If this didn’t involve Rupert Murdoch, his sensational-obsessed headline writers likely would be having a field day with the aging media mogul’s growing misfortunes.

• 

  By Adrian Dennis, AFP/Getty Images

  A demonstrator dressed in a Rupert Murdoch mask controls puppets of British leaders at a protest Friday.

By Adrian Dennis, AFP/Getty Images

A demonstrator dressed in a Rupert Murdoch mask controls puppets of British leaders at a protest Friday.

Murdoch Meltdown!

Sordid Shenanigans!!

Hack Attack Fallout!!!

• STORY: New allegations besiege Murdoch empire

• MORE: Shareholders sue News Corp. over scandal

But what initially began with allegations that Murdoch’s British News of the World had illegally hacked scores of Brits’ phone messages has widened from a sordid tabloid tale involving a murdered British teen to a burgeoning scandal with broad political, criminal, ethical and business ramifications for Murdoch’s far-flung News Corp.

The $33 billion media empire’s holdings include U.S.-based Fox TV, film studio 20th Century Fox, publishing giant HarperCollins, The Wall Street Journal and the New York Post.

Rupert Murdoch’s empire

News Corp., founded in 1922, is a media company that operates in the United States, the United Kingdom, Continental Europe, Australia, Asia and Latin America. It has 51,000 employees and revenue of $33 billion last year. Its interests include:

Newspapers

• United States — Dow Jones Newswires, The Wall Street Journal, New York Post; The Daily, an electronic magazine designed for the iPad and other tablets

• United Kingdom — The Times, The Sunday Times, The Sun

• Australia — 146 papers, including The Australian; The Daily Telegraph, in Sydney; Herald Sun, in Melbourne

Broadcast television

• Produces shows, such as Bones, Glee, The Simpsons, Modern Family

• Owns and operates 27 TV stations, including two each in New York, Los Angeles and Chicago

• Owns Fox Broadcasting Company, which has 203 affiliates and broadcasts American Idol,National Football League and Major League Baseball games and NASCAR

Cable television

• Channels include Fox News, Fox Sports Net, FX, Speed, National Geographic

Movies

• Owns Twentieth Century Fox and Fox Searchlight Pictures

Film and TV library

• Owns rights to top-grossing films, such Avatar, Titanic and the Star Wars series

• TV programs include 24, Boston Legal, The Mary Tyler Moore Show, M*A*S*H, Hill Street Blues, Ally McBeal, In Living Color, Buffy the Vampire Slayer

Books

• Owns HarperCollins, which published such best-sellers as Going Rogue by Sarah Palin; Game Change by John Heilemann and Mark Halperin; The Lacuna by Barbara Kingsolver; and Where the Wild Things Are by Maurice Sendak

Digital

• Owns IGN Entertainment

Source: Standard Poor’s Capital IQ

Murdoch, 80, folded News of the World on Sunday in what trade journals such as Advertising Age said was an effort to placate British regulators and advertisers upset by the hacking incidents. The incidents include accessing phone messages of 13-year-old kipnap and murder victim Milly Dowler, and those of families of 9/11 victims and British soldiers killed in Afghanistan. Prime Minister David Cameron’s former communications chief, Andy Coulson, was arrested last week in connection with alleged payoffs to police when he was editor of News of the World.

Fresh allegations of attempted phone hacking against Britain’s royal family (including Prince Charles), paying British police for tips and illegally accessing medical and financial records of former prime minister Gordon Brown and family members by Murdoch’s The Sun and The Sunday Times newspapers have caused more damage. That includes the possible unraveling of News Corp.’s planned $12.4 billion acquisition of a 61% stake in British Sky Broadcasting, the United Kingdom’s largest pay-TV broadcaster.

News Corp. currently owns a 39% stake in BSkyB and already was running into political opposition in Britain’s Parliament over the News of the World scandal. A regulatory review could take six months and allow the scandal to fade, but Deputy Prime Minister Nick Clegg has asked Murdoch to reconsider the bid.

Two News Corp. spokespersons didn’t return calls Monday. But the company said in a statement that it would investigate new allegations that its papers had hacked the medical records of Brown’s son, Fraser. In 2006, The Sun revealed that the seriously ill, 4-year-old Fraser Brown had cystic fibrosis.

Fraser’s mother, Sarah, tweeted her reaction about the revelations Monday: “So sad to learn all I am about my family’s privacy — it is very personal and really hurtful if all true.”

Londoners are accustomed to the sensational headlines of British tabloids, but many are shocked at reports that Fraser Brown’s medical records had been hacked.

“It’s absolutely appalling,” says Tamsin Kemmiss, 52, a secondary school teacher. “The sublime arrogance of Murdoch being able to just fly in here, keep Rebekah Brooks at her post, shut down the paper. It’s all just appalling.”

Rebekah Brooks, CEO of U.K. subsidiary News International, edited News of the World when some of the hacking occurred. She has denied knowledge of any wrongdoing, and Murdoch has stood by her.

Other Londoners aren’t surprised at the developments, given the salaciousness of the British tabloids.

“They call it the gutter press for a reason,” says Nicholas Thompsell, a senior partner at a London law firm. “It was bad, yes, but I think the media attention on it is out of line with its importance. People are starving, being murdered, and all we’ve read about for (two weeks) is this.”

Some believe billionaire Murdoch was due for some comeuppance.

“I think Murdoch had it coming,” cab driver Jim Roach says. “Working-class people are glad this is happening to him. How can a man who doesn’t live in this country own 40% of the media here? It’s wrong.”

Stock takes a dive

Investors aren’t liking what they’ve been reading or hearing.

On Wall Street, News Corp. shares sank 7% to $16.10 Monday and have lost nearly 16% from their 52-week high. Monday’s plunge reflects investor concerns that “reputational damage” could spill over to other News Corp. properties, says Standard Poor’s analyst Tuna Amobi.

News of the World accounted for less than 1% of News Corp. revenue and earnings. But Jeffrey Logsdon of BMO Capital markets says investors are worried the allegations could lead to wider questions .

For the stock market, “it’s a mystery why this newspaper would go to these lengths to get this story,” Logsdon says. “For investors, that makes everything mysterious. Is this localized, regionalized or globalized? No one knows.”

Amobi, who rates the News Corp. as a buy, thinks investors are overacting and that the company’s global operations are sound. “Right now, the sell-off seems overdone,” he says.

Major investors, such as Saudi Prince Al Waleed bin Talal, whose Kingdom Holding’s 7% stake is News Corp.’s largest non-family shareholder, told the Financial Times that he still backs Murdoch.

But on Monday, other News Corp. shareholders, including Amalgamated Bank and several municipal and union pension funds, filed an amended claim against News Corp. in Delaware court, accusing the company’s board of directors of failing to exercise oversight and take action since news of the hackings surfaced. (An earlier complaint challenged New Corp.’s acquisition of Shine Group Ltd., a film and TV producer that provided a $250 million windfall for Murdoch’s daughter, Elizabeth.)

“News Corp.’s behavior has become an egregious collection of nepotism and corporate governance failures, with a board completely unwilling to provide even the slightest level of adult supervision,” says co-lead counsel Jay Eisenhofer. “The result has been a piling on of questionable deals, a waste of corporate resources, a starring role in a blockbuster scandal and a gigantic public relations disaster.”

‘Tabloids set the agenda’

The British scandal has its underpinnings in an ultra-competitive market for eyeballs and readers.

Stephen Ward, director of the Center for Journalism Ethics at the University of Wisconsin-Madison, saw how the British tabloids operate when he spent five years in London as a correspondent for The Canadian Press.

“There are some very good journalists over there, but there’s more public tolerance for the British tabloid, anything-goes culture of news,” he says. “The tabloids set the agenda.”

Nothing in North America compares to British tabloid tactics — yet. “Our media, in tone and characteristics, are moving toward a British/Euro model, becoming increasingly competitive and more ideological and partisan” as revenue and resources decline, Ward says.

Phone hacking is illegal in the USA, and goes against journalism ethics. Such an incident occurred in 1998, when TheCincinnati Enquirer — which like USA TODAY is owned by Gannett — paid a multimillion-dollar settlement and was forced to retract a report on Chiquita Brands International after a reporter hacked into thousands of corporate voice messages.

“This is a classic example of what happens when you do dishonest things and how it can undermine your story,” says Kelly McBride, who teaches ethics at the Poynter Institute, a journalism think tank.

“While there are lots of problems in newsrooms, I’ve never heard of systemic eavesdropping or hacking,” McBride says. “We don’t have a tabloid or media property that consistently gets scoops on all the big sensational stories. The National Enquirer gets an occasional scoop on a really sensational story, but when they do, it’s because they’re damn persistent.”

Ryan Chittum, a former Wall Street Journal reporter who is deputy editor of the Columbia Journalism Review‘s online critique of financial journalism, says the scandal will affect Murdoch’s reputation and the credibility of other News Corp. properties, including TheWall Street Journal and Fox News.

“When you think of how powerful Murdoch is here and in the UK … it’s like a Wizard of Oz moment: Pull back the curtain and it’s just this pathetic little dude. This is the kind of thing that can take a company down, and it might even take Rupert Murdoch down.”

Crisis management specialist Robbie Vorhaus says it’s too early to determine what impact the scandal will have on Murdoch’s U.S. interests, which include TV broadcasting rights to pro football and baseball games.

“When something like this happens, everything is up for observation and conjecture. For now, reputationally, the scandal doesn’t touch News Corp. in the U.S. beyond negative association,” Vorhaus says.

“However, if like a wildfire, an unlikely spark of any scandal jumps the pond, it could be an unrecoverable crisis.”

Contributing: Daniela Deane in London, the Associated Press

Posted | Updated

SAN FRANCISCO — The bustling social-networking neighborhood just got more crowded.

• 

  Katango

  Katango — on iPhone, iPad, iPod and the Web — organizes its members into groups based on their interests, topics and backgrounds.

Katango

Katango — on iPhone, iPad, iPod and the Web — organizes its members into groups based on their interests, topics and backgrounds.

Katango joins the fray Tuesday just days after Google threw down the gauntlet with its social-networking play, Google+, only to be countered by new video calling on Facebook that expands the social experience.

Katango — on iPhone, iPad, iPod and the Web — organizes its members into groups based on their interests, topics and backgrounds. Facebook Groups and Google Circles do the same but require users to manually join groups. “We think it is a valid way to chop larger social graphics into pieces, based on interests and topics,” says Yee Lee, Katango’s vice president of product.

The arrival of Katango highlights the virtual land rush by companies to draw consumers to social networks in hopes of reaping billions in potential revenue. A resurgent online display-advertising market in the U.S. is expected to reach nearly $15 billion in 2012, compared with $12.3 billion this year, eMarketer says. Display ads, different from search ads, appear on websites as banners and in other forms.

• COLUMN: Pros, cons of Facebook’s new video chat

• STORY: Google+ thoughtful answer to Facebook

“The ascent of Facebook, Twitter, LinkedIn and others has successfully made the case for social media,” social-media analyst Greg Sterling says. “It would be negligent not to include a social strategy in one’s start-up plan.”

Facebook, with 750 million users, would appear to have nothing to worry about for now.

Besides Google+, there are few real threats to Facebook unless you count a handful of start-ups (Altly and Formspring) and some niche social networks (Strava, a fitness social network, and CrimeDex, for law enforcement). But the sheer volume of players — add StumbleUpon, Foursquare, Path and Instagram to the list — shows that others see opportunity.

“It’s certainly our first attempt that spans all of Google,” Google engineer Vic Gundotra says of Google+. “It’s a social circle. We don’t believe it’s a social network.”

“They’re jabs at the models,” Google’s Gundotra says, denying that Google+ is aimed entirely at Facebook.

Facebook CEO Mark Zuckerberg, who declined to comment on Google+ during a press conference last week, said the next phase of social networks will be dictated by how consumers use applications and how they interact with one another.

But when is it all too much for consumers trying to juggle multiple social-networking services, asks Ray Wang, CEO of Constellation Research. “My question is how many can one person handle?” he says. “My point of view is one for work and one personal.”

“I’m having enough trouble trying to juggle Facebook, Google+, Twitter and LinkedIn,” says Lorita Ba Vannah, 33, of Brookline, Mass. “I like (Google+), but it’s hard to judge since it’s such a small subset of my Facebook universe.”

Contributing: Scott Martin

Posted | Updated

If financial turmoil and longer lifespans hadn’t complicated retirement planning enough, aging Americans now are worrying about having enough money in their later years to handle their families’ needs, too.

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  By John Zich, USA TODAY

  Multi-generational households are on the rise, according to a Pew Reseach Center study.

By John Zich, USA TODAY

Multi-generational households are on the rise, according to a Pew Reseach Center study.

Half of Americans who are age 55 and older now expect to provide financial assistance to family members, and 70% think they’ll need to help adult children, according to a study to be released today by SunAmerica Financial Group and Age Wave, which specializes in aging issues.

The findings show a reversal from the past, when adults expected their children to take care of them during their golden years.

“When the word ‘childcare’ first emerged, we didn’t imagine it lasting 50 years, but now, when you’re 85 years old, you may still be providing care to your 50-year-old child,” says Ken Dychtwald, founder of Age Wave. “If all of a sudden you’ve got to divert a fair chunk of what you’ve been saving to look after children and grandchildren, that could change everything.”

• STORY: Five tips for making the most out of your 401(k) plan

• COLUMN: Put your 401(k) on autopilot with target-date funds

• STORY: Five ways to avoid sabotaging your 401(k) plan

More than half of working parents, 59%, are already providing or have provided financial support to adult children, ages 18 to 39, who are no longer in school, says a poll by the non-profit National Endowment for Financial Education.

“Parents were generally willing to provide support, says Ted Beck, CEO of NEFE. “But among those, 7% have delayed retirement, and 26% have taken out debt to do so — and that is a big red flag.”

In the new retirement world, more families are also moving in together. Multi-generational families had bottomed around 1980, but since then, extended family households have started to rise, according to a Pew Research Center study that looked at households from 1940 to 2008.

“There was a big increase, particularly in the last couple of years, among 25-to-34-year-olds,” says Pew’s Jeffrey Passel. “That is where we’d expect to see new people buying their first homes, but it is that group that is doubling up more.”

That’s just one of many factors causing older Americans to reset their retirement goals. The SunAmerica study compared post-recession adults with a survey it had conducted of the same age group 10 years ago. Today, 54% of adults 55 and older call retirement a new chapter in their lives, vs. 38% in 2001. Less often do they consider retirement as a time for rest and relaxation.

“Their intention now is to retire at age 69 rather than 64″ as it was a decade ago, says Jay Wintrob, SunAmerica CEO. “Now, two thirds of them say that their ideal retirement involves remaining productive, and they equate that with work.”

Posted

Here’s an anomaly: The bigger, more-powerful V-6 engine in the Chrysler 200 convertible has a better government fuel-economy rating than the smaller four-cylinder engine.

The 175-hp, 2.4-liter four-cylinder (standard engine, no extra charge) is rated 18 mpg in town, 29 mpg on the highway and 22 mpg in combined driving.

The 283-hp, 3.6-liter V-6 ($1,795 option that also includes other features) is 19/29/22.

The weight of the convertible’s extra bracing and gear makes the four-cylinder work harder — enough to lose by 1 mpg vs. the V-6 in the Environmental Protection Administration’s city test cycle. But in the lighter 200 sedan the two engine still are equal in EPA rating.

