| By Gary Anderson | Thursday, January 30th 2014, 20:30 GMT |
At the end of the third day of winter testing at Jerez, Gary Anderson answered the key questions raised from what we have seen so far
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| By Mark Glendenning | Thursday, January 30th 2014, 19:41 GMT |
This year's NASCAR Sprint Cup will be decided by a winner-takes-all finale as part of a revamped Chase for the Championship, series bosses confirmed on Thursday
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble | Thursday, January 30th 2014, 20:55 GMT |
Renault insists that the problems that have struck its Formula 1 teams are fixable by the next Bahrain test
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Wednesday, January 29th 2014, 17:19 GMT |
Nico Rosberg says his sequence of afternoon long runs on Wednesday was an emphatic sign that Mercedes' 2014 Formula 1 preparations are on track
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble | Wednesday, January 29th 2014, 18:27 GMT |
Renault is confident that overnight fixes to its battery energy stores will cure the problems that have blighted its pre-season Formula 1 testing programme
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| By Kevin Turner | Wednesday, January 29th 2014, 18:55 GMT |
Jenson Button believes McLaren's 2014 Formula 1 car does not have the same "issues" that plagued the team last season
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble | Monday, January 27th 2014, 19:10 GMT |
Marussia's debut of its new Formula 1 car has been delayed because of a last-minute technical glitch, AUTOSPORT has learned
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| By Jonathan Noble | Monday, January 27th 2014, 18:32 GMT |
Formula 1's new generation of ugly noses have no place in the sport, reckons Toro Rosso team boss Franz Tost.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Kevin Turner | Monday, January 27th 2014, 19:55 GMT |
Double British Touring Car champion Alain Menu will return to the series this season, driving a Volkswagen Passat
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| By Edd Straw | Sunday, January 26th 2014, 15:38 GMT |
Esteban Gutierrez has set his sights on emerging as the leader of the Sauber Formula 1 team in 2014
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| By Peter Mills | Sunday, January 26th 2014, 19:30 GMT |
Auto GP organisers have announced that the series will race alongside the World Touring Car Championship, DTM and European Le Mans Series in 2014
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| By Gary Watkins | Sunday, January 26th 2014, 19:51 GMT |
Action Express Racing came out on top in a three-way Chevrolet-powered fight to claim a second Daytona 24 Hours victory with Joao Barbosa, Christian Fittipaldi and Sebastien Bourdais
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Saturday, January 25th 2014, 22:18 GMT |
The Daytona 24 Hours has been red-flagged shortly before the three-hour mark after a serious incident involving the pole-winning GAINSCO/Bob Stallings entry driven by Memo Gidley.
Gidley was running fourth when he hit the Risi Competizione GT Le Mans class Ferrari of Matteo Malucelli, who is understood to have lost drive.
Gidley and Malucelli were both taken to the local Halifax hospital after being removed from their respective cars.
The safety car was initially deployed and then the race stopped when the extrication of the Gidley began.
The race was led overall by Christian Fittipaldi in the Action Express Coyote-Chevrolet Corvette DP by less than a second when the red flags came out.
| By Gary Watkins | Sunday, January 26th 2014, 00:35 GMT |
The Action Express team led the Daytona 24 Hours at five hours with its lead Coyote-Chevrolet Corvette DP in the hands of Christian Fittipaldi
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Sunday, January 26th 2014, 02:03 GMT |
Memo Gidley and Matteo Malucelli are "awake and communicating" in hospital after their accident at the end of the third hour of the Daytona 24 Hours
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
Argentina's currency has tanked in recent days after the government devalued the peso.
NEW YORK (CNNMoney)
Argentina's government devalued the currency Thursday in a bid to jump start growth. The resulting drop in the peso was the worst since 2002 -- when Argentina defaulted on its debt.
Devaluation can cheapen a country's exports and make them more competitive globally, but can also make imports more expensive and therefore drive up inflation.
The currency move was a shift for Argentine President Cristina Kirchner, a populist who had previously vowed not to devalue the peso. It also raised concerns about Argentina's dwindling dollar reserves.
The sell-off in the peso came as other emerging market currencies, such as Turkey's lira and India's rupee, have gotten hammered due to the expectation that the Federal Reserve, Bank of England, and Bank of Japan will pull back on propping up their own economies.
As forecasts for growth in developed nations become rosier there isn't as great a need for stimulus from these central banks, said Steven Englander, head of foreign exchange strategy at Citigroup.
Related: Investors go globetrotting for bargains
That could lead to higher bond yields in the developed markets and stronger currencies as well. But emerging markets have come to rely on the Fed, BoE and BoJ keeping exchange rates low so they can borrow aggressively to fund their economies.
To that end, many emerging markets performed well in the wake of the financial crisis as growth in developed nations remained sluggish.
But the prospect of rising rates coupled with domestic economic and political problems have caused emerging markets investors to head for the exits. A dip in the price of oil and other commodities, typically the mother's milk of many emerging markets, has only exacerbated investors' concerns.
Argentina, for its part, grew quickly following its deep recession of the early 2000s that began when it stopped paying its creditors. But it never fully recovered its reputation in the international markets.
And the election of Kirchner in 2010 did little to boost confidence. Kirchner's economic platform is predicated on selling the country's natural resources to spend heavily at home.
But many economists say her policies have dampened free-market competition with rising debt and tepid growth.
The Argentine government also hasn't opened up its books to the International Monetary Fund in years, creating tension with the international lender.
Related: Related: IMF warns of deflation risk
Speaking to CNN's Richard Quest from the World Economic Forum in Davos this week, IMF chief Christine Lagarde said her organization would like to learn more about Argentina's finances.
"We would like to go under the skin of any economy in the IMF," she said, adding that a call from the Argentinean government "would be more than welcome."
But there's no question that the situation in Argentina is worrisome.
The Global X FTSE Argentina 20 ETF (ARGT), which invests in key Argentine companies, has plummeted nearly 9% this week.
Neil Shearing, chief emerging markets economist for Capital Economics, said in a note Thursday that Argentina's high debt, low currency reserves, and general economic mismanagement are all cause for concern.
"Where we go from here is difficult to say," he said. "Our forecast that the economy would slide into recession this year looked bold a few months ago -- all of a sudden that doesn't seem so implausible." 
First Published: January 24, 2014: 12:44 PM ET
NEW YORK (CNNMoney)
Sherman, a defensive back, made the play that secured Seattle's 23-17 win over San Francisco on Jan. 19. Immediately after the play, he did a TV interview proclaiming that he was the best cornerback in the National Football League, and dissing the opposing player who he had foiled on the play.
Sherman's agent, Jamie Fritz, told CNNMoney that interest in his clients has boomed since the remarks. While Sherman's current endorsements amount to just a bit more than his $550,000 NFL salary, Fritz believes there are millions in deals that will be signed soon, -- some before the Super Bowl is played Feb. 2.
"We have some new players who have come to the table who are starting the conversation," Fritz said.
The remarks caused an immediate sensation -- positive and negative -- in social media and on sports talk radio, among fans accustomed to bland comments from winning players.
Some advertisers fret about the controversy generated by the rant. But Fritz thinks the rant was more positive than negative for Sherman's image.
Related: Super Bowl ads sneak peak
"I think that he's more likeable," he said. "People love this. The brand managers love this."
Outside experts agree that advertisers are more likely to be attracted by Sherman's new celebrity than scared off by the controversy.
"He's going to be the very hot interview in next couple of weeks. I'm sure you're see someone take advantage of him," said Jordan Schlachter. executive vice president, sports for The Marketing Arm, a firm that arranges endorsement deals.
Related: Richard Sherman tells CNN rant was 'immature,' reaction was 'mind-boggling'
Bob Dorfman, editor of the Sports Marketers Scouting Report and executive creative director of Baker Street Advertising, said that the NFL's defensive players don't get the endorsements that offensive stars such as Denver quarterback Peyton Manning get. So the rant has elevated Sherman in advertisers' eyes.
