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4fdf3c79ee56ecf464939e33854cb0f7 | https://www.cnbc.com/2015/05/07/saudi-arabia-more-to-the-market-than-oil.html | Saudi Arabia: More to the market than oil | Saudi Arabia: More to the market than oil
VIDEO3:4703:47Where are the opportunities in Saudi Arabia stocks?Capital Connection
Oil may be Saudi Arabia's bread and butter but as the Middle East's largest bourse gets set to open its doors to foreigners, investors may want to focus their attention outside the energy sector.
"There are 162 listed companies and the largest by market cap is a pretty diverse group: Technology, construction, financial services, retail, and chemicals. There are lots of different sectors that an international investor can enter," said Joel Whitaker, senior vice president of global research at Frontier Strategy Group.
Starting from June, qualified foreign investors with a minimum of $5 billion in assets will be able to invest in the stock market, known as the Tadawul. The $570 million bourse previously only allowed foreigners indirect access via equity swaps and exchange-traded funds.
Indeed, Tadawul's top five companies by market cap are all non-energy focused: Chemical manufacturer Sabic Basic Industries, National Commercial Bank, Saudi Telecom, Al Rajhi Banking and Saudi Electricity.
"It's a broad market. Although it is energy-centric, there are other opportunities for international investors like consumer goods, health care and banking," Robert Parker, senior adviser at Credit Suisse, told CNBC on the sidelines of the Euromoney Saudi Arabia Conference this week.
Read MoreOnly Allah knows about oil prices: Saudi oil chief
Insurance and health care are especially enticing sectors, according to Frontier Strategy. The former is the second-fastest growing sector in the Gulf Co-operation Council (GCC) because penetration is still very low, while the latter will continue to benefit from spending regardless of oil revenues, Whitaker said.
But will there be enough demand?
FAYEZ NURELDINE | AFP | Getty Images
There is tremendous appetite for Saudi stocks, according to John Sfakianakis, regional director at Ashmore Group. "This is the biggest story for emerging markets this year and the outlook looks good. The stock market is back to levels when Brent crude traded at $95, so I think the market is now pricing in higher oil levels."
The new investment rules are expected to reduce the Kingdom's reliance on oil, something economists have long been recommending due to the commodity's volatile prices. Over 90 percent of Saudi government income presently comes from oil revenues.
"This is part of a long term strategy on the part of Saudi leadership to diversify the economy, and also provide more diversified employment opportunities for Saudi citizens," said Whitaker.
The rules could also offset the economic hit from lower oil prices. Citi is expecting a 3.3 percent growth contraction in 2015 and a 130 billion budget deficit, or 22 percent of GDP, if the Kingdom refuses to cut government spending in response to Brent crude's 40 percent fall in the past year.
The opening of the stock market is the latest in a series of dramatic developments under the new leadership of King Salman.
Last week, the King surprised the world by removing Muqrin bin Abdul Aziz as crown prince, naming his nephew Prince Mohammed bin Nayef instead as next in line. He also recently announced that Aramco - the world's biggest energy company- will no longer be controlled by the petroleum ministry. Analysts widely interpret both moves as a significant departure from the late King Abdullah's policies.
Read MoreWhat the Saudi royal reshuffle means for oil
To be sure, caution will prevail at least in the early months when the scheme kicks off.
"Investors like ourselves swill move slowly because there are limits on how much we can invest over time in the market, and we want to avoid chasing a market where valuations over time may start to look stretched if too much money comes in quickly," said Parker. Further interest is likely to come when the Tadawul becomes a member of MSCI's emerging markets index, he added.
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ba249b85c5b1d4825ca36e629b060f0e | https://www.cnbc.com/2015/05/07/who-exactly-is-alibabas-new-ceo.html | Who exactly is Alibaba’s new CEO? | Who exactly is Alibaba’s new CEO?
Incoming Alibaba CEO Daniel ZhangNelson Ching | Bloomberg | Getty Images
Alibaba announced on Thursday that it had appointed Daniel Zhang, the key architect of the Chinese internet behemoth's annual Singles Day shopping event, as the new chief executive officer, with investors giving the move a thumbs-up.
Forty three-year-old Zhang, an 8-year-old veteran at the Hangzhou-based company, will replace Jonathan Lu effective May 10.
Since joining Alibaba in 2007, Zhang has held several top management positions, most recently serving as chief operating officer. He is credited with the rampant growth of T-mall, fronting the company's ongoing transition to mobile and leading several strategic investments including Alibaba Health, Haier, Intime Retail and Singapore Post.
Zhang joined Alibaba as the chief financial officer of Taobao Marketplace – the company's consumer-to-consumer portal similar to eBay – and quickly climbed the ranks. A year later, he was promoted to chief operating officer of Taobao Marketplace and general manager of business-to-consumer (B2C) e-commerce platform Taobao Mall or T-mall.
VIDEO5:1605:16Alibaba's management shake-up: What it means
The investment community has applauded Zhang's appointment as CEO, citing his deep understanding of the business.
"We are positive on the change of the CEO and believe Mr. Zhang, having been with Alibaba since 2007 and spearheaded the development of Tmall and Nov 11 Singles Day event, will have strong experience and proved execution track record to lead Alibaba thrive to deliver a better, improved ecosystem for its marketplaces," Alicia Yap, analyst at Barclays, wrote in a note on Friday.
Zhang has a strong financial background, earning a bachelor's degree in finance from Shanghai University of Finance and Economics.
Read MoreAlibaba incoming CEO Zhang will focus on mobile
Before joining Alibaba, he served as chief financial officer at Shanda Interactive Entertainment, a Nasdaq-listed online game developer and operator, and as senior manager of PricewaterhouseCoopers' Audit and Business Advisory Division based in Shanghai.
While Zhang will be in the driver's this seat starting Sunday, outgoing CEO Lu will remain on Alibaba's board of directors as vice chairman and aid in the transition over the coming months, Alibaba said in a statement.
"Daniel [Zhang] is a proven international business leader and innovator with a strong track record of delivering results. He has the confidence of our entire management team, and there is no better person to lead Alibaba Group as we embark on the next stage of our growth on top of the strong foundation that Jonathan helped build," Jack Ma, group executive chairman at Alibaba, said in a statement.
"I am grateful to Jonathan Lu for his excellent leadership and management over the past several years, and I look forward to his continued contribution as a key leader in helping Alibaba Group train and develop the next generation of leaders," he added.
Read MoreAlibaba mulls stake in one of India's biggest smartphone player
In a letter to employees, Ma said the leadership shuffle was part of efforts to bring younger leaders into the company, Wall Street Journal reported.
"This marks a future where the post-70 generation will command the troops at Alibaba Group!" Ma said in the letter, according to WSJ, referring to people born in the 1970s. Zhang was born in 1972 while his predecessor was born in 1969.
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8974d9d6ef7f6c52170aa8c25b492160 | https://www.cnbc.com/2015/05/07/yellen-was-right-markets-are-overpriced-shiller.html | Yellen was right, markets are overpriced: Shiller | Yellen was right, markets are overpriced: Shiller
VIDEO4:3604:36Santelli Exchange: Valuations & Fed policy
Federal Reserve Chair Janet Yellen was right to point out that markets are overvalued, said Yale economics professor, Robert Shiller, on Thursday.
"It's part of their job to disturb the tranquility and I praise Janet Yellen for doing that," he said in an interview with CNBC's "Squawk on the Street."
"On the other hand, she was also right not to be alarmist about it."
Robert ShillerAdam Jeffery | CNBC
Read MoreTraders ignore Yellen warning, not a 'good investor'
On Wednesday Yellen spooked markets when she warned that equity market valuations were "quite high," though she added the Fed was not seeing the hallmarks of a bubble.
Yellen also noted that the Fed was watching the issue closely. Stocks were already moving lower on the day but they took a dip down on her comments before regaining some ground. The Dow was off triple digits mid-afternoon Wednesday.