Chrysler says the four might do a little better in certain conditions. “If you drove back-to-back over identical drive cycles without a lot of stop-and-go or heavy use of the air conditioner, you’d see better fuel economy with the four-cylinder” than the V-6, says Ben Winter, engineer over developing the company’s small cars and minivans.

You won’t want to hear this: There is a 4-cylinder version of the 200 convertible with a higher 20/29/23 mpg rating that’s cheaper, too — but you can’t have it.

Fleet only (read “rental cars”) says Chrysler. The fleet car mates the four-clinder to the four-speed automatic used when 200 was the Sebring, instead of today’s six-speed. It also has “lower content,” Chrysler says, meaning fewer weight-adding features.

While unusual, the 200 convertible mileage disconnect isn’t unique. In the 2007-09 Toyota Tundra pickup, for example, the 4.7-liter V-8 was rated 14/17/15 and the 5.7-liter was 14/18/16.

So what have we learned, class? That “conventional wisdom” isn’t always wise. Manual transmissions, we’ve long come to see, no longer always get better mpg than automatics, and now, small engines don’t necessarily get better mpg than bigger engines. Automatics and bigger engines often carry price premiums, though, that have to be balanced against fuel savings, if you’re bringing a green-eyshade attitude to the purchase.

You won’t want to hear this: A cheaper, higher-mpg version of the 200 convertible is available, and you can’t have it.

See photos of: Chrysler LLC

SYDNEY — Australia’s liquor industry launched a voluntary program to label its products with health warnings Tuesday, possibly to pre-empt future criticism that it is contributing to excessive drinking that is part of the national culture.

• 

  Rick Rycroft, AP

  A small label with a health warning is displayed on an alcohol bottle in Sydney, Australia, July 12, 2011.

Rick Rycroft, AP

A small label with a health warning is displayed on an alcohol bottle in Sydney, Australia, July 12, 2011.

About 80% of alcohol sold in the country — beer, wine and spirits — will carry the warnings, primarily aimed at teenagers and pregnant women, said Trish Worth of DrinkWise Australia, a group funded by the alcohol industry.

The group, founded in 2005, aims to overturn the traditionally benign view that Australians have had of drinking, even among teenagers. According to DrinkWise, the average Australian starts drinking alcohol at 15 ½ years of age and more than a quarter of 14-19 year olds are putting themselves at risk of harm at least once a month.

“We see physically mature teenagers and assume that their brains are mature, but they are not,” Worth told reporters. “We have to challenge ideas that are so traditional and historic in Australia.”

The first few products with warning labels are already in stores but most others will introduce them gradually over the next few months, she said.

The three principal messages are “Kids and Alcohol Don’t Mix,” “It is Safest Not to Drink While Pregnant,” and “Is Your Drinking Harming Yourself or Others?”

The voluntary move comes ahead of an expected government decision later this year to make warnings mandatory in Australia, similar to some 14 other countries including the U.S.

Australia’s culture of drinking goes back to 1788 when the first settlers — British convicts and their jailers — landed in the country after an eight-month voyage. They celebrated the end of their ordeal with a raucous booze-fueled party that established a time-honored tradition.

Former Prime Minister Robert Hawke once held the Guinness World Record for downing two and a half pints of beer in 11 seconds, and former cricket legend David Boon is best known for a 1989 flight from Sydney to London during which he drank 52 beers.

Binge drinking is a problem especially during the so-called “Schoolies Week,” marking graduation from high school and often associated with turning 18, the legal age for drinking. Binge drinking often leads to fights, drink driving and unwanted sex.

Ian Hickie, executive director at the Brain and Mind Research Institute at the University of Sydney, said alcohol disrupts brain development, which is at its most intense between age 12 and 20.

But “our teenagers think they are bulletproof,” he said. “What is sad in Australia is that the campaign against alcohol is being led by police. We need to have a wider discussion in the community. … The DrinkWise campaign might precipitate a discussion.”

According to government statistics, the proportion of people drinking at high risk level has increased from 8.2% in 1995 to 13.4% in 2004-2005, when the last National Health Survey was conducted. The increase has been greater for women.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted | Updated

WASHINGTON — The U.S. trade deficit surged in May to the highest level in more than two and a half years, driven upward by a big increase in oil imports.

• 

  Danny Johnston, AP

  Gas station manager Joseph Sublett changes a sign reflecting lower prices on June 22, 2011 in Little Rock, Ark.

Danny Johnston, AP

Gas station manager Joseph Sublett changes a sign reflecting lower prices on June 22, 2011 in Little Rock, Ark.

The Commerce Department said Tuesday that the deficit increased 15.1% to $50.2 billion in May. That’s the largest imbalance since October 2008.

Exports declined 0.5% to $174.9 billion. Imports rose 2.6% to $225.1 billion. Oil prices have fallen since early May, so the effect of higher prices should ease some in the coming months.

The deficit with China jumped to $25 billion, the largest monthly gap since November. The deficit with Japan fell 26.4% to $2.6 billion. Japanese imports shrank further because of supply-chain disruptions caused by the March earthquake and tsunami.

Economists say Japan is starting to rebound from the crisis and a parts shortage that followed those disasters is beginning to dissipate. As a result, Japan’s factories should increase shipments to the United States over the next few months.

American companies depend on component parts supplied from Japan. The supply-chain disruptions have slowed production at U.S. factories, particularly among those companies that make autos and electronics.

Manufacturing has been one of the strongest areas of the U.S. economy in the two years since the recession officially ended. Sales in foreign markets have been helped by increased demand and a weaker dollar, which makes U.S. goods cheaper overseas and imported goods more expensive.

Last year, the U.S. deficit with China hit $273 billion. It’s the largest deficit the United States has ever had with any country. The huge trade gap between the two countries has prompted many companies and members of Congress to criticize China for manipulating its current to gain a trade advantage. U.S. manufacturers contend that China is keeping its currency undervalued against the dollar by as much as 40%.

The Obama administration has been pressuring China to allow its currency to rise at a faster rate against the dollar. But in May, the administration declined to cite China as a currency manipulator. Such a designation could eventually lead to U.S. economic sanctions against China.

The Chinese government says it has been allowing its currency to rise in value against the dollar for more than a year. But Beijing says it must do so gradually to avoid adverse consequences to the Chinese economy.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

GM built zero Chevrolet Volts in June and the supply of Volts will be extremely limited this summer. There are currently about 200 available nationwide, says GM spokesman Robert Peterson.

The shutdown was planned and Volt production will restart sometime this month, says Peterson. The Detroit-Hamtramck plant, where Volt is built, is undergoing upgrades for the 2012 model-year changeover, which adds new features to the extended-range electric car and a new, cheaper version with fewer accessories.

Capacity also is being added to build more Volts, as well as to make its new Opel sibling, the Ampera, for export to Europe.

But the result will be a dearth of Volts for sale until August, Peterson says.

The Volt took an early lead in the EV race this year — and continued to outsell the Nissan Leaf as Nissan struggled to recover from the disaster in Japan. But now Leaf has a wide lead, with 3,875 sold through June vs. the 2,745 Volts sold by Chevy. Nissan hopes to hit 6,000 to 7,000 leaf deliveries by end of summer.

Peterson says GM still expects to produce 16,000 Volts total in 2011 — 10,000 sold to U.S. customers, 3,500 for export (Chevy sells it in China, for one) and 2,500 for use as demos at Chevy dealers.

– Colin Bird/Cars.com Kicking Tires and Fred Meier/Drive On

See photos of: General Motors, Chevrolet, Nissan Motor Company

ST. LOUIS — Corn supplies are projected to be higher than expected this fall. A bigger crop would ease concerns of a grain shortage and could slow food inflation later this year.

• 

  Seth Perlman, AP

  Central Illinois farmers harvest their corn crops near Monticello, Ill., Sept. 11, 2010.

Seth Perlman, AP

Central Illinois farmers harvest their corn crops near Monticello, Ill., Sept. 11, 2010.

The U.S. Agriculture Department said Tuesday that 880 million bushels of corn will be left over when the harvest begins. That’s an increase from the previous estimate of 730 million acres (295 million hectares).

Higher corn prices led farmers to plant the second biggest corn crop this year since World War II.

More expensive grain has led to food price increases this year. It could ultimately make everything from beef to cereal to soft drinks more expensive at the supermarket. For all of 2011, the USDA predicts food prices will rise 3% to 4%.

News of the big corn crop brought down global corn prices 20% over the last month. A huge harvest in August could ultimately slow food inflation. It typically takes six months for changes in commodity prices to affect retail food prices in the U.S. Analysts say consumers could see some relief at the supermarket by early 2012.

Farmers saw corn futures rise, so they switched their acreage into corn from other crops like soybeans. The size of this year’s corn crop will be 92.3 million acres (37 million hectares), about 9% larger than the average annual corn crop over the past decade. The only crop bigger in the past 67 years was planted in 2007.

Farmers chose to plant corn at the expense of this year’s soybean crop. They planted only 75.2 million acres (30.4 million hectares) of soybeans, about 3% less than last year. Farmers have a limited supply of good farmland and usually trade one crop for another on their acreage.

Higher corn prices make soybeans and wheat more expensive because farmers plant less of them.

The price of corn is a driver for food inflation because the crop is an ingredient in feed for poultry and livestock, and a staple in many processed foods. When corn prices rise, food processors and grocers pass along the higher costs to the consumer.

A bigger crop doesn’t guarantee lower food prices. A drought or flood could limit the size of the harvested crop. Many of the acres planted this spring were on marginal land that won’t yield much grain. Many farmers planted during wet weather just because they knew they could get the crops insured.

A bushel of corn equals 25.4 kilograms (56 pounds).

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted | Updated

Frequent business traveler Jim Shriner says it’s too risky to walk through neighborhood streets outside the Philadelphia and Newark airports.

• 

  By Eileen Blass, USA TODAY

  Grime just down the street from 30th Street Railroad Station in Philadelphia.

By Eileen Blass, USA TODAY

Grime just down the street from 30th Street Railroad Station in Philadelphia.

“I would not venture out alone on foot into either of these areas,” says Shriner, who lives in Lithia, Fla., and is a vice president in the health care industry.

Shriner, like other veteran travelers, knows the risk of becoming a crime victim often increases once he leaves the confines of an airport or central train station and goes into surrounding neighborhoods — where travelers routinely pick up or return rental cars, refill gas tanks, buy provisions and check into hotels.

An exclusive neighborhood study done for USA TODAY by crime-forecasting company CAP Index shows those instincts are right — and criminologists are not surprised.

• STORY: Crime risk near airports exceeds national average, study says

The CAP Index study finds that the likelihood of crime is nearly eight times higher than the national average outside Philadelphia airport and nearly five times higher outside Newark airport.

The likelihood of crime exceeds the national average outside 28 of 29 big-city airports in the study and outside all 26 central train stations, says CAP Index, which uses statistics, demographics and computer modeling to determine the likelihood of crime.

Of the 29 airports, about half have surrounding neighborhoods where the likelihood of crime is more than four times higher than the national average. Of 26 central train stations, 21 have surrounding neighborhoods where the likelihood is more than four times higher.

CAP Index President Jon Groussman says his company’s analysis of law enforcement and clients’ loss data shows a large number of crimes are committed in such neighborhoods.

“You are clearly getting into a more elevated risk potential” when you enter a neighborhood with a crime likelihood at least four times the national average, he says.

CAP Index says its crime-risk determinations are 70% to 90% accurate. Like other probability formulas, CAP Index’s methodology has its limitations, company officials acknowledge, because it does not take into account various variables, including police force size, amount of security equipment being used and current events.

Rosemary Erickson, a criminologist and security expert, says CAP Index is “extremely useful for predicting crime,” and travelers should heed its findings for neighborhoods outside airports and central train stations.

The areas outside airports and central train stations have a higher likelihood of crime because they’re often poor neighborhoods and are probably not as effectively policed as some downtown areas, says Lewis Yablonsky, emeritus professor of criminology at California State University-Northridge.

Though airports may have a heavier police and security presence than nearby streets, they aren’t immune to crime. During the first five months this year at New York’s JFK airport, for example, 912 crimes were reported to police, according to Port Authority of New York and New Jersey statistics. 

Erickson says the areas around airports and train stations aren’t the most desirable to live. Many are low-income areas with high unemployment rates — “signs of social disorder” and higher crime rates, she says.

In southwest Philadelphia, for instance, the neighborhood outside the airport falls under the jurisdiction of police district 12 — one of the two “most violent” of 21 districts, according to a 2007 Philadelphia Police Department report. There were 3,580 crimes in district 12 reported to police last year, ranking the district 13th in total number of major crimes, according to Philadelphia Police Department statistics.

Last year, Philadelphia police busted an alleged prostitution ring that operated from hotels near the airport. Many robberies, assaults and a murder of an alleged pimp in December 2009 were related to the ring, police said.

Where the hot spots are 

Hotels and motels near other U.S. airports have also been crime scenes. Police in Burbank, Calif., last year said prostitution and criminal activities were increasing in hotels near Bob Hope Airport.

At a motel near Virginia’s Richmond airport in April 2007, Gary Post of Broadway, Va., was murdered while unloading his vehicle with his two adult sons. The men had driven to the motel for an inexpensive room before their flight the next day, police said. They were approached by four men with semiautomatic weapons attempting to rob them.

Several frequent fliers say they’re wary of the neighborhood outside Los Angeles International Airport. Dallas-based Ted Mitchell, who works for a software company, calls the neighborhood “awful.”

According to CAP Index, the likelihood of becoming a crime victim outside Los Angeles International is nearly four times more than the national average.

The likelihood of crime is even higher — more than seven times above the national average — in the neighborhood outside the airport in Ontario, Calif.

Of all neighborhoods near airports and central train stations in CAP Index’s study, none has a higher likelihood of crime than the one outside Houston’s Amtrak station on Washington Avenue. The crime likelihood there is nearly 11 times higher than the national average.

A review of the Houston Police Department‘s online statistics for crimes within a half mile of the Amtrak station indicates that during the first five months this year, more than 200 crimes were reported to police, says CAP Index Vice President Stephen Longo.

The crimes included two murders, three rapes, two robberies, 16 aggravated assaults, 15 auto thefts, 14 burglaries and more than 150 thefts, Longo says.

Frequent business traveler Richard Szulewski of Germantown, Tenn., says he thinks the risk of crime is greatest at New York’s Penn Station.

“I consider myself quite vigilant, yet I always feel like I have to be on my highest guard at all times,” says Szulewski, a health care development manager.

Tourists there “could easily be crime victims of pickpocketing or bag theft.” But, he says, “there is typically a large, armed police force present.”

Outside Penn Station, located on Manhattan’s west side, the likelihood of crime is nearly seven times the national average, CAP Index’s analysis shows.

Like Szulewski, many frequent business travelers say they are most concerned about theft.

Rebecca Carranza of Barrington, Ill., was a theft victim last year while returning a rental car to an off-airport facility outside Memphis airport.

An employee of the rental company stole her new iPhone out of the rental car she was returning, she says.

“The surveillance tape showed the employee taking it out of the car and putting it in his pocket,” says Carranza, a manager in the educational publishing industry.

Frequent business traveler Mitch Fong of Mill Valley, Calif., says he’s never been a crime victim in an airport or train station, but he’s concerned about areas outside them.

“I would say that the areas around most major airports are not the best neighborhoods in most cities,” says Fong, a vice president in the financial-services industry. “I am definitely on high alert whenever I am just outside most major airports.”

Some safety tips for travelers 

Frequent business traveler Paul Tamburelli of Peoria, Ariz., says he’s never been a crime victim while traveling and offers some safety tips.

