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Fed Prepares Big Banks for Severe Downturn

The Federal Reserve proposed that large banks should keep enough cash, government bonds and other assets on hand in order to survive a severe downturn, like the 2008 financial crisis. The proposal subjects the banks to liquidity requirements for the first time. Liquidity is the capability to access cash as soon as possible. The biggest banks, those with more than $250 billion in assets, must have enough cash and securities to fund their operations for 30 days during a market stress. Smaller banks, those with less than $250 billion and more than... 
 

Same-Day Delivery Service to Be Presented by eBay in New Way

In order to improve its same-day delivery service, eBay has agreed to acquire Shutl last Tuesday. The move was made to make the company competitive with Amazon, which is the world’s biggest online retailer. Shutl was founded by Tom Allason four years ago. It utilizes a network of courier companies to deliver online orders from physical stores. The service covers majority of shoppers in the United Kingdom, where the company partners with retailers such as Oasis, Argos and Karen Millen. Shutl was looking to expanding to the US this year before eBay... 
 

Amazon Tax Violated Federal Rules

The Illinois Supreme Court rejected a state law Friday that taxes Internet sales. The high court stated that the so-called Amazon tax violated federal rules against discriminatory taxes on online or digital transactions. The Illinois Supreme Court voted 6 to 1 that saw for the first time a court had threw out an internet sales tax law among the 18 states that have them. The ruling was criticized by traditional, store based retailers and asked Congress to step into regulating taxes on online sales. The court found out that Illinois’ 2011 Main... 
 

Oil Prices Played $104 after US Government Was Shut Down

The price of oil dropped a day after the International Monetary Fund cut its forecast for global growth through the end of 2014. Benchmark crude for November delivery declined 3 cents to $103.46 a barrel on the New York Mercantile Exchange. The contract went up 46 cents and settled at $103.49 Tuesday. The IMF said that it slashed its global economic forecasts for 2013 to 2014 due to slowing growth in India, China, Brazil and other developing countries. Oil prices were capped due to concerns that a slowdown in emerging markets has an impact on demand. According... 
 

Potbelly Gains after IPO

Potbelly Corp. has more than doubled in trading after it priced its initial public offering over the increased range. This indicated investors’ appetite for restaurant chains. The Chicago-based seller of made-to-order toasted sandwiches had its shares gain 120 percent to $30.77 at the close of trading in New York. Potbelly’s IPO was the second best trading debut on a US exchange this year. The company and existing stockholders sold 7.5 million shares for $14 each after the initial offering of $12 to $13. The company increased the range October... 
 

US Department of Labor No to September Payrolls

The US Department of Labor said that the September Payrolls report is one of the casualties of the partial government shutdown. It was scheduled to be released on Friday, October 4. The department hasn’t issued an alternative date for the jobs report. The unemployment rate and data on payroll employment were set to be released. The report is the most prominent among the data releases issued by federal government agencies that have been canceled as some federal workers deemed unimportant are furloughed. President Barack Obama and the leaders of... 
 

Washington Post Completes Sale to Bezos

The Washington Post Co. announced Tuesday that it has completed the sale of the newspaper to the founder and chairman of Amazon.com, Jeff Bezos. It ended the 80 years of local control of the newspaper by the Graham family. The deal was first made public in early August. Bezos paid $250 million in cash for the paper and gained control of the publication that has been owned by four generations of the Graham family. Bezos bought the paper as an individual and not as part of Amazon. With the purchase, he also acquired other properties in the Washington... 
 

Third Job Cut Presented by Siemens

Joe Kaeser became Siemens new chief executive officer last August after he worked as the company’s chief financial officer for seven years. He announced that the company will widen job cuts from an initial plan after it failed to catch up in profitability with competitors ABB Ltd. and General Electric Co. This was the issue that cost the former CEO the job. Siemens will cut 15,000 jobs that represented 4 percent of the company’s 370,000 works across the globe. This is the third job cut in the German home market. Siemens spokesman Oliver Santen... 
 