Yellen also took aim at the bond market, which a number of high-profile investors from Warren Buffett to David Tepper said was overvalued just this week.
The Fed chair made it clear that while she does not see a bubble in financial markets, bond yields were down due to low premiums. But bond yields can move rapidly and she noted that was the case in the "taper tantrum" of 2013.
Read More Cramer: Thanks for nothing, Janet Yellen!
"We need to be attentive and are to the possibility that when the Fed decides it is time to begin raising rates, these term premiums could move up and we could see a sharp jump in long-term rates," she said.
This was not the first comment by a Fed chair that stock prices are too lofty. Former Fed Chairman Alan Greenspan used the phrase "irrational exuberance" to describe the stock market in 1996.
Shiller, who is a 2013 Nobel laureate, said that the Fed was right to go ahead with quantitative easing when it did.
"Nobody knows for sure because it's a new experiment, and yes the boom in the housing market and the stock market are partly the Fed's doing. But on the other hand, we were close to a depression and they had to do something."
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6a03438e90f55ef27ef3963e99a443df | https://www.cnbc.com/2015/05/08/female-protestors-see-red-over-sexist-opticians-ad-in-spain.html | Protestors see red over ‘sexist’ opticians ad | Protestors see red over ‘sexist’ opticians ad
Following on from protests in the U.K. over the "Beach Ready" ad for a protein drink, another European retailer is facing a backlash after its commercial presented women as nothing more than "accessories."
As a result, Multiópticas, a Spanish chain of opticians has this week been the subject of protests by women dressed in alluring clothing, feather boas and lingerie, angry at what they consider a "sexist" commercial.
Multiópticas Protest, SpainCredit: Laura Zorrilla. (Provided by Yolanda Domínguez)
The advert itself, showed a man walking into a "wild west" themed bar filled with women, who immediately turn around to watch him – because he's wearing the brand's glasses – all whilst a voiceover says ""have that incredible first time feeling any time you want."
Visual artist, Yolanda Domínguez, appealed to other women to dress the same as the actors in the commercial, and head to flagship stores of Multiópticas, on Tuesday. Eight protestors were arrested by police in Seville, according to The Local Spain, a news site.
The demonstration received a wide variety of reactions, with some people saying they were insulted and would call the police, to others believing that the company had sent the women to the branches for promotional purposes, according to Ms. Domínguez's website.
Ms. Domínguez and her colleagues called upon Multiópticas to withdraw the commercial from TV, and ask advertisers in general to ensure that their campaigns didn't discriminate against individuals.
"Multiópticas makes an analogy between an object (glasses) and women, characterizing them as "accessible" and "accessory", making them accessible because they are willing and available, because the accessory can be changed as often as you want," she wrote in translated remarks on her site.
Despite only 12 women turning up for the protest, the event has got over 64,400 YouTube views and one post got shared over 41,000 times on Facebook.
Tweet: Y esta la iniciativa de @yodominguez. ¿No quieres coles? Pues toma, coles. Bravo.
Yesterday, Multiópticas responded to the commotion it caused on social media platforms, by saying that they "regret the controversy" and "want to convey their feelings for the misinterpretation."
"The (TV) spot wants to recreate in a free manner that moment when everyone around you notice that you have changed something and you're noted. Time to feel the center of attention: it refers to the entry of the protagonist of the spot, which becomes the target of all eyes. With this idea from "Multiópticas wanted to invite all our customers to feel that feeling of being the center of attention more often," said in a translated statement.
The statement ended with the chain saying they have stopped airing the television advert and will take people's views into consideration for future advertising campaigns.
Multiópticas Protest, SpainCredit: Sol Salama. (Provided by Yolanda Domínguez)
Domínguez told CNBC via email about her thoughts to Multiopticas' campaign, saying that its "negative publicity is not good."
"If Multiópticas, rather than trying to excuse the inexcusable with an argument that makes no sense, had admitted their mistake and withdrawn its ad from TV networks and shops, perhaps they would have regained all those customers who have sworn never to enter in one of their stores again. The negative publicity is not good, they have to be honest, I think that's the biggest value that a brand can offer to its customers," Dominguez told CNBC.
Read MoreYou can't feel 'fat' on Facebook anymore
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3a7ec9fa3bcc576ce1c27e2a67c7fee0 | https://www.cnbc.com/2015/05/08/ord-to-grow-old-in-your-home.html | The true cost of staying home for retirement | The true cost of staying home for retirement
VIDEO3:4903:49Baby Boomers: Saving too much, or not enoughClosing Bell
Peak moving season is fast approaching, but most older Americans won't be going anywhere. Almost three-quarters of Americans over age 45 feel strongly that they want to stay in their current residence as long as possible, and another 13 percent believe that to some degree, according to research by AARP. And a December study by the Demand Institute found that 63 percent of boomers do not plan to move.
Whether they can swing it financially is another matter.
Home ownership is expensive, considering home repairs and maintenance, insurance and taxes. And millions of Americans are facing retirement with limited savings: According to a new study by the Transamerica Center for Retirement Studies, the median total household retirement savings for Americans in their 50s was just $117,000. (Tweet This)
Not surprisingly, people find it difficult to set aside a rainy day fund to cover things like emergency home repairs, with just 38 percent of the respondents to a recent Bankrate survey saying they could cover a sudden $1,000 expense with savings.
"People are unrealistic about their ability to take care of themselves." said Cathy Curtis of Curtis Financial Planning.
Morsa Images | Getty Images
One reason home ownership is becoming more challenging in retirement is that more people are still paying off mortgages during their so-called golden years. About 30 percent of Americans over age 65 had a mortgage in 2011, up from 22 percent in 2001, according to a Consumer Financial Protection Bureau analysis of Census Bureau data.
As a result, housing costs start eating up more of seniors' income as they age. A report by the National Housing Conference's Center for Housing Policy found that one-fourth of households with at least one resident who's 85 years or older spent at least half their income on housing, compared with one-sixth of households headed by people under age 65.
Then there are home repairs. Many of the most common emergency repairs are not cheap. Tom Rusin, CEO of HomeServe, estimated the cost of a new heating system at over $6,000. Replacing a new water heater costs about $1,100 on average, he said.
Making home modifications can also add up. MetLife calculates that two grab bars can be had for $250, but adding a ramp to a home can cost $1,600 to $3,200 and remodeling a bathroom can run from $3,500 to $35,000.
Curtis has worked with several clients refitting their homes so they can age in place, and she estimates that the changes "can cost potentially upwards of $20,000 to $30,000 or more, depending on how extensive they get."
Read MoreLook who's living on the financial edge
In addition, property taxes and utility costs generally head in only one direction—up. Average state and local property taxes nationwide rose nearly 19 percent between 2006 and 2010, according to the Tax Foundation.
And as people age, they will likely need some in-home care, said Sandy Markwood, CEO of the National Association of Area Agencies on Aging. "Sometimes people start out needing in-home support or chore services a couple hours a week. Then over time that increase. Then they need transportation services. Then they need home-delivered meals," she said. "These are cheaper to provide in a home than in an institutional setting, but all of these things start adding up over time."
The rule of thumb is that a comfortable retirement requires an income of at least 70 percent of preretirement income. But an analysis of Census Bureau data by Interest.com, a personal finance website owned by Bankrate, found that in 49 out of 50 states, retirees' income was 50 to 60 percent of the income of those ages 45 to 64. (Seniors in Nevada squeaked by with median income at 70.78 percent of the younger group's.)
In addition, incomes tend to decline in retirement. Harvard's Joint Center for Housing Studies found in a study last year that the median income of households aged 55–59 in 2012 was more than $5,000 lower than that of households aged 45–49, with the disparity widening to $15,000 between households in their late 50s and those in their late 60s. And the Transamerica study found that 42 percent of respondents in their 50s expected their standard of living to decline in retirement.