“Keep your wits about your surroundings; don’t wear flashy jewelry; and know where to go and where not to go at all times,” says the vice president in the transportation industry. “Don’t attract unwanted attention to yourself or make yourself look like an easy mark.”

Regardless of location, “Vigilance is the most important factor in preventing crime,” says Jennifer Welch, a flight attendant in Hillsborough, Calif. “A little situational awareness goes a long way in ensuring you don’t become a victim.”

Erickson says travelers should “always look for warning signs” outside airports and train stations. If a neighborhood has graffiti, litter, iron bars over doors and windows or homeless people on the streets, a traveler shouldn’t walk or get out of a rental car in the neighborhood, she says.

“If it doesn’t feel safe, you probably shouldn’t be there,” Erickson says.

Q: Is Bank of America a good stock to buy now that the company has settled with investors over mortgages?

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  By Justin Sullivan, Getty Images

  People use a Bank of America ATM in San Francisco, Calif.

By Justin Sullivan, Getty Images

People use a Bank of America ATM in San Francisco, Calif.

A: Bank of America (BAC) is one of the banks considered too big to fail. But it still gives its investors plenty to worry about.

It’s been a rough year so far for Bank of America stock, with shares skidding 22%. Investors have braced for a number of big financial hits connected with Bank of America’s mortgage business, especially from its Countrywide unit in mortgages.

The first hit landed in late June when Bank of America agreed to a $8.5 billion settlement with 22 investors who alleged the company sold them bum mortgage loans. But there’s likely more fallout to come. Many of the states are accusing Bank of America of improper foreclosure procedures. Bank of America has vowed to fight these allegations. However, there’s still a risk of more monetary punishments to come.

• STORY: Bank of America settles mortgage case for $8.5B

• COLUMN: Why banking stocks went bust

• COLUMN: Which is better for investors: Brokerage or mutual fund?

And that’s not to mention the giant headwinds the company continues to face from a challenged mortgage market. Many borrowers continue to struggle and face the looming risk of foreclosure.

Some investors may be attracted to the bank’s potential for boosting its dividend. Currently, the stock yields just 0.36%, well below the roughly 2.5% yield of the Standard Poor’s 500. Investors, though, might make the bet that the company will boost its dividends until they meet or exceed the SP 500′s yield.

Ask Matt about stocks

USA TODAY financial markets reporter Matt Krantz answers a new question every weekday at money.usatoday.com.

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Given such an uncertain immediate future, it’s easy to understand why Wall Street analysts who follow the stock are so torn on it. Of the 26 analysts that cover the stock, 13 rate it a strong buy or buy but another 13 rate it a hold. Sell ratings are rare on Wall Street, and there are no sells on Bank of America, a hold though is often considered a somewhat negative opinion on the stock.

If you’re more bullish on the real-estate market and economy, you might consider Bank of America. Since the consensus is that the mortgage market will continue to be weak, if the masses are wrong, you might get a chance to profit. However, if you agree with the idea the mortgage market will be challenged, it’s hard to make a case for Bank of America, no matter how you look at it.

Matt Krantz is a financial markets reporter at USA TODAY and author of Investing Online for Dummies and Fundamental Analysis for Dummies. He answers a different reader question every weekday in his Ask Matt column at money.usatoday.com. To submit a question, e-mail Matt at mkrantz@usatoday.com. Follow Matt on Twitter at: twitter.com/mattkrantz

Posted | Updated

Most of us aren’t very good at delayed gratification, which is why so many pies mysteriously disappear before it’s time for dessert. Social Security is no exception. Most seniors file for benefits as soon as they become eligible at age 62, even though that results in a permanent haircut in their monthly benefits.

Many seniors have no choice: They’ve been laid off or downsized, and companies aren’t exactly lining up to hire older workers (or young ones, either). Others have been forced to file as soon as they’re eligible because of health problems. Some have physically demanding jobs that eventually take their toll on aging bodies.

But if you’re healthy and employed as you approach your 62nd birthday, you may want to think twice about turning in your security badge. Claiming Social Security at 62 could reduce your benefits by as much as 8% a year until full retirement age, which for current retirees is 66, the AARP estimates.

“The sooner you tap into it, the less you’ll have,” says Jean Setzfand, vice president of financial security for the AARP.

• COLUMN: Is Social Security an investment Ponzi scheme?

• COLUMN: Can I opt out of paying Social Security and invest myself?

In 2008, nearly 73% of retirees claimed Social Security benefits before 65, and only 14% took benefits the month they reached full retirement age, according to a recent report by the federal Government Accountability Office. By taking benefits on or before their 63rd birthday, nearly half gave up 25% to 33% in additional monthly inflation-adjusted benefits that would have been available if they had waited until full retirement age, the GAO said.

Getting the most out of Social Security benefits has taken on added importance, because most retirees can no longer rely on a traditional pension to provide a lifetime source of income. And numerous studies have shown that most workers haven’t saved enough in their 401(k) plans to make up for the loss of a traditional pension.

Calculating your benefits

If you’re 62 and out of work and need to pay the electric bill, filing for Social Security may be your only option. But for many retirees, Setzfand says, the decision to file for benefits is an emotional choice — they hate their jobs, for example, or just don’t feel like working anymore.

On Monday, the AARP launched a Social Security Benefits Calculator that’s designed to take some of the emotion out of this important decision. The interactive tool allows you to estimate how much you’ll receive in monthly and lifetime benefits, based on your salary and your age when you file.

Social Security benefits

Estimated monthly benefits for a single
woman with income of $60,000 a year, based on her age when she files:

Source: AARP Social Security Benefits Calculator

You can also learn how continuing to work will affect your benefits.

For example, suppose you’re a single woman who was born in 1949 and earns $60,000 a year. According to the calculator, you would receive $1,126 a month if you filed for benefits at 62. Wait until 70, and you’ll receive $2,123 a month.

Based on average longevity rates, filing at 62 would produce lifetime benefits of $392,000. Waiting until 66 would produce lifetime benefits of $483,000. And postponing benefits until 70 would deliver $535,000.

The calculator allows married couples to calculate their combined benefits, based on when they file and whether they claim spousal benefits.

“This is one of the most difficult things for consumers to understand,” Setzfand says.

The calculator also shows how much of your basic expenses would be covered by Social Security benefits, based on when you claim them. You can customize the calculator by plugging in your actual expenses or use average expenses provided by the Bureau of Labor Statistics.

In the past, retirees who filed early could claim benefits for a few years, withdraw their application, repay the benefits, then refile at the higher amount. Some retirees used this option to get what was in effect an interest-free loan and ended up with larger benefits overall.

Last year, though, Social Security announced that retirees who want to withdraw their application must do it within 12 months of filing for benefits, Setzfand noted.

That means you’ll no longer have the option of changing your mind after a few years, so it’s important to get it right the first time.

Solvency concerns

Some older Boomers who are capable of working longer may feel compelled to file for Social Security anyway, because they’re afraid benefits will be reduced as part of a deficit-reduction deal.

The calculator doesn’t address potential benefits cuts because the AARP doesn’t have a crystal ball, Setzfand says.

But she notes that most of the proposals to reduce benefits or change the way they’re calculated wouldn’t affect Americans who are approaching retirement age, which is the group the calculator is designed to help.

Visit the AARP Social Security Benefits Calculator online.

Sandra Block covers personal finance for USA TODAY. Her Your Money column appears Tuesdays. E-mail her at: sblock@usatoday.com. Follow on Twitter: www.twitter.com/sandyblock. See an index of Block’s columns.

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MILAN — European financial markets were slammed Tuesday by fears that Italy and Spain would be dragged into the debt crisis, though investors found some relief in signs that Rome would speed up approval of austerity measures.

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  Ralph Orlowski, Getty Images

  A trader looks on during a trading session on the floor of Frankfurt stock exchange on September 30, 2008 in Frankfurt am Main, Germany.

Ralph Orlowski, Getty Images

A trader looks on during a trading session on the floor of Frankfurt stock exchange on September 30, 2008 in Frankfurt am Main, Germany.

Stocks, the euro and government bonds tumbled, with the Milan exchange down 4% and the yield on Italy’s 10-year bond trading above 6% at one point, suggesting investors are increasingly worried the country will not be able to handle its debts.

Rescuing Italy and Spain — the third- and fourth-largest economies in the eurozone — would simply be too expensive for the EU’s rescue funds, so their stability is synonymous with that of the 17-nation currency bloc.

Traders were spooked by the fact that eurozone finance ministers remained vague in their promises of new support measures at a meeting in Brussels on Monday and suggested they would even accept a temporary default by Greece to get a bigger private sector contribution to a second bailout.

The prospect that Greece will be allowed to default on its debts — and the lack of any detail on how that would happen or how it might impact countries like Italy — proved toxic for markets.

“The risk of a major eurozone bank collapsing cannot be ruled out and this threat would only heighten a ‘Lehman-style’ moment,” said Neil MacKinnon, a strategist at VTB Capital.

The finance ministers said they are considering broader powers for the region’s bailout fund, such as buying up distressed bonds on the secondary market, as well as giving already bailed out countries more time to repay their loans and lower interest rates.

However, they did not reach a final deal on a new rescue package for Greece and moved away from earlier promises that any efforts to involve banks will not trigger a default rating from rating agencies.

That opens the door to more drastic plans for private sector involvement and renewed concerns about a lack of political will in the richer eurozone countries to stem the crisis.

Pressure in Italian markets only eased somewhat after Finance Minister Giulio Tremonti announced plans to accelerate Italy’s austerity measures.

“I am going to Rome to close the budget,” Tremonti told reporters as he left the ministers’ meeting early.

Italian Senate President Renato Schifani asked that the upper house clear the cuts by Thursday before they go to the lower house for approval. The government had earlier said the measures would be completed only by August.

“I believe it is necessary and indispensable to give a cohesive signal abroad from our country, and it is important that we vote on the measures no later than Thursday,” Schifani said.

The comments helped the Italian 10-year yield drop back down to 5.71%, while the Milan stock index cut its losses to trade only 0.3% lower.

Tuesday is the last day for any amendments to the €48 billion ($67 billion) package that aims to balance the budget by 2014. Commentators urged lawmakers to cut spending on bureaucracy during this legislative period, which ends in 2013, and not delay it to a future government.

“I would say that the best medicine could be to issue measures to contain the public debt in a quick and incisive way, this is what the markets are asking for, and this could be the recipe to allow this down trend to stop, a trend which is having a very negative impact on Italian investors,” Patrizio Passagnia, an investment banker at Insigner de Beaufort Bank’s Rome offices.

Amid the market turmoil, Italy raised €6.75 billion ($9.49 billion) from the markets in an auction of 12-month debt. Though it was oversubscribed, the yield rose sharply to 3.67%, from 2.15% at a similar auction a month earlier.

————

McHugh reported from Brussels. Gabriele Steinhauser in Brussels and Maria Grazia Murru in Rome contributed to this report.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

Companies already sitting on a record pile of cash may soon set another all-time high: profit.

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  By Jeff Swensen, Getty Images

  Alcoa kicked off earnings season Monday.

By Jeff Swensen, Getty Images

Alcoa kicked off earnings season Monday.

Aluminum giant Alcoa Monday kicked off what’s expected to be a banner second-quarter earnings season, as investors look for companies to report their fattest earnings in history, says Standard Poor’s. This is while employment and housing prices struggle to climb back to levels before the economic crisis. “Companies are not feeling the slowdown,” says Doug Sandler of RiverFront Investment Group.

If earnings hit a record, investors would get a concrete sign of how big business is faring amid renewed fears about the health of the European and U.S. economies and the Federal Reserve’s wind-down of its QE2 program of buying Treasuries. Alcoa reported earnings Monday that more than doubled from the same quarter last year.

SP 500 companies’ earnings are expected to grow 15.4% in the second quarter, to $24.12 a share, SP says, topping the previous record of $24.06 in the second quarter of 2007. It would be the sixth quarter in a row of double-digit growth.

• STORY: How to spot when stock market is ready to turn

• STORY: When does slower earnings growth mean trouble for a stock?

Earnings season is expected to reveal sought-after clues for investors, including a:

•Gauge of the value of stocks. The SP 500′s price-earnings ratio is 14.6, based on what companies have earned the past 12 months. Such a reasonable valuation vs. the average P-E of 19 since 1988 reassures investors they’re not overpaying, says Jack Ablin of Harris Private Bank.

•Further taste of slowing growth. The rate of growth is expected to be the lowest since the third quarter of 2009. Even with record earnings, “Deceleration is a cause of concern,” says Robert Maltbie of Singular Research. Yet, a big reason for the slowdown is weakness at financial firms, which investors might be able to look past, says Dirk Van Dijk of Zacks Investment Research. And third-quarter growth is expected to rise to 17%.

•Measure of macroeconomic factors. Still-lofty commodity prices, a weak U.S. economy relative to other nations and a weak dollar could be wild cards, says John Butters of FactSet Research. Already, Carnival has warned about higher energy costs, Oracle said overseas growth is better than in the U.S., and McDonald’s and Nike are benefiting from a weak dollar, he says.

So despite challenges in other parts of the economy, profits are a bright spot. Low labor costs don’t help “the vast majority of people,” but they help the stock market and earnings, Van Dijk says.

Posted | Updated

Consumers are counting calories like crazy.

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  Starbucks

  Starbucks’ Bistro Boxes.

Starbucks

Starbucks’ Bistro Boxes.

So, too, are some of America’s savviest food and drink marketers.

Which may explain why, today, Starbucks rolls out Bistro Boxes: small meals under 500 calories, such as Chipotle Chicken Wraps and Sesame Noodles, that cost less than $6. The move comes four months after the chain’s rollout of its Petites line of bite-size desserts.

Low calories are in high demand. Kraft recently rolled out SnackWell’s treats in 100- to 150-calorie servings. And Coke’s 7.5-ounce, 90-calorie minicans are a hit.

• PHOTOS: See some of the small-is-beautiful eats

• STORY: Sonic, Burger King, other fast-food chains selling alcohol

• PHOTOS: See the changing face of Starbucks over 40 years; timeline

In the midst of an obesity epidemic, fewer calories would seem to be a good thing. But one nutritionist wonders if consumers haven’t lost the ability to judge how much to eat — so they’re letting foodmakers do it for them. “Americans don’t want to think about it,” says Carolyn Costin, a food psychologist. “We’d like to be able to stop in a place and have our food made, packaged and certified for us as just enough.”

But the very notion of food marketers trying to make food healthier — and lower in calories — is huge, says Jo Ann Hattner, nutrition instructor at Stanford University, who is enamored of the Starbucks Bistro Boxes. “If you’re on the run, it’s so much better than grabbing a giant slice of pizza.”

Some small-is-beautiful eats and drinks:

•Meals. Some 5,400 domestic Starbucks locations will roll out four Bistro Boxes offerings. A Sesame Noodles box is 350 calories, including a cucumber carrot salad. A Chicken Lettuce Wrap is 360 calories, including peanut sauce.

The target: the 45% of Americans who are “wellness seekers — constantly looking for healthy options,” says Annie Young-Scrivner, global chief marketing officer.

•Desserts. Since rolling out in March, sales of the Starbucks Petites line of eight tiny desserts at $1.50 each have “exceeded expectations,” spokeswoman Lisa Passe says. Top seller: Birthday Cake Pop, a couple of bites of rounded, icing-covered cake on a stick.

•Snacks. With portion-controlled sizes launched in May, Kraft reinvented the SnackWell’s line with sweet popcorn and brownie bites.

•Drinks. Since rolling out Coke’s minicans last year, the company has added similar versions of Sprite, Fanta Orange and Cherry Coke.