"I think there are some who will worry because of the way he's not afraid of opening his mouth, eventually he'll say something that really gets him in trouble," said Dorfman. "But a lot of those advertisers don't use athletes anyway
Related: Behind the scenes of Apple's iconic '1984' Super Bowl ad
Sherman, who was his high school's salutatorian graduated from Stanford and started a masters degree there his final year playing football there. Before Sunday's game he had few endorsements. His first two national ads aired during the game -- one for Beats by Dre headphones, the other a Nike (NKE, Fortune 500) spot that focused on Kobe Bryant in which Sherman makes a cameo appearance. He also has a regional ad campaign in the Pacific Northwest for Internet service provider CenturyLink (CTL, Fortune 500).
Fritz said even if he's not the star of the Super Bowl, he thinks advertisers' interest in his client is now secure.
"Win or lose, I don't think it changes the landscape of opportunities for Richard Sherman this offseason," he said.
First Published: January 24, 2014: 11:33 AM ET
Sam's Club will lay off 2% of its workforce.
NEW YORK (CNNMoney)
That's 2% of the workforce for the wholesale club chain, which has nearly 600 locations in the United States.
A little less than half of the employees affected are assistant managers, according to Sam's Club spokesman Bill Durling. Before the layoff, each club's fresh section -- which sells meat, poultry, seafood, dairy, produce and baked goods -- had six managers. Half of those jobs have been eliminated. Instead there will be three fresh section managers, who will be paid more, Durling said.
The company eliminated some hourly positions too.
Each employee affected by the cut will be paid for 60 days and is encouraged to look for other jobs at Sam's Clubs or its parent company, Wal-Mart, (WMT, Fortune 500)stores. If they cannot find a job within the company, they will receive some severance, Durling said.
Durling said that the company also plans to add at least fifteen more stores in the next year.
--CNN's Poppy Harlow contributed to this report.
First Published: January 24, 2014: 7:18 PM ET
The cheaper the Big Mac, the more undervalued the currency.
LONDON (CNNMoney)
The Economist's "Big Mac index" compares the price of the McDonald's hamburger around the world to determine whether a currency is overvalued.
So which country has the cheapest Big Mac?
India takes the crown. You can pick up chicken- or mutton-based Maharaja Macs for just $1.54. South Africa is next at $2.16, followed by Malaysia at $2.23.
Burger lovers will need deeper pockets in Norway, where a Big Mac costs a whopping $7.80.
For nearly 30 years The Economist has used the index as a lighthearted way to determine whether currencies are trading at the "correct" level.
Here's how it works: right now the average price of a Big Mac in America is $4.62; in China its $2.74.
According to the index, that makes the yuan undervalued by 41%.
Related: Japan's Abe: I am beating deflation
It might seem like a glib way to measure currencies, but the magazine says its burger index provides insight into the forces shaping the world economy.
Fears about the Federal Reserve scaling back its massive stimulus program last year rattled investors in emerging markets and pushed exchange rates in Brazil, Indonesia and Turkey sharply lower against the dollar.
And with the exception of Brazil, that made Big Macs more affordable: the BRICS all rate low on the burger index.
Big Macs could be getting even cheaper in emerging markets as new strains begin to show. This week, the Argentine peso collapsed and Turkey's lira plumbed fresh lows amid renewed worries about slowing growth and rising political tensions in developing economies.
First Published: January 24, 2014: 10:50 AM ET
The rising popularity of male body shaving could lift razor sales at Procter & Gamble.
LONDON (CNNMoney)
Procter & Gamble (PG, Fortune 500) released its fiscal second quarter results Friday. The maker of Gillette razors recorded flat sales in its grooming unit, sparked largely by a shift to disposable razors over blade and cartridge systems.
The Movember movement apparently didn't help matters either. The idea, which began in Australia in 2003, has spread to men around the world who proudly grow mustaches during the month of November to draw attention to prostate cancer.
Related: Want to boost sales? Start exporting
But P&G is hopeful that even if men aren't shaving their faces as much, they may want to take a razor to other parts of their body. Male body shaving is gaining popularity.
The "manscaping" trend is a growth opportunity for P&G and the company wants consumers to use new and additional tools when they trim and clip.
A survey conducted on behalf of the firm found that nearly 80% of men use separate razors for their face and anything below the neck.
Nearly half of men surveyed say they shaved their groin area, while one-fifth shear their chest, underarms and stomach. About half of all respondents also said they felt better without chest hair.
Regardless of where men are (or aren't) shaving, P&G's grooming unit doesn't move the company's dial all that much. It accounts for less than 10% of total sales.
And sales gains in the company's health care and fabric care product lines helped P&G to report better-than-expected earnings. Shares of P&G were up 3% Friday, making it a rare bright spot in a market where investors were busy shaving off stock prices.
First Published: January 24, 2014: 12:53 PM ET
A weekly collection of design, data and interactive links.
Design/Data viz
In Flight | Planes in the sky interactive
Where Football Players Call Home | Origin of college football players
Oblivion GFX montage | UI and motion design from the film Oblivion
Surveillance aircraft | Infographic explaining the JLENS military aircraft
Music Timeline | Visualization of Google Play Music user libraries
Talky | Simple and anonymous video chat
Drake Weather | Drake and the current weather
uArm | Put a miniature industrial robot arm on your desk
Photo/Video
Black Vultures | Capturing flight movements
Robocop Special Effects | Looking at special effects now vs. then
360 Fly | A new camera that captures 360 degree images
Illustration
Today or Tomorrow | A semiweekly comic by Tim Lahan
See last week's links
Have a nice weekend!
@dubly and @talyellin
Private jets are expected to cause their own traffic jam as the Super Bowl comes to New York.
NEW YORK (CNNMoney)
The airport, which serves small private jets, is only about 2 miles north of MetLife Stadium as the Lear Jet flies -- making it ideal for jetsetters wanting to fly in and out for the big game.
That has forced the Port Authority of New York and New Jersey, which overseas the region's four airports, to place limits on the number of private jet landings and take-offs in the days surrounding the game.
"You can't just fly 300 planes out right after the game," said Port Authority spokesman Ron Marsico.
The Federal Aviation Administration is expecting a surge of 1,200 extra private jet flights in the days surrounding the Feb. 2 Super Bowl. Most of those will be destined for Teterboro, as New York's three major passenger airports have only limited private jet flights. The spike will stretch the capabilities of Teterboro, which only handles about 400 take-offs and landings on a typical day, and has parking spots for about 600 planes.
Related: Super Bowl ads sneak peak
So private jets need to reserve take-off and landing times that start the Wednesday before the game, and last until the Tuesday afterward. It's the first time in memory that such reservations have been required. Typically planes can land and take off as soon as cleared by air traffic controllers.
To handle the overflow, Port Authority officials expect many jets to do "stop-and-go" operations -- landing, dropping off wealthy passengers and then flying to another airport to wait out the game. The agency also hired a temporary "ramp coordinator" to work with companies based at the airport to make sure flights don't bunch up.
Related: Company jet too pricey? Rent one by the hour
No one will be able to fly in or out of Teterboro between 2 p.m. and midnight on game day, as security precautions for MetLife Stadium include a "no-fly zone" that includes Teterboro. That could drive some of the private jet traffic to slightly more distant airports, such as Morristown Municipal Airport, about 20 miles to the west. Morristown will also require reservation times for take-offs and landings, but it is not in the no-fly zone.
While there are still take-off and landing slots available, some of the companies that operate hangers and ramps where private jets park report spots are already fully booked for the days around the game. One of those companies, Meridian, booked all 70 of its parking spots even before the Super Bowl match-up was determined on Jan. 19.
