virus could be imported to France by October 24, and a 50 percent chance it could hit Britain by that date.
Those numbers are based on air traffic remaining at full capacity. Assuming an 80 percent reduction in travel to reflect that many airlines are halting flights to affected regions, France's risk is still 25 percent, and Britain's is 15 percent.
""It's really a lottery,"" said Derek Gatherer of Britain's Lancaster University, an expert in viruses who has been tracking the epidemic - the worst Ebola outbreak in history.
Read MoreEbola patient in Dallas 'fighting for his life' says CDC head
The deadly epidemic has killed more than 3,400 people since it began in West Africa in March and has now started to spread faster, infecting almost 7,200 people so far. Nigeria, Senegal and now the United States - where the first case was diagnosed on Tuesday in a man who flew in from Liberia - have all seen people carrying the Ebola haemorrhagic fever virus, apparently unwittingly, arrive on their shores.
France is among countries most likely to be hit next because the worst affected countries include Guinea, alongside Sierra Leone and Liberia, which is a French-speaking country and has busy travel links back, while Britain's Heathrow airport is one of the world's biggest travel hubs.
France and Britain have each treated one national who was brought home with the disease and then cured. The scientists' study suggests that more may bring it to Europe not knowing they are infected.
""If this thing continues to rage on in West Africa and indeed gets worse, as some people have predicted, then it's only a matter of time before one of these cases ends up on a plane to Europe,"" said Gatherer.
Read MoreEbola patient in US takes turn for the worse
Belgium has a 40 percent chance of seeing the disease arrive on its territory, while Spain and Switzerland have lower risks of 14 percent each, according to the study first published in the journal PLoS Current Outbreaks and now being regularly updated at http://www.mobs-lab.org/ebola.html.
The World Health Organisation (WHO) has not placed any restrictions on travel and has encouraged airlines to keep flying to the worst-hit countries. and Emirates airlines have suspended some flights.
But the risks change every day the epidemic continues, said Alex Vespignani, a professor at the Laboratory for the Modeling of Biological and Socio-Technical Systems at Northeastern University in Boston who led the research.
""This is not a deterministic list, it's about probabilities - but those probabilities are growing for everyone,"" Vespignani said in a telephone interview. ""It's just a matter of who gets lucky and who gets unlucky.""
The latest calculations used data from October 1.
Read MoreDeadly Ebola virus spreads—and so do fears
""Air traffic is the driver,"" Vespignani said. ""But there are also differences in connections with the affected countries (Guinea, Liberia and Sierra Leone), as well as different numbers of cases in these three countries - so depending on that, the probability numbers change.""
Patients unaware
Patients are at their most contagious when Ebola is in its terminal stages, inducing both internal and external bleeding, and profuse vomiting and diarrhoea - all of which contain high concentrations of infectious virus.
But the disease can also have a long incubation period of up to 21 days, meaning that people can be unaware for weeks that they are infected, and not feel or display any symptoms.
This, it seems, is what allowed the Liberian visitor Thomas Eric Duncanto to fly to the United States and spend several days there unaware that he was carrying the deadly virus, before being diagnosed and isolated.
In the European Union, free movement of people means someone unknowingly infected with Ebola could easily drive through several neighbouring countries before feeling ill and seeking help, and spend weeks in contact with friends or strangers before becoming sick enough to show up on airport scanners.
Jonathan Ball, a professor of molecular virology at Britain's Nottingham University said that even with exit screening at airports of affected countries, the long, silent incubation period meant ""cases can slip through the net"".
Read MoreUS health system will 'stop' Ebola: WH officials
""Whilst the risk of imported Ebola virus remains small, it's still a very real risk, and one that won't go away until this outbreak is stopped,"" he said. ""Ebola virus isn't just an African problem.""
However, the chance of the disease spreading widely or developing into an epidemic in a wealthy, developed country is extremely low, healthcare specialists say.
According to the latest Ebola risk assessment from the European Centres of Disease Prevention and Control, which monitors health and disease in the region, ""the capacity to detect and confirm cases...is considered to be sufficient to interrupt any possible local transmission of the disease early.""
Gatherer cited Nigeria as an example of how Ebola can be halted with swift and detailed action.
Read MoreEbola: A closer look at this 'frightening disease'
Despite being in West Africa and being home to one of the world's most crowded, chaotic cities, Nigeria has managed to contain Ebola's spread to a total of 20 cases and 8 deaths, and looks likely to be declared free of the virus in coming weeks.
""Even if we have a worse case scenario where someone doesn't present for medical treatment, or..it's not correctly identified as Ebola, and we get secondary transmission, it's not likely to be a very long secondary transmission chain,"" he said.
""People aren't living in very crowded conditions (in Europe), so the disease doesn't have the same environment it has in a shanty town in Monrovia, where the environment is perfect for it to spread. It's a different matter in modern western cities with the very sanitized, sterile lives that we live.""
Apple sent me a pair of its new AirPods Max headphones to check out ahead of their release on Dec. 15. The $549 price tag shocked a lot of people when Apple unveiled them earlier this week. And, yeah, that's a lot of money. But they sure are nice.
Apple dominates the Bluetooth headphone business, with more than a 50% share of the market, according to Strategy Analytics. That's thanks to the huge success of the original AirPods and AirPods Pro. With the AirPods Max, Apple built a luxury pair of headphones that borrows some of the features from the AirPods Pro but with larger speakers and more premium materials like steel and aluminum and better sound.
The AirPods Max kind of remind me of the original HomePod. It's one of the best sounding smart speakers on the market, but it also costs several times more than competitors from Amazon and Google. Apple may not sell millions and millions of the AirPods Max the way it does the AirPods, but it doesn't need to. I think these are really just a top-tier option for people who want the best headphones Apple makes. Sort of like how Apple sells a $5,999 Mac Pro for people who want the best Mac Apple makes.
Here's a look at the AirPods Max:
This case serves a purpose, though. It has magnets inside so that when you put the AirPods Max in it they automatically go into low power mode to help save battery life. I agree with the critics. It looks a little weird.
I wore the AirPods Max for several hours Wednesday and they felt super comfortable. There's a breathable mesh band on the top that felt light on my head and didn't get sweaty or hot. I also love the ear cups, which are spacious and fit around my ears instead of sitting on them.