Read MoreAt what age can you really retire?
Despite the financial challenges, there are compelling reasons for seniors to age in place. An AARP survey on home and community preferences among older Americans found that two-thirds cited proximity to friends and family as their main reason for staying put, and a similar proportion pointed to their closeness to doctors, libraries and other places they might frequent.
As for seniors' health, a study for the National Institutes of Health examined how older Americans receiving long-term care in their communities fared, compared to their counterparts in nursing homes. They found that the group that remained in their communities had better cognition, less depression and a greater ability to manage the activities of daily living.
So how can seniors stay in their homes?
For one thing, it's a good idea to build up an emergency fund for household repairs. Rusin pointed out that with 128 million hot water heaters in homes across the country, with useful lives of roughly 10 years, 12.8 million will fail every year.
Taking steps to generate a reasonable income stream may help as well. The government has created incentives for people to place assets in longevity annuities, which pay out later in life and can reduce or eliminate the risk that people will outlive their savings.
Read MoreLongevity annuities can provide income late in life
Waiting to take Social Security benefits will also generate more income. For every year after your retirement age, up to age 70, you will receive an 8 percent delayed retirement credit that increases your payments. If you are 65 today, your full retirement age is 66. If you wait to start taking benefits until you are 70, your benefit will be 32 percent higher than if you start at age 66.
Some experts recommend reverse mortgages as a means of insuring that income will continue in old age. Seniors ran into serious problems with reverse mortgages in the past when some were persuaded to buy products that were inappropriate for them. But the Federal Housing Administration has introduced new safeguards, and a 2014 research brief from the Center for Retirement Research at Boston College found that the protections "should make reverse mortgages better for borrowers."
"A reverse mortgage would solve that problem of getting at your home equity so it gives you a stream of income but you are still able to stay in the home you have lived in for 30 years," said John Scott, director of the retirement savings project at the Pew Charitable Trusts.
Staying in your home may be more complicated and expensive than you think, but with a little planning you can be homeward bound on your own terms.
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28aa3201f682c82f2066390ba20356d1 | https://www.cnbc.com/2015/05/08/social-security-may-be-in-worse-shape-than-you-think.html | Social Security's in worse shape than you thought: Study | Social Security's in worse shape than you thought: Study
VIDEO1:0301:03Retire well: Maximizing social security benefitsDebt
VIDEO3:4403:44Retirement warning
VIDEO1:1501:15'Age old' Social Security fraudClosing Bell
The Social Security Administration projects that its trust funds will be depleted by 2033—not an optimistic forecast. But it may be even bleaker than that.
New studies from Harvard and Dartmouth researchers find that the SSA's actuarial forecasts have been consistently overstating the financial health of the program's trust funds since 2000.
"These biases are getting bigger and they are substantial," said Gary King, co-author of the studies and director of Harvard's Institute for Quantitative Social Science. "[Social Security] is going to be insolvent before everyone thinks."
Read MoreWill you miss out on Social Security benefits?
The Social Security and Medicare Trustees' 2014 report to Congress last year found trust fund reserves for both its combined retirement and disability programs will grow until 2019. Program costs are projected to exceed income in 2020 and the trust funds will be depleted by 2033 if Congress doesn't act. Once the trust funds are drained, annual revenues from payroll tax would be projected to cover only three-quarters of scheduled Social Security benefits through 2088.
Researchers examined forecasts published in the annual trustees' reports from 1978, when the reports began to consistently disclose projected financial indicators, until 2013. Then, they compared the forecasts the agency made on such variables as mortality and labor force participation rates to the actual observed data. Forecasts from trustees reports from 1978 to 2000 were roughly unbiased, researchers found. In that time, the administration made overestimates and underestimates, but the forecast errors appeared to be random in their direction.
"After 2000, forecast errors became increasingly biased, and in the same direction. Trustees Reports after 2000 all overestimated the assets in the program and overestimated solvency of the Trust Funds," wrote the researchers, who include Dartmouth professor Samir Soneji and Harvard doctoral candidate Konstantin Kashin.
Read MoreHow Social Security funding affects your retirement
The administration's Office of the Chief Actuary produces the forecasts. Stephen Goss, the chief actuary since 2001, was unavailable to comment and has not seen all of the new research, an administration spokesman said.
However, Goss published a 2013 note that outlined the SSA's projection methodologies. The note was written in response to 2012 research by King and Soneji that found the Social Security Administration underestimated how long Americans will live and projected that the trust funds would be depleted by 2031, two years earlier than the government has estimated.
"The projections developed by the Office of the Chief Actuary for the Trustees Reports are intended to reflect all aspects of future possible trends in demographic, economic, and programmatic factors, given current Social Security law," Goss and other SSA officials wrote. King and Soneji's projections "were within the range of reasonable uncertainty as specified in the Trustees Report, and therefore should cause no alarm."
People line up outside of the Social Security Administration office in San Francisco.Getty Images
But King argues that the agency should reveal more about how they produce their forecasts and publish an annual evaluation of its forecasting performance to avoid forecasting bias. Social security programs in other countries and other U.S. government agencies, such as the Congressional Budget Office, the Census Bureau and the Bureau of Labor Statistics, routinely publish self-evaluations of their forecasts, he said.
King and the studies' co-authors confidentially interviewed former and current Social Security Administration actuaries involved in the forecasting process as part of their research to figure out why the forecast bias happened since 2000. He noted that actuaries are in the center of a political firestorm over the future of Social Security as lawmakers debate whether to cut benefits, raise taxes or a combination of both. "Actuaries worked really hard at being unbaised," he said. "We find no evidence that they bend to political pressure."
But the agency's attempts to be unbiased have created a bunker mentality, he said, which lead them to ignore evidence that Americans life expectancy has risen more than they have projected and how that could hurt the future funding of Social Security system.
"The issue is not the people," King said. "If you swap out the people and kept the same procedures, you would very likely get the same result." He urges the administration to openly share their data and methods with the public so outside researchers are able to replicate their forecasts and contribute to their improvement.
Read MoreSocial Security on 'unsustainable path': Analyst
The bigger problem with the Social Security Administration is not disclosure, it's accounting, said Laurence Kotlikoff, a Boston University professor of economics and co-author of "Get What's Yours," a New York Times best-seller about how to maximize claiming Social Security retirement benefits.
Kotlikoff applauds the efforts for more disclosure, but wants the agency to calculate its liabilities using fiscal gap accounting, which considers the difference between the government's projected financial obligations and the present value of all projected future tax and other revenue.
The Social Security Administration projects its unfunded obligations out 75 years in the annual trustees' reports. Kotlikoff wants the administration to calculate unfunded obligations using the "infinite horizon," which accounts for funding after 75 years. Under this accounting system, SSA's projected unfunded liabilities would be $24.9 trillion (instead of the $10.6 trillion projected in 2088).
Trustees noted in their 2014 report that "the degree of uncertainty associated with estimates increases substantially for years further in the future."
Yet 17 Nobel Prize-winning economists have endorsed Kotlikoff's push for the SSA and other government agencies to use the fiscal gap accounting method more broadly.
"We have a situation that is like Enron accounting," Kotlikoff said. "And the public doesn't want to hear about it."
Read MoreSocial Security is hot topic for aging boomers
While King and Kotlikoff differ on how the Social Security Administration can improve its reports, they agree that better information about Social Security's financial health will enhance the public debate and help lawmakers fix the program before it's too late.
"Fair, transparent and accurate forecasts give Congress more of a chance to consider of all the policy proposals to preserve the solvency of Social Security," King said. "And it's easier to make changes to Social Security now than in the future."
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cb0766515084528c5ee51f3064c96571 | https://www.cnbc.com/2015/05/11/apple-watch-nail-in-the-coffin-for-these-analyst.html | Apple Watch nail in the coffin for these: Analyst | Apple Watch nail in the coffin for these: Analyst
VIDEO3:1903:19'Gangbusters' ahead for retailers?Squawk Box
The Apple Watch won't supplant venerable luxury timepiece makers, but everyday fashion watch makers are in trouble, two former retail executives said Monday.