Related: Richard Sherman's $5 million rant
"A lot of the people who fly in on their own jets want to see the Super Bowl no matter who the teams are," said Kirk Stephen, marketing manager at Meridian. "We have a waiting list for those who waited to see if their teams got in."
First Published: January 24, 2014: 3:23 PM ET
NEW YORK (CNNMoney)
So Nissan and its advertising agency have entered into a proposed settlement with the Federal Trade Commission over charges of deceptive advertising. Neither Nissan (NSANF) or its advertising agency, TBWA Worldwide, will pay any fines. They simply agree not to make any more misleading ads.
The ad aired in October and November of 2011. In making it, the truck and the dune buggy were actually pulled up the hill using cables, according to the FTC. That means the ad, which is shot to look as if it were done by an amateur with a cell phone camera, does not accurately show the true capabilities of an unaltered Nissan Frontier.
Plenty of TV ads show vehicles doing absurd things -- like jumping on and off moving trains -- but those ads depict situations that are completely unbelievable and, so, don't actually mislead anyone. In the case of the Nissan Frontier ad, someone might actually think the truck could do this.
"Special effects in ads can be entertaining, but advertisers can't use them to misrepresent what a product can do," said Jessica Rich, Director of the FTC's Bureau of Consumer Protection. "This ad made the Nissan Frontier appear capable of doing something it can't do."
Gallery - 10 priciest collector cars from Scottsdale auctions
"Under the proposed settlements, Nissan and TBWA cannot misrepresent any material quality or feature of a pickup truck through the depiction of a test, experiment, or demonstration," according to the FTC's statement. Special effects can still be used, however, as long as they do not misrepresent the truck or its capabilities.
Nissan and TBWA both said they take their "commitment to fair and truthful advertising seriously" and that they are "committed to complying with the law."
The proposed settlement will be available for public comment for 30 days before the FTC decides to make it final.
First Published: January 24, 2014: 3:56 PM ET
Sony Pictures has acquired the film rights to Sheryl Sandberg's book "Lean In."
NEW YORK (CNNMoney)
Sony Pictures confirmed that it has acquired the rights to make the Facebook (FB, Fortune 500) COO's book into a movie.
Published in March 2013, "Lean In: Women, Work and the Will to Lead" encourages women to advance their careers. If the film stays true to the book, it won't be so much a biography of Sandberg, who recently became one of the youngest female billionaires ever, as a manifesto advising women on how to achieve professional success.
Sandberg also launched an organization, Lean In, to further promote her message. She will donate her proceeds from the film to the foundation, according to Deadline, which reported the story earlier.
While there were few specifics available about the movie or the deal, Deadline said Sony Pictures (SNE), which made "The Social Network" about Facebook CEO Mark Zuckerberg -- tapped Nell Scovell to write the script. Scovell helped Sandberg write the book.
--CNN's David Daniel contributed to this report.
First Published: January 24, 2014: 5:54 PM ET
The widening gap between rich and poor is having a corrosive effect on U.S. politics, say Davos elite.
Davos, Switzerland (CNNMoney)
Nearly two-thirds of the delegates surveyed at a World Economic Forum debate Friday in Davos said the widening gap between rich and poor is having a corrosive effect on U.S. politics.
The same group also believed by a big margin -- 70% -- that democracy will defend itself.
"We have a tendency to re-engineer ourselves and I think we're on that path," said Anthony Scaramucci, founder of hedge fund SkyBridge Capital. "I do believe that the message from America is that people are ready for candidates who will tell people the truth."
Related: The myth of the American Dream
Others were less convinced that democracy will heal itself, arguing that changes to the political system are needed to ensure the powerful are constrained and governments held accountable.
"Huge pools of wealth are passed across generations with very little tax," said Harvard economist Ken Rogoff. "It's hard to believe that doesn't have something to do with political influence."
Rogoff called for a more progressive tax system, saying he was concerned about declining social mobility.
Related: JPMorgan's Dimon gets 74% pay hike despite legal woes
Nobel laureate Joseph Stiglitz said American democracy was under threat from a system that results in under-representing some groups.
"The extent to which economic inequality gets translated into political inequality depends on the rules of the game," he said. "Poor people don't vote and there's a concerted effort to make it harder for them to vote."
The U.S. should consider compulsory voting, better funding for regulators, government support for public interest groups, and more public information as a counter-weight to corporate lobbying, Stiglitz said.
"If you don't have access to good information, you can sell bad ideas just as you can sell poisonous cigarettes, or products that lead to obesity," he said.
American historian and author T.J. Stiles put some of the blame on globalization, saying that has made it easier for corporations to escape regulation.
Companies haven't just been looking to exert control over regulation, but also making use of anonymous unlimited donations to try to dominate the cultural landscape.
"We need to have great wealth and we need to have critics of great wealth," he said.
First Published: January 24, 2014: 12:35 PM ET
| Friday, January 24th 2014, 18:05 GMT |
Toro Rosso and Force India both gave their 2014 Formula 1 cars their first runs on track on Friday
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Friday, January 24th 2014, 17:47 GMT |
Mercedes completed a shakedown test of its 2014 Formula 1 car at Silverstone on Friday.
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| By Jonathan Noble | Friday, January 24th 2014, 19:38 GMT |
The sound of a 2014 Formula 1 car at speed has been revealed for the first time by Mercedes
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| By Gary Watkins | Thursday, January 23rd 2014, 22:48 GMT |
Alex Gurney claimed Daytona 24 Hours pole position for the GAINSCO/Bob Stallings team as the Daytona Prototypes blocked out the first seven positions on the grid
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| By Jonathan Noble | Thursday, January 23rd 2014, 18:46 GMT |
Formula 1 is to make another attempt to ban tyre warmers in 2015
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| By Gary Watkins | Thursday, January 23rd 2014, 19:05 GMT |
The Daytona Prototypes outpaced their LMP2 opposition in the new United SportsCar Championship's top class ahead of qualifying for the Daytona 24 Hours
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| Wednesday, January 22nd 2014, 17:19 GMT |
This year's World Touring Car Championship will start one week later than planned after the opening Marrakech round was deferred by seven days
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| By Mark Glendenning | Wednesday, January 22nd 2014, 22:02 GMT |
Justin Wilson will remain with Dale Coyne Racing for the 2014 IndyCar season
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| By Mark Glendenning | Wednesday, January 22nd 2014, 22:22 GMT |
NASCAR has announced a dramatic overhaul of its qualifying system in an attempt to enhance the experience for fans
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Subscribe to Premier Sports TV to watch all Sprint Cup events live in the UK. Visit www.premiersports.tv for more information.
| Tuesday, January 21st 2014, 16:17 GMT |
Andre Negrao will move from Formula Renault 3.5 into GP2 for 2014 with Arden Motorsport.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Mark Glendenning | Tuesday, January 21st 2014, 16:29 GMT |
Justin Allgaier will step up to the NASCAR Sprint Cup this year after securing a full-time deal with Phoenix Racing
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Subscribe to Premier Sports TV to watch all Sprint Cup events live in the UK. Visit www.premiersports.tv for more information.