There are a lot of high-end touches, like aluminum cups and a steel frame, instead of plastic parts you might find in competing headsets. I also dig the Digital Crown that Apple brought over from the Apple Watch. It feels solid and turns easily to adjust the volume. A lot of competing high-end headphones use touch controls for volume, which isn't as accurate as a physical control.
The AirPods Max are just as easy as other AirPods to set up. That's important, since it's one of the reasons the AirPods are so successful. You just turn the AirPods Max on, bring your iPhone or iPad nearby, and tap a pop-up that says ""connect."" That's it. There's no need to poke through your Bluetooth settings for the connection.
I like that it's easy to switch between an iPhone, Mac or iPad, too. But, they don't have a 3.5 mm headphone jack so you'll need to buy an adapter and a cord if you want to use them with non-Bluetooth devices.
You don't need an Apple gadget to use the AirPods Max. They'll connect to Android phones, Windows PCs and other devices like any other Bluetooth headset.
They sound really good to me. I'll revisit more in my full review, but I also don't know that I could stand here right now and pinpoint exactly how much better they sound than a pair of Bose or Sony headphones. The noise cancellation is pretty solid: I didn't hear people talking in the room next to me while I was working. I'm not sure how they'll compare on an airplane to Bose yet, though. And I won't be flying anytime soon for obvious reasons.
Apple has a few tricks competitors don't have, like Spatial Audio, which makes it sound like noises in a movie are coming from all around you and from the source, like your iPad or iPhone. It's a cool feature Apple recently added to the AirPods Pro.
There are lots of sensors, so the headphones pause audio when you take them off, or even when you lift an earcup. That works well.
Finally, I tested the microphones with a quick 10-minute call Wednesday. It seemed like the other side heard me just fine, and I could hear them perfectly.
The AirPods Max are also pretty big. One of the reasons I love the AirPods Pro so much is that, back when we could travel, I was able to leave my Bose headphones at home and use the noise cancellation in the much smaller earbuds. They just slip in my pocket and I can carry them with me wherever I go. The AirPods Max don't have that convenience. They're still big enough that you'll need a bag to carry them around. But they're perfect at home right now when I'm mostly sitting at my computer most of the day.
Simon Johnson, the former chief economist of the IMF who is now a leading financial commentator at Baseline Scenario, is one of the more prominent critics of the view that blame for the financial crisis falls on affordable housing and fair lending policies. The problem is that his critique is extremely misguided.
Let's take this recent column Johnson wrote for Project Syndicate.
Johnson begins by attempting to summarize the view that, for example, FCIC commissioner Peter Wallison appears to hold.
In December, the Republican minority on the Financial Crisis Inquiry Commission (FCIC), weighed in with a preemptive dissenting narrative. According to this group, misguided government policies, aimed at increasing homeownership among relatively poor people, pushed too many into taking out subprime mortgages that they could not afford.
But this isn't quite right. What Wallison argues is that GSEs and banks lowered credit standards and accumulated huge mortgage holdings in an effort to comply with misguided government policies.
Shortly after making that mistake, Johnson restates what he takes to be Wallison's point in a way that demonstrates that he doesn't really understand it at all. (Emphasis mine.)
This narrative has the potential to gain a great deal of support, particularly in the Republican-controlled House of Representatives and in the run-up to the 2012 presidential election. But, while the FCIC Republicans write eloquently, do they have any evidence to back up their assertions? Are poor people in the US responsible for causing the most severe global crisis in more than a generation?
It is very difficult to see how that last question follows from anything that came before it. The proposition that the financial crisis was brought about by government policies aimed at increasing homeownership among the poor has no logical connection at all to the culpability of the poor for the crisis.
This is easy to understand if we think of other types of misguided government regulations. Take, for example, the regulation of fishing. For years, it has been common practice for regulations to set minimum sizes for fish that can be taken. The idea is to allow fish a chance to mature enough to breed at least once, in hopes that this will keep the population robust.
For individual fishermen, this usually means just throwing back a fish that is too small. For large commercial fishermen, however, this involves using fishing techniques that allow smaller fish to escape their nets and traps.
Now the purpose of this kind regulation is to preserve the fish population. A recent study, however, indicates that this kind of selective fishing might have the perverse effect of reducing the biodiversity of the fish population and making it more fragile and prone to collapse in the face of unexpected changes.
In 2010, a team of researchers wrote: “We believe it is time to critically rethink traditional selective fishing approaches that might not protect ecosystems and fisheries as intended, but may in fact make them more vulnerable to large changes in structure and function.”
Now according to Johnsons logic, if we say that a regulation intended to protect smaller fish from harvesting causes the ecosystem to become more vulnerable we are also claiming that small fish are responsible for harming the ecosystem. Clearly, that's nonsense.
In the same way, it is simply nonsensical to equate blaming affording housing and fair lending policies for the crisis with blaming the poor.
Of course the poor are not responsible for the financial crisis. And the small fish aren't responsible for falling biodiversity. In both cases, misguided regulations are to blame.
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As political uncertainty continues to mount, some strategists fear intensifying D.C. drama could further push out a tax reform package and roil markets.
Following Monday's disclosure that two former Trump campaign officials were indicted as part of Special Counsel Robert Mueller's investigation, continued political turmoil could have a potential ""long-term and very negative impact on capital markets,"" said strategist Boris Schlossberg.
""The critical question going forward is whether this is just a one-and-done, or whether it's just the beginning of a very long and perhaps a very, very tedious judicial process that could really weigh both on Washington and Wall Street as we go forward,"" Schlossberg, managing director of foreign exchange strategy at BK Asset Management, said Monday on CNBC's ""Trading Nation.""
These questions come as economic data have been ""superb,"" Schlossberg said. Specifically, he pointed to the latest consumer spending data, which reflected the largest monthly gain since 2009 (likely affected by spending related to recent hurricane devastation), and personal income, which also rose month-over-month.
Still, ""markets are very concerned, because the big catalyst going forward is tax reform. That's what the market is looking for as the next jump-start to get the economy going to the next level,"" he said.
Should the administration's agenda stall further, ""that could weigh very badly on the market,"" he said.
According to a Bloomberg News report on Monday, Republicans are considering ""gradually"" lowering the corporate tax rate, and markets had a relatively muted response.