"The fine, luxury watches, they're being hurt right because of the euro," not because of the Apple Watch, former Saks Chairman and CEO Steve Sadove told CNBC's "Squawk Box" in an interview. "Fashion watches are taking a hit right now. That's sort of a trend we're seeing."
"That watch business, which was great for the last six years, was slowing down before the [Apple Watch]," retail consultant and ex-department store executive Jan Kniffen said. "This is the nail in the coffin, the new Apple Watch. I don't think it's taking over the world. But it's a negative to those sellers."
"The real market is the $300 to $600 watch. That's what they're [Apple] really trying to win," continued the J. Rogers Kniffen Worldwide Enterprises CEO. The Apple sport device starts at $349, while the mid-tier watch starts at $549.
While Apple's bread-and-butter may be in the mass appeal, more affordable smartwatches, the tech giant is trying to get a foothold in luxury.
The Apple Watch was available to buy in select high-end boutiques before the device was available to buy directly in Apple stores.
"Angela Ahrendts, the ex-Burberry head who's at Apple, has done a great job of treating [the Apple Watch] as luxury launch as opposed to a mass launch," Sadove said.
Ahrendts leads Apple's retail operations, including online.
"They're trying to fight that battle," agreed Kniffen, pointing out that Apple for the first time got devices into the hands of celebrities who Tweeted about their experiences.
Kniffen and Sadove both feel it's icing on the cake, but the main market for the Apple smartwatches won't be wealthy at $10,000-plus a pop for the gold Watch Edition models.
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c3647d52565d578e9649260628c60ceb | https://www.cnbc.com/2015/05/11/bank-of-england-holds-interest-rates-at-05-hike-seen-sooner-rather-than-later.html | Bank of England holds rates; hike seen sooner | Bank of England holds rates; hike seen sooner
VIDEO4:3604:36BOE will need to raise rates in 2016: EconomistCapital Connection
The U.K. central bank kept monetary policy unchanged on Monday, as the stronger-than-expected Conservative electoral victory refocused markets on the possible date of the first interest rate hike.
The Bank of England held its benchmark interest rate at a record low of 0.5 percent, where it has stayed since March 2009. It also kept the size of its bond purchases under the quantitative easing program at £375 billion ($578 billion).
The bank's policy announcement was delayed because of last Thursday's general election, in which the incumbent Conservative Party gained enough votes to take a majority in parliament. This meant the center-right party was able to shed its coalition partner, the Liberal Democrat party, of the previous government.
Simon Dawson | Bloomberg | Getty Images
The news boosted markets on Friday, due to relief that there would be neither a hung parliament nor lengthy deliberations over new coalition partners. Plus, the Conservatives are viewed as more business-friendly than either the centrist Liberal Democrats or the opposition center-left Labour Party.
Read MoreBank of England admits 'error' on data
Given the result, analysts said that market forecasts for when the Bank of England would raise its key rate might move forward.
"The politics have dominated for quite some time in the U.K. in the run-up to the election, but now we are likely to see a focus back on the macroeconomics and certainly the macroeconomics in the U.K. speak for themselves: We are seeing a very solid backdrop in the growth picture and in the inflation picture and so we are likely to see a repricing in the U.K. rates market in favor of rate hikes at the beginning of next year," Phyllis Papadavid, senior global foreign exchange strategist at BNP Paribas, told CNBC on Monday.
VIDEO2:3402:34What the UK elections mean for sterlingWorldwide Exchange
Kit Juckes of Societe Generale said that any rate hikes would be gradual, but concurred that the Conservatives' victory could see forecasts for a starting date brought forward.
"Maybe the market's pricing of the first rate hike by the Bank of England will come forward a bit from the first half of 2016. But fiscal austerity is assured and will carry most of the burden of policy adjustment. Rates will rise, but slowly," said the London-based strategist in a research note on Monday.
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58be3b969d98187e844f7caaa3bf4090 | https://www.cnbc.com/2015/05/11/comcast-names-new-cfo.html | Comcast names new CFO | Comcast names new CFO
Michael CavanaghAndrew Harrer | Bloomberg | Getty Images
Comcast said Monday it has named Michael Cavanagh as senior executive vice president and chief financial officer.
Cavanagh will replace CFO Michael Angelakis, who is moving to chief executive of a new strategic investment company. The transition is expected to be completed this summer, Comcast said.
Cavanagh is co-president and co-chief operating officer at the Carlyle Group, a global alternative asset manager based in New York. Previously, he was CFO and a member of JPMorgan Chase's operating committee.
"I'm so thrilled Mike is joining our team," Comcast Chairman and CEO Brian Roberts said in a statement. "He is a world-class executive with significant experience leading and overseeing large companies with multiple, complex businesses. He has had a distinguished career that spans more than two decades, is incredibly talented, and will be a great leader for Comcast."
Read More Comcast earnings, revenue top expectations
Said Cavanagh: "Comcast is an exceptional company that is well-positioned to win in the rapidly evolving media and technology industries. The opportunity to work closely with Brian and one of the best management teams I've come across in any industry was something I could not pass up."
DISCLOSURE: Comcast is the parent company of NBCUniversal, which owns CNBC.
CORRECTION: This piece has been corrected to reflect that Michael Angelakis is moving to CEO of a new strategic investment company.
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fd4a97faf51a0782ef28392db025f10f | https://www.cnbc.com/2015/05/11/crowdfunding-comes-to-real-estate-and-pays-off.html | First crowdfunded real estate project paying off | First crowdfunded real estate project paying off
VIDEO1:5501:55Crowdfunding real estatePower Lunch
When Ben Miller decided to use crowdfunding as a means to rehabilitate a beaten-down building in one of Washington, D.C.'s transitional neighborhoods, he didn't really know crowdfunding was a thing, That's because it wasn't, at least not in real estate, yet.
But Miller and his brother Dan were raised in both a real estate family and in the social generation. Their goal—to give everyone the opportunity to invest in commercial real estate—was just intuitive to them. Previously, commercial real estate was a playground for large-scale investors only.
"We didn't know it would become a movement, and that the movement would be our business," said Ben Miller, standing in the finished project—an open, modern/industrial-style space called Maketto. "We raised $350,000 from 175 people at $100 a share, and now the industry will do a billion dollars a year, and we're doing a project a week and raising probably half a million dollars a day."
Fundrise is an online crowdfunding platform offering individual investors a chance to buy shares in a commercial real estate project. The returns come from both rental stream and the appreciation of the property itself.
Read MoreMonitor an index of the top equity-crowdfunded real estate projects
That was what was so enticing about the first project on H Street, a transitional neighborhood just east of D.C's Union Station. Not only was the neighborhood on the verge of big growth, but it also begged for an anchor destination to get the ball rolling.
When you first walk into Maketto, it's not immediately clear what the place is—and that is literally by design. It is a bar, a designer coffee house, a bakery, a retail clothing and sneaker shop, and a restaurant with a James Beard-nominated chef. Independent vendors all feed off each other, literally, under one roof. By sharing the space, the rent is cheaper, and therefore the profit greater.
"The whole idea was to do something different, to do something that the neighborhood wanted, so the space is both a restaurant and high fashion, it has a cafe," Miller said. "It's called Maketto meant to be a communal market, and the people invested in this project not only own a piece of the real estate but also a piece of the restaurants."
Miller may call it a market, but really it is a floor plan for the future: A social network of retail and restaurant on three levels, with communal seating everywhere (even in the chef's kitchen), and open-air spaces on the roof. It is what the millennials moving into this now-trendy new neighborhood expect.