| By Jonathan Noble | Tuesday, January 21st 2014, 22:15 GMT |
McLaren will be without a title sponsor when it launches its new Formula 1 car on Friday, the team has confirmed.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Gary Watkins | Monday, January 20th 2014, 18:13 GMT |
The German HTP Motorsport squad and Maximilian Buhk will defend their Blancpain Endurance Series title with Mercedes in 2014
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Glenn Freeman | Monday, January 20th 2014, 18:27 GMT |
Ferrari protege Raffaele Marciello will graduate from Formula 3 to GP2 in 2014, the Scuderia has announced
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Marcus Simmons | Monday, January 20th 2014, 18:41 GMT |
Ferrari has confirmed that its protege Antonio Fuoco will race in the Formula 3 European Championship this season with Prema Powerteam
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| By David Evans | Sunday, January 19th 2014, 14:20 GMT |
Hyundai's Thierry Neuville says his team should still feel positive about the i20's World Rally Championship debut, even though he crashed after just four miles in Monte Carlo
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Ingram and Matt Beer | Sunday, January 19th 2014, 14:31 GMT |
Rookies Kyle Larson and Sage Karam will not jeopardise Ganassi's bid for a sixth Daytona 24 Hours victory, insists team lynchpin Scott Pruett
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Sunday, January 19th 2014, 16:27 GMT |
NASCAR is considering a radical overhaul of its points system that would place far more value on wins, and feature eliminations during the Chase
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
Subscribe to Premier Sports TV to watch all Sprint Cup events live in the UK. Visit www.premiersports.tv for more information.
| Saturday, January 18th 2014, 16:23 GMT |
Nani Roma won the 2014 Dakar Rally as X-raid Mini team-mate Stephane Peterhansel slowed on the final stage
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| Saturday, January 18th 2014, 19:29 GMT |
Stephane Peterhansel admitted he was "frustrated" to finish second on the 2014 Dakar Rally after handing the lead to X-raid Mini team-mate Nani Roma
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Saturday, January 18th 2014, 20:53 GMT |
Sebastien Ogier began his World Rally Championship title defence with a hard-fought victory in atrocious conditions on the Monte Carlo Rally
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
NEW YORK (CNNMoney)
Students from the poorest families are less than half as likely as those from the wealthiest families to get bachelor's degrees by the time they're 25, a statistic cited by the Obama administration as a reason why 140 heads of universities and advocacy groups were invited to unveil ideas aimed at increasing the number of low-income students who enroll in and graduate from college.
These include waiving the application fees, working with primary and secondary schools to better prepare them for college, providing more scholarships in science- and technology-related fields, and connecting them with adult mentors and advisors.
Related: Yale, Harvard, other colleges to court low-income students
All of these things have been proven in pilot programs to increase college attendance and graduation rates among students from the nation's poorest families.
"We don't want these to be the exceptions," President Barack Obama told the college leaders and others on Thursday. "We want these to be the rule."
However, university interests are conflicting with White House goals and the one essential incentive to get students to go to college -- money, in the form of financial aid -- has been slowly shifting to wealthier families, not low-income ones.
At the same time, more aid is going to students who don't need it: Since 1995, the percentage of students who received financial aid based on need remained flat at around 43%, while those who received aid but did not demonstrate a financial need for it has nearly doubled to 42%, according to the U.S. Department of Education.
Federal figures also show that students from families that earn at least $100,000 a year get an average of $10,200 in financial aid, significantly more than the $8,000 that goes to students from families that earn less than $20,000.
Related: 10 most expensive colleges
This is happening because colleges worried about their bottom lines are giving small amounts of financial aid to lure wealthy families that can afford to pay the rest, rather than large amounts to poor families that can't. It's also driven by annual rankings, which reward colleges for the high-school achievements of their incoming students. Since applicants from wealthier school districts with better facilities and more resources often do better on such things as entrance tests, many of them get money, even if they don't need it.
It's not only financial aid that has been moving to higher-income students. So have some federal tax breaks, including the American Opportunity Tax Credit, which Obama signed into law in 2010 and allows households earning as much as $180,000 to claim expenses paid for tuition, fees and other costs related to higher education.
That credit, and other education-related tax breaks, now account for nearly $34 billion annually, or $1 billion more than the federal government spends on Pell Grants for low-income students. And more than a third of the money goes to the wealthiest fifth of American households, according to the Center for Law and Social Policy. Fifty-seven percent of the tuition tax deduction alone goes to those families earning more than $100,000, while only 12% of families that made under $50,000 got the tax deduction.
A coalition of advocacy groups wants the income eligibility for these tax breaks lowered from $180,000 to $86,000, in order to refocus the perks on poor students. A bill to that effect has been introduced by congressmen Danny Davis, a Democrat from Illinois, and Diane Black, a Republican from Tennessee, though supporters concede the prospect it will pass is slight.
Related: Why poor kids forgo top colleges
The president previously won a victory when he convinced Congress to raise the maximum amount low-income students could receive in Pell Grants, the direct grants that can be used toward college costs without having to be paid back. Three-quarters of recipients come from families making $30,000 or less.
But Pell Grants are losing a battle with escalating college costs. Even though the taxpayer-supported program is at record funding levels, it covers only a third of the cost of attending a four-year university or college, on average -- the lowest share ever.
Another federal financial-aid program, the work-study program under which students can earn money by working on campus, is also disproportionally benefiting the rich.
Partly because the $1 billion a year in taxpayer money that goes to work-study is based on a 50-year-old formula that gives preference to high-priced private universities and colleges, nearly one work-study recipient out of four comes from a family that earns $80,000 a year or more, according to Education Department figures. That's a higher proportion than those that make less than $20,000. And fewer than half meet the federal definition of financial need.
Related: Taxpayer-funded aid program benefits richer students
Community colleges enroll 30% of all students, including many who have comparatively low incomes. But they collectively get only 16% of work-study money, according to the College Board. Fewer than 2% of community college students have work-study jobs. By comparison, private, nonprofit institutions enroll only 17% of all students but get 40% of the work-study funding.
Last summer, Obama pitched a plan that would rate colleges based on their prices, average student loan debt and graduation rates, among other measures, and dole out federal aid based on those ratings. But colleges are pushing back on this proposal, claiming it will punish the schools that serve the lowest-income students and force them to stop taking chances on those students who show promise.
"Even after all these steps that we've taken over the last five years, we still have a long way to go to unlock the doors of higher education to more Americans," Obama told the college and university presidents. "And especially lower-income Americans."
First Published: January 17, 2014: 12:59 PM ET
Jos. A. Bank called the Men's Wearhouse bid "inadequate and opportunistic."
NEW YORK (CNNMoney)
Jos. A. Bank's message to shareholders Friday? You're not going to like the way it looks.
Men's Wearhouse's $1.6 billion hostile bid offered Jos. A. Bank (JOSB) stockholders $57.50 a share, a modest premium from Friday's closing price of $56.49.
"The Offer significantly undervalues Jos. A. Bank, and its future prospects," Jos. A. Bank (JOSB) said Friday. "Men's Wearhouse's true motives are unclear and its commitment to the Offer is not credible."
The firm added that it "is continuing to consider strategic alternatives, including acquisitions, which will maximize stockholder value."
The announcement marks the latest development in the months-long takeover battle between the two menswear merchants.
Jos. A. Bank made an offer to buy Men's Wearhouse last year for $2.4 billion. Men's Wearhouse rejected that bid and countered with an unsolicited bid of $55 a share for Jos. A. Bank -- a proposal that was also rejected.
Related: Time Warner Cable rejects merger plan
"Given that the Jos. A. Bank Board has publicly acknowledged the compelling strategic logic of this transaction, we think Jos. A. Bank shareholders should question why their Board is refusing to negotiate with us to reach an agreement that will deliver to them significant value," Men's Wearhouse said Friday.
Earlier this month, Jos. A. Bank announced a shareholders' rights plan, commonly known as a poison pill defense, to block hostile bids by granting additional shares should any buyer acquire 10% of its shares.
It's been a tumultuous few months for Men's Wearhouse, which is under pressure from its largest shareholder, Eminence Capital, to secure a deal.
Last June, the retailer announced the firing of George Zimmer, its chairman, founder and long-time pitchman.
First Published: January 17, 2014: 7:01 PM ET
NEW YORK (CNNMoney)
OK. But what's the metadata he's talking about?
It's information wireless carriers collect about where, when and to whom customers make phone calls. It doesn't include any recordings of the actual phone call itself.
The metadata can contain phone numbers, the time and duration of calls and the location of the caller and the recipient.