King.com Files for IPO

The tech sector is now looking forward for the next hot IPO candidate. King.com filed an S-1 document with the Securities and Exchange Commission worth $5 billion. The company’s filing is similar to the one that let Twitter to keep its IPO a secret last week. The company has been referred to as Britain’s answer to Zynga. King employed Hope Cochran as its chief financial officer this week. She previously held the same title at Clearwire that built the first 4G network in the USA and merge with Sprint in 2012. King has gained the attention of... 
 

Twitter IPO Leaning Toward NYSE

Twitter might list its shares on the New York Stock Exchange when it goes public. This was seen as a blow to the Nasdaq Stock Market. Getting the high-profile IPO would help the NYSE solidify its allure among new technology companies after playing second fiddle to Nasdaq. Twitter announced last September 12 that it has filed paperwork to go public. The company didn’t give details of the time frame of the offering. The company filed privately with the Securities and Exchange Commission via a process that would keep its S-1 prospectus away from... 
 

GM Dumps Expensive Debt with Lower Cost Debt

General Motors announced that it would replace around $3.2 billion of preferred shares owned by a UAW trust fund with lower cost debt. It continues to whack away at the financial constraints as a result of its 2009 bailout. Since it exited bankruptcy, GM has been paying 9 percent annual dividend on the 240 million Series A preferred shares held by the UAW Retiree Medical Benefits Trust that cost around $620 million per year. The healthcare trust acquired the shares as part of the company’s bailout. The car manufacturer said that it would buy back... 
 

California Regulators Approve Ride-Sharing Services

Ride-sharing services got the approval from California regulators Thursday. The move gave the services hope that the move will clear their legal status in other regions. The California Public Utilities Commission made a new category named Transportation Network Company that will cover businesses such as UberX, SideCar and Lyft. The companies let customers get rides via apps from drivers who use their personal, non-commercial vehicles. Consumers pay for the rides through the apps as well. It has taken off in big cities and has become an alternative... 
 

Jobless Rates Remain or Fall in 32 States

15 states saw their jobless rates below the US rate of 7.3 percent in August. This was according to the report released by the government. North Dakota got the lowest jobless rate in the nation with 3 percent that was attributed to the boom in energy production in the state. Other states with low unemployment rates include South Dakota with 3.8 percent, Nebraska with 4.2 percent, Hawaii with 4.3 percent, Iowa with 4.9 percent, Vermont with 4.6 percent, and Wyoming with 4.6 percent. Nevada has the highest unemployment rate in the nation with 9.5... 
 

Allegiant Declines Due to Canceled Flights

Allegiant Travel Co. dropped the most since July after it canceled 15 percent of its flights after the grounding of its Boeing Co. MD-80s to make sure that its emergency slides meet safety standards. The airline moved 16 of the canceled flights the next day, when it expects to complete a full inspection. The company has not determined how the grounded planes will affect flights over the weekend or early next week, which is its busiest period. The MD-80s accounts for 85 percent of Allegiant’s fleet. They have an average age of around 23 years according... 
 

Fed Surprises Wall Street with No Taper

Traders were caught by surprise by the Federal Reserve when the central bank made the announcement that it would not taper its stimulus program. Right after the announcement, the 10 year benchmark Treasury increased with buyers rushing to cover wrong way bets made when most investors expect the Fed to pull back its bond buying program. Traders reacted as quickly as they could. They were buying emerging markets and cut some high yield bonds as they increased in price. High yield bonds have outperformed emerging markets by around 10 percentage points... 
 

Starbucks Says Guns Unwelcome in Stores

Starbucks Corp. announced Wednesday that guns will not be welcomed in its cafes. This has brought the coffee chain giant deeper into the debate regarding weapons that has been difficult for retailers and other businesses. The request was made through an open letter from Starbucks’ Chief Executive Howard Schultz. It came after the company was pressured by the public after allowing customers to openly carry their guns in states that allow it. Gun control advocates criticized the company for its policy while gun rights advocates had praised it. The... 
 

Consumer Prices Increase in August

Consumer prices in the United States slightly increased in August. This was the latest indicator that slow economic growth has been keeping the inflation in check. The Labor Department said that the consumer price index went up 0.1 percent last month, after it gained 0.2 percent in July. When volatile food and energy costs were excluded, core prices went up 0.1 percent. In the last 12 months, prices went up 1.5 percent. It was down 2 percent compared to the same period last year. It was also below the Federal Reserve’s 2 percent inflation goal.... 
 