Furthermore, the market is also ripe for some kind of pullback, Schlossberg said, which gives him an overall cautious view heading into the rest of the year.
Others are less concerned about the probability that Mueller's investigation into Russian attempts to interfere in the 2016 U.S. presidential election could weigh meaningfully on equities.
""There is some trepidation on the Mueller indictments but we are starting to see Trump as teflon, so much so that we think he can 'get away with' firing Mueller and markets would actually take that well as it would remove an overhang. Cries for impeachment remain far fetched whether we like that emotionally or not,"" Michael Block, chief strategist at Rhino Trading Partners, wrote Monday in a note to clients.
Block added: ""And the crazy thing is, if Trump does fire Mueller, it's probably bullish for stocks. It would show that this guy can do anything he wants including shove pro business legislation down everyone's throat. I'm not happy about this kind of power even if I like what's good for stocks, but that's my honest read.""
U.S. markets closed lower on Monday.
Maybe people need a distraction from the bleak economic headlines of the day, or maybe its America's obsession with youth. Either way, business is booming in the business of nips, tucks, and lifts.
Cosmetic plastic surgery procedures rose two percent to 1.6 million in 2010, according to a recent study by the American Society of Plastic Surgeons (ASPS), which represents 7,000 board-certified plastic surgeons.
""Consumers are willing to spend on themselves again and confidence is up,"" says Dr. Phil Haeck, president of the ASPS.
Although 91 percent of all cosmetic procedures were performed on women, statistics show that more men are going under the knife. Overall cosmetic plastic surgery procedures for men were 2 percent higher in 2010 than the previous year.
""The men out there are worrying about how they look compared to the competition, which is much younger,"" says Haeck.
So what are Americans looking to improve? Click ahead to see the most popular cosmetic procedures and the average cost. (Fees do not include anesthesia, operating room facilities, or other related expenses.)
By Jessica Naziri
Posted 12 September 2011
No. of surgeries performed: 296,203 (up 2 percent)
Surgeon fee: $3,351
Breast augmentation, or augmentation mammaplasty, has been the most popular cosmetic procedure since 2006.
No. of surgeries performed :252,261
Surgeon fee: $4,306 (down 1 percent)
Commonly called a nose job, rhinoplasty is the reshaping of the nose to make it bigger or smaller, to narrow the span of the nostrils, or to change the angle between the nose and upper lip.
No. of surgeries performed: 208,764
Surgeon fee: $2,828 (up 3 percent)
In eyelid surgery, or blepharoplasty, drooping upper eyelids and bags below the eyes are corrected by removing extra fat, muscle, and skin.
No. of surgeries performed: 203,106
Surgeon fee: $2,828 (up 2 percent)
Liposuction, technically known as suction lipoplasty, is the removal of fat deposits using a vacuum-like device. The procedure is often performed on the abdomen, buttocks, hips, thighs, and upper arms.
No. of surgeries performed: 116,000
Surgeon fee: $2,828 (up 1 percent)
The tummy tuck is a common cosmetic procedure used to tighten overly stretched abdominal muscles and skin.
No. of surgeries performed: 116,000
Surgeon fee: $6,231 (up 9 percent)
Many factors including exposure to the sun, fluctuations in weight, genetics, and smoking take a toll on the appearance of the human face. A face lift, also known as rhytidectomy, attempts to correct the damage by firming and tightening the skin of the face.
In 2010, the number of men undergoing rhytidectomy increased by 14 percent.
No. of surgeries performed: 89,931
Surgeon fee: $4,207 (up 3 percent)
Many women have sought out breast lifts, or mastopexy, to reduce sagging and to achieve firmer and shapelier breasts. The procedure is frequently done in conjunction with breast augmentation and breast reduction.
No. of surgeries performed: 68,636
Surgeon fee: $4,207 (up 8 percent)
Surgeons use dermabrasion for the treatment of scarring related to acne, rosacea, tattoos, chicken pox, scars, skin growths, multiple pigmented birthmarks, blotchy brown or liver spots, keloids, and sun-damaged skin. It produces smoother skin by removing the epidermis, or outer layer of skin, so that new tissue grows back to replace the old.
No. of surgeries performed: 42,433
Surgeon fee: $3,161 (up 1 percent)
This procedure designed to rejuvenate one's appearance by reducing or eliminating lines and creases in the skin on the upper portion of the face.
No. of surgeries performed: 21,714
Surgeon fee: $2,288 (up 9 percent)
Some women who have their breasts surgically enlarged later decide to have the implants removed. This, of course, requires another surgery. Breast implant removal is generally less costly than it is to have the implants inserted.
Job creation in April bounced back from a disappointing March, with nonfarm payrolls growing by 211,000 while the unemployment rate fell to 4.4 percent, its lowest since May 2007.
Economists surveyed by Reuters had been expecting payroll growth of 185,000 and the headline jobless rate to tick up one-tenth to 4.6 percent. The payroll increase nearly tripled the dismal March number.
Market experts believe the report likely cements an imminent interest rate hike.
""The market has sorely needed a shot of unambiguously positive 'hard' data,"" Quincy Krosby, market strategist at Prudential Financial, said in a statement. ""This morning's employment report suggests the Fed will most certainly move in June.""
Wages grew seven cents an hour to an annualized pace of 2.5 percent.
The unemployment rate dropped even as the labor force participation rate edged lower to 62.9 percent. The employment-to-population ratio increased to 60.2 percent, its best showing of 2017 and the highest level since February 2009.
""This just adds to the perception that it's going to be easier and easier to find a job if you want one these days,"" said Brian Coulton, chief economist at Fitch Ratings. ""It's job security that causes people to ask for wage rises. If it's easier for them to get a job outside their company, they're more likely to push for higher wages.""
An alternative reading on the unemployment rate that includes those not actively looking for jobs as well as those working part-time for economic reasons dropped to 8.6 percent from 8.9 percent in March, the best reading since November 2007. Those counted as not in the labor force swelled to 94.4 million but that was countered by an increase of 156,000 counted as employed, according to the household survey.
Job growth was concentrated in lower-paying areas, with leisure and hospitality adding 55,000 positions. Health care and social assistance rose 37,000, financial activities grew by 19,000 and professional and business services grew by 39,000. Government payrolls increased by 17,000 and mining rose 9,000.