Posted | Updated

The old, lime-green Porsche 911 classic still attracts attention when it roars through the industrial park in Irvine, Calif.

But it’s an illusion: This one’s not that old, any more anyway.

Drive On recently stopped by Singer Vehicle Design of Los Angeles, a company that’s taking apart early-1990s Porsches and rebuilding them into modern wonders. The sheet metal is replaced with carbon-fiber panels. The original air-cooled engine is radically reengineered by Torrance, Calif.-based Cosworth Group, famous for its racing engines. The interior is gets racing-inspired seats and modern amenities.

Photo gallery: Singer Porsches

The result is the Singer 911, a car that proves even the good old days can stand improvement. “The purpose of this car is not only to capture the golden age of the iconic 911, but bring those best elements together,” Singer founder Rob Dickinson told us.”

The engine is boosted to 300, 380 or 425 horsepower, depending on the order, from a maximum of about 280 in the original. And it gets beefed up components to handle higher compression. “We like the style of the car and their quest for nothing but the best,” says Ken Anderson, Cosworth vice president of sales. “They are very passionate about this.”

Performance also is boosted by the carbon fiber skin, which cuts about 400 pounds in weight. It’s made by Irvine-based Aria Group, which is better known for building concept cars for auto shows. A six-speed transmission replaces the original five-speed. Widely flared fenders and a rear spoiler that rises at 60 mph make it look race-ready.

The result is a car that can leap from 0 to 60 miles per hour in as little as 3.8 seconds. “It is frighteningly quick,” Dickinson says.

Frighteningly expensive, too — Singer versions are $190,000 to $360,000.

Three have been built so far; two others are in progress.

Dickinson, who grew up in England, says he’s been a Porsche fan almost from the start. “I’ve been obsessed with the 911 since I was 5,” he says.

He was trained in auto design but first chose a career that better lent itself to owning a series of Porsches: rock star.

He was lead singer in Catherine Wheel, a British alternative band that had two songs in the U.S. modern rock top 10 in the 1990s (Black Metallic and Crank). Hence the name Singer.

To gauge interest, he unveiled plans for a 911 that is “restored, reimagined and reborn” at the Pebble Beach Concours d’Elegance auto show in 2009. “People’s jaws were on the floor,” he says. “We knew we were on to something.” Shortly thereafter, Singer got its first orders.

Part of the buzz owes to the car’s utility. It doesn’t need to sit in the garage all week waiting for weekend track time, but can commute as well. The old Porsches get such modern amenities as a cup holder that juts out from under the passenger’s seat, a 110-volt outlet for your laptop and, of course, a pullout iPod box.

Dickinson sweats the details. “He’s fanatical,” says Seamus Taaffe, Singer’s production manager. “He sees things others can’t see.” Example: He spent six months finding the right xenon headlights.

But in the end it’s performance that sells the car. That’s what attracted Matt Strong, a serial Porsche owner who discovered Singer while Internet surfing, bought a car — and then invested in the company.

“Once I got into the car and saw that it really was everything that I was hoping it would be, it upped my level of confidence in what Rob is doing,” he says. “The Singer really has a lot of character put into it, and a lot of the modern conveniences that I’ve become accustomed to — and don’t want to live without.”

Strong just received the first Singer. The lime-green model was shipped to him in Wisconsin. Despite the amenities, he doesn’t plan on driving it a lot. “It will be fantastic at the track, but this one is too much of a piece of art for me.”

Dickinson hopes to soon cut production time so he can build eight to 10 cars a year and he’s looking for growth outside the U.S. as well, especially among the new rich in China.

“Building a car from scratch is a daunting task,” Dickinson says. “The more we make, the better we’ll get.”

See photos of: Porsche

Pickup makers agree to standard test for towing ratings

Q: Steve, I hear so much these days about e-commerce and e-business, but it sure hasn’t worked for me. I have a nice site but seem completely unable to make any money off of it, or to even get many people to visit it for that matter. Help! Ellen

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  Annette Brown, Getty Images

  Chuck Leavell performs at the 2nd Anniversary of the Mother Nature Network at the Millenium Gate Club on June 2, 2011 in Atlanta, Georgia.

Annette Brown, Getty Images

Chuck Leavell performs at the 2nd Anniversary of the Mother Nature Network at the Millenium Gate Club on June 2, 2011 in Atlanta, Georgia.

A: I hear variations of this question all of the time, and that is because it’s legit. With seemingly bazillions of websites out there offering copious content and gizmos galore, getting heard above the din – and making a buck in the process – is no easy task.

While I personally have had some success on my own site selling both products and services, what we need here is a real expert; a big game Internet hunter who has bagged the big cats.

Enter Joel Babbit.

• VIDEO: 5 questions with Chuck Leavell

Babbit is a Madison Avenue advertising guru who, a few years ago, teamed up with conservationist Chuck Leavell to create the cool website, Mother Nature Network. (What’s that you say, Chuck Leavell is a familiar name? You bet. He is also the longtime musical director and keyboardist for the Rolling Stones.)

Launched only in 2009, MNN now gets more than 12 million monthly page views and as such ranks as the world’s second-most visited environmental site (first among for-profits) surpassing the U.S. National Park Service, the EPA and more than 7,000 others in the category.

But more importantly for our purposes, MNN makes money. A lot of money. Revenue climbed to $6 million in 2010, from $3 million in 2009. Leavell and Babbit expect more than $9 million in revenue by end of this year.

So how did they do it? How did two guys take their passion, enter a very crowded field (what isn’t “green” these days?) and make money hand over fist in a little more than a year? I asked the smart and affable Babbit that question when we spoke recently.

The first thing he pointed out is how clean their site is. As opposed to far too many websites that use an advertising model, MNN is not cluttered with advertising banners, Google links, hotwords and the like. Instead what you see is an esthetically elegant site that is long on great content and short on drab hype.

But this is not so say they don’t have advertisers, they do. Each section of the site is sponsored by a different company. That company not only gets exclusivity in that section 24/7/365, it also gets significant online real estate in that section, except that the ads are mostly limited to that specific area – you won’t find ads crowding out the content. As such, the site becomes more about sustainability and less about commerciality. MNN is popular because it offers great content in an informative, engaging way. And that popularity translates into ad revenue since, after all, advertisers like eyeballs.

Get people to come to your site for the great content and watch the advertisers follow.

That is the first lesson. Beyond that, Babbit has five more excellent tips for creating a website that makes money:

1. Keep your overhead low: Babbit says that it is vital to keep expenses down. “Costly advertising campaigns, perks, expensive offices, and hiring based on projections versus current needs are deadly.”

2. Keep it real: It is important to have a realistic revenue model and execute it effectively. For instance, charging for content is usually not a very good idea online.

3. Search engine optimize, and then optimize some more. The importance of search and optimization cannot be overstated. “No matter how good your site is, if you’re not highly ranked in search results, you can’t achieve significant traffic.”

4. You’ve got to have friends: Another way to grow your site without incurring significant expenses is to foster no-cost partnerships with organizations, companies, and other sites that can drive visitors to yours.

5. No deadbeats: “Deal only with companies that have the financial ability to pay their bills and collect receivables aggressively.”

So take some advice from the e-master, Joel Babbit. If you follow his successful strategy, you won’t be writing me saying “I can’t get no satisfaction!” (Groan, I know, sorry.)

Today’s Tip: Are you looking to start a business? Then let me suggest that you check out Corporation.com’s Business in a Box. This great tool essentially gives you everything you need to start your business:

• Incorporation.

• A business planning tool.

• Consultation with small business advisers.

• A website builder.

It’s great. Steve says check it out!

Ask an Expert appears Mondays. You can e-mail Steve Strauss at: sstrauss@mrallbiz.com.See an index of Strauss’ columns. Steven D. Strauss is a lawyer, author and speaker who specializes in small business and entrepreneurship. His latest book is The Small Business Bible. You can sign up for his free newsletter, “Small Business Success Secrets!” at his website —www.mrallbiz.com. Follow him on Twitter at http://twitter.com/stevestrauss.

Posted | Updated

GENEVA — Nestle, the world’s biggest food and drink company, took another big step into the Chinese market Monday with the announcement that it is to buy a majority stake in candy maker Hsu Fu Chi for 2.1 billion Singapore dollars ($1.7 billion; $1.4 billion Swiss francs).

• 

  AFP/Getty Images

  A shopper selects varieties of Chinese candies by sweetmaker Hsu Fu Chi at a supermarket in Nanjing, eastern China’s Jiangsu province on July 11, 2011.

AFP/Getty Images

A shopper selects varieties of Chinese candies by sweetmaker Hsu Fu Chi at a supermarket in Nanjing, eastern China’s Jiangsu province on July 11, 2011.

The Swiss manufacturer of Nescafe coffee, KitKat bars and Dreyer’s ice cream, said it will acquire 60% of shares in Singapore-listed Hsu Fu Chi, which had sales of almost $800 million last year.

The Hsu family will retain the remaining 40% stake, with current CEO and chairman Hsu Chen continuing in those roles.

Analysts at Zuercher Kantonalbank said the price for Hsu Fu Chi was high, but noted Nestle’s strategic ambitions in China — one of the emerging economies where the Vevey, Switzerland-based company sees the strongest chances of future growth.

“This proposed partnership will greatly reinforce our presence in China,” Nestle CEO Paul Bulcke said in a statement. “It also demonstrates our long-term commitment to China and enhances our ability to grow our portfolio of international and local brands in this dynamic market.”

In April, Nestle bought a controlling stake in Yinlu Foods Group, a Chinese producer of ready-to-drink peanut milk and canned rice porridge, for an undisclosed amount.

Nestle is particularly eager to exploit Hsu Fu Chi’s distribution network in China. The confectionery company, founded in 1992 by four Taiwanese brothers, operates four large-scale factories in China and employs 16,000 people.

Hsu Fu Chi makes sweets, cereal snacks, packaged cakes and sachima, a traditional Chinese pastry made of flour, butter and rock sugar.

Nestle entered the Chinese market over twenty years ago and last year had sales of 2.8 billion francs in the China region. Its biggest sellers in China — where it operates 23 factories and employs 14,000 people — include Nescafe, Nan and Maggi as well as domestic brands such as Totole, Haoji and Dashan.

Worldwide Nestle sales reached 109.7 billion francs last year, up from 107.6 billion in 2009.

The takeover of Hsu Fu Chi is subject to regulatory approval in China, Nestle said.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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It’s a victory for truth, justice and anybody who ever towed a trailer up a steep hill.

Major makers of pickups and SUVs have agreed to a standard test to rate their vehicle’s towing capacity. By the end of the 2013 model year, most truck buyers should know — for the first time — how a vehicle performs versus the competition.

“We wanted our customers to know that 10,000 pounds of towing capacity means the same things for all trucks,” said Robert Krause, the General Motors engineer who chaired the Society of Automotive Engineers committee that created the new standard.

This is a really big deal for millions of drivers. Towing capacity measures how heavy a trailer a vehicle can safely haul. The rating is as important to many pickup and SUV buyers as fuel economy or horsepower are to minivan or sports-car shoppers.

The big difference, and the reason the SAE standard is a breakthrough, is that, until now, automakers could pretty much make up the numbers they claimed for towing capacity.

Each company designed its own test, and — Surprise! — their trucks always aced the tests. Imagine the EPA didn’t exis and car companies could just make up fuel-economy figures to boost sales.

It’s been caveat emptor, and catch me if you can on towing. Makers would boast about the pounds their pickups and SUVs could tow, and their exhaustive testing used to determine the towing capacity.

But when a new truck claimed a higher number, the other manufacturers would rewrite their spec sheets. Their trucks’ towing capacity — coincidentally … magically! — increased to match or beat the new kid on the block.

It was a farce, but there was nothing a customer could do, short of bringing a 10,000-pound trailer to their test-drive.

The new standard solves that problem. Created with input from leading truck, trailer and hitch makers, it assures that every truck tested fulfills the same performance requirements.

“Before, you couldn’t say who had the best towing capacity, because you didn’t know how it was tested,” says Mike Levine, editor of Pickuptrucks.com. “This is the first time a customer can do an actual apples-to-apples comparison.”

The test is demanding and automakers expect published ratings to decrease:

The SAE test includes real-world tasks like acceleration, braking, towing up a steep grade in 100-degree temperatures, understeer and stability. In addition to validating a truck’s working credentials, it assures a basic level of safety for the driver and for others on the road.

With the demanding test, automakers expect their tow ratings to decrease by anything from a few hundred to more than a thousand pounds. They’re willing to take the hit, because it’s in their interest as well as the customers’ to have credible towing figures.

Toyota is the first to use the standard. It already applied it to the Tundra. The Tundra’s claimed towing capacity decreased, but its credibility grew.

Chevrolet, Dodge, Ford and GMC full-size pickups are expected to adopt the test during the 2013 model year, which begins Jan. 1, 2012. Nissan will use the standard someday, but won’t say when or on which vehicles.

Every truck tested to the standard can say its towing capacity is SAE rated. That’s the Good Housekeeping Seal of Approval when it comes to vehicle performance. The SAE is the leading independent body for vehicle standards and tests.

The towing standard is not mandatory. No manufacturer has to use it. If they don’t, though, the figures they claim for towing capacity will be less credible and more open to challenge than their competitors’.

– Mark Phelan/Detroit Free Press

See photos of: General Motors, Ford Motor Company, Toyota Motor Corporation, Chevrolet

NEW YORK (AP) — The parent of Dunkin’ Donuts plans to raise as much as $401 million before expenses through its initial public offering of 22.3 million shares, which are expected to price between $16 and $18 apiece.

• 

  Darron Cummings, AP

  Bags of coffee sit on the shelves at a Dunkin’ Donuts store in Indianapolis, Indiana, October 14, 2010.

Darron Cummings, AP

Bags of coffee sit on the shelves at a Dunkin’ Donuts store in Indianapolis, Indiana, October 14, 2010.

Dunkin’ Brands, parent company of Dunkin’ Donuts and Baskin-Robbins, disclosed the estimated pricing in a regulatory filing on Monday.

The company anticipates proceeds of about $348.4 million after deducting expenses if the IPO is priced at the midpoint of $17 per share.

Dunkin’ is giving the underwriters a 30-day option to buy up to an additional 3.3 million shares.

The company previously announced that it would use its proceeds from the stock offering to pay down about $475 million in high-interest debt owed to banks. That money was borrowed partly to pay a $500 million dividend to some of the company’s current shareholders.

Dunkin’ is also hoping it will have money left over to fund expansion plans.

The company’s stores are concentrated in the northeastern U.S., where it has about one location for every 9,700 people. Now it wants to expand into the western U.S., where it averages one store per 1.2 million people.

The company plans to trade on the Nasdaq under the “DNKN” ticker symbol. The timing of the IPO has not been disclosed.

Dunkin’ Brands has about 16,200 locations worldwide, behind Starbucks’ 16,900 locations.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

BRUSSELS — European officials are trying to work out a strategy Monday to prevent the eurozone’s debt crisis from spilling over into bigger economies such as Italy and Spain, as they discuss details of a second bailout for Greece.

• 

  Aris Messinis, AFP/Getty Images

  The flags of the European Union and Greece fly above the Parthenon on the Acropolis hill in Athens, Greece, May 10, 2011.

Aris Messinis, AFP/Getty Images

The flags of the European Union and Greece fly above the Parthenon on the Acropolis hill in Athens, Greece, May 10, 2011.