"The point is to get people in there from the minute you wake up in the morning for your coffee through your nighttime cocktail and to meet people while you're there. It invites you to chat," said Gina Schaefer, one of the "crowd" investors in the project.
Read MoreHouse flippers seeing record returns
Schaefer and her husband own 10 hardware stores in the District and in Baltimore, but they lease all their properties. Owning real estate was way beyond their means until Fundrise approached them with the crowdfunding platform. They bought into it, investing $10,000 in the project. Last year, they received their first dividend check.
VIDEO1:4901:49Crowdfunding for house flippersSquawk Box
"I think for us it was just being part of the sharing community and the movement, and even if it was just a piece, to say that we owned something," Schaefer said. "We never in a million years would be able to afford to own a property in Washington, along H Street, where everything is starting to grow."
On a sunny Friday, midmorning, Maketto was already humming.
Toward the back of the main floor, just past the well-stocked bar which, for now, is spread with an array of breakfast pastries, one patron sits alone, wired up to a conference call. She is sipping something from Vigilante Coffee, a vendor that has set up shop on the second floor. At a longer, communal table upstairs, two suited patrons appear to be in the midst of an interview.
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Just past them, across the first roof garden where a young man sits reading on his laptop, you can see workers in the glass-enclosed kitchen preparing for the lunch crowd. On the outdoor third-roof level, a group of young women is hashing out a business plan over laptops, something that involves dancing. All this as an older couple walks into the front of the main floor, tempted by pastries on the bar, but stopping to browse the $100 shoelaces.
For Christopher Vigilante (that's his mother's maiden name actually), it was the opportunity to share in something bigger than his tiny coffee company.
"For business, it helps create a lifestyle brand. Folks that typically want to drink a high-end coffee can understand what really fine cuisine can be like, can also appreciate fine clothing, a shirt that might cost you a few extra dollars but will last you 10 years—these folks all kind of run in similar circles," said Vigilante, standing behind three glass spheres of bubbling brews, heated by Bunsen burners. "I think when you have the synergy of all these businesses, you get that lifestyle brand."
A brand that is solidly Millennial—shared—right down to the funding.
"A hundred companies have followed us into this space," said Miller, who has grown his crowdfunding company Fundrise from three to 30 employees. Fundrise recently raised $35 million for its technology platform, and Miller said he is hiring an employee a week.
Read MoreCompetition rises as home remodeling goes digital
Fundrise began raising money for the H Street property in 2012. Back then, Miller talked about how they had to work through an arduous process with the Securities and Exchange Commission in order to make this first-of-its-kind online equity offering for a real estate property happen.
Now Fundrise is crowdfunding projects across the country. (Tweet This)
Maketto is very nearly a visual manifestation of the philosophy behind its fundraising; put simply, a social structure grown out of social financing.
"You can tell when you interact with customers, who maybe put in that first hundred dollars to get this project off the ground, that they feel connected to the space in a different way than say any other coffee bar," Vigilante said.
As such, it is already transforming the neighborhood around it.
"We've created an anchor down this side of H Street, so it's drawing more people here," said Miller of the neighborhood, which, along with several new restaurants and fitness studios, will soon be home to a Whole Foods and more than 1,000 new apartment units. "It's probably the coolest project tin the whole city, and that's making it a destination. The real estate growth from this neighborhood has been sensational."
Miller estimates that the building itself has appreciated between 50 and 100 percent since the crowd brought it back to life. For the neighborhood, its contribution appears, so far, invaluable.
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ff3e243ee0f024fe10a194d2a7b77c99 | https://www.cnbc.com/2015/05/11/egypt-mummy-animal-scandal-unwrapped.html | That's a wrap! Egyptian mummy 'scandal' exposed | That's a wrap! Egyptian mummy 'scandal' exposed
From cutting corners and bodge jobs to outright fraud, failing to deliver a promised service is the scourge of modern business. But it seems to be an age-old problem: the Ancient Egyptian mummy industry wasn't above a bit of sharp practice when struggling to keep up with consumer demand, a BBC news report said Monday.
Research done in the U.K. by the Manchester Museum and the University of Manchester on 800 Ancient Egyptian animal mummies, bought by people in order to make religious offerings, showed that a third of the mummies didn't contain any animal material at all.
Instead, researchers found bits of shell and feathers in those mummies, signalling that the huge demand for the votive animal mummies may have outstripped the number of mummies that Egyptian embalmers could supply.
A mummified crocodile from 332-30 B.C.Matt McClain for the Washington Post | Getty Images
The project, in which mummies ranging from cats and birds to crocodiles were scanned to identify their contents, was followed by the BBC's "Horizon" program.
Alongside human mummification, the ancient Egyptian burial practice, animal mummification was big business in Egypt with scientists estimating that up 70 million animals – many of which were mass-bred to keep up with the demands of the Egyptians' religious practices -- may have been mummified by the Egyptians.
"The scale of animal mummification between about 800 BC and into the Roman period was huge," Dr Price, curator of Egypt and Sudan, at Manchester Museum, told the BBC.
"Animal mummies were votive gifts. Today you'd have a candle in a cathedral; in Egyptian times you would have an animal mummy."
Read more on the BBC's mummy report here.
- By CNBC's Holly Ellyatt, follow her on Twitter @HollyEllyatt.
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a048aea9f0cdf360d0775571b3363993 | https://www.cnbc.com/2015/05/11/how-the-2014-cnbc-disruptors-cashed-in.html | How the 2014 CNBC Disruptors cashed in | How the 2014 CNBC Disruptors cashed in
VIDEO0:4700:47LendingClub's disruptive model Squawk Box
The most disruptive companies are continuing to grab the attention of the industry giants they're threatening—as well as investors looking for the next big thing. Five of the 50 companies on last year's second annual CNBC Disruptor 50 list "graduated," meaning they have gone public or been acquired. That's half the number that graduated last year from our 2013 list, and only two successfully pulled off an initial public offering.
So why the decline in exits among the CNBC Disruptor 50, especially after a torrid IPO market pace set in 2014?
Employees and sellers of the online marketplace Etsy stand with CFO Kristina Salen on the floor of the Nasdaq as the company went public on April 16, 2015.Getty Images
Private companies are staying private longer or opting to be taken out by larger rivals. This is according to a recent financing trend reflected in the paths taken by companies on the annual CNBC Disruptor List of closely watched start-ups.
According to Renaissance Capital, an institutional market research firm that tracks the IPO market and offers an IPO ETF, last year marked the most active U.S. IPO market since 2000, with 275 companies going public and raising a stunning $85 billion. But so far this year, the IPO market has slowed dramatically.
The 34 IPOs in the first quarter raised $5.4 billion, making it the least-active quarter by IPO count since the the first quarter of 2013 and the smallest amount of IPO proceeds raised since the the third quarter of 2011. The proportion of IPOs with negative first-day returns remained above 30 percent for the second quarter in a row, according to Renaissance.
Market volatility, as well as widespread availability of private funding at very high valuations, dampened enthusiasm to seek IPO capital.
Read MoreEtsy IPO aims to prove its model
Another important factor in the lower deal proceeds overall was a lot less private equity-backed leveraged buyouts coming back into the public market, which tend to be bigger. Nevertheless, the shift in IPO investor sentiment can be seen in secondary equity deals for existing public companies, which have been faring better on a relative basis than IPOs.
First-quarter 2015 IPO trends Number of deals in Q1 2014: 64 Number of deals in Q1 2015: 34 Number of VC-backed deals in Q1 2014: 40 Number of VC-backed deals in Q1 2015: 17 VC-backed deal proceeds Q1 2014: $3.2 billion VC-backed deal proceeds Q1 2015: $1.3 billion(Source: Renaissance Capital)
There's a chasm between losing money and breaking even, and investors are not looking over that chasm.Francis Gaskinspresident of IPO Desktop Premium
Etsy—No. 3 on last year's CNBC Disruptor List—not only debuted at a valuation that was a discount to the valuation from its last round of private financing, according to Kathleen Smith, principal at Renaissance Capital, but has also traded down since its offering, down 23 percent since its April IPO. [It went up 86 percent on its first day of trading.]