The report comes a month after a dismal March that saw payrolls grow by just 79,000, a number that was revised lower from 98,000. That number dashed some of the hopes that the economy was poised for a breakout year in 2017. February's reading grew, however, from 219,000 to 232,000.
The weak March payroll gain also closed out a disappointing quarter for U.S. growth overall, with gross domestic product rising just 0.7 percent.
Jobs skewed sharply to full-time positions, which grew by 480,000, while the part-time rolls tumbled by 370,000.
The Federal Reserve, at its two-day meeting earlier this week, projected that the weakness to start the year was likely ""transitory"" and likely to change as seasonal factors abate.
The central bank is widely expected to hike its benchmark interest rate a quarter point at its June meeting.
Chances of a hike rose following the jobs release, with traders now putting a 78.5 percent probability on June for a quarter-point raise. December remains the most likely month for another move with a 57.2 percent chance, up a percentage point from Thursday.
""The Federal Reserve, while not a religious entity, has indicated that its members have faith that the economy will return to a familiar, steady growth path after a lackluster start to the year,"" said Mark Hamrick, senior economic analyst at Bankrate.com. ""The April jobs report helps them to keep their own brand of faith, meaning that the odds are good that the outlook remains for rising interest rates.""
Get the market reaction here.
This is breaking news. Please check back for further updates.
Correction — A previous version misstated the number of leisure and hospitality positions.
Watch: Headline unemployment rate may not be best jobs measure
Amazon has finally lifted the lid on its second-annual Prime Day sale, which it's touting as the ""biggest Amazon event ever.""
On July 12, the online retailer will offer Prime members new deals as often as every five minutes. That compares with a new deal every 10 minutes during last year's Prime Day. In all, the sale will include more than 100,000 deals spanning ""nearly all departments and categories,"" from televisions to vitamins.
Amazon did not provide a comparable number of items for last year's event, but said this is the largest number of deals it's offered in a single day.
The U.S. sale will kick off at 3 a.m. Eastern for existing Prime members, as well as those who sign up that day for one of its paid memberships or free 30-day trial. Unlike last year, Amazon will offer a handful deals for Prime members in the week leading up to Prime Day, on items including a 32-inch TV bundled with a Fire TV Stick, which will sell for $119.99.
""Following last year's record sales, we have dramatically increased the inventory behind many deals,"" said Greg Greeley, vice president of Amazon Prime.
That includes nearly double the number of TV units in stock as compared with Black Friday and Cyber Monday combined. Last year, some shoppers complained on social media that the deals were selling out too quickly.
Amazon's Prime Day playbook is similar to its Black Friday strategy, which also rolled out deals every five minutes. Company spokeswoman Julie Law said some of the discounts will be deeper than last year's event.
During its inaugural Prime Day sale, held last July in honor of the company's 20th anniversary, Amazon sold more units than on Black Friday 2014, which at the time was its biggest ever (Amazon's 2015 Black Friday event surpassed that metric). In addition to driving sales, the event led to more new members trying Prime than on any day in its history, Amazon said.
Though Amazon does not release information regarding the number of Prime members, Consumer Intelligence Research Partners estimates Amazon has 54 million U.S. members. The firm's data also shows that 73 percent of Amazon's 30-day trial subscribers pay for the first full year of membership. And 91 percent of first-year subscribers renew for a second year, CIRP said.
Amazon has not set an explicit goal for this year's event, though the company expects it to be ""another record-breaking Prime Day,"" Law said. She said additional details regarding specific Prime Day deals will be released closer to the event, including ""far more"" limited-time lightning deals and deals of the day.
Shoppers last year also grumbled on social media that the discounts were not as deep as they had expected, and that some of the items on sale seemed strange. One deal, for example, promoted a chef's hat.
Law responded to criticism that the Prime Day discounts at times seem random, saying the event is different from Black Friday in that it's not a gifting holiday. Instead, it's the time of year when shoppers are stocking up on such things as seasonal summer goods and back-to-school essentials, she said.
""What could be weird to one person may be wonderful to someone else,"" Law said. ""We really stand behind the deals we had last year and the deals we have this year.""
Amazon's announcement, while widely expected, comes one day after Wal-Mart announced a free 30-day trial for its ShippingPass service, which is positioned as a competitor to Prime. Similar to Amazon Prime, Wal-Mart shoppers can pay an annual fee to receive unlimited two-day shipping.
Wal-Mart's version of the service costs $49 a year, compared to $99 for an annual Prime subscription. However, Prime membership includes additional benefits that aren't part of Wal-Mart's program, including unlimited streaming of movies and TV shows. Amazon also boasts a broader array of products, with more than 20 million items eligible for Prime. Walmart's U.S. site has roughly 7 million items up for grabs.
NEW YORK -- A weak showing in home sales and a mixed batch of earnings reports kept the stock market flipping between minor gains and losses on Wall Street. With an hour left in the trading day, the major market indexes were slightly up.
A strong profit report from Procter & Gamble helped indexes start higher early Thursday, but they weakened in late morning trading after a realtor group said that the pace of contracts for new home sales had leveled off.
That turned the stocks of builders sharply lower. PulteGroup was off 3 percent, giving up an early gain. D.R. Horton fell 2 percent and Toll Brothers fell 3 percent.
In afternoon trading Thursday the Dow Jones industrial average was up five points at 13,082. It had climbed as much as 87 points earlier in the day.
The Standard & Poor's 500 rose three points to 1,412 and the Nasdaq gained six points to 2,987.
""This is a market still working through a difficult earnings season,"" said Jason Pride, the director of investment strategy for Glenmede, a wealth-management firm.
Pride said investors probably celebrated too much after the Federal Reserve pledged more support for the economy in early September. They overlooked shrinking economies in Europe, slower growth in China and other signs that this earnings season would be rough. In the past two weeks, they've paid for it.
""We had a party and now we're dealing with a hangover,"" he said. ""The market is basically back to where it was at the end of August. I don't think that's unreasonable.""
The stock market has been in a slump for more than a week because of the weak revenue numbers and lower profit projections that have emerged from the latest round of corporate earnings reports.
The Dow gained 127 points Oct. 16 but since then has managed only two daily gains, both of them meager. The average has lost 474 points since that last significant increase.