Intense debate over how, and how much, banks and other private investors can contribute to a new rescue package for Greece has unsettled financial markets in the currency union, most dramatically in Italy, as rating agencies warn that even a voluntary involvement will likely be seen as a partial default of Greece on its massive debts.

Though the proposals currently doing the rounds may be less severe that a Greek payment halt, for example, Moody’s said in a note Monday that the “prospect of any form of private sector participation in debt relief is obviously negative for holders of distressed sovereign debt.”

Moody’s warning follows a report last week from Standard Poor’s that said that even a relatively market-friendly French proposal on a voluntary rollover of Greek debt would likely trigger a “selective default” rating.

Investors are concerned that the debt crisis, which has so far been contained to the small economies of Greece, Ireland, and Portugal, could soon drag down bigger countries like highly indebted Italy and unemployment-ridden Spain. The mere size of their economies could easily overwhelm the rescue capacity of the rest of the eurozone.

The yield, or interest rate, on Spanish and Italian government bonds shot up Monday morning, in contrast to other big economies, while the euro dropped 0.6% to $1.412.

Yields on Spanish 10-year bonds rose from 5.7% at the start of trading to 5.8%, while the yield on Italian 10-year bonds meanwhile increased to 5.4% from 5.3%, following sharp rises on Thursday and Friday.

“The fact that contagion is spreading marks the failure of politicians to draw a line under the Euro-crisis to date,” Rabobank analyst Jane Foley said. “As yields rise and debt financing costs become even more exaggerated the difficulties of containing the crisis become even bigger.”

The threat of contagion and the wider financial market jitters are set to feature prominently in a meeting of eurozone finance ministers in Brussels Monday afternoon.

The ministers will debate whether a substantial contribution from banks to a second bailout is worth letting the country temporarily slip into default. However, senior eurozone officials warned that no decisions are expected Monday, with talks likely to drag into September.

To stay afloat until mid-2014, Greece will need an extra €115 billion ($164 billion)— on top of the €110 billion ($157 billion) it was granted last year — according to the European Commission, although some of the money will come from privatizations.

Frustrated with the slow progress on Greece, European Union President Herman Van Rompuy, usually in charge of the summits of EU leaders, called in top officials — including European Central Bank President Jean-Claude Trichet, the EU’s Monetary Affairs Commissioner Olli Rehn and European Commission President Jose Manuel Barroso — for an unscheduled get-together ahead of the finance ministers meeting.

Trichet in particular has stressed the potential negative consequences of a default rating, even a temporary one.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

Remember how we all blamed investor/flippers using faulty financing for the housing crash?

• 

  Damian Dovarganes, AP

  A sign for Fannie Mae financing is posted on a foreclosed property offered for sale, May 31, 2011 in Los Angeles, Calif.

Damian Dovarganes, AP

A sign for Fannie Mae financing is posted on a foreclosed property offered for sale, May 31, 2011 in Los Angeles, Calif.

You know, these are all the bad guys who ran up home prices to their own profit, with no concern for the inevitable fallout; they colluded with overzealous, borderline blind, lenders who gave anybody and everybody a loan with no attention paid to their ability to repay said loan.

That’s all over now. You can’t get a loan without pledging your first born in collateral, and if you’re an investor, you rank somewhere just below Angelo Mozilo.

Or do you? Last month Fannie Mae made a little change in the rules for all-cash buyers to apply for mortgages. I don’t recall a press release, and I’m quite sure I’m on their mailing list. But there it is, “Announcement SEL-2011-5,” a “Selling Guide Update:”

• STORY: Government Mortgage Bailout Numbers Still Weak

• PHOTOS: America’s Biggest Double-Dip Real Estate Markets

• PHOTOS: Most Expensive States to Live In

Currently, Fannie Mae requires a minimum of six months to elapse between the time a borrower purchases a home and subsequently applies for a cash-out refinance.

The Selling Guide has been updated to allow a cash-out refinance within six months of a purchase transaction when no financing was obtained for the purchase transaction.

There are of course all kinds of parameters, including maximum LTV (loan-to-value ratio), documentation, arms-length transaction and “all other cash-out refinance eligibility requirements and cash out pricing applied.” The mortgage cannot be larger than the value of the home, of course.

Hands down, this is a boon to investors, who can now get equity out of their investments faster. It’s also a boon to home buyers who couldn’t compete in the long term with all-cash investors, but who might be able to put down the cash for a few weeks before obtaining a mortgage.

So is this a “loosening” of standards that could fuel all those nefarious investors of the housing boom? Wait, maybe today’s investors aren’t so dangerous after all (as I’ve been saying over and over).

“We continually examine our policies and standards to determine what changes to make to better serve the market, and this is one of those changes,” said Fannie Mae spokesman Andrew Wilson.

“There is a role for everyone in stabilizing the market, including those who invest in properties to repair and improve them, owner occupant buyers, and those that build and maintain quality, affordable rental units,” Wilson said. “We believe our requirements are carefully crafted to ensure that we are financing legitimate buyers who opt to purchase with cash.”

All-cash buyers are now one-third of the market and far higher in the more distressed markets. Most all-cash buyers are investors, but owner-occupants are also trying to take advantage of reduced pricing on distressed properties; trouble is they can’t always compete in the all-cash arena.

A lot of deals, especially short sales (where the bank lets you sell for less than the value of the mortgage), have fallen apart because of buyer financing issues. All-cash buyers also usually get a price break in competitions with financed buyers, as sellers would rather just see the money. This could give some owner occupants at least an even playing field with investors. Obviously they still need the cash up front, but only temporarily.

Will this now create a new breed of quick flippers? Today’s investors tend to hold long-term and rent out in order to make their gains, but now, with a quick financing option, they may take the money out to do upgrades and then put the property right back on the market.

Tough to say, but it certainly changes the lending landscape and signals something of an olive branch to all those real estate investors, who are helping to clear the vast quantity of distressed properties that continue to plague the nation’s housing market.

© 2011 CNBC.com

Posted

Here is a list of best buys in new vehicles out there that will appeal to shoppers who are flexible and not necessarily looking for the hottest new car or truck.

Where your flexibility comes in is that some of these six values may be models due to be replaced and/or with trims, equipment or engine-transmission combinations that are not selling as fast. This best-value list, the Car Buyers Market Report, is compiled quarterly by the National Automobile Dealers Association’s online pricing and data service.

NADAguides bases its list on short- and long-term value, so it looks at competitive starting price, incentives, a low first-year depreciation rate and better-than-average long-term value retention. It also looks at the days-supply on dealer lots, meaning you can actually find one and strike a decent deal.

Here’s the second quarter with a Drive On comment or two. The full NADAguides data on why they made the list are below.

• The 2011 Acura TL, a solid car with controversial styling. It has been replaced by a 2012 model with the styling toned down.
• The 2011 Dodge Challenger with the R/T trim, the sporty two-door whose sales have been slower that rivals Mustang and Camaro.
• GMC Terrain SLE-2, a hot, small crossover with perhaps more supply of this trim.
• Hyundai Azera Limited, a moderately upscale sedan due for redesign in the coming year, no doubt bringing its conservative look in line with the brand’s new swoopy style.
• 2011 Toyota Tacoma Double Cab V-6 Manual, the brand’s midsize pickup with the four-door, two-row crew cab and a stick shift.
• 2011 Toyota Venza I4 AWD, the Camry-based crossover/wagon/hatchback with a four-cylinder engine and all-wheel-drive.

Said Troy Snyder, director of product development at NADAguides: “The results of our most recent Car Buyer’s Market Report show a healthy mix from diverse manufacturers across several segments.”

Here is what NADAguides says makes these vehicles top current buys:

(Note: Financing rates based on California data and may vary in your region)

2011 Acura TL:The TL made the list based on its first-year depreciation rate of 19%, its 22 mpg rating in combined driving, financing incentives, and an abundance of safety and comfort features. Acura is currently offering 1.9% financing for 36 months, and 2.9 % for 48 or 60 months. With a four-year, 50,000 mile warranty, 62 days-supply on lots at the end of May, and a competitive starting price of $35,305. TL comes with Acura’s Total Luxury Care — 24-hour emergency and travel services, roadside assistance, Acura Concierge Service and other benefits.

2011 Dodge Challenger R/T: With a mere 8% first-year depreciation rate, a starting price and financing incentives, this Challenger offers both short-term and long-term value. Current financing deals are 1.9% on 36 months, 2.9% on 48, 3.9% on 60 and 5.9% on 72. Dodge is also offering $1,000 bonus cash. Other features: a combined mileage rating of 20 mpg MPG, 375 horsepower, four-star federal safety rating.

2011 GMC Terrain SLE-2:Starts at $26,300 MSRP and has a first-year depreciation rate of 16%. Current financing offers: 2.9% for 36 months, 3.9% for 48, 4.9% for 60 and 5.9% for 72 months. Dealer days-supply is 46, combined mileage rating of 27 mpg, two-year, 36,000-mile warranty, a four-star federal safety rating, six months free OnStar communications service.

2011 Hyundai Azera Limited: Has a 21% first-year depreciation, starting price of $30,095 and comes with Hyundai’s trade-in guarantee that promises a specific trade-in value in 2-4 years. Current Hyundai owners get $1,500 value owner coupon. Azera has a current days-supply of 103, a five-year, 60,000-mile warranty, a five-star federal safety rating and a combined mileage rating of 23 mpg.

2011 Toyota Tacoma Double Cab V-6 with manual transmission: Starting price of $26,145, low first-year depreciation of 10%, three-year, 36,000-mile warranty, four-star federal safety rating along with Toyota’s Star Safety System and current days-supply of 53. Also comes standard with the Toyota Care free maintenance and roadside assistance for two years or 25,000 miles.

2011 Toyota Venza with four-cylinder and all-wheel drive: Low 12% first-year depreciation, starting price of $28,575 and 79 days-supply. Toyota is currently offering $500 cash or 0% financing on 36 months, 1.9% on 48 or 2.9% on 60. Has three-year, 36,000-mile warranty, four star federal safety rating, Bluetooth phone controls and Toyota Care free maintenance and roadside assistance.

See photos of: Toyota Motor Corporation, Hyundai, Acura, GMC

St. Louis most loyal to U.S. car brands, L.A. is foreign heaven

Six best values in new vehicles right now

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The requested document was not found.

Last month’s fall in the number of temporary workers could herald continued weakness in the job market.

• 

  Mark Ralston, AFP/Getty Images

  People search for jobs in an employment office in the southern Californian town of El Centro, on Oct. 28, 2010.

Mark Ralston, AFP/Getty Images

People search for jobs in an employment office in the southern Californian town of El Centro, on Oct. 28, 2010.

The total number of temporary employees placed by staffing agencies dipped by 12,000 last month and is down 19,000 the past three months, the Bureau of Labor Statistics reported Friday.

That doesn’t bode well for a rapid turnaround in the broader job market because employers typically hire temporary workers to meet increased demand, then convert them to permanent positions when they’re confident growth will be sustained.

“It’s not a good sign” for the next two months, says Paul Ashworth of Capital Economics.

• INTERACTIVE: Where the jobs are

• STORY: Economy adds a weak 18,000 jobs

Overall, U.S. payrolls grew by 18,000 last month and 25,000 in May after swelling by an average 215,000 in each of the previous three months. Economists blame high gas prices and Japanese supply disruptions that crimped car sales. Both problems have eased recently, and many economists expect stronger job growth this year. The questions: when and how strong?

Friday’s job report wasn’t heartening. The average workweek edged down to 34.3 hours from 34.4 hours in May. Employers typically increase the hours of existing employees before bringing on new workers.

Temporary workers, however, could be the most telling signal. The number of contingent workers started growing in fall 2009, about six months before the broader job market began to emerge from the recession. From September 2009 to March, employers added nearly 500,000 temporary workers.

Roy Krause, CEO of Spherion, a top staffing agency, says temporary placements for white-collar jobs in accounting, computers and legal remain strong. But those for lower-skilled light industrial, clerical and certain call-center jobs — which accounted for most of last year’s growth — have slowed. “They tend to be more sensitive to economic conditions,” he says.

Chemical maker Arkema of Philadelphia employed about 150 temporary workers earlier this year. But it trimmed that total by about 50 in April and May as the weak economy prompted it to cut its 2011 forecast, Vice President Chris Giangrasso says. Arkema, he says, will likely not add this year to its permanent staff of about 2,500 in North America.

Posted

DES MOINES — Muhammad Abdullah needed a line of credit to fill large orders from customers of his safety and medical-supplies business, but he couldn’t get help from a bank. So he turned to a credit union.

• 

  By Andrea Melendez,, The Register

  Success: Muhammad Abdullah is one small business owner who couldn’t get a loan from a bank, but he got one from a credit union. He has a business supplies company in Des Moines.

By Andrea Melendez,, The Register

Success: Muhammad Abdullah is one small business owner who couldn’t get a loan from a bank, but he got one from a credit union. He has a business supplies company in Des Moines.

He got the line of credit, and now he’s taking orders he wouldn’t be able to otherwise.

“It’s not the normal way, but I guess I’ve been doing business with credit unions personally for a good while,” said Abdullah, who owns Legacy Business Group in Des Moines.

Credit unions are expanding to fill a void in business lending left by banks since the financial crisis. As banks have been slow to start lending again, credit unions have gotten a head start.

Banks still carry about 12 times as much in loans as credit unions in America, according to Federal Deposit Insurance Corp. statistics. But over the past two years those numbers have trended in opposite directions, and officials at major credit unions say they are more interested than ever in commercial lending, not traditionally the core function of a credit union.

From March 2009 to March 2011, total loans by banks declined by more than $500 billion, according to FDIC data. Over the past year, credit union business lending is up 5%, while bank business lending is down 3% — a decline of about $95 billion, according the Credit Union National Association

Pat Keefe, a spokesman for the Association, said credit unions are pushing into business lending in part because of slow demand for consumer credit — auto and home loans, for instance.

“Businesses are looking for new sources of credit; credit unions are looking for new sources of borrowers,” he said. “They’re improvising strategies to do business lending.”

In January, Abdullah’s company took a $60,000 order for fire extinguishers, fire extinguisher cabinets, white boards, bike racks and other things needed for an Armed Forces Readiness Center in Middletown, Iowa. Legacy Business Group suffered in 2009 and 2010, and Abdullah couldn’t get a bank to extend him a line of credit, he said. Then he saw an article about Veridian Credit Union.

“They said they want to work with small business, and so we called them,” he said.

Veridian offered him a $25,000 line of credit, and he said it has helped him deliver on the big jobs that pay the bills.

Competing with the big boys

In Iowa, Veridian is now a larger financial institution by assets than all but three of Iowa’s banks. John Poley, who was a banker for 20 years, has been head of commercial lending for Veridian since 2008. He said the credit union’s business lending was up 80% from 2009 to 2010, with most of the growth coming in metro Des Moines.

“We do everything. We’ll do your little mom-and-pop start-ups, manufacturing, industrial,” he said. “If we had to pick the one that we have the most exposure in, it would be real estate, I suppose.”

Poley said credit unions avoided the bad loans in commercial real estate that have plagued many banks since the financial crisis, and credit unions have been freer to lend.

“We’re still doing everything we’ve ever done. We just so happen to be able to now step into a void in that lending space that they’ve created,” he said.

Credit unions are pushing federal legislation that would lift a regulatory cap on their business lending. They are allowed to make loans equaling up to 12.25% of their total assets. Bills in both the U.S. Senate and House of Representatives would raise the cap to 27.5%. Both bills have been referred to committee.