Shopify with Challenge for Entrepreneurs

Shopify has announced a challenge for entrepreneurs called Build-A-Business competition. Shopify has helped business owners get their businesses online and improve their consumer experience. The company has powered more than 60,000 online stores. Since 2010, Shopify has helped businesses through its Build-A-Business competition. It utilizes the power of entrepreneurial spirit that can promote new businesses and improve their consumer experience at the same time. It mentors business owners to build relationships with their customers as it shares... 
 

Intel to Lower Production Capacities

Intel, which is the world’s leading manufacturer of computer chips, is reported to be closing its factory in Massachusetts. It would cut up to 700 high-paying manufacturing jobs, which would be one of the biggest job cuts in the state in recent years. The company said that its plant in Hudson is utilizing outdated technology to manufacture older generations of computer chips used in low-end applications that is no longer as profitable as its higher-end microprocessors used in PCs. Intel spokesman Chuck Mulloy said that the facility and the site... 
 

Hilton Chain Expects to Raise $1.25 Billion in IPO

Blackstone Group is going to take Hilton Worldwide Holdings public in an initial public offering that is expected to earn up to $1.25 billion. This was according to a regulatory filing Thursday. Hilton owns and franchises a portfolio consisting of 4,401 hotels in 90 countries across the globe. The company owns several brands such as Conrad, Waldorf Astoria, Embassy Suites, DoubleTree, Hampton Inn, Hilton Garden Inn, and Homewood Suites. Blackstone took Hilton private in October 2007 after a leveraged buyout that was worth $26 billion. It was before... 
 

McDonald’s August Sale Increase Due to Higher Demand in Europe

McDonald’s Corp, the world’s biggest restaurant chain, reported its sales at stores open at least 13 months gained 1.9 percent last month. This was above the estimates made by analysts. The increase was attributed to the demand in Europe. Analysts forecasted a 0.3 percent gain according to the average estimates from Consensus Metrix. Same store sales increased 3.3 percent in Europe, which was the largest gain since June 2012. Analysts called for a drop of 0.1 percent. McDonald’s got around 40 percent of its revenue from European nations. It... 
 

Payrolls Climb Less than Predicted

Payrolls in the United States increased less than the estimate in August. The gains for the previous two months were revised down. These indicated that the expansion has struggled to gain momentum. 169,000 workers were added last month, which was below the average estimate of 180,000 made by 96 economists in a Bloomberg poll. Jobless rate dropped to 7.3 percent, which was the lowest since December 2008. This was attributed to the workers who left the labor force. Larger gains in employment are needed in order to propel the consumer spending that... 
 

Ford Competes with Tech Companies in Finding New Workers

Ford Motor announced that it will hire 3,000 more white-collar workers in 2013 in order to meet with the increasing demand for its vehicles. The company said that it improved this year’s hiring target by 36 percent from around six months ago. It attributed the increase to strong US sales and its aggressive worldwide growth plans. Ford said that it has a hard time filling up the job vacancies because it is looking for people with different skills than in the past. The demand for mechanical engineers has dropped while the need for electronic engineers... 
 

Small Businesses Experience Optimism

Small business optimism increased in July and August, which reached the highest level since the beginning of the recession. This was according to several surveys. The Gallup reported an optimistic reading with regards to capital spending plans. 80 percent of small businesses are hopeful about their 2013 holiday sales. Most small business owners opted for sales over closing their business this Labor Day weekend. A new study also showed that prospective business buyers and sellers have positive outlook with regards to their prospects of finding a... 
 

Verizon Wants to Buyout Vodafone in Wireless Unit

Vodafone confirmed that it is in talks to sell to Verizon Communications its 45 percent stake in Verizon Wireless. Analysts said that the deal could be worth around $125 billion. Verizon has been trying to buy the stakes. It could be the largest purchase in history. Once Verizon has complete ownership of Verizon Wireless, the company could shift from receiving dividends to being able to incorporate all of the profits. The company will also have full control of what to do with the profit as advertisers, wireless carriers, and content distributors... 
 