Among companies reporting earnings Thursday, infant formula maker Mead Johnson Nutrition plunged 10 percent after its revenue came in well below what Wall Street analysts were expecting. The company also cut its forecast for full-year earnings and its stocks slumped $6.92 to $62.59.
Profits at United Airlines declined with fewer people flying, and the company fell well short of Wall Street expectations. The stock fell 77 cents to $19.50, a loss of 4 percent.
Homebuilders fell broadly after the pace of growth in home sales slowed last month. PulteGroup, which returned to profitability in the third quarter, gave up an early gain and was trading down 51 cents at $16.94. Toll Brothers fell 93 to $34.32 and D.R. Horton fell 25 cents to $21.16.
Procter & Gamble was the biggest gainer in the Dow after the consumer products company, whose products include Tide, Gillette and Charmin, reported earnings that beat analysts' expectations. P&G rose $1.90 to $69.98.
Online game maker Zynga jumped 26 cents to $2.39 after the company reported revenue that was stronger than analysts had anticipated. The company also said it would cut costs and enter the gambling business.
Health insurer Aetna rose 38 cents to $44.33 after reporting a 2 percent gain in third-quarter earnings. Higher revenue and lower-than-expected health care claims helped the company beat Wall Street's profit expectations.
Apple and Amazon.com report earnings after the market closes.
As investors moved into stocks, they sold U.S. government bonds, sending yields higher. The benchmark 10-year U.S. Treasury note yielded 1.83 percent, up from 1.79 percent late Wednesday.
It seems there is a global effort to exacerbate the problems
+ and worries of the world. Let's start in Japan where Prime
+ Minister Taro Aso said today that people should not be
+ over-concerned about daily movements in Japanese share prices,
+ after the benchmark Nikkei average fell to a 5-year low.
""Stock prices in New York fell yesterday, but they rose the
+ day before. We should not fret over stock moves,"" Aso told
+ reporters according to MNI. Which begs the question, when's the
+ next election in Japan? I'm thinking they are closer to Italy
+ than we know....BTW, Japanese exports to the US fell 10% and
+ Japan's trade surplus shrunk 94% as a wonderful indication of
+ why stocks in Japan are under pressure.
Next up fresh after being forced to testify on Capitol Hill,
+ the ratings agencies are out and about focusing on emerging
+ markets. Standard & Poor's Ratings Services today said
+ it had revised its outlook on the long-term sovereign credit
+ ratings on The Russian Federation to negative from stable
+ according to Reuters. ""The outlook revision reflects the
+ likelihood of a downgrade if costs to the Russian government of
+ the bank rescue operations continue to increase, amid rising
+ capital outflows as confidence in the financial system and the
+ monetary regime declines,"" Standard & Poor's credit
+ analyst Frank Gill said. ""It is difficult at present to
+ determine the ultimate impact on the public sector balance
+ sheet of the banking system bail-out, not least due to the
+ uncertain outlook on asset quality."" How about looking at lower
+ oil prices as an indication of their problems along with that
+ little foray into a neighboring country? Just for fun, put up a
+ chart of crude vs the Russian Ruble.
- Jobless Claims Rise More Than Expected
Yesterday, United States Sen. Charles Schumer, Sen. Jack
+ Reed, and Sen. Robert Menendez asked the US Treasury department
+ to establish guidelines saying that banks receiving government
+ capital injections should use the funds to restore their
+ lending practices to levels prior to the onset of the credit
+ crisis. ""Although we are supportive of your efforts to restore
+ stability to the financial system through direct capital
+ injections into financial institutions, we are concerned that
+ if the program is not implemented correctly, it's effectiveness
+ will be limited."" According to CNBC's website, the letter tells
+ Treasury officials that they should issue guidelines that
+ specify the type of lending allowed, encourage loan
+ modifications, and provide more oversight of executive
+ legislation. In this same vein, the Michigan congressional
+ delegation has drafted a letter it intends to send to Federal
+ Reserve Chairman Ben Bernanke and Treasury Secretary Henry
+ Paulson later this week, urging the two officials to use their
+ ""broad regulatory authority"" to ""promote liquidity in the U.S.
+ auto industry."" (WSJ)
This type of government micromanaging of the financial
+ system and government reach into the private sector takes us
+ full circle back to the 1930s. This will accelerate with a
+ potentially strongly Democratic legislative and executive
+ branches next year. Globally, the theme of governments
+ aggressively stepping into the private sector is the short term
+ cure for all that ails from credit crisis. Longer term for the
+ developed countries, it will create sclerotic economies unable
+ to grow faster than 2% due to regulation and programs designed
+ to effect social goals instead of profit targets. For now, all
+ that matters is survival and socialism is embraced.
________________________
left
+ /CNBC/Sections/News_And_Analysis/_Blogs/Guest_Blog/__COVER/bush_andy.jpg110010000lefttruehttp://msnbcmedia.msn.comAndrew Busch
false1Pfalse
+ falsefalsefalseAndrew B.
+ Busch Global FX Strategist atBMO Capital Markets, a recognized expert on the
+ world financial markets and how these markets are impacted by
+ political events, and a frequent CNBC contributor.
+ here LEAWOOD, Kan.--(BUSINESS WIRE)-- Tortoise MLP Fund, Inc. (NYSE: NTG) today announced that as of Sept. 30, 2012, the company’s unaudited total assets were approximately $1.7 billion and its unaudited net asset value was $1.2 billion, or $25.19 per share.
As of Sept. 30, 2012, the company was in compliance with its asset coverage ratios under the Investment Company Act of 1940 (the 1940 Act) and basic maintenance covenants. The company’s asset coverage ratio under the 1940 Act with respect to senior securities representing indebtedness was 558 percent, and its coverage ratio for preferred shares was 420 percent. For more information on calculation of coverage ratios, please refer to the company’s most recent applicable prospectus.
The company issued 88,905 shares of common stock under its at-the-market equity offering program for gross proceeds of approximately $2.3 million during the month of September 2012.
Set forth below is a summary of the company’s unaudited balance sheet at Sept. 30, 2012 and a summary of its top 10 holdings.