But it also goes beyond that: It can include which cellular towers were used to transmit the call and what kind of phone was being used.
When bundled together, those metadata can potentially reveal a whole lot about a caller.
For example, knowing that a person was calling someone frequently in the early hours of the morning could indicate that they have a close relationship. Knowing that the call rapidly switched cell towers could indicate that the caller was driving during a call.
Currently, the government collects and stores most of those records.
Obama isn't proposing that the NSA stop collecting metadata entirely. But the scope will be more limited. Fewer calls will be cataloged, and the government will have to get a judge's approval to tap the records.
Eventually, Obama said the government will stop gathering and keeping metadata, but there is no plan yet to replace the existing system.
First Published: January 17, 2014: 3:57 PM ET
Starbucks said it has fixed its mobile app that had been saving customers' usernames, passwords and other personal information in plain text.
NEW YORK (CNNMoney)
The hugely popular app, which allows Starbucks (SBUX, Fortune 500) customers to purchase drinks and food directly from their smartphones, had been saving customers' usernames, passwords and other personal information in plain text.
That meant a hacker could have picked up a left-behind phone, plugged it into a laptop and easily recovered a Starbucks customer's password without even knowing the smartphone's PIN code.
Starbucks acknowledged the vulnerability this week. It said that no customers had claimed to have been hacked as a result.
On Thursday night, Starbucks said it pushed out an updated version of its mobile app for iOS that "adds extra layers of protection." The Android app does not have the security flaw, the company said.
Related: Credit card hack a wakeup call for privacy
Exploiting the issue wouldn't have been easy. To access a customer's password, a hacker needed to be in possession of the phone, have a computer handy, and know how to access the file.
If a hacker did obtain the password, it would allow him access to money stored in the customer's Starbucks account. Customers could be at greater risk if they use the same password for other sites.
Related: You see a zip code, retailers see a goldmine
The issue was first exposed by security researcher Daniel Wood, a Starbucks customer who said he tested the app to see if his information was secure.
"The application is storing the users' information -- everything from your full name to your address to your username and password as well as your email address," he told CNNMoney earlier this week.
Wood disclosed the issue in an online posting after approaching the company in December without a response from technical teams. After the issue became public, he was contacted by Starbucks. On Tuesday, his post was reported by the technology site ComputerWorld.
First Published: January 17, 2014: 9:57 AM ET
Henrique de Castro is expected to leave Yahoo with a severance package of more than $60 million.
NEW YORK (CNNMoney)
de Castro, the chief operating officer, was shown the door by Yahoo (YHOO, Fortune 500) CEO Marissa Mayer, apparently due to disappointing performance in improving Yahoo's advertising revenue. Mayer reportedly wrote in a memo to staffers this week that said, "I made the difficult decision that our COO, Henrique de Castro, should leave the company."
Experts in executive compensation say the larger nine-figure exit packages given to some executives are typically for those who retire, voluntarily leave a company or leave upon the purchase of their company.
"As a pure severance package due to performance-related termination, de Castro's exit package is definitely at the top end of the severance we have seen," said Gary Hewitt, the managing director and head of research at GMI Ratings, an expert in corporate governance issues.
Related: Marissa Mayer hasn't saved Yahoo yet
One thing that makes de Castro's package so notable is that the former Google (GOOG, Fortune 500) executive was only at Yahoo for 15 months. And he was one of the top paid executives while he was there.
Even though he joined the company in November 2012, Yahoo estimated his pay for the year at $39.2 million, which was more than even Mayer received in total compensation. Much of it was due to a $20 million one-time payment to compensate him for Google bonuses he forfeited when he changed companies.
Related: Can Mayer's vision kickstart Yahoo's growth?
The Yahoo payment would not have vested for four years, but with his termination will now vest immediately. The speed-up vesting of other stock options and long-term pay is a major factor in estimates that put his severance package at above $60 million.
Equilar, another research firm that estimates executive compensation, puts the value of the accelerated vesting of various options and stock grants at $64.6 million. Aaron Boyd, Equilar's director of governance research, said that total compensation de Castro received during his time at Yahoo could end up reaching $109 million when all the figures are finally reported.
Yahoo did not respond to a request for comment on de Castro's departure or severance pay.
First Published: January 17, 2014: 12:53 PM ET
A weekly collection of design, data and interactive links.
Design/Data viz
The Pattern Library | A collection of patterns compiled by designers
Famous movie quotes | Movie quote visualizations
Flat design vs realism | The evolution of design in 2013
MegaFon Sochi Winter Olympics | Interactive 3D faces on the side of a building
Blackphone | The world's first smartphone focusing on privacy
Hands Free | Personal project by Phil Jones
OpenBCI | Open source brain-computer Interface
Photo/Video
Flexible Muscle-Based Locomotion | 3D muscle-based simulations
Primitive internet report on KRON | Digital news predictions from 1981
Lomography Konstruktor | A $35 camera you build yourself
See last week's links
Have a nice weekend!
@dubly and @talyellin
Big banks released quarterly results this week. Morgan Stanley was a winner, while Citigroup fell short.
NEW YORK (CNNMoney)
For the final three months of 2013, five of the six largest U.S. banks reported earnings that were better than analysts had expected. But underlying profits were hurt in several cases by legal expenses, sluggish mortgage activity and lackluster trading. Overall revenue fell in many cases.
JPMorgan Chase (JPM, Fortune 500) and Morgan Stanley (MVNR) both reported hefty legal hits that dragged profits lower. Excluding those costs and other one-time items, earnings at both banks topped analyst expectations.
Echoing comments by JPMorgan chief executive Jamie Dimon, Morgan Stanley CEO James Gorman said Friday that his bank is "continuing to address many of the legal issues from the financial crisis."
Related: JPMorgan earns $5.3 billion despite legal woes
Wells Fargo (WFC, Fortune 500), the nation's largest home lender, was also hurt by weakness in the mortgage market as rising interest rates deterred borrowers.
But earnings at Bank of America (BAC, Fortune 500) came in better than expected, helped by a $2 billion profit in the company's consumer banking division, which includes branch banking and loans for small business.
Unlike its main rivals, BofA has yet to settle with the Federal Housing Finance Agency over allegations that it misled investors about the quality of mortgage-backed securities sold prior to the financial crisis. CEO Brian Moynihan seemed to allude to this by saying "work remains on past issues."
BofA and JPMorgan both benefited from an improvement in overall credit quality, which allowed them to set aside less money for losses on bad loans.
Meanwhile, earnings at Goldman Sachs (GS, Fortune 500) plunged 19% in the quarter, but still topped expectations.
Related: Earnings down at Goldman Sachs but still beat forecasts
Goldman, which was the lead banker on Twitter's (TWTR) IPO in November, said fees from stock underwriting more than doubled to $622 million.
The firm's trading business rebounded in the fourth quarter, which eased some concerns about the impact of new regulations that impose limits on certain risky trading strategies. Revenue from fixed income, commodities, and currency trading fell 15% in the fourth quarter from a year ago. But it was up 38% from the third quarter.
Despite the rebound in trading late last year, the amount of money Goldman spent on benefits, salaries and bonuses fell in 2013.
But compensation was up at Morgan Stanley from a year ago. Morgan Stanley reported a big jump in revenue from underwriting thanks to last year's robust IPO market. The company's wealth management and brokerage businesses were strong as well, due to the bull market in stocks. But revenue from fixed-income and commodities trading fell to $694 million from $811 million a year ago.
Citigroup (C, Fortune 500) was the big disappointment. The bank's earnings fell short of analysts' expectations, due largely to the slowdown in mortgage financing. Shares of Citi are down sharply for the week.
First Published: January 17, 2014: 12:48 PM ET
GM CEO Mary Barra will earn a base cash salary of $1.6 million.