Joy Global Hits Lowest Level in a Month

Joy Global, which is the biggest manufacturer of underground mining equipment, dropped to its lowest price in a month after it announced that it anticipates a decline in sales for the rest of the year as demand for large shovels and draglines weakened as a result of a challenging coal market. The company decreased as much as 6.4 percent to $48.07, which is the lowest value since July 25, before it cut losses to trade at $49.33. In 2013, the shares dropped around 20 percent before the start of trading. Chief Executive Officer Mike Sutherlin said... 
 

Consumer Confidence Improves in August

Consumer confidence improved this month as Americans became more optimistic about employment opportunities as well as the outlook for the economy. The Conference Board’s index of sentiment went up to 81.5 from the revised 81 the previous month that was stronger than the initial report. The average estimated from a poll by Bloomberg was 79. Another data showed that home prices increased in June at the second fastest rate in seven years. Higher property values as well as stock market returns have bolstered income expectations that as helped sustain... 
 

New York Has Average Car Costs

According to a new report made by Bankrate.com, New York is around average when it comes to car costs. The Car Cost Index is based on the costs of repairs, taxes, gasoline, insurance and other fees. According to the study, New York ranked 20th among states. Some states have higher gasoline prices but the overall ownership costs were offset by other factors. The cheapest place to own and operate a vehicle was Oregon. The average cost in the state was just $2,204. This was a surprise to consumers since the state is known to have gas prices above $4... 
 

Amgen to Acquire Onyx

Amgen is said to be close to signing a deal to acquire Onyx Pharmaceuticals Inc., which is a manufacturer of drugs to battle cancer. This is according to people who know about subject. They said that the deal is worth around $10.5 billion. The deal would have Amgen pay around $125 per share and to be announced to the public as soon as Monday. The sources said that the talks are still ongoing and there is a possibility that it could fall apart. Once the deal is completed, it would become the most recent of many in the health care sector. It looks... 
 

Barnes & Noble Falls 12% due to Poor Earnings Report

Barnes & Noble shares dropped Tuesday after the bookseller released its profits report that showed its retail revenue and sales of Nook e-reader declined in the second quarter. Investors reacted to news that founder and board chairman Leonard Riggio didn’t continue with his bid to purchase the company. Barnes & Noble shares dropped $2.06 to $14.61. The company’s profit declined 8.5 percent to $1.3 billion for the second quarter compared to the $1.45 billion in the same quarter the previous year. Its Nook suffered a big loss with revenue... 
 

Direct Selling Firms Faces Tough Time Ahead

Industry research company IBISWorld released its most recent report on direct selling companies. It indicated that businesses are expected to pick up as the economy and consumer spending recovers but it would not be the case for direct selling companies. They face stiff competition from department stores, big box stores and online retailers. Consumers are looking for low prices and convenience. The decrease in consumer spending has led to recessionary conditions that impacted the direct selling industry for five years that ended 2013. The increasing... 
 

US Consumer Less Optimistic in August

US consumers were worried about the higher interest rates and slower economic growth. These were the factors why they were less optimistic in August as consumer sentiment dropped from July’s six year high. This was according to the survey made by Thomson Reuters/University of Michigan. The preliminary reading on overall index on consumer sentiment by The Thomson Reuters/University of Michigan dropped to 80.0 from 85.1 last month, which was the highest level since July 2007. The result this month was below the estimated 85.5 by economists. Consumers’... 
 

US Postal Service Revamps Priority Mail to Improve Revenue

The US Postal Service was overhauled its priority mail service to boost its revenue as well as compete with its private sector competitors FedEx and United Parcel Service. The USPS will provide customers free insurance, no-charge online tracking and day-specific delivery. The agency also redesigned boxes and envelopes. Its package business had grown in recent years. It went up more than 14 percent since 2011. At the same period, first class mail volume went down more than 6 percent. In 2012, the USPS lost around $16 billion. Its updated service... 
 

US Business Inventories Remain Unchanged in June

Inventories of businesses in the United States remained unchanged in June as companies excluding the auto industry cut back on restocking. This could affect the estimates for economic growth of the nation in the second quarter. The total number of inventories was unchanged in June according to the Commerce Department. A poll made by Reuters had estimated overall inventories to increase 0.2 percent in June. Inventory is one of the vital components of gross domestic product. Retail inventories, minus autos, declined 0.1 percent after an increase of... 
 