Unaudited Balance Sheet
| | | (in Millions) | | Per Share |
| Investments | | $ | 1,661.0 | | $ | 35.81 |
| Cash and Cash Equivalents | | | 0.3 | | | 0.01 |
| Other Assets | | | 2.8 | | | 0.06 |
| Total Assets | | | 1,664.1 | | | 35.88 |
| | | | | |
| Short-Term Borrowings | | | 19.9 | | | 0.43 |
| Senior Notes | | | 255.0 | | | 5.50 |
| Preferred Stock | | | 90.0 | | | 1.94 |
| Total Leverage | | | 364.9 | | | 7.87 |
| | | | | |
| Other Liabilities | | | 5.0 | | | 0.11 |
| Deferred Tax Liability | | | 125.9 | | | 2.71 |
| Net Assets | | $ | 1,168.3 | | $ | 25.19 |
46.38 million common shares currently outstanding.
Top 10 Holdings (as of Sept. 30, 2012)
| | | | | |
| Williams Partners L.P. | | $ | 139.1 | | 8.4 | % |
| El Paso Pipeline Partners, L.P. | | | 138.5 | | 8.3 | % |
| Enterprise Products Partners L.P. | | | 132.0 | | 7.9 | % |
| Energy Transfer Partners, L.P. | | | 123.2 | | 7.4 | % |
| Regency Energy Partners LP | | | 105.4 | | 6.3 | % |
| Boardwalk Pipeline Partners, LP | | | 98.3 | | 5.9 | % |
| Spectra Energy Partners, LP | | | 86.1 | | 5.2 | % |
| ONEOK Partners, L.P. | | | 84.4 | | 5.1 | % |
| Kinder Morgan Management, LLC | | | 67.6 | | 4.1 | % |
| Plains All American Pipeline, L.P. | | | 66.8 | | 4.0 | % |
| Total | | $ | 1,041.4 | | 62.6 | % |
Name
Market
Value
(in Millions)
% of
Investment
Securities(1)
(1) Percent of Investments and Cash Equivalents
About Tortoise MLP Fund, Inc.
Tortoise MLP Fund, Inc. owns a portfolio of master limited partnership (MLP) investments in the energy infrastructure sector, with an emphasis on natural gas infrastructure MLPs. Tortoise MLP Fund, Inc.’s goal is to provide its stockholders a high level of total return with an emphasis on current distributions.
About Tortoise Capital Advisors, L.L.C.
Tortoise Capital Advisors, L.L.C. is an investment manager specializing in listed energy infrastructure investments. As of Aug. 31, 2012, the adviser had approximately $8.6 billion of assets under management in NYSE-listed closed-end investment companies, an open-end fund and other accounts. For more information, visit www.tortoiseadvisors.com.
Safe Harbor Statement
This press release shall not constitute an offer to sell or a solicitation to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer or solicitation or sale would be unlawful prior to registration or qualification under the laws of such state or jurisdiction.
Forward-Looking Statement
This press release contains certain statements that may include ""forward-looking statements"" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical fact, included herein are ""forward-looking statements."" Although the Company and Tortoise Capital Advisors believe the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's reports that are filed with the Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required by law, the Company and Tortoise Capital Advisors do not assume a duty to update any forward-looking statement.
E*Trade Financial has ousted its CEO, Citigroupveteran Steven Freiberg, just two years into a four-year contract as the online broker deals with declining trading by customers.
The company said Thursday that it's looking for a new chief executive as it adjusts its business strategy, which is focused on strengthening its financial position. It named its chairman to the top spot until a permanent replacement can be found.
E*Trade has been struggling as individual consumers pull money out of the stock market. The New York company's net income dropped 16 percent in the April to June quarter as investors made far fewer trades than a year ago. Faced with less trading activity, E*Trade said it was focusing on managing costs and dialing back on risk to strengthen earnings.
Freiberg, 55, had been at E*Trade's helm for a little more than two years. He was at Citigroup for 30 years before that, where he most recently led the consumer group that handles individual investments, retail banking, and credit cards.
Freiberg was paid a base salary of $1 million a year and was eligible for stock incentives worth up to three times that. He will get an undisclosed severance package.
Shares of E-Trade have lost more than half their value in the past year. Adjusting for a stock split, they are down 97 percent from their peak in 2006. The stock was up more than six percent in pre-market trading Thursday.
Frank Petrilli, 61, has been E*Trade's chairman since January. He's a long-time financial industry executive.
Investors waiting for a cheaper stock market entry point risk missing out, Simon Baker of Baker Avenue Asset Management said Monday.
""Here's the problem if you're waiting for that pullback: The move back comes back so, so quickly,"" he said.
On CNBC's ""Fast Money,"" Baker said that at a recent Miami conference of high net-worth investors, about half were waiting for such a dip to buy.
The question, he added, was simple: ""Where do you want to be in the market?""
Cyclical sectors would likely lead the market higher, and it was time to get out defensive positions, Baker said.
""I'd go long the ETF in technology and short the staples. It's a good hedge,"" he said. ""It's a pair trade, but I think you need to be long.""
TheStreet CIO Stephanie Link also said that cyclicals were undervalued.
Link's top picks included Eaton, Stanley Black & Decker and Ensco.
""I think that the global economic story has changed because you have more liquidity measures being implemented,"" she said.
Trader disclosure: On May 6, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's ""Fast Money"" were owned by the ""Fast Money"" traders: Stephanie Link is long AAPL; Stephanie Link is long GS; Stephanie Link is long JPM; Stephanie Link is long CSCO; Stephanie Link is long FB; Stephanie Link is long HD; Stephanie Link is long GE; Stephanie Link is long ESV; Simon Baker is long AAPL; Simon Baker is long BAC; Simon Baker is long JPM; Simon Baker is long WFC; Simon Baker is long SBUX; Simon Baker is long FB; Simon Baker is long MSFT; Simon Baker is long GOOG; Simon Baker is long HD; Anthony Scaramucci is long AAPL; Anthony Scaramucci is long GS; Anthony Scaramucci is long JPM; Anthony Scaramucci is long MS; Anthony Scaramucci is long MSFT; Anthony Scaramucci is long GOOG; Jon Najarian is long MBI; Jon Najarian is long BAC; Jon Najarian is long JNPR; Jon Najarian is long FFIV; Jon Najarian is long RDN; Jon Najarian is long UVXY; Jon Najarian is short NFLX; Scott Black is long QCOM; Scott Black is long TCAP; Scott Black is long WLL.