NEW YORK (CNNMoney)
The salary information was disclosed by GM (GM, Fortune 500) in an SEC filing Friday. Barra is the first woman to head a major automaker. She will also be eligible for up to $2.8 million in incentive pay, as well as stock options, awards and bonuses, the value of which was not disclosed.
Barra's total compensation as the head of the company's product development group was $4.9 million in 2012, the most recent year for which data is available.
Akerson left the CEO job Tuesday. His last act as CEO was restoring the dividend to shareholders, the first at the company since 2008.
He received a base cash salary of $1.7 million. The GM board agreed that he would continue to get salary and incentive pay worth $4.7 million on an annual basis to serve as an adviser to the company. But that amount would be reduced based on how long he serves in that position. The company anticipates he will not stay in that role for the full year.
Akerson's total compensation was $9.1 million in 2012, the most recent year for which data is available.
That is less than executives at some other automakers. Alan Mulally, CEO of Ford Motors (F, Fortune 500), received total compensation of just less than $21 million in 2012. But the pay of GM executives was limited while Treasury held shares related to the 2009 federal government bailout of the company. Treasury sold its remaining stake in GM in December, freeing executives from those government pay limits.
First Published: January 17, 2014: 2:51 PM ET
Workers inspect the Freedom Industries storage facility in Charleston, W.Va.
NEW YORK (CNNMoney)
The company, which is based in Charleston, W. Va., where the spill occurred, estimated it has assets of between $1 million and $10 million, but that it has liabilities within the same range.
The company's filing doesn't provide extensive details on last week's spill. The document says it's "presently hypothesized" that the break of a local water line near the Charleston facility may have contributed to the freezing and rupture of a chemical storage tank that then leaked into the Elk River.
The chemical in question -- methylcyclohexane methanol, or MCHM -- is used by Freedom's customers to treat coal during the coal preparation process. The disaster resulted in a state of emergency in nine West Virginia counties, causing the loss of water supplies for roughly 300,000 residents and the shuttering of a number of businesses in the affected area.
A bankruptcy filing could protect Freedom's assets in the case of court judgments against it.
A person who answered the phone at Freedom Industries on Friday declined to comment.
Related: New health hazard, same story in West Virginia?
The news came Friday as West Virginia authorities announced that thousands more water customers have been given the green light to resume using tap water following the spill.
The end of the "do not use" order for residents in the West Virginia communities of Eskdale, Leewood, Ohley and Elkview means more than 220,000 of the approximately 300,000 people originally affected by the incident have been cleared to resume using tap water.
That number was further increased Friday afternoon, when all customers in the Kanawha Valley district were given the all-clear.
Officials detected the 7,000-gallon leak eight days ago, on Jan. 9. More than 7,000 gallons of the coal treatment chemical leaked into the river, officials say.
Related: West Virginia chemical spill shines spotlight on loose regulation
Environmental authorities say the amount of the chemical in the water has fallen to well under 1 part per million, the level deemed safe for consumption by the Centers for Disease Control and Prevention. A later advisory suggested that pregnant women should continue to avoid drinking the water.
Concern lingers among many affected by the spill, some of whom say they will not drink the water out of fear that scientists know too little about the long-term effects of the chemical, which is not routinely tested for in water supplies.
"If a pregnant woman can't drink this ... no, we're not feeling safe here in West Virginia," Charleston resident Jacqueline Bevan said Thursday.
CNN's Miriam Falco, Dana Garrett, Catherine E. Shoichet, Jean Casarez and Ashley Fantz and CNNMoney's James O'Toole contributed to this report.
First Published: January 17, 2014: 2:56 PM ET
NEW YORK (CNNMoney)
The company says the cuts are in response to "evolving market trends."
Intel (INTC, Fortune 500) said it will trim about 5% of its 107,600 global workforce by the end of 2014 -- 5,380 jobs.
"This is not a layoff," said Intel Spokesman Chris Kraeuter. "It's not a giant, one time action. This is a target employment rate for the end of the year."
Kraeuter said the cuts will come as a result of people retiring, redeployments, or people leaving voluntarily.
"We're making decisions on how to design our resources to better meet the needs of our business," said Kraeuter.
The news comes after the company announced lackluster earnings and guidance Thursday. Investors are anxious for the chipmaker to become less dependent on the slow growing personal computer market and more engaged in mobile technology.
For the year, Intel shares are up about 18%, while the broader electronic technology sector is up over 30%.
First Published: January 17, 2014: 6:00 PM ET
| Friday, January 17th 2014, 18:42 GMT |
Kimi Raikkonen doubts the 2014 Formula 1 rule changes will make a very big difference for drivers
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble | Friday, January 17th 2014, 18:50 GMT |
McLaren is in a race against time to get its new Formula 1 car ready for the first 2014 test at Jerez
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Pablo Elizalde and Matt Beer | Friday, January 17th 2014, 20:09 GMT |
Stephane Peterhansel said he did not disregard any team instructions as he passed X-raid team-mate Nani Roma to reclaim the Dakar Rally lead
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Thursday, January 16th 2014, 20:20 GMT |
Nani Roma extended his lead in the 2014 Dakar after stage 11, despite seeing fellow Mini driver Orlando Terranova take the stage victory.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By David Evans | Thursday, January 16th 2014, 20:58 GMT |
Citroen driver Kris Meeke insists he will not be tempted in to pushing harder in an attempt to wrest the lead of the Monte Carlo Rally, despite a strong opening day.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Thursday, January 16th 2014, 21:24 GMT |
Stephane Peterhansel admitted that his hopes of victory in the 2014 Dakar were over after his Mini team called off the fight for the lead.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Tuesday, January 14th 2014, 15:32 GMT |
Former British Superbike champion Leon Camier is set to move into MotoGP next year with Ioda.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Jonathan Noble | Tuesday, January 14th 2014, 17:44 GMT |
Formula 1's leading drivers admit they have no idea how grands prix will shake out this season because of the radical regulation changes.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Tuesday, January 14th 2014, 19:16 GMT |
Stephane Peterhansel edged closer to the lead of the Dakar after winning the ninth stage of the rally on Tuesday.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Edd Straw | Monday, January 13th 2014, 19:14 GMT |
Kimi Raikkonen has started simulator work ahead of his return to Ferrari for the 2014 Formula 1 season
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Mark Glendenning | Monday, January 13th 2014, 19:34 GMT |
Andretti Autosport's interests will expand to include a Global Rallycross entry in 2014, representing Volkswagen
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Monday, January 13th 2014, 20:28 GMT |
Nasser Al-Attiyah won his first stage of the 2014 Dakar rally as overall leader Nani Roma lost time to nearest rival Stephane Peterhansel on stage eight
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Matt Beer | Sunday, January 12th 2014, 14:35 GMT |
Formula 1 racer turned commentator Martin Brundle believes the pay driver situation in the world championship is becoming "uncomfortable".
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Sunday, January 12th 2014, 19:13 GMT |
Superstars series racer Tonio Liuzzi claimed victory in Felipe Massa's annual International Challenge of the Stars karting event.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| Sunday, January 12th 2014, 20:58 GMT |
Carlos Sainz cruised to a comfortable win in today's seventh stage of the 2014 Dakar Rally.
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Glenn Freeman | Saturday, January 11th 2014, 14:52 GMT |
McLaren test driver Gary Paffett believes Formula 1 rookie Kevin Magnussen has the speed to push Jenson Button in the same way Lewis Hamilton used to at the team
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Saturday, January 11th 2014, 13:17 GMT |
Citroen has completed a five-day test of its 2014 World Touring Car Championship C-Elysee in Abu Dhabi
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
| By Sam Tremayne | Saturday, January 11th 2014, 14:41 GMT |
Tom Kristensen believes efforts to improve safety at Le Mans must always be balanced by 'respect' for the circuit and its traditions
You have viewed over 20 free stories this month. Why stop there? Click here to find out how to continue reading.