US Wholesale Inventories Drop for 3rd Straight Month

Inventories at wholesalers in the United States surprisingly dropped in June for the third month in a row. This was the longest streak in almost four years and was attributed to the increase in demand. Stockpiles decreased 0.2 percent at distributors after a 0.6 percent decline in May. This was according to the Commerce Department report released this week. A Bloomberg poll showed an average estimate of 0.4 percent increase. Sales increased 0.4 percent. The drop in stockpiles of electrical equipment, automobiles, and hardware meant that companies... 
 

Soybean and Corn Up on Friday Trading

Corn and soybean were higher Friday. This was attributed to the bargain buying of end users that helped drive the agricultural markets higher after a selloff. Wheat was also up after two sessions of drop in a row due to pressure from a decline in demand for supplies in the United States. It looks like a good season for farmers in the Midwest. The entire grain belt experienced favorable weather for crops this summer that has helped dragged down the corn and soybean prices in the US. This made the crops attractive for importers. New crop corn for... 
 

Time Warner Reports 87% Increase in 2nd Quarter Income

Time Warner released its second quarter net income report that showed it increased 87 percent to $771 million. This was due to the higher TV ad sales and strong box office performances of Warner Bros that offset the drop in its magazine business. The media conglomerate based in New York earned an adjusted 83 cents a share that excluded one-time items. It was higher than the estimate made by analysts of 76 cents per share. Time Warner shares dropped 24 cents to $63.84. Time Warner’s revenue increased 10 percent from the past year to $7.4 billion.... 
 

Molson Coors Reports Above Expectations Profit

Molson Coors Brewing Co reported higher than estimate quarterly profit that was attributed to the company’s acquisition of Central European brewer Starbev in June 2012. After the release of the report, the company’s shares increased 5 percent. The acquisition of Starbev increased Molson Coors Brewing’s capacity in countries such as Romania and Czech Republic. Its sales improved around 18 percent. Chief Executive Officer Peter Swinburn said that consumer demand was soft but they managed to earn profits due to the combination of good cost management... 
 

J.C. Penney Hires Berman from Kraft to Turn Brand Around

Department store chain J.C. Penney hired Debra Berman from Kraft Foods Group Inc. as senior vice president of marketing. The move was made in the hopes that she can rally the company from its worst sales year in more than two decades. Berman is tasked of trying to revitalize J.C. Penney’s brand and will be directly under Chief Executive Officer Mike Ullman. This was according to the announcement made by the company. She joined the company August 2. She was previously responsible for the global brand strategy and customer engagement at Kraft.... 
 

Mortgage Rates Get First Increase in Three Weeks

Mortgage rates in the United States increased for the first time in three weeks as it continued an upward trend that has started to affect home sales. The average rate for a 30 year fixed mortgage went up to 4.39 percent in the week that ended August 1. This was according to Freddie Mac. The average 15 year rate went up to 3.43 from 3.39 percent. Mortgage rates for 30 year loans increased to the highest level in two years last month due to the speculation that the Federal Reserve will start to pull back on its stimulus program. Analysts said that... 
 

US Home Prices in May Reach Highest Level since 2006

Home prices in May increased the most since 2006. This is an indicator that the recovery in residential real estate got some momentum. The S&P/Case-Shiller index of property values increased 12.2 percent from May 2012. This was the largest 12 month gain since March 2006 after it advanced 12.1 percent a month earlier. The average estimate of 31 economists polled by Bloomberg was for a 12.4 percent gain. Low borrowing costs, improving job market, and low level of supply have been boosting demand for residential property. These factors increase... 
 

Apple and Samsung Domination of Smartphone Market Over

Samsung and Apple get new competition in the smartphone market as the two companies’ combined market share dropped to 43 percent in the second quarter from 49 percent the previous year. This was according to the research firm IDC. Old timers such as Sony, Nokia and HTC and relative newcomers like Lenovo, LG, ZTE and Huawei have steadily chipped away at the leaders. The smartphone market is not just about Apple against Samsung anymore. Analysts said that consumers are looking for alternatives to Samsung or Apple because most smartphones are similar... 
 