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General Maritime : Cramer likes the CEO, Peter Georgiopolous, and the 6.7% yield. “Let’s buy some.”
BigBand Networks : “Waiting for some results from the Comcast test. You know I like that stock here.”
There is a lot of tough talk emanating from the Middle East. Here's a currency-trading plan in case the situation worsens.
With all the news about oil output and rumors of possible military action in the Middle East, it's a good idea to have a trading plan in the event of an oil shock.
Rebecca Patterson, chief markets strategist for J.P. Morgan Asset Management, Institutional, is looking north for her plan.
""If you are trading currencies and you see a headline go across the tape saying something has happened, what's the first thing you should do? If it's a supply shock, I want to go with a current account surplus country. I want to be long the Norwegian krone,"" she told CNBC's Melissa Lee.
To keep the trade liquid, Patterson suggests using the euro as a cross. Also, because ""we don't know what levels we'll be at if and when this happens,"" she says, ""we're just going to use where we are now as an example.""
So for now, Patterson suggests entering the trade right around 7.6200, with a stop at 7.4000 and a target of 7.7000.
Todd Gordon, co-head of research and trading at Aspen Trading Group, says the trade measures up nicely in technical terms. And Patterson adds that it's not just the oil issue that could make this trade work.
""Norway has a current account surplus. If equities fall this week and people take risk off, that could also benefit Norway at the margin.""
You can watch the discussion on this video.
--------------
CURRENCY FUTURES
Tune In: CNBC's ""Money in Motion Currency Trading"" airs on Fridays at 5:30pm and repeats on Saturdays at 7pm.
Learn more: The essential vocabulary for currency trading is on Key Currency Terms. Top currency strategies are broken down for you in Currency Class.
Talk back: Tell us what you want to hear about - email us at moneyinmotion@cnbc.com.
Is it better to rent or to own?
The default answer for a long time — when real estate’s horizon seemed limitless — was to own. Lately some individuals and businesses have decided that maybe owning is not always better, especially when you have other pressing needs for cash, like paying off your creditors.
Now the idea has spread to some states with serious debt problems. In January the state of Arizona concluded a deal to sell to investors ownership stakes worth a total of $735 million in several state-owned office buildings, arenas and other properties — including the buildings housing both chambers of the State Legislature. Arizona will lease back the property from its new landlords, among them the mutual fund giants Fidelity and Vanguard, for 20 years, after which ownership will revert to the state. Arizona is planning another, smaller round of real estate sales in June. For fiscal 2011, which begins in July, the state is estimated to have a deficit of $3 billion.
Although it has been drowned out by hotter issues, like the uproar over the state’s new immigration law, some Arizona politicians have sought to make an issue of the sale-leaseback. Dean Martin, the state’s treasurer and a candidate for the Republican nomination for governor this fall, has derided the sale as a one-time gimmick used to circumvent the state’s debt limit and avoid the hard choices he contends Arizona needs to make about what he calls “unsupportable spending.”
“How many times can you sell the state capital?” he said.
Mr. Martin said he wanted to repackage the state’s debt as bonds and use some of the proceeds to buy back the buildings.
“Who wants to make a long-term investment in a state that is renting its Capitol buildings?” he has been asking on the campaign trail.
Last month California received sale-leaseback bids on a portfolio of 7.3 million square feet of office space in 11 state-owned buildings. The Golden State Portfolio includes buildings in Los Angeles and Sacramento, as well as the San Francisco Civic Center, where the state Supreme Court sits. The deal had been expected to yield about $660 million in revenue for the state, after $1.1 billion in expected proceeds were used to pay off construction bonds. California’s deficit for 2010-11 is about $20 billion.
Kevin Shannon, a vice chairman of the commercial real estate firm CB Richard Ellis, which is managing the auction for the state, said he believed the state would take in more than expected once it analyzed the bids and completed a deal, which is expected to happen by the middle of May. Mr. Shannon said the auction had produced more than 300 bids.
“There’s been a lot of press about this being a fire sale,” he said, “but we’re in a competitive bidding situation.” Mr. Shannon said demand for the properties had been greater than expected.
As with Arizona’s leaseback, the California auction has become a political football. The state Legislature was almost unanimous in approving the plan a year ago. More recently, however, two members of state real estate boards whose approval was necessary for the sale to proceed say they were abruptly dismissed by Gov. Arnold Schwarzenegger because they opposed the deal. They have told reporters they believe it would cost the state more in rent money than it would raise. A state Assembly committee is reviewing the matter.
The view that the deal does not make economic sense has been seconded by others, including the state’s independent Legislative Analyst’s Office, which has called the sale “bad budgeting practice.”
The leaseback continues to enjoy the support of the governor.
“The governor doesn’t believe the state should be in the real estate business,” said Erin Shaw, a spokeswoman for the California Department of General Services, which manages the state’s property holdings. Governor Schwarzenegger said recently that he would not approve a sale if bids were too low. Previously the state shelved a proposed sale of the Orange County fairgrounds when bids came in lower than expected.
Besides Arizona and California, only Connecticut is conducting a sale of state office buildings.
Connecticut, however, is seeking bids for straight-out purchases of buildings it regards as surplus rather than sale-leasebacks. The comparatively modest properties, which include the Litchfield Jail and the Bristol Armory, have attracted little attention.
Gordon F. DuGan, chief executive of W. P. Carey and Company, a real estate investment company that specializes in corporate sale-leaseback deals, said that if the California sale went well other states might follow. Mr. DuGan said, however, that he had not heard of any great interest in such future deals from either prospective buyers or sellers. W. P. Carey has made a bid for some of the California properties, which Mr. DuGan does not expect will be accepted. (The state has said it prefers bidders for the entire package.)
Mr. DuGan said bidding for the California property appeared stronger than he had expected, particularly considering that, unlike other sale-leasebacks, the California deal requires buyers to pick up the cost of services like waste hauling and security. He said that structure made the deal more appealing to bidders that, unlike his company, had big operations units.
The risk of drawing unwanted headlines by selling state property may be one reason the idea has yet to take hold in other states that are short on money. A few years ago a spurt in the sale of state- and city-owned infrastructure, like highways and bridges, ended amid outrage that some of these properties were being sold to foreign investors.