Smith noted that Box—a 2013 CNBC Disruptor—also went public at a discount to its last round of private financing.
"Both Etsy and Box opened at a higher price than the IPO deal pricing and then went down," said Francis Gaskins, president of IPO market tracker IPO Desktop Premium. The same was true for GoDaddy. Box is down 27 percent since its offering; GoDaddy is down 5 percent since its IPO.
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"What's common about those three is that they are all losing money," Gaskins said. "There's a chasm between losing money and breaking even, and investors are not looking over that chasm," Gaskins said.
First-quarter 2015 IPO trading performanceAverage first-day return of Q1 2014 IPOs: 20.3% Average first-day return of Q1 2015 IPOs: 10.6% Q1 2014 IPOs above issue price at quarter-end: 71.4% Q1 2015 IPOs above issue price at quarter-end: 60.6% Q1 2014 IPOs from tech sector: 22% Q1 2015 IPOs from tech sector: 12%(Source: Renaissance Capital)
Investors are concerned that Etsy has not yet turned a profit. Plus, as it expands, it faces the challenge of competing with giants eBay and Amazon.
"I'm interested to see how Etsy performs over the next six months," said Michael Dempsey of the research and data analysis team at CB Insights. "These nonprofitable high-growth companies—they aren't all Amazon—and public markets don't have the patience, especially when there is not the same understanding of what they are building, while they are losing money."
On Monday morning, Etsy shares dropped by as much as 10 percent after three Wall Street firms published skeptical to outright bearish ratings on the company. Wedbush Securities alleges in its sell rating that as many as two million items on Etsy, or around 5 percent of all merchandise, may potentially be either counterfeit or infringe on existing copyrights and trademarks. Etsy stock hit a new post-IPO low on Monday morning.
Lending Club, the world's largest martketplace for consumer loans, went public in December, raising nearly $870 million. The first-ever IPO of an online lending platform, Lending Club's IPO soared out of the gate, giving the company a valuation of some $9 billion, more than a number of banks, including Comerica, City National and CIT Group. But shares have been struggling—down 30 percent since its deal—on disappointing fourth-quarter results and lower than expected forecasts for the year.
Read More Why Uber is making America better
Lending Club—which was a CNBC Disruptor two years running and No. 33 last year—announced a number of big-name deals, strategic partnerships with Google and Alibaba, as well as a lending partnership with Citigroup, as it aims to show Wall Street some stability. The company's also looking for ways to expand and has recently announced it's developing a payment device.
Dempsey said IPO activity could pick up in the second half of the year but will partially depend on the performance of recent IPOs that are now "getting killed" as public companies recover in the second quarter.
Private investors may be hesitant to face a valuation markdown triggered by an IPO as a reason they are keeping their start-up darlings funded for longer, according to Smith.
"Public markets are not buying into private market valuation inflation," Dempsey said. But, he added, "they're staying private for longer because they can."
"If you can take a company public at a $2 billion valuation or keep it private and have Fidelity Investments come in and give it a $4 billion valuation, that's more attractive," Dempsey said. He gave Twitter as an example of a company that went public before it had its business model figured out—in its case, advertising—and Twitter has paid the price in the public markets as a result, down 10 percent all-time since its IPO.
Other start-ups are opting to take the money from large corporations rather than test the public market appetite, particularly in the online advertising and media space.
There are the three Disruptor 50 companies that were acquired in the past year for a total of $1.44 billion: Fullscreen, Brightroll and, just as last year's list was published, Skybox Imaging.
Anything can happen along the way, because we're in an environment with lots of capital sloshing around on the private side, and when a model assumes a start-up will be a dominant player but others are being funded, the onus is on the tech companies.Kathleen Smithprincipal at Renaissance Capital
Brightroll, a digital video ad network that was No. 27 on last year's list, sold to Yahoo in November for $640 million. CEO Marissa Mayer snatched up the company as part of an acquisition spree to make Yahoo's video ad platform the largest in the U.S. The Internet giant said Brightroll was profitable, with net revenues of more than $100 million last year. The plan was to combine Yahoo's desktop and mobile ad inventory with Brightroll's platform to boost the bottom line.
Cashing in on the explosion of YouTube celebrities and the more than 55,000 online video creators in its network, Fullscreen—No. 21 on last year's CNBC Disruptor List—sold a majority stake to Otter Media, a joint venture between AT&T and the Chernin Group, Hollywood veteran Peter Chernin's media company. The September deal reportedly valued Fullscreen between $200 million and $300 million, though terms weren't disclosed. Fullscreen's acquisition follows Walt Disney's nearly $1 billion purchase of Maker Studios in April 2014.
SkyBox Imaging was snapped up by Google last June for half a billion dollars, ranking it at No. 14. The satellite imaging and analysis company built and launched the world's smallest high-resolution imaging satellite to further its mission of revolutionizing access to information about changes happening across the Earth. While Google said Skybox's up-to-date imagery will help to improve Google Maps, the company also said that over time they hope Skybox's team and technology will "help improve Internet access."
Last year was a banner year for IPOs because the equity indices' run of 2013 carried over into the next year's investor sentiment, but with the flattening in stocks this year—the is up 3 percent—the opportunity has narrowed.
Even the best bets in the IPO market are beginning to cool down. Led by biotechs, the health-care sector stayed active, accounting for half of all IPOs in the first quarter, but that action is slowing. "The wind is out of the biotech sails right now," Gaskins said.
Several biotech IPOs scheduled to price last week haven't yet made it to market, and even those that did have disappointed in pricing and early trading. "I might have said that you could go to market anytime with biotech, until about a week ago," Renaissance Capital's Smith said.
A U.S. and world economy that are not growing significantly, along with lots of market uncertainty, shortens the time horizon investors afford to start-ups to break even.
Read MoreWhy Warby Parker is turning heads
"The IPO market is healthy for profitable companies that have growth prospects," Gaskins said.
"There's a risk in companies that are very fast growing and don't have earnings and are spending a lot of marketing dollars," Smith said. "Anything can happen along the way, because we're in an environment with lots of capital sloshing around on the private side, and when a model assumes a start-up will be a dominant player but others are being funded, the onus is on the tech companies."
Or, in other words, many start-ups with good stories and the backing of Silicon Valley still have a lot to prove.
The 2015 CNBC Disruptor List will be unveiled on Tuesday. Follow coverage of the companies that made this year's list on CNBC and CNBC.com.
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20441af53e3b78f822fafb71c09d819b | https://www.cnbc.com/2015/05/11/uks-eu-referendum-may-be-sooner-than-you-think.html | Why UK’s EU referendum may be sooner than you think | Why UK’s EU referendum may be sooner than you think
Getty Images
The possibility of a "Brexit" – Britain exiting the European Union after more than four decades – may become reality sooner than many in the markets expect.
Since winning an unexpected majority in Thursday's general election, U.K. Prime Minister David Cameron has already re-committed to an in-out referendum by the end of 2017. However, he also acknowledged earlier in the year that it could come sooner.
UK election result: EU seeks to avert Brexit
Following his electoral success, Cameron said he is already trying to re-negotiate the U.K.'s position within the EU. If he can win concessions, it may help keep his own party and the rest of the electorate on side.
"This election result gives David Cameron considerable political capital, and for the sake of financial stability it is to be hoped that he uses this to take a tough but ultimately constructive view on the U.K.'s role in the EU," Michael O'Sullivan, chief investment officer for the U.K. at Credit Suisse, wrote in a research note.
VIDEO1:4601:46Brexit? We're better in the EU: CEO Worldwide Exchange
Currently, polls indicate that the electorate favors remaining in the EU, with a poll by Survation for the Mail on Sunday over the weekend suggesting that 45 percent would vote to stay, and 38 percent would vote to leave.