A new U.S. Treasury note will be available on January 29. But don't look for high yields.
(Money Magazine)
The U.S. has a deal for you -- though it's probably not a good one.
On Jan. 29, the Treasury will start selling its first new security in 17 years, the floating-rate note.
Unlike the case with most U.S. debt, which pays fixed rates, interest on the two-year FRNs will adjust weekly, tied to changes in the rate the Treasury pays on debt maturing in three months.
Related: Stocks, bonds? In 2014, think cash
While the FRNs' initial yield is expected to be low -- around 0.16%, compared with 0.3% in December for two-year Treasuries -- demand could be high, partly because investors don't want to be stuck with two-year notes if short-term rates rise.
But those rates aren't likely to budge soon, says Collin Martin, an analyst at the Schwab Center for Financial Research. Skip the notes, to be sold via TreasuryDirect.gov; instead, get better yields from online banks.
Floating rates, low yields
Interest on the U.S. Treasury's new debt securities has the potential to rise. Even so, the yield will likely be minuscule for the near future.
| Yield | 0.16% estimated | 0.3% | 0.9% |
NOTE: Estimate and actual yields as of Dec. 9, 2013. SOURCES: U.S. Treasury; Jerome Schneider, Pimco; Bankrate.com
First Published: January 10, 2014: 4:18 PM ET
The 2014 Chevy Silverado.
NEW YORK (CNNMoney)
The affected models include 2014 Chevy Silverados and GMC Sierra full-size trucks. GM (GM, Fortune 500) said the vehicles had problems with their software that could lead to the overheating of exhaust components and cause fires.
GM said it had confirmed eight fires that have resulted from this issue so far, though no injuries.
"All occurred in areas with very cold weather," the automaker said.
Related: Tesla to upgrade overheating chargers
Drivers will be alerted about the problem by mail, and can take the affected vehicles to dealerships starting next week for free repairs.
In the meantime, GM urged owners of the trucks in question "to avoid leaving their trucks to idle unattended."
GM's announcement follows Chrysler's November recall of roughly 1.2 million trucks following a series of accidents related to problems in their steering systems.
First Published: January 10, 2014: 7:15 PM ET
Jobs report shows retail, food service, and other temporary low wage positions continue to dominate American hiring scene four years into the recovery.
NEW YORK (CNNMoney)
On Friday, the government's monthly jobs report showed that 55,000 positions were added in the retail sector in December, including clothing sales and workers at supermarkets and convenience stores.
The professional and businesses services sectors added a net of 19,000 jobs in December. But that gain came with a big boost from the 40,000 additional temporary positions that offset a 25,000 decline in accounting and bookkeeping jobs.
This isn't just a one-month trend. For the year, the retail sector added an average of 32,000 jobs per month, second only to professional and businesses services, which added 53,000 per month.
Job growth in health care, meanwhile, averaged 17,000 a month, while construction added just 10,000 jobs monthly. The information sector didn't add any jobs.
"We're still waiting for the middle and higher wage earners to participate in the jobs recovery," said Russell Price, senior economist at the financial services firm Ameriprise.
Related: 2013 ends with weakest job growth in years
That's problematic because it means there's less money in consumers' pockets that they can then go out and spend, furthering economic growth.
The average weekly wage for a retail sales employee in 2012 was $576, according to the Bureau of Labor Statistics. For a registered nurse, it was $1,097.
Price said it's natural that companies hire for lower wage positions during the early stages of a recovery because there's less risk. This past recession was so severe, he said, that four years since the jobs recovery began could still be considered the early stages.
He believes things will get better in 2014, pointing to recent strong readings in manufacturing activity, consumer spending, the European economy and a reduction in so- called "fiscal headwinds" -- the risks emulating from Washington, including the drag imposed last year by the expiration of the payroll tax cut.
Other economists aren't so sure.
The lack of hiring for higher-wage positions "indicates businesses aren't willing to make a significant commitment to move forward," said Sung Won Sohn, an economist at California State University-Channel Islands' Smith School of Business.
Sohn believes businesses aren't willing to make a hiring commitment because there's still too much uncertainty -- over everything from global economic growth to the political situation in Washington.
"Who knows, this spring there may be more shenanigans over the debt-ceiling debate," he said. "These uncertainties don't just fall off. If they do diminish, they diminish gradually."
First Published: January 10, 2014: 12:43 PM ET
The health care sector lost jobs for the first time since July 2003.
NEW YORK (CNNMoney)
Health care companies shed 6,000 positions in December, the first down month since July 2003, according to the government's monthly jobs report. This comes after a yearlong slowdown in hiring.
The hardest hit areas were nursing homes, which jettisoned 3,900 jobs, and home health care, which lost 3,700 positions. Hospitals got rid of 2,400 jobs, while physicians' offices reduced staff by 1,200.
For the year, health care added only 207,600 jobs, down from 320,600 a year earlier. It was the slowest year of growth since 1999.
Several notable hospitals, including the Cleveland Clinic, reported layoffs last year as the federal government cut reimbursement rates and patient care shifts more to outpatient and urgent care clinics. In fact, outpatient care centers were the only part of the health care sector to boost jobs last month, adding 3,600 positions.
Share your story: Have you lost a job in health care recently?
It's not so surprising that the health care sector, which had reliably added jobs even through the Great Recession, is finally taking a breather, experts said. The industry is in the midst of a restructuring aimed at slowing the growth in costs and improving quality.
"There needs to be a pause, which may lead to a reduction of jobs," said Stuart Altman, a health policy professor at Brandeis University.
Friday's dour news comes on the heels of another federal report released this week that showed health care spending growth remained low for the fourth year in a row. Spending on health care grew by only 3.7% in 2012, according to data released Monday by the Centers for Medicare and Medicaid Services.
"Since health spending has slowed down, we should expect at least some layoffs -- though not many," said Uwe E. Reinhardt, an economics professor at Princeton University.
Experts said the drop in health care is likely to be only temporary. It could even be reversed if the government revises the figures upward when it releases the next jobs report in February, noted Dartmouth Economics Professor Jonathan Skinner.
But even if the December health care jobs number remains negative, demographic trends suggest the industry's payrolls will have to grow again soon.
"In the long run, given the aging of the population and the need for health care, jobs will be added in the future," Altman said.
First Published: January 10, 2014: 2:04 PM ET
Barnes & Noble has a new CEO. Now the bookstore chain and Nook seller needs some new customers.
NEW YORK (CNNMoney)
Barnes & Noble (BKS, Fortune 500) announced Huseby's promotion to CEO on Wednesday, one day before the company revealed lackluster holiday sales. The CEO spot had been open since William Lynch resigned last July.
Lynch stepped down after a difficult three-year tenure, marked in particular by disappointing sales of Nook tablets.
That trend has continued post-Lynch: On Thursday, Barnes & Noble announced Nook sales fell more than 60% this holiday season compared with 2012. However, the 2012 season included two new Nook products, unlike the 2013 holiday.
Given Nook's inability to compete with the likes of Amazon's (AMZN, Fortune 500) Kindle and Apple's (AAPL, Fortune 500) iPad, it may seem odd that Barnes & Noble selected Nook chief Huseby to become CEO.
Related story: Amazon Kindle Paperwhite is the best e-reader ever
But the Nook business had already been struggling for years by the time Huseby took it on in July 2013. Although he wasn't able to turn the Nook unit around in a few short months, he's intimately acquainted with that important business -- and its problems.
What's more, Huseby is an executive deeply rooted in finance: He originally joined Barnes & Noble as its chief financial officer in March 2012. Before that he held the same position at Cablevision (CVC, Fortune 500) from 2004 to 2011.