Another reason for the absence of a rush to such deals may be relatively modest proceeds for states. Dan Fasulo, chief of research at Real Capital Analytics, which tracks commercial real estate markets, said in an e-mail message, “There are many states that look at things like this during a crisis, but at the end of the day the amount of money raised from such activities is a laughable amount when viewed from the context of the overall budget shortfalls.”
Stocks began the truncated trading week after Memorial Day on a negative note. All three major indices finished Tuesday lower, and concerns about bond yields sent the Dow Jones Industrial Average down again on Wednesday.
The bearish action followed three straight weeks of declines for the as the index shed nearly 5% in the past month.
But history says current losses could precede future gains.
Over the past decade, the has logged three consecutive weeks of losses on 18 other occasions, according to a CNBC analysis of Kensho, a machine learning tool used by Wall Street banks and hedge funds to mine market history for potential trading profits.
A month after these declines, stocks tend to bounce back, Kensho finds.
The S&P 500 recoups 3.4% on average, trading positively 83% of the time.
The top sectors following these episodes: Materials, Tech and Consumer Discretionary, which all gained at least 4% the following month.
HOUSTON, Oct. 5, 2012 /PRNewswire/ -- Noble Energy, Inc. (NYSE: NBL) announced today that it will host a conference call to discuss its new venture exploration program at 9:00 a.m., Central Time, Thursday, October 11, 2012. The intent of the call is to provide insight into several frontier plays where the company has activities in progress - the deep oil potential of the Eastern Mediterranean, the Falkland Islands, and Northeast Nevada.
The webcast will be accessible on the 'Investors' page of the Company's website, www.nobleenergyinc.com. Conference call numbers for participation are 888-401-4691 and 719-325-4766. The passcode number is 5184314.
A replay will be available at the same web location until January 11, 2013.
Noble Energy is a leading independent energy company engaged in worldwide oil and gas exploration and production. The Company has core operations onshore in the U.S., primarily in the DJ Basin and Marcellus Shale, in the deepwater Gulf of Mexico, offshore Eastern Mediterranean, and offshore West Africa. Noble Energy is listed on the New York Stock Exchange and is traded under the ticker symbol NBL. Further information is available at www.nobleenergyinc.com.
SOURCE Noble Energy
With millions working and learning from home, some exchange-traded fund issuers are trying to capitalize on the shift to virtual living.
Direxion kicked it off in April by announcing it would file for a work-from-home ETF, ticker WFH, tracking industries at the heart of remote connectivity such as cybersecurity, communications and cloud technologies.
Whether others will follow Direxion's lead remains to be seen, but there are already numerous options on the ETF market that investors can use to play the stay-at-home boom, market analysts say.
""It's amazing how we've been talking about FANG stocks for so long, but they worked right into the whole stay-at-home world – online shopping, home offices, video streaming, ... modern communication,"" Tom Lydon, the CEO of ETF Trends and ETF Database, told CNBC's ""ETF Edge"" on Monday.
All four FANG companies — Facebook, Amazon, Netflix and Alphabet — reported their first-quarter earnings results within the last two weeks. Shareholders responded well to all but Amazon, which said it would spend the entirety of its second-quarter profits on bolstering its coronavirus response. Netflix's spike in new subscribers was a particular highlight.
One of the most popular ways to trade these names using ETFs is via the Invesco QQQ Trust (QQQ), which tracks the tech-heavy Nasdaq 100 Index, Lydon said.
""The FANG stocks make up 35% of QQQ. If you add in Microsoft, it's 47%,"" he said. ""So, it's a great way to play it as we continue to be quarantined in this stay-at-home world because it doesn't seem that their businesses are going to get weak any time soon. They just continue to pull away from the pack.""
ETFs that have the biggest position in the FAANG stocks — which is FANG plus Apple — include the Communication Services Select Sector SPDR Fund (XLC) at more than 47%, the Vanguard Communication Services ETF (VOX) at over 44% and the Fidelity MSCI Communication Services Index ETF (FCOM), also at 44%.
Other existing products investors could consider include some of Global X's more focused products, Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA Research, said in the same ""ETF Edge"" interview.
He highlighted the Global X Cloud Computing ETF (CLOU) and the Global X Robotics & Artificial Intelligence ETF (BOTZ).
""Cloud computing [and] robotics ... [are] themes that I think have been driven home as people need more bandwidth to be able to work from home and as companies realize that they need more of an automation and use robotics when they can to improve the supply chain,"" Rosenbluth said.
""Some of these themes are really going to resonate with investors even more in 2020 than they have in the recent past,"" he said. ""And there's a whole host of these products from First Trust, from ROBO, from other firms that are really in this space for investors that want to dig deeper into how you can play this stay-at-home theme.""
Jason Bloom, director of global macro ETF strategy at Invesco, suggested Invesco probably won't be getting as granular as some others in the ETF industry anytime soon.
""We do try to be responsive, clearly, to changes in the structure of the market or fundamentals that would suggest that you have an investment theme that makes sense,"" he said in the same ""ETF Edge"" interview.
""We're probably a little more conservative in that durability of the theme for us is ... a very high priority,"" Bloom said. ""So, if there's a risk that the theme may only have a year or two or so before it runs its course, it's probably not going to make it through our process, but if we think it has five, 10 years or more of durability then it certainly makes sense to us.""
Disclosure: Invesco is the sponsor for CNBC's ""ETF Edge.""
Disclaimer
Do lower crude prices mean lower prices at the pump?
Not necessarily, oil prices fell more than 5 percent on Thursday however the average price for a gallon of gasoline in the United States has risen for the first time since early July.
The national average for self-serve, regular unleaded gasoline rose to $1.7793 on January 9, up some 11.71 cents.
And Fast Money’s Joe Terranova thinks prices at the pump are going higher from here. “The crack spread used to be minus 2 dollars, now it’s 7 bucks,” he says.
How should you trade it?
“The trade is to own the refiners,” counsels Terranova. “Own Valero and Sunoco. They have good balance sheets and are not that reliant on credit.”
And it's worth noting, that although gasoline prices are higher, they are still less than half of what consumers paid in July when the average price reached an all-time high of $4.11 a gallon.
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