The American Bankers Association opposes the legislation. Chairman Stephen Wilson testified at a Senate hearing in June that the bill is “nothing less than legislation that would allow a credit union to look and act just like a bank, without the obligation to pay taxes or have bank-like regulatory requirements applied to them.”

Banking executives believe credit unions’ non-profit status and exemption from federal income tax is already an unfair advantage, and they argue the increased emphasis on commercial lending calls the advantage further into question.

“To me it’s pretty obvious that our calls for transparency and evaluating whether or not credit unions are actually using that exemption for its correct purpose — there’s a good deal of data that backs that up,” said John Sorensen, president of the Iowa Bankers Association.

Belz also reports for the Des Moines Register

Posted

When the biggest passenger jet in the world — eight stories high and longer than a football field is wide — made its inaugural landing at Miami International Airport last month, the welcome befitted the arrival of a rock star more than an airplane.

• 

  By Reed Saxon, AP

  An Airbus A380, the world’s largest passenger jet, passes the old control tower at Los Angeles International Airport.

By Reed Saxon, AP

An Airbus A380, the world’s largest passenger jet, passes the old control tower at Los Angeles International Airport.

Water cannons sprayed and crowds cheered the mammoth A380 jet, made by European planemaker Airbus and flown from Frankfurt by its owner, German airline Lufthansa.

“We thought, ‘This is a historic moment for the airport,’” Greg Chin, spokesman for the Miami-Dade Aviation Department, said of the June 10 arrival. “So we felt historic aircraft deserve a historic day.”

Since the A380 flew its first commercial flight from Singapore to Sydney in October 2007, the jet that surpassed the American-made Boeing 747 to become the largest passenger plane in the world has joined the fleets of six airlines and ferried more than 12 million passengers. This summer, it will appear in the USA in greater numbers and be available to more American travelers, as airlines such as Lufthansa fly it to runways from San Francisco to Washington, D.C.

Airlines that fly the superjumbo A380 say they’re having no trouble filling most of the 525 seats that are typical for the aircraft. And they and Airbus officials tout the plane’s fuel efficiency, design and comfort as setting a new standard for the travel industry.

“This is an aircraft that has become a new benchmark of efficiency and customer appeal,” says Richard Carcaillet, head of A380 marketing for Airbus, Boeing’s chief global rival in the production of passenger jets. “It’s a game changer.”

But while U.S.-based fliers can hop aboard the supersized jet in five cities, no U.S. airline currently flies it. And with U.S. airlines focused on boosting profits and flight frequency, some analysts doubt they’ll add the superjumbo A380, or even more of Boeing’s nearly as big 747s, to their fleets anytime soon.

“There’s a reason that (U.S. airlines) are not adding 747s to their network,” says Bob McAdoo, senior airline analyst at Avondale Partners, a Nashville-based institutional brokerage house. “They’ve all gotten rid of them because they’ve found other airplanes that are a better fit for the way they want to fly their routes,” with smaller aircraft better able to make more frequent non-stop trips from U.S. cities.

For all its rock-star appeal, the double-decker A380 also poses a mammoth challenge for many airports that already struggle with heavy air traffic and now have to deal with its giant size on their crowded runways and taxiways.

Changing airliners

A next generation of aircraft that’s lighter, more fuel efficient and environmentally friendly is beginning to take flight. Among them: Boeing’s new Dreamliner 787 and Airbus’ A350, which are being made largely from carbon fiber composites instead of aluminum, and Boeing’s latest version of its jumbo 747 that drew on some Dreamliner technology.

The A380 is counted among them. But Airbus says the A380′s massive size and cabin perks set it apart. “These are aircraft that will also be very advanced,” Carcaillet said of the other new aircraft being developed. “But (they) will not bring a novelty in terms of capacity or experience.”

Six carriers, including Singapore Airlines, Air France and Emirates, are flying 51 A380s between 25 airports. As of June 29, Airbus has had 234 orders for the aircraft from 18 customers. Chances to fly the A380 from the U.S. to Europe and Asia are also on the rise, with eight new North American routes being added this summer.

Lufthansa flights between Miami and Frankfurt are among the newest. Based on the German airline’s experience flying seven of the jets, with eight more on order, officials expect customers to clamor to get on board.

“We see if people have a choice between two aircraft, and one is an A380, they definitely steer toward the A380,” says Martin Riecken, senior spokesman for Lufthansa for the Americas. He added that the plane typically flies “well above” 85% full. “There’s still hype about the aircraft. People sometimes even fly a day later to make sure they get an A380.”

Composite materials make up 25% of the jet’s body. Despite its size, Airbus says, the A380 burns 20% less fuel per seat than a 747-400, conserving both the environment and an airline’s cash.

“If you look in the future and imagine the pressure from authorities, from the community about fuel emissions, about climate change, about saving fossil fuel, all that will work, and we will save on the price of fuel,” says Pierre-Henri Gourgeon, CEO of Air France, which began A380 service between Paris and Washington’s Dulles airport on June 6.

The jet also is quieter than its long-haul peers, Airbus and airline officials say, and has systems that maintain premium air quality in the cabin.

Traveler Brian McCarty, a sound engineer in the film industry who’s flown on an A380 twice, says he was struck by the high air quality.

“I usually sleep pretty well on airplanes anyway, but the difference in air quality was immediately apparent after the plane took off,” says McCarty, a former Los Angeles resident who lives in Australia. “You don’t get that kind of groggy feeling that quite often you get flying long distances, and there just seemed to be more air circulation generally.”

Gourgeon also has high praise for the aircraft’s quiet and space. “The difference in noise is very significant compared to the aircraft you’re used to flying,” he says. And “Everywhere — in business class, economy class — you have space.”

“It’s an aircraft which gives a different sensation,” he says. “It’s like a big ship on the sea. If you go through clouds and it’s supposed to be shaky, this aircraft is moving gently.”

The jet’s size also helps Air France’s bottom line by enabling it to fly more passengers in a single plane on certain long-haul flights. “In our calculation, when we replace two average-size aircraft of 250 to 300 passengers, with this one, which is 538 passengers, we estimate our savings yearly is $20 million, which is very significant,” he says, noting that the airline is paying fewer pilots, among other savings.

Maneuverability a challenge

But at 79 feet tall, 239 feet long, with a wingspan of 262 feet and a top take-off weight of more than 1.2 million pounds, the A380′s girth has also been a challenge.

The jet requires big runways. And maneuvering the plane around airports has been accompanied by some mishaps.

The Federal Aviation Administration requires airports that want to receive the A380 to have 200-foot-wide runways, the standard for the largest aircraft. In 2007, airports were allowed to apply a modification to the standard for the A380 to use 150-foot-wide runways already in place at most major U.S. airports. However, new runways or those undergoing significant work using federal money must be built to meet the larger size requirement.

On April 11, an A380 operated by Air France and taxiing at New York’s JFK Airport made national news when it knocked into the tail of a Comair CRJ700. Air France said in a statement that the clipping, which was being investigated by the National Transportation Safety Board, “only caused material damage to the two aircraft.”

Carcaillet of Airbus added that while “it was a minor mishap, something that clearly shouldn’t have happened, this is one of a million movements of A380s around the world, so there’s no trend that the A380 is bothering other aircraft on a regular basis.”

Perhaps more embarrassing was an incident last month at the Paris Air Show, the aviation industry’s premier event, where an A380 wing tip hit a building and required minor repairs.

Several airports have made changes to accommodate the superjumbo jet.

Miami spent $4 million to add a third loading bridge to funnel passengers onto the A380′s upper and lower levels, says Chin. San Francisco International Airport built its new international terminal, which opened in December 2000, with the A380 in mind.

“When we started the facility … we went to Boeing and Airbus and said, ‘What’s the biggest airplane you’ve had on your books?’ And that’s what we designed (it) to accommodate,” says San Francisco airport spokesman Mike McCarron. He added that there have been “no problems at all” with the large jet clipping other planes.

Miami airport officials think the large aircraft will usher more customers and revenue to airport shops and restaurants, as well as make the Florida hub more prominent.

“You’re talking about an increase of 200 seats per day on the same route,” says Chin. “In addition, it brings a prestige to the airport, putting us in a class of lead airports around the world, very few that are able to accommodate the A380. So it definitely adds cachet.”

But for now, some U.S. airlines seem to be bypassing the A380 in favor of other new long-haul aircraft. United and Continental, in the wake of their merger “have firm commitments to purchase 125 new aircraft, including Boeing 737 and 787 aircraft and Airbus A350 XWB aircraft,” says spokesman Rahsaan Johnson.

And for the more frequent, shorter flights that AirTran flies, the A380 doesn’t quite work, says spokesman Christopher White. “The A380 doesn’t fit our model of relatively short hops and high utilization,” he says. “Typically, the A380, Boeing 747 and other jumbo jets are used on long-haul routes that just don’t fit our route map. It’s not efficient or cost-effective to fly a superjumbo jet from Atlanta to Tampa.”

Some analysts say that they are not surprised.

“The market has spoken,” says Richard Aboulafia, vice president of analysis at the Teal Group. “U.S. carriers, like many other world businesses, are focused on profit, not market share.”

Posted

Hatchbacks are back.

• 

  Hyundai

  Hyundai hopes to pick up market share with the 2012 Accent.

Hyundai

Hyundai hopes to pick up market share with the 2012 Accent.

The hatchback — a car with a top-hinged rear door, or hatch, instead of a separate trunk — has for years been held in such low esteem by buyers that automakers invented euphemisms to describe them, if they offered them at all. Now, they’re making a comeback, driven by a push to roomy, fuel-efficient alternatives to crossovers or bigger cars.

Sales of hatchbacks from all brands increased 63% from the 2006 to the 2010 model years, says Ford Motor, citing data from Ward’s Automotive. By comparison, total cars sales fell 21% in the same period.

Ford officials say 43% of buyers opt for hatchback versions of its Focus compact, instead of the sedan. Its smaller Fiesta hatchback is hot, too. “A surprising number of people are taking the hatch,” says Robert Parker, group marketing manager for Ford.

Hyundai expects 40% of sales of the new version of its Accent subcompact, which just arrived in showrooms, to be hatchbacks. Chevrolet’s new smallest car, the Sonic, will come in a hatch version. Kia says its recently introduced Forte hatchback is beating expectations.

Among electrified models, the Chevrolet Volt extended-range electric and Toyota Prius hybrid are hatchbacks.

Only recently have automakers started calling them hatchbacks again. For years, they tried to foist them on buyers as fastbacks, five-doors, liftbacks or other terms. The hatchback market “is very cyclical,” says spokesman Jeremy Barnes of Mazda, whose Mazda3 hatch is the sportier version of the compact.

How automakers are luring buyers back:

•Luxury touches. Hatchbacks sold to college students of the 1970s and 1980s were often the cheapest cars on the lot. Now, they’re being packed with features at least equal to their sedan stable mates. “The hatch used to be the lowest common denominator, and now, they are making them more premium,” says George Peterson, president of consultant AutoPacific.

•Better looks. The hatchback of yore sometimes looked like a lopped-off sedan. Now, they are getting swoopier, more distinctive styling.

•Enhanced security. One of the biggest knocks on hatchbacks used to be that thieves could see luggage or other valuables in back. Today’s hatchbacks all have built-in covers.

Posted

The slurp’s on them. But the goof may be on you.

• 

  AFP/Getty Images

AFP/Getty Images

Today 7-Eleven, the nation’s largest convenience store chain, expects to give away 5 million 7.11-ounce Slurpees on the chain’s unofficial birthday: 7/11. That’s roughly 1,000 freebie Slurpees per store.

No coupons. No catches. No questions asked.

Those 7-Eleven folks sure must be dumb — as foxes. When they handed out 4.5 million Slurpee’s last July 11, a funny thing happened: Slurpee sales for the day rocketed 38%, says Nancy Smith, vice president of marketing.

• STORY: Goofy drinks go into overdrive for summer at fast-food spots

• PHOTOS: See new goofy drinks coming this summer

• STORY: Sonic, Burger King, other fast-food chains selling alcohol

That’s right: Folks bought more Slurpees, even though they could grab as many free tiny ones as they wanted. “You get a taste of it,” says Slurpee senior brand director Laura Gordon, “and you choose to have more.”

Perhaps. But many folks seem to be so enamored of the word “free” that they’ll spend whatever it takes to cash in. In many cases, customers will spend more on gasoline just to get to 7-Eleven and wait in line for a free Slurpee than the estimated $1 retail value of the corn-syrup-laden drink that has virtually no nutritional value.

“Slurpee drinkers are some of the most loyal fans we have,” Smith says. “They come here to have fun.” And while they’re in the store, Smith says, many buy other stuff, too.

What is it that drives consumers to chase after — even spend more to get — freebies? Denny’s has seen record crowds when it’s given away breakfasts. Ditto for free chicken wings at KFC and free doughnuts at Dunkin’ Donuts. “Free is magic,” says Barry Schwartz, professor of psychology at Swarthmore College. “If you offer something for free, people will gladly spend money to get it.”

It gets sillier: People who go to Slurpee.com can download tiny hats and confetti to celebrate, photograph themselves, then post the picture on the Slurpee Facebook page for prizes.

Schwartz isn’t buying — so to speak. “Economists are wrong about almost everything,” he says. “But they’re right about one thing: There is no free lunch — or in this case, free Slurpee.”

Posted

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As a child, Lisa Price loved fragrances. She found a way to create her own, blending different perfume oils. Over the years Price created oils and creams in her home as a hobby. In 1993 her mother, Carol, suggested she sell her body creams at a church flea market. They nearly sold out.

“I invested about $100 in that flea market, and I made my money back and then some,” she says.

And that’s how Carol’s Daughter was born.

Price spent that summer at craft fairs, street festivals and flea markets selling her handmade concoctions. As more people bought her products, she knew she could turn her passion into profit.

• VIDEO: Lisa Price turns love for fragrance into money-making venture

• STORY: SBA advice on starting a home-based business

• STORY: Booty Pop entrepreneurs turn niche idea into successful firm

“I knew pretty early on that people loved my product and wanted it,” Price says. “As long as I could manage where I sold it and how I sold it, I could manage my costs and I could make money doing it.”

Though Price, 49, was able to turn her hobby into a profitable business, Tory Johnson, a network commentator and founder of Spark Hustle (sparkandhustle.com), which provides conferences for small businesses, says that one of the biggest mistakes that people make is treating their new business like their old hobby.

“A hobby is not generally responsible for paying your mortgage, maintaining your lifestyle. That’s what a business is for. So you have to shift from thinking about this as a hobby, which is something I do simply when I feel like doing it, to thinking of it as a business,” Johnson says. Kimberly Seals-Allers, author of The Mocha Manual to Turning Your Passion into Profit, agrees, noting that not every hobby is a business.

“There is a disillusionment about entrepreneurship,” Seals-Allers says. “People think it’s easy, that they’re going to be at home or they’ll have more time. You will work harder than you’ve ever worked in your life.”

A Tip for Small Businesses

Turning something you love into a profitable business can be a natural evolution.

Social media is a great way to get the word out. By using apps on your smartphone to post pictures and information on the latest products and services you offer, you can grow your customer base by encouraging your customers to tag and share what you’re offering.

For the first six years of her business, Price ran Carol’s Daughter out of her home. She juggled her job in film and television production with the demands of entrepreneurship: mixing things, pouring things, labeling and unpacking boxes. It was a challenge, she says, balancing the expenses, managing payroll and controlling expectations. So she decided to hire an accountant on a consulting basis. Things got better.

“That was a great thing for me … because it freed up my time that I was spending doing something that I really didn’t know how to do, and it allowed me to focus on other areas of the business so that I could grow the business,” Price says.