The rest of Huseby's resume includes stints at Charter Communications (CHTR, Fortune 500) and AT&T (T, Fortune 500) Broadband (which was then sold to Comcast (CMCSA, Fortune 500)). He also spent 23 years as a partner at Arthur Andersen.
In addition to figuring out how to make the Nook more competitive, Huseby will need to find a way to reverse a persistent decline in sales as more consumers buy books (in physical and digital form) online at Amazon. The shift to online retailing is one of the factors that led to the closing of Barnes & Noble rival Borders.
Shares of Barnes & Noble are more than 30% below their 52-week high and investor confidence was shaken last month after company founder and chairman Leonard Riggio sold a big chunk of his stake.
But In its press release announcing the promotion, Barnes & Noble listed ten skills Huseby has obtained in his wide-ranging experience, from accounting to corporate development to investor relations.
For a company as troubled as Barnes & Noble, that list of skills can't be long enough.
First Published: January 10, 2014: 2:28 PM ET
Served on a silver platter: the right portfolio strategy and investing well for retirement.
(Money Magazine)
With a subscription to the Bloomberg online news service (price: about $20,000 a year), traders can instantly see anything from the location of oil tankers around the globe to supply-chain maps of a company's vendors and customers.
Hedge fund managers who invest in drug and technology companies tap into "expert networks" of executives and scientists paid for their specialized knowledge. In some cases, it's been charged, traders have also illegally gotten inside information through these contacts.
Half of stock trades are made by automated "high-frequency" programs; it takes 7/10,000ths of a second to buy or sell on the New York Stock Exchange, says the Tabb Group, down from a horse-and-buggy 10 seconds eight years ago.
Related: Stocks, bonds? In 2014, think cash
You can't get a jump on this crowd. You can't even compete with them. Chances are, the professional managers you hire via a mutual fund, for 1% of assets or more per year, won't be able to stay ahead either.
In October, Ray Dalio, one of the most successful hedge fund managers in the world, told a conference audience that "going forward, most investors are not going to be able to produce alpha." "Alpha" is finance jargon for outperforming the market after accounting for risk. In truth, the search for alpha has always been something of a snipe hunt; the word was first used in a 1967 article that showed that most mutual funds didn't deliver it, especially after subtracting fees.
Two things have changed since then: More pros admit the alpha game is over, and perhaps more important for you, investing has never been better for those willing to stop playing. In the words of Tadas Viskanta, editor of the finance blog Abnormal Returns, there's wisdom in reaching for "investment mediocrity."
Today, just as in 1967, most professionals can't beat an index that tracks the stock market. "The paradox," says Viskanta, "is that the less effort you put in, the better off you are." And recently, he notes, perfect mediocrity has grown more attainable, as index-based investing has moved steadily closer to free.
For as little as 0.04% of assets per year -- that's $4 for every $10,000 you've invested -- and often with no broker commission, you can buy an exchange-traded fund, or ETF, that follows most of the U.S. stock market and delivers its return.
This year's Investor's Guide starts from the idea that index funds and a buy-and-hold stance should be the default approach for long-term wealth builders. With that in mind, MONEY has rebuilt our basic investing tool set: Our list of recommended funds is now the MONEY 50, streamlined from 70. Not all the funds are index trackers, but the core choices are low-cost, highly diversified portfolios for the long run. For many investors, a portfolio balanced among one broad U.S. stock fund, an international fund, and one or two bond funds is all you need. The MONEY 50 makes building that portfolio easy.
Related: How should I invest my retirement savings?
Yet even if you decide to stick with a simplified strategy, that doesn't mean every investment puzzle you'll face has been solved. The stories in this guide will help you think through your approach to the three biggest questions you still face as you save for retirement.
Question No. 1: Buy and hold what exactly?
You can build a simple portfolio for any level of risk. Stretching for high returns? You could put all your money in the Schwab U.S. Broad Market (SCHB), or crank up risk and return potential further by adding funds like Vanguard Small-Cap (VB) or Vanguard FTSE Emerging Markets (VWO) . Need safety? Stash more in Vanguard Total Bond Market (BND) or iShares Barclays TIPS Bond (TIP) to add inflation protection.
These funds make security selection automatic, but they don't help at all with the question of how much risk you want to take. The standard rule of thumb says you should start out with a high allocation to equities and gradually "glide" that down as you age. These days fund companies often focus less on their stock-picking prowess and more on designing all-in-one "target date" funds that do this asset allocating for you. Yet as you'll see in "How much should you hold in stocks?", the theory and practice of lifetime asset allocation are all over the map.
Question No. 2: What if high stock and bond returns are really over?
If you're a just-own-the-market purist, you don't ask if stocks are cheap or expensive. You assume it's too hard to outwit the hive-mind intelligence of the crowd. Over the short run that's almost certainly true. But there's evidence that the price of stocks relative to measures of their value like earnings and assets can provide a clue about returns over the course of a decade.
Stocks are now priced at about 21 times the five-year average of their earnings. According to research from the Leuthold Group advisory firm, when the market's price-to-earnings ratio is between 20 and 25, over the next 10 years stocks have delivered an annualized return of only 3% after accounting for inflation.
Combine that with a gloomy outlook for bonds. Current yields are an indicator of future returns, and with the 10-year Treasury at 2.8%, you may be lucky to carve out 1% after inflation. "Stocks, bonds? In 2014, think cash," will help you think through your strategy so that you can thrive in a world where today's high-asset prices could repress tomorrow's returns.
Question No. 3: Can I ever do better?
Maybe. Even some advocates of index investing say there may be ways to outperform. But the extra bump doesn't come from tearing into company balance sheets or, as famed Fidelity manager Peter Lynch used to say, "buying what you know." It comes from "tilting" a portfolio of hundreds of securities to take advantage of anomalies that have shown up in historical stock returns.
One is the value effect, the tendency of stocks with low prices relative to their earnings or asset value to outperform over time. Likewise, there seems to be a small-company premium. For a shot at earning these boosts, you don't buy a portfolio of 40 or 50 small-caps or bargain stocks. Instead, you buy an index or index-like fund that gives more weight to such shares.
You'll need nerve: Larry Swedroe of Buckingham Asset Management, who recommends tilting, says the strategy trailed the S&P 500 badly in the late 1990s; in the past decade, though, an index of small value stocks earned an extra 2% annualized. "You have to be able to live through it," he says.
"The New Faces of Stock Picking" profiles a pioneer in low-cost, tilted portfolios as well as other quantitatively driven thinkers searching for ways investors can carve out advantages. Instead of hunting for the inside scoop, they crunch data and use insights into investors' behavioral blind spots. A caution: Now that star fund managers have faded, Wall Street is cranking out lots of ETFs. For every robust new idea, there's likely to be a dozen more that are nothing but savvy marketing tied to a hot short-term trend.
Investing may be simple now, but you'll still need the discipline not to chase the latest market beater, plus the patience to stick to a long-term strategy even when it's out of favor. Simple? Yes, but not always easy.
OWN THE WORLD, FOR NEXT TO NOTHING
You can build a solid portfolio with just three investments. Here are examples using ETFs and index mutual funds:
The ETF route:
Schwab U.S. Aggregate Bond (SCHZ): 40%
Schwab U.S. Broad Market: (SCHB) 40%
Schwab International Equity: (SCHF) 20%
The index fund route:
Vanguard Total Stock Market Index: (VTSMX) 40%
Vanguard Total Bond Market Index: (BND) 40%
Vanguard Tax Managed International (VDVIX): 20%
Either way you go, your costs will be far, far less than most active fund managers charge...
Annual fee:
ETF portfolio: 0.05%
Index fund portfolio: 0.08%
Three average active funds: 1.22%
... and you'll be diversified across the globe.
Number of stocks:
ETF portfolio: 3,144
Index fund portfolio: 4,823
Three average active funds: 289
SOURCE: Morningstar
First Published: January 10, 2014: 4:25 PM ET