Yet Thursday's election result – which came as a shock to most pollsters -- shows how unreliable polls can be.
Here, we look at why the referendum may come sooner rather than later.
There is already controversy brewing in the U.K.'s right-wing press about whether or not the country will be "forced" to take in some of the refugees and asylum seekers who have tried to cross the Mediterranean in recent weeks.
The European Agenda on Migration, which is expected to be announced on Wednesday, is set to include a proposal that the people – many of them from war-torn states like Libya and Syria – are distributed amongst EU states according to their population and economic health.
Deadly Mediterranean migrant wave will be tough to thwart
The desperation of these refugees has been highlighted by a number of tragic accidents in the Mediterranean, with close to 2,000 people either dead or missing in its waters over the year to date, according to the International Organization for Migration.
Immigration was one of the key issues in the recent U.K. election campaign, and the newly re-elected Prime Minister, who is reliant on his backbench MPs, will not want to look soft on either the EU or asylum seekers.
Cameron will well remember the travails of John Major, the last Conservative prime minister who also had a slim majority, as he tried to keep all of his MPs on side. There is a very real possibility that, in the event of a referendum, some of Cameron's own party will be campaigning alongside the UK Independence Party (UKIP) for the country to leave the European Union. As such, the Prime Minister may find it easier to bring forward a vote during the party's honeymoon period.
Yes, they have only got one MP – but 3.5 million people (in a country of around 62.5 million) voted for the anti-EU party. If there is a low turnout for the EU referendum, and you add the number of people who voted UKIP to those who voted for other parties but aren't keen on the EU, there might be a real risk of exit. It may be better for the Conservative Party to strike with a referendum while UKIP is demoralized and disorganized.
The biggest victor (apart from Cameron) in Thursday's election was the Scottish National Party (SNP), who destroyed the Labour Party in Scotland. And its leader, Nicola Sturgeon, has already made it clear that an EU referendum could trigger a new Scottish independence referendum – making it doubly risky for sterling and other U.K. investments. Cameron may want to remove this double risk from the equation sooner rather than later.
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6dbfc295d50da1cc9ccbb1ff7040ac26 | https://www.cnbc.com/2015/05/11/what-disney-apple-and-facebook-have-in-common.html | What Disney, Apple, and Facebook have in common | What Disney, Apple, and Facebook have in common
VIDEO3:5903:59What Disney, Apple & Facebook have in commonOptions Action
The market may have seen a small rebound after the selloff earlier last week, but in a strange coincidence, the charts for several top names are showing patterns that may be flashing a warning sign for stocks.
While the flirts with new record highs, some of its biggest and most recognizable names are stuck in the mud. Shares of Apple, Disney, Nike, Starbucks and Facebook have sold off an average of 5 percent from their highs shortly after reporting earnings. (Tweet This)
These selloffs are significant because of the important role these names have played in the S&P 500's rally over the past several months, said Dan Nathan, founder of RiskReversal.com.
"They have been leaders throughout this whole bull market," the CNBC contributor said on "Options Action" on Friday. "In some ways, they are kind of like a Teflon portfolio of U.S. consumer stocks."
Dado Ruvic | Reuters
But that Teflon might have worn off after they became popular with investors.
Read MoreThis Facebook search feature could worry Google
"People are kind of full-up on these things," said Nathan. "They're crowded trades. Everyone [knew] the news [was] going to be good, so there was no incremental buyer and you had some selling."
Even Facebook, which showed promise when it broke out of a nine-month trading range between $70 and $82, has since sold off. It is now testing its 200-day moving average as it returns to its sideways trend, Nathan said.
"When we're trying to figure out what's going to cause the S&P to break out, we'd like to see stocks like Apple and Disney and Nike and Starbucks get us there," he said. "If they're showing waning momentum, then I would actually be skeptical of a breakout in the S&P."
In short, according to Nathan's work, the market might be losing its leaders and, as a result, the rally could "be losing some of the horsemen of this bull market."
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ecf846483a09c105f361e9ad476cc1ef | https://www.cnbc.com/2015/05/12/bhp-billiton-to-reduce-spending-sees-lower-waustralia-iron-ore-costs.html | BHP cuts production costs in response to metal price dive | BHP cuts production costs in response to metal price dive
BHP Billiton, the world's largest mining company, said on Tuesday it would slash its iron ore production cost further and cut spending to better withstand a downturn in commodity prices.
Giant iron ore producer BHP and rival Rio Tinto are locked in a battle to become the lowest cost iron producer. At the same time, they are increasing production of the steel ingredient, hoping to squeeze out competitors and gain market share.
Getty Images
BHP Billiton Chief Executive Andrew Mackenzie dismissed criticism that such a strategy was fuelling the sharp slump in iron ore prices.
"We operate in highly competitive and cyclical markets, where earnings outperformance through the cycle depends on being the most efficient supplier, not supply restraint," Mackenzie said, speaking at an investor conference in Barcelona.
"In this environment we are well prepared for the possibility of an extended period of lower prices in several commodities."
Read MoreBHPBilliton: Iron ore spot price is fair value
Conserving capital has been a theme in the mining sector since metals prices started to cool in 2011 as the commodity supercycle came to an end.
BHP said it would reduce its capital and exploration expenditure to $9 billion in the 2016 financial year from $12.6 billion in 2015 as it completes its growth projects.
VIDEO4:5104:51Why BHP Billiton's spin-off move makes senseSquawk Box Asia
The Anglo-Australian mining company said also it expected to reduce iron ore unit costs at its Western Australia operations by 21 percent to $16 per tonne in the 2016 financial year, from just below $20 per tonne last month.
"That's is an incredibly low cost. That's targeting even lower levels than Rio," said Investec analyst Hunter Hillcoat.
Rival Rio Tinto, the lowest cost iron producer, had an average cash cost of $19.50 a tonne in 2014, and forecasts it will be about $17 a tonne this year.
Read MoreBHP Billiton sees evolution of iron ore market
Analyst Paul Young at Deutsche Bank in Sydney said he expected Rio to still be ahead of BHP in 2016, forecasting its cost will fall to $13-14 a tonne.
Both producers have been helped in their cost-cutting efforts by weaker oil prices and a lower against the U.S. dollar. But competitors have benefited from these too.
"I don't expect these cuts to result in higher margins for BHP and Rio," said Liberum analyst Richard Knights. "Costs are being cut aggressively by marginal producers as well which in an oversupplied market, leaves more room for the price to fall."
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ca5bf69be4da084c5f4b6a768640e892 | https://www.cnbc.com/2015/05/12/china-outlook-even-worse-than-imagined-morgan-stanley.html | China outlook even worse than imagined: Morgan Stanley | China outlook even worse than imagined: Morgan Stanley
VIDEO0:5900:59China cuts interest rates
The worst of the Chinese economic slowdown is likely still ahead because of the nation's debt, according to a senior Morgan Stanley investment strategist.
"China, to try and sustain its growth rate in the post-financial-crisis era, has engaged in the largest credit binge of any emerging market in history," said Ruchir Sharma, head of emerging markets and global macro at Morgan Stanley Investment Management,
Sharma, speaking Tuesday at the Global Private Equity Conference in Washington, D.C., predicted that the credit boom would cause problems.
Whenever a country increases its debt to gross domestic product sharply over five years, in the next five years there's a 70 percent chance of a financial crisis and 100 percent chance of a major economic slowdown, according to Morgan Stanley research.
The Chinese government this week cut interest rates for the third time in six months because of projected 7 percent GDP growth this year, the lowest level in more than two decades.
Sharma said the slow growth he forecast would be around 4 percent or 5 percent over the next five years, about half the rate of what it used to be. (Tweet this)
"If China follows this template, it really is payback time," he said.