Seals-Allers says it’s really important to have an honest assessment of skills to determine what type of business best suits your personality. “You have to really know your strengths and weaknesses, If not, your business suffers,” she says.

When Price opened her first store in 1999, the business had $1.7 million in sales. Five years later, she took on an equity partner. The decision helped her expand. Today her investors include marketing mastermind Steve Stoute, hip-hop mogul Jay-Z and movie star Will Smith.

Johnson of Spark Hustle notes how critical it is to align with people who can either help you or do things for you. She says that one of the biggest challenges aspiring entrepreneurs face is just understanding the process around launching a successful business based on your passion or hobby.

“Getting nine stores and being in places like Dillard’s and Macy’s and selling on Home Shopping Network would not have been doable by myself. I just would not have been able to borrow enough money to do that,” Price says. “I knew that I had done on my own everything I could to grow my business and that I had taken it pretty much as far as I could.”

Price’s handmade body oils and creams were popular among her customers, but she noticed an increasing demand for hair products. It was the early ’90s and African-American women with natural hair yearned for products that addressed their hair-care needs. Price filled that void.

Today Carol’s Daughter is known as much for its hair-care products as its body oils and creams. The competition from major brands hasn’t deterred her passion — or sales. She still feels strongly about her product, which has grown to 85 different items, including products for hair, skin and body. Carol’s Daughter has nine retail stores, and can be found in Dillard’s, Macy’s and Sephora. In 2009, she opened the Back Room Hand Foot Spa at her flagship store in Harlem. Customers can get manicures and pedicures with Carol’s Daughter products. And last year, the company launched its first celebrity fragrance, My Life, with RB singer Mary J. Blige on the Home Shopping Network. It sold more than 60,000 bottles in less than six hours.

As her company continues to grow, Price, who lives in Brooklyn with her husband and three children, is working just as hard as she did in the beginning. But it’s a different kind of work, she notes.

And even though Carol’s Daughter has had a slew of celebrity spokesmodels, including actress Jada Pinkett Smith, singer Solange Knowles and model Selita Ebanks, Price continues to be the chief spokesperson for her product.

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For more small business advice, check out USA TODAY’s Entrepreneur Exchange series, which runs every other Monday through mid-September. SBA-answered questions will appear alongside that series.

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“You have to sell yourself to keep yourself going. If you can’t sell you, then how are you going to sell anybody else?” Price says.

Posted

It looks like Kraft Macaroni Cheese, and Kraft says it tastes just like the original. But a new ingredient is lurking inside this version of the American family dinner staple — cauliflower.

• 

  Eric Francis, for USA TODAY

  Kraft Foods is the latest large food manufacturer to try hiding additional veggies in packaged foods to help kids eat healthier.

Eric Francis, for USA TODAY

Kraft Foods is the latest large food manufacturer to try hiding additional veggies in packaged foods to help kids eat healthier.

Don’t tell the kids!

Kraft Foods is the latest large food manufacturer to try hiding additional veggies in packaged foods, an effort to ride a renewed interest in healthy eating to fatter profits. It’s a slowly growing trend, and it’s one that is dividing food industry experts.

In June, Wal-Mart and Target stores started stocking Kraft Macaroni Cheese Dinner Veggie Pasta across the country, alongside boxes of the traditional recipe and other alternative versions, including organic and whole grain. Every neon-orange cup serving of the new recipe packs a half-serving of cauliflower.

Kraft joins brands such as ConAgra Foods’ Chef Boyardee, which includes enough tomato in some of its canned pasta to claim half a cup of vegetables per serving, and Unilever’s Ragu pasta sauces, which says it has two servings of veggies for every half cup of sauce.

In the Kraft product, the company freeze-dries cauliflower and pulverizes it into a powder, then uses that powder to replace some of the flour in the pasta.

“We know moms are always looking to please their kids and wanting to not make meals a big ordeal, insofar as being able to get them to eat their food,” said Alberto Huerta, who oversees the Kraft Macaroni Cheese brand at Kraft. “Mom is looking for ways to sneak veggies into her kids’ diet.”

Kraft via AP

Kraft says it tastes just like the original, but Kraft Macaroni Cheese Dinner Veggie Pasta contains a half-serving of cauliflower.

In Canada, the cauliflower-based pasta has been available since last March. It immediately became one of the faster-selling versions of the dish, Huerta said. It also drew new Kraft Dinner consumers, boosting overall revenue growth for the entire product line.

Kraft’s move is a variation on a theme espoused by several recent — and highly successful — cookbooks. Missy Chase Lapine is author of the “Sneaky Chef” series of cookbooks, in which she promotes a system of color-coded, pureed fresh and frozen fruits and vegetables that can be mixed into foods such as macaroni and cheese (yams or cauliflower), spaghetti (carrots and sweet potato) and brownies (baby spinach and blueberries).

“The ideal, of course, is you steam up some local, organic, freshly picked cauliflower, and your child eats it outright with a little mist of olive oil, happily,” Lapine said.

But like Kraft, Lapine takes a practical approach. “Food is only healthy if you can get someone to eat it,” she said.

Harry Balzer, who tracks Americans’ eating patterns for The NPD Group, a market research firm, says parents are making genuine attempts to get healthier foods into their kids. Fruits now make up 6% of kids’ diets, the largest share since he started tracking kids’ consumption 30 years ago. Meantime, cookies, cake, pre-sweetened cereal, candy and carbonated soft drinks are at their lowest level, in terms of their share of kids’ diets.

But vegetables, which peaked as a percentage of kids’ diets in 1984, remain a sticking point. They’re a hassle for parents to buy and keep fresh, they’re not generally seen as snack foods the way fruits are, and they’re rarely served alone as a main dish. That means if someone is cooking at home, vegetables are added work. And when they are available, many kids simply aren’t biting, the analyst said.

And while parents may have good intentions to buy healthier options, a higher vegetable content doesn’t top the list of criteria.

“I don’t think there’s a food company in American that doesn’t have on its radar the health and wellness of Americans, as a market,” Balzer said. “They think it’s a driving force in our behavior. I know it’s not. I know the driving force of our behavior is taste buds.”

For Phil Lempert, another food industry analyst, half a serving of cauliflower in the new Kraft Macaroni Cheese is better than nothing if Americans are willing to serve it.

“I don’t care about the top 1% that can buy whatever they want, eat strictly organic, buy artisan cheese where they know the cheese maker,” Lempert said. “I want to make sure people who go in every week in the supermarket, are spending 22 minutes and 100 bucks a week for a family of four get the best health, taste and value that they can.”

That approach draws skepticism from Marion Nestle, a professor at New York University‘s department of nutrition, food studies and public health. Nutrients are lost when vegetables are freeze-dried, Nestle says, and people are also losing the benefit of greater volume of less calorie-dense food in a meal.

“Oh, what will they think of next,” Nestle said. “What a silly idea.”

Posted

Saab now renter in own home, puts off production

Scammers claim luxury cars as farm vehicles for cheap insurance

Audi TT RS (poor man’s R8) still will set you back $57K

St. Louis most loyal to U.S. car brands, L.A. is foreign heaven

You’ve heard it a million times at the checkout counter: “Receipt with you, or in the bag?”

• 

  Michelle Pemberton, The Indianapolis Star

  Owner Colleen Dobbs of crepe shop Three Days in Paris. Paperless receipts have been embraced by smaller businesses.

Michelle Pemberton, The Indianapolis Star

Owner Colleen Dobbs of crepe shop Three Days in Paris. Paperless receipts have been embraced by smaller businesses.

Now, you might hear a third option: your email inbox.

An increasing number of retailers are offering to send receipts by email, touting it as a convenient, environmentally friendly alternative to paper receipts. Gone, they say, are the days of digging through your purse looking for that crumpled slip of paper.

Retailers including Nordstrom and Gap began offering paperless receipts in the past few months, and Indianapolis-based Finish Line and Fort Wayne, Ind.-based Vera Bradley are testing the option or plan to begin testing it.

• VIDEO: See Card Case in action

It also has been embraced by smaller businesses.

“It does a lot of different things,” said Nordstrom spokesman Colin Johnson. “If they (customers) prefer to save paper, they can get it electronically. If they want to save some time, it can do that.”

But while some praise the policy for its added convenience, others view it as a ploy to gain access to a customer’s email account.

“It’s a subtle way of saying, ‘How can I invade your personal life but not offend you at the same time?’ I’ve got to give them credit — it’s a pretty ingenious act,” said Britt Beemer, a retail analyst and founder of America’s Research Group.

It’s part of a growing effort by retailers to electronically reach out to consumers via their smartphones and computers.

They send emails and text messages alerting consumers to deals. They have websites and Facebook pages and smartphone apps —all aimed at making the store more than just a bricks-and-mortar shop.

Typically, emailed receipts will contain offers for consumers to receive coupons and other deals from retailers in the near future.

Consumers may opt out of receiving those offers, but some are still loath to give stores their email addresses.

Ronda Coon said she was a bit leery when a Gap employee asked whether she’d like her receipt emailed as she shopped at the Fashion Mall in Indianapolis last week.

“I admit I’m a little skeptical they want me on their list so they can spam me,” the Danville, Ind., woman said with a laugh.

Although such concerns may be valid, no retailer serious about building a relationship with its customers would consider taking advantage of email access, said John Talbott, assistant director of Indiana University’s Center for Education and Research in Retailing.

That’s because for the retailer, the most significant benefit is being able to offer a service customers appreciate, he said. It isn’t about cutting costs, he said, as less than 1% of a retailer’s total revenue goes toward paper and ink for receipts.

Instead, the driving force is providing an option that makes the store a more appealing place to shop.

The prevalence of digital receipts is likely to grow quickly, many retailers said. Already, some retailers in Indianapolis are testing a platform that is both paperless and credit-card-less — and declares on its website that “paper receipts are so 2010.”

The form of payment, called Card Case, uses mobile-phone and iPad technology. It enables users to pay for products by simply walking up to the cash register and giving their name after registering their card using the Square app.

Their picture shows up on the retailer’s iPad, and the customer receives a receipt in the form of a text message. The receipt can be accessed at any time using the app.

Card Case, offered through Square — a company led by the co-founder of Twitter — is new and available only in select cities.

In Indianapolis, it is being piloted by two retailers, including Three Days in Paris. Owner Colleen Dobbs said many of her customers use credit cards and one is already using Card Case.

She imagines that within 10 years, the majority of retailers will offer some form of paperless receipts.

“It’s how things are moving,” Dobbs said. “I think you’ll pretty much have to. I think the consumer will expect it, and it will just become the standard.”

Posted

Car buyers in St. Louis, Detroit and Cleveland are the most likely to buy cars sold buy domestic automakers, while majorities East- and West-Coast cities opt for foreign brands.

And the buying gap can be big, reports Paul A. Eisenstein of the The Detroit Bureau, citing data from shopping site CarGurus.com that look at six months of shopping trends for the site’s DealFinder service.

Of 50 metro areas in the data, 67% of St. Louis car sales are domestic makers’ brands. That’s the same percentage as Detroit, but counts for more with Drive On because it doesn’t have the huge chunk of the population depending on domestic Big Three for their livelihoods. Those two are followed by Cleveland (59%), Milwaukee (58%) and Tulsa (57%).

Meanwhile, among East Coast cities just 32% in New York choose Detroit brands, with similar minorities in Boston (33%), Philadelphia (38%) and Miami (35%).

It’s even worse for U.S.-based automakers on the West Coast. Their brands capture just 27% of buyers in Los Angeles — where Asian brands get 39% of sales and Europeans score 34%. San Diego and San Francisco also are at 27% for domestics.

Since for their long-term health, the Detroit 3 can’t concede the coasts, they all are making new efforts in such cities, and are achieving some success with certain models. In its recent sales reports, Ford has cited West Coast gains by its new Focus compact and Fiesta sub-compact. General Motors has had success their with the Camaro and has said the Chevy Cruze is getting some traction.

The irony in all this is that whether a car is domestic or foreign brand doesn’t always correlate with made in the U.S.A or elsewhere, such as a Dodge Journey from Mexico vs. a Hyundai Santa Fe from Georgia.

See photos of: Europe, Philadelphia, Boston, San Francisco, Miami, Detroit, Mexico, Cleveland, San Diego, New York City, St. Louis, Los Angeles, General Motors, Milwaukee, Ford Motor Company, Chevrolet, Tulsa, Hyundai

The Inlet House condo complex in Fort Pierce, Fla., was once the kind of place the 55-and-older set aspired to. It was affordable. The pool and clubhouse were tidy, the lawns freshly snipped. Residents, push-carts in tow, walked to the beach, the bank, the beauty parlor, the cinema and the supermarket. In post-crash America, this was a dreamy little spot. Especially on a fixed income.

• 

  J Pat Carter, AP

  An empty park bench and rusting pipe sit near the swimming pool at the Inlet House, in Fort Pierce, Fla., June 15, 2011.

J Pat Carter, AP

An empty park bench and rusting pipe sit near the swimming pool at the Inlet House, in Fort Pierce, Fla., June 15, 2011.

But that was Inlet House before the rats started chewing through the toilet seats in vacant units and sewage started seeping from the ceiling. Before condos that were worth $79,000 four years ago sold for as little as $3,000. And before the homeowners’ association levied $6,000 assessments on everyone — and then foreclosed on seniors who couldn’t pay the association bill, even if they didn’t owe the bank a dime.

Normally, it’s the bankers who go after delinquent homeowners. But in communities governed by the mighty homeowners’ association, as the sour economy leaves more people unable to pay their fees, it’s neighbor vs. neighbor.

“What the board is doing is trying to foreclose on people to force people out the door,” says Mike Silvestri, 75, who stopped paying his dues at Inlet House in protest over what he considers unnecessary and unaffordable assessments.

• STORY: Obama to extend help for unemployed homeowners to 12 months

He and others say there were cheaper ways to deal with the rat infestation and leaky sewage that led the board to order up a costly plumbing overhaul. “They are bamboozling old people. I’m old, but I’m not senile,” he says.

In exchange for adhering to the rules, homeowners got safe communities with clubhouses, pools and tennis courts. But what many didn’t realize when they bought their homes was that the fine print gave the association the right to foreclose — even over a few hundred dollars in unpaid dues.

All the association board has to do is alert its attorney to place a lien on the property to start the process. The home can then be auctioned by the board until the bank eventually takes ownership. Homeowners typically have no right to a hearing.

In the past, housing associations have gained infamy for dictating everything from the weight of your dog (one mandated a diet for a hound) to whether you can kiss in your driveway (not if you don’t want a fine in one). Homeowners’ associations have served as the behavior police, banning lemonade stands, solar panels and hanging out in the garage. One ordered a war hero to take down his flag because of a “non-conforming” pole. Another demanded that residents with brown spots on their lawns dye their grass green.

Now, past the faux regal gates, beyond the clubhouses, many property owners in associations owe more than their homes are worth. Some are struggling to pay their bills after they lose a job. Others have had their pay cut. So they’ve stopped paying their association dues.

To combat the rise in delinquencies, boards are switching off utilities, garnishing income and axing cable. They are yanking pool passes and banning the billiard room. And, in the most extreme cases, they are foreclosing.

“The treacherous part is that homeowners’ associations are acting like a local government without restraints, and they have this extraordinary power,” says Marjorie Murray, a lawyer and founder of the Center for California Homeowner Association Law.

Today, one in five U.S. homeowners is subject to the will of the homeowners’ association, whose boards oversee 24.4 million homes. More than 80% of newly constructed homes in the U.S are in association communities.