Zynga Shares Fall after Dropping Plans for Online Gambling

Zynga, which is a social networking games company, dropped the most in a year after it announced the abandonment of its plans to venture into the online gambling business in the United States. The company is known for games such as Texas HoldEm and Farmville. Zynga shares fell 14 percent to $3.01. This was the largest one day drop since July 2012. In a statement, the social network gaming company said that it continues to evaluate its real money gaming products in the United Kingdom and has made the choice not to pursue a license for real money... 
 

US Demand Offset Slowdown in Europe to Give GM Profit

The strong demand for GM vehicles in North America helped the company earn second quarter profit above the estimated $1.2 billion. It offset the problems the company faced in the European car market. The largest US motor manufacturer reported its net revenue gained 4 percent to $39 billion as US customers bought F-Series pick-ups. Chinese consumers purchased Buicks and Cadillac units. Sales in North America earned GM $12 billion of profit. European operations resulted to loss of $110 million. Chairman and Chief Executive of GM Dan Akerson said that... 
 

HanesBrands Acquires Maidenform

HanesBrands Inc. announced that it has bought Maidenform Brands Inc. The deal is worth at $575 million. It is the union of two major companies in the delicates business. HanesBrands is known for the brands Hanes, Playtex, Champion, and Wonderbra. Maidenform is own for Sweet Nothings and Self Expressions. Maidenform does 90 percent of its business in the United States. HanesBrand said that combining its panty and full figure bra business with Maidenform’s own bra segment will be good for the company. Maidenform’s average figure bra business is... 
 

Intel Slashes Annual Revenue Estimate as PC Sales Decline

Intel managed to reach its earnings target but it slashed its full year revenue forecast due to the drop in PC sales and the transition toward smartphones and tablets. Shares initially increased after-hours but it dropped 4 percent for the day. Intel Chief Finance Officer Stacy Smith said that the company has lowered its expectations for the PC market and this resulted to the decline of its full year revenue forecast. He added that the company was slow in shifting toward mobility and that the company started to gain market share in large growth... 
 

US Homebuilder Confidence Grows More than Estimate

Homebuilder confidence in the United States increased more than the estimate in July to the highest level since January 2006 as companies became more upbeat about sales prospects. The National Association of Home Builders/Wells Fargo index of builder sentiment went up to 57 in July from the modified reading of 51 in June. The reading surpassed over all except one forecast in a Bloomberg survey. The reading went up 13 points in the last two months. This was the largest back-to-back gain since January-February 1992. The gains in builder optimism about... 
 

Consumers Keep their Buying in Check in June

American consumers have kept their buying in check in June. They bought less goods last month as an indicator of a weak second quarter. Sales at retailers increased 0.4 percent in June, which was below the 0.8 percent gain that was estimated by economists polled by Bloomberg. Auto and parts dealers got the largest gain in seven month. If that data was excluded, demand remained unchanged from May. The Commerce Department reported households were replacing old vehicles and furnishing new homes and at the same time they limit their spending on electronics... 
 

US Airways Shareholders Approve Merger with American Airlines

Shareholders of US Airways have given their approval to the pending merger with American Airlines. The step will give the company a step towards becoming the biggest carrier in the world. US Airways CEO Doug Parker made the announcement during the company’s annual meeting of stockholders last Friday. The merger of Northwest and Delta in 2008, United and Continental in 2010 and AirTran and Southwest in 2011 resulted into three airlines that are bigger than US Airways. Parker said that it made it hard for airlines such as American Airlines and US... 
 

Twinkies Presented At Wal-Mart Shops

Twinkies come back to Wal-Mart stores ahead of schedule. The retailer said that it will start selling the cakes at around 1,600 locations beginning Friday. The retailer added that around 3,000 of its 4,000 stores in the United States will carry the product by Sunday, which is a day before Hostess said the yellow cakes would be available on the market again. By next week, Wal-Mart stores will have fried Fruit Pies and Muffins on their shelves. Ho Hos, Coffee Cakes, Suzy Qs, Orange Cupcakes, and Zingers will make their comeback by August. Sno-Balls... 
 
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