And of the nation’s 300,000 homeowners’ associations, more than 50% now face “serious financial problems,” according to a September survey by the Community Association Institute. An October survey found that 65% of homeowners’ associations have delinquency rates higher than 5%, up from 19% of associations in 2005.

Associations set rules for their communities. They levy monthly dues, typically between $200 and $500, and cover the costs of services that a municipal government usually takes care of: road repair, streetlights, sewage systems. If an association’s budget is strained or major repairs need to be done, the board can levy a “special assessment” on top of those dues. And when one homeowner doesn’t pay those fees, all the other homeowners have to pick up the cost.

The rise in delinquencies comes as banks are taking over foreclosed homes and then leaving them vacant more often than ever. Taken together, these shortfalls are resulting in higher fees for all of the other homeowners — and massive financial angst for association boards.

Before now, associations rarely, if ever, foreclosed on homeowners. But today, encouraged by a new industry of lawyers and consultants, boards are increasingly foreclosing on people 60 days past due on association fees, says Evan McKenzie, a former homeowner association attorney who is now a University of Illinois political science professor and the author of the book “Beyond Privatopia: Rethinking Residential Private Government.”

The government does not keep statistics on how often homeowners’ associations initiate foreclosures. But a non-profit research group found that association-initiated foreclosures in the Houston area jumped from 500 in 1995 to 2,200 in 2007. Most association-related foreclosures in Texas do not go through the judicial process, so the group’s analysis represented only a fraction of the foreclosures that housing associations have initiated.

The problems in some communities are resulting in more scrutiny. In Nevada, the FBI is investigating corruption in elections of association boards. In Utah and Arizona, legislators are trying to pass bills that would root out the use of debt-collectors who are alleged to have used thug-like tactics to strongarm residents into paying fees.

State legislatures in California, Arizona, North Carolina, Texas and Florida have taken up legislation that would clamp down on foreclosures.

Not everyone thinks the tactics are out of line, though.

“When people are not paying their assessments, they’re not shortchanging some giant multinational corporation. They are taking money directly out of the pockets of their neighbors,” says Andrew Fortin, head of government affairs for the trade group the Community Associations Institute.

So the neighborhood feuds are escalating. At Inlet House, one resident claims her fellow senior citizens have turned into vigilantes, vandalizing her car in retaliation for not paying her dues.

In all, 17 of the 60 units are in various stages of delinquency. Paul Gray, a fastidious budgeter, paid off his mortgage long ago and paid all but $2,500 of the Inlet House assessment. The association initiated foreclosure proceedings. A few days after he received the foreclosure notice, Gray suffered another stroke, three friends say. Now he is in a nursing home. He has since paid off the $2,500. His home, worth $89,000 in 2006, is for sale for $18,500.

In the meantime, the board, facing $172,000 in costs from non-payers, has had no choice but to raise dues by an extra $50 a month to an average of $375. Between the assessment and increased dues, some residents complain that they pay more than they would to rent a plush oceanfront spread down the street at the posh Fontainebleau condo complex. Association manager Janice Stinnett, who is also an Inlet House resident, says she isn’t to blame, the non-payers are.

“It’s unfair that everyone is paying extra to cover these deadbeats,” she says.

The board is continuing to make the plumbing repairs that made the assessments necessary to begin with. It will soon issue another special assessment to cover the costs.

To homeowners who opposed the repairs on the grounds that they were too expensive, the entire picture adds up to a crime. Says Silvestri, “What these associations are doing is illegal. It’s a fraud.”

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

WASHINGTON (AP) — The International Monetary Fund approved on Friday just over $4.2 billion for Greece, the latest installment of a rescue package aimed at helping the country pull back from an impending debt default.

• 

  By Petros Giannakouris, AP

  A woman enters a branch of Alpha Bank, in central Athens, on Thursday.

By Petros Giannakouris, AP

A woman enters a branch of Alpha Bank, in central Athens, on Thursday.

The move by the executive board had been expected after a decision last week by eurozone finance ministers to give Greece their portion of a $17.4 billion loan payment that is part of a $259 billion package agreed to last year.

Friday’s IMF action, with new Managing Director Christine Lagarde in the chair, came as European banks, insurance companies and other financial institutions were trying to get the private sector involved in helping save Greece from default.

The 17 countries that use the euro will continue, with the IMF, to prop up Greece’s struggling economy in the coming years with a second package of aid loans to be completed in September.

Lagarde said the raft of reforms, spending cuts and tax hikes the government has been carrying out as part of conditions to receive bailout funds “is delivering important results: the deficit is being reduced, the economy is rebalancing and competitiveness is gradually improving.”

However, she said, Greek officials still face significant challenges, including meeting a target of getting its burdensome debt down to 7.5 percent of gross domestic product in 2011 and to less than 3 percent by 2014.

Lagarde said, “Greece’s debt sustainability hinges critically on timely and vigorous implementation of the adjustment program with no margin for slippage, and continued support from European partners and private sector involvement.”

She said the government’s privatization strategy is a critical step toward boosting investment and reducing the debt burden.

The European Union and the IMF Fund had said they would refuse to pay out the next installment unless Greek lawmakers approved a new five-year package of $40 billion worth of spending cuts and tax increases and a $72 billion privatization plan before the end of June. Greek lawmakers delivered what was asked of them, cheering up global financial markets but provoking violent demonstrations in the streets of Athens.

Lagarde, a former French finance minister, took over as head of the 187-member lending institution on Tuesday, replacing Dominique Strauss-Kahn, who resigned in May to fight charges he sexually assaulted a New York City hotel housekeeper. Lagarde is the first woman to head the organization since it was founded after World War II.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

Trader Joe’s, the specialty grocery chain, might not have the cheapest toilet paper or the most varieties of ketchup, but it hooks customers with mango butter, chocolate-covered pomegranate seeds and cilantro-and-jalapeno hummus.

• 

  Ric Francis, AP

  A Trader Joe’s is shown in Los Angeles, February 11. 2008.

Ric Francis, AP

A Trader Joe’s is shown in Los Angeles, February 11. 2008.

These goodies aren’t on most grocery lists, but they’re eye-catching enough to tempt shoppers into an impulse buy. At a time when families are watching dollars and the Web makes discount-hunting easy, unexpected treasures are an increasingly important strategy for stores.

“It’s the wow factor that’s getting people to buy,” says Wall Street Strategies analyst Brian Sozzi. “You walk into Costco for tuna and end up getting a Marc Jacobs coat.”

So shoppers may go into T.J. Maxx or a DSW shoe store looking for a bargain on something they need but end up splurging on irresistible finds, from dirt-cheap Ray-Bans to half-priced Puma sneakers.

Dollar Tree lures customers with rock-bottom prices on cleaning supplies, then tempts them with extras like leather iPod cases. And at Costco, tucked inside the hulking pallets of mayonnaise and paper towels is a section where shoppers never know what they’ll find.

Costco has been using the term “treasure hunt” for years to explain why up to a fifth of its stock is limited-quantity items that are in the store for as little as a week. Sometimes it’s seasonal merchandise, such as margarita machines in summer. Often it’s surprisingly trendy — such as bargain-priced Hunter rain boots, sold almost exclusively in the U.S. by Nordstrom.

The wholesale chain shows that the treasure hunt strategy can pay. Revenue at U.S. Costco stores open at least a year was up 10% last quarter from last year, with strong growth in non-essentials like jewelry and home and garden.

Walmart, on the other hand, is still trying to correct itself after a move to pare down to the basics — the opposite of the treasure hunt approach — proved unsuccessful.

Constantly cycling in fresh merchandise is critical as the Web makes it harder for stores to compete on price. After all, why drive to a store that offers “everyday low prices” when you can find the same products cheaper online? Surprises also create suspense and encourage repeat visits.

TJX Companies, the parent company of T.J. Maxx and other chains that sell designer goods at a discount, gained momentum during the recession, when frugality came into style. That growth is continuing after the recession, at a time of high gas prices and stagnant incomes. First-quarter revenue at Marshalls and T.J. Maxx stores open at least a year was up 4% over the same period last year.

Sherry Lang, vice president of investor relations at TJX, says the company is focused on keeping trend-conscious customers as the economy improves. One advertising campaign features a real-world T.J. Maxx buyer on the prowl for hip fashions. “When I score, you score,” she says.

The key is not only tracking down quality merchandise from vendors but getting it into the store quickly. To do this, T.J. Maxx and others have invested in sophisticated buying, planning and distribution systems.

The quick turnover creates a sense of urgency: If you don’t buy it today, it probably won’t be here tomorrow. When the economy tanked, TJX began cycling inventory through the store faster than ever before, Lang says. She believes that a rapidly changing assortment is the top driver of traffic, especially when stores are competing with the Internet.

Superstores like Kmart and Walmart are getting stung by online competition. Any mass-market product — think Jif peanut butter or Hanes T-shirts — can be comparison-priced online, and people tend to buy from the cheapest source. Increasingly, that’s Amazon.com or another Web retailer.

But the so-called off-price stores, such as T.J. Maxx and Marshalls, often pick up products that have been discontinued and sell them cheaply, says Michael Dart, co-author of the book “The New Rules of Retail.” Shoppers probably won’t find them for less — or at all — online.

Jessica Zaloom, who works for a Manhattan advertising agency, buys full-priced designer clothes at department stores like Nordstrom. But she also hits T.J. Maxx and Marshalls every other week to see what’s in stock. She recently picked up a Marc by Marc Jacobs two-piece bathing suit, originally $158, for $39.99.

“Soon enough, you’re sure to spot a find like this,” Zaloom says.

When shoppers find these treasures, they want to share them. In the age of social media, peppering shelves with unexpected finds is a way to generate free publicity through tweets or Facebook posts. Devotees of Trader Joe’s post comments on sites like Yelp about interesting new products they’ve tried. On Twitter, there is a “(hash)MaxxFinds” hashtag that users affix to tweets about cool stuff at T.J. Maxx stores.

“They have these consumers marketing for them,” Mityas says. “If you’re a retailer, that’s basically the Holy Grail.”

By embracing the treasure hunt, dollar stores have been able to keep the middle-income shoppers they attracted during the recession. Dollar Tree CEO Bob Strasser told analysts the store has taken the opposite approach from Walmart, expanding its assortment of “fun” discretionary products and adding more brand names. That means more surprises to tempt shoppers.

It’s working. Dollar Tree’s revenue at stores open at least a year was up 7.1% in the most recent quarter. Both traffic and the size of the average transaction increased.

Shoppers learned during the recession that they can find quality products at discount stores, says Lars Perner, assistant professor of clinical marketing at USC’s Marshall School of Business. He says they appreciate the competitive aspect of shopping, too— finding bargains other people may have missed.

At DSW shoe stores, a savvy shopper digging through the clearance section might find Cole Haan snakeskin pumps for half off or white Converse All-Stars for $30. Revenue at DSW stores open at least a year was up 10.8% last quarter despite dreary weather that slowed sandal sales.

Trader Joe’s is built almost entirely on the treasure hunt. The privately held company declined to comment on business operations but said 80% of its products are private-label foods you can’t find anywhere else, like Thai green curry simmer sauce and chili spiced dried mango.

Shopping there is “almost a thrill-seeking experience” — very different from the major food chains, which mostly stock the same stuff, says Sherif Mityas, a partner at AT Kearney, a retail consulting firm.

Victoria LeBlanc Bors of Los Angeles says she doesn’t even take a shopping list there anymore. She never leaves without extras, like a $10 gold and burgundy orchid. When she’s preparing for guests, she cruises the store for interesting finger foods such as Greek spinach pies and chocolate-covered dried cherries.

Because the prices are low, she says she doesn’t feel guilty trying new things.

“I’m liable to carry just about anything out of that store,” LeBlanc Bors says. “You buy things that you might not normally buy.”

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Posted

What if you had to pay as much a month to park your car as lots of people around the country pay in monthly rent on their apartments? Welcome to New York City.

Midtown and downtown Manhattan are the two most expensive places in the USA to park, with median monthly rates at $541 and $533, respectively, says Colliers International’s annual survey of parking rates in North America. In third place is Boston at $438, 19% less per month than midtown Manhattan and well above the national average of $155.22.

There’s no shortage of cities with eye-popping downtown parking rates. Rounding out the top 10 most expensive central business districts for monthly parking rates are San Francisco at $375; Philadelphia at$304; Seattle at $294; Chicago at $289; Washington at $260; Honolulu at$217; and Los Angeles at $210. If you’re looking for cheap cities, go no father than Reno, which has a monthly rate of $45; Phoenix at $50, and Bakersfield, Calif., at $53.

Despite the high rates in Manhattan, the cost of parking has held fairly steady when compared with 2010, the study finds. Nationally, the median monthly parking rate decreased 0.2% in the past year. In Manhattan, rates inched up 0.6% in midtown and 0.8% downtown. Median monthly rate changes in other major markets include Boston, up 3.1%; Washington, up 6.1%; Houston, up 4.8%; Los Angeles, down 0.2%; and Chicago, down 9.7%. San Francisco was unchanged.

“This year’s parking rate survey reflects a moderately improving economy and better office leasing fundamentals,” said Ross Moore, Colliers International’s chief economist. “Despite these improvements, operators are still holding the line on parking rates.”

It makes you wonder, though, when you see some of the daily parking rates:

Midtown Manhattan took the top spot for median daily parking rates at $41, followed by Honolulu at $38 and Boston at $34. The rest of the top 10 daily median parking rates were Chicago ($32); downtown Manhattan and Los Angeles ($30); San Francisco, San Diego and Philadelphia ($26); and Seattle ($24).

Major market year-to-year changes in daily parking rates include Boston, up 6.3%; Chicago, up 3.2%; Houston, up 20.8%; Los Angeles, up 1.2%; midtown Manhattan, up 2.5%; San Francisco, up 4%; Washington, up 20%; and downtown Manhattan, down 3.2%.

“The long-term trend is still for rates to move higher, but any near-term movement will be dictated by the vigor of the economic recovery,” Moore said.

In Canada, the story was a bit different from in the USA, with the monthly median parking rate increasing by 3% over 2010 to $241.59 USD. Calgary led the pack with a median monthly rate of $486 USD, followed by Toronto at $342 USD and Montreal at $305 USD. Daily median rates were highest in Calgary at $25.73 USD, followed by Toronto at $23.67 USD and Vancouver at $20.59 USD.

With the exception of Greenville, S.C., Phoenix, Hartford and Walnut Creek, Calif., where parking availability was described as abundant, parking in all other cities surveyed in both the USA and Canada was described as limited or fair. With only five new parking facilities under construction in the USA and seven in Canada, that situation is unlikely to change significantly.

Even high-cost U.S. and Canadian cities seem like a relative bargain when compared with parking rates in some European, Asian and Australian cities. London was the most expensive place in the world to park, with an astronomical $1,084 median price for a monthly spot. London’s West End was close behind at $1,014 per month, followed by Zurich at $822 and Rome at $719. In Asia, Hong Kong and Tokyo both topped New York’s median monthly cost for a parking spot reaching $745 and $744, respectively. Perth, Australia, also topped the Big Apple with a median cost for a monthly spot at $717.

Colliers International is the leading source of commercial real estate market data in the industry and conducts research on all segments of the market, including office, retail, industrial and hospitality. In addition, Colliers develops and issues periodic White Papers on a wide range of topics.

Data for the 2011 Parking Rate Survey were collected during the month of June and include all relevant taxes. Sources for the data include third parties, owners/operators and Colliers International. Survey data include only covered or underground parking garages in prime central business districts. All rates are reported in U.S. dollars.