VIDEO1:5401:54Rate cut isn't an antidote to China woes: ProSquawk Box Asia
Another speaker at the conference, former U.S. Gen. Wesley Clark, took a less grim view.
"I'm not as worried about the buildup of debt in China as other countries," the founder of Wesley Clark & Associates said.
He cited two reasons. The renminbi is not fully convertible to other currencies, and the Chinese economy still has elements of central control.
"Every year people at these business conferences say the demise of the Chinese economy is coming very rapidly," Clark added. "But it hasn't happened. And President Xi is not going to let it happen if he can avoid it."
Another China bull, Robert Petty, managing partner and co-founder of Clearwater Capital Partners, said China can forestall its debt problems.
"We believe the balance sheet of China absolutely has the capacity to do two things: term it out and kick the can down the road," Petty said.
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35ac287a49bca26cdf2572b397fa916e | https://www.cnbc.com/2015/05/12/deflategate-sales-of-tom-brady-merchandise-double.html | 'Deflategate': Sales of Tom Brady merchandise double | 'Deflategate': Sales of Tom Brady merchandise double
Tom Brady is not only the most-talked about football player right now. He's also the top-selling.
Fan wearing a Tom Brady jersey at a New England Patriots gameJim Wilson | The Boston Globe | Getty Images
According to Fanatics, the largest retailer of officially licensed sports merchandise, sales of Brady gear have spiked 100 percent since Monday, when the NFL announced he would be suspended for four games next season. (Tweet This)
"Our sense is fans are rallying behind Brady and the Patriots and supporting them," said Jack Boyle, president of merchandising for Fanatics.
Read MoreFans try to crowdfund Patriots' 'Deflategate' fine
Since May 6, when the NFL reported that the Patriots and Brady likely knew that they were using deflated game balls—which presumably are easier for receivers to catch—Brady has been the third-best-selling NFL player on the site after Marcus Mariota and Jameis Winston, the two top NFL draft picks.
This week, Brady gear is doing even better. "His jersey was the leading item the last 24 hours," Fanatics said.
VIDEO1:4901:49Brady suspended 4 games, Patriots fined $1 millionFast Money
The online retailer said it has remained well-stocked on Brady's #12 jersey. Historically, Fanatics said, this type of positive trajectory after negative news does not happen.
"We generally do not see an overall lift in sales if the news with a team is not favorable," said Boyle.
It's not just Brady seeing the surge. The Super Bowl-winning Patriots are the second highest-selling NFL team on their site, behind only the Dallas Cowboys.
Read MoreDeflategate: What did Tom Brady know?
Boyle said he expects another week or two of increased sales before they return to normal.
Though merchandise for Brady and his team is flying off the shelf, game ticket prices have remained steady on the secondary market. According to ticket resale site TiqIQ, the price of admission to Patriots home games for the 2015 season is down less than 1 percent from this time last season.
Tickets saw the biggest change for the Patriots' Oct. 18 game against the Colts. Those prices were up 13 percent.
Pending an appeal, that would be Brady's first game back from suspension.
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067baf0afc04854b548406fb1212c788 | https://www.cnbc.com/2015/05/12/dont-expect-rate-riot-nouriel-roubini.html | Don't expect 'rate riot': Nouriel Roubini | Don't expect 'rate riot': Nouriel Roubini
VIDEO3:0103:01Roubini: Art indicative of high asset pricesClosing Bell
Bond investors shouldn't expect a "rate riot or rate rage" when the Federal Reserve begins to raise interest rates because the central bank has already telegraphed what it is going to do, economist Nouriel Roubini said Tuesday.
"It's not going to be a significant surprise. As the economy recovers, as inflation goes higher, gradually long-term interest rates are going to go higher," said the co-founder and chairman of Roubini Global Economics, also known as "Dr. Doom."
That said, he told CNBC's "Closing Bell" there could still be some volatility in the short term.
"In the short run, lack of market liquidity, lack of market makers can imply that when there are some surprises—economic and otherwise—or inflation, then you're in a very volatile environment for bond yields in the U.S. and Europe."
Nouriel RoubiniJin Lee | Bloomberg | Getty Images
When it comes to stocks, Roubini said there is "certainly frothiness" but not a bubble.
He noted that among other things, price-earnings ratios are slightly above historical averages and some sectors like biotech and technology look "funny in terms of what's happening right now."
"The frothiness is driven by the fact that we are still at zero policy rates in the U.S." and quantitative easing in advanced economies like the euro zone and Japan, Roubini said.
Read MoreBanks not buying what the US government is selling
All the liquidity hasn't been going into the real economy; instead it's going into asset reflation, he added.
"Soon enough asset reflation can become asset inflation, asset inflation can become asset frothiness and eventually you have asset and credit bubbles."
Therefore, he thinks valuations and the length of the Fed's exit from the market need to be watched.
"My worry is the real economy justifies a slow exit—low inflation, still low growth, unemployment is still high—but then all this liquidity is going to go to asset inflation and eventually in frothiness and financial bubbles."
Roubini has already warned a bubble may be forming in the art market, which he thinks should be considered as an asset class like stocks and bonds.
Read More Beware an art market bubble, Roubini warns
On Monday night, the Pablo Picasso painting "Les femmes d'Alger (Version 'O')" became the most expensive work of art ever sold at auction when it went for $160 million. Including the auction fees, the total price was $179.37 million.
The piece was last sold at auction in 1997 for $31.9 million.
"What I'm seeing is that these asset prices, even for art ... is a signal of how many asset prices are too high today," Roubini said Tuesday.
He also said in some cases, art has been used for money laundering or tax evasion.
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bbe4f3e9995d644d5ee8680211b376b7 | https://www.cnbc.com/2015/05/12/gateley-becomes-first-law-firm-to-join-uk-stock-market.html | Gateley becomes first law firm to join UK stock market | Gateley becomes first law firm to join UK stock market
U.K. law firm Gateley is poised to be the first British legal practice to list its shares in London after it announced plans on Tuesday for a flotation that would value the company at £130 million-£140 million ($203.45 million-$219.16 million).
The company will be listed on the Alternative Investment Market (AIM) which supports smaller companies wishing to sell equity.
Michael Ward, CEO of Gateley, the UK's first listed law firmBen Phillips | Gateley
Changes to U.K. laws in 2011 permitted law firms to accept investment from people outside the legal industry for the first time. Firms that did so were called Alternate Business Structures (ABSs). Gateley became an ABS in 2014 and is now the first firm to launch an initial public offering.
Gateley, which provides legal services across the U.K. and has an office in Dubai, states its revenue grew annually over the past 10 years by 14.3 percent to £54.6 million ($85.45 million) and operating profit by 14.8 percent to £7.4 million in 2014. The company, which was established in the 19th Century, has a 380-strong team of lawyers and serves more than 4,000 corporate and 1,500 private clients.
Nick Smith, Gateley's acquisitions director, told CNBC that the flotation was the "natural next step" for the business. He said: "We've delivered continuous growth in a difficult environment and we've managed to secure the commitment of a fantastic team of people.
"Accessing the public markets will enable us to continue to innovate and develop more relevant, valuable services. But also at the same time secure and retain the best talent within the industry by employee share holder participation which is not available within the confines of a traditional partnership model."
Read More Why UK investors should cheer the election results
CEO Mike Ward also told CNBC that becoming a public limited company would not negatively affect how the company is run: "We want to run the business in the post IPO world as near as possible to how its run now. We understand and accept that there are corporate governance issues which we will comply with and that won't be a problem.
"In terms of restrictions from running our business how we run it now we can't see there are any there."
Mr Smith also explained what challenges commercial law firms faced in the economy. He said: "We have seen a number of changes in the last 10 years or so internationally and nationally and we think the market is subdividing itself into clear groups.
"You need to be clear about which market you're facing, you need to build a financial model that meets the requirements of that market and for us its product development, its maintaining the highest standards of service delivery and retaining the best talent.
"It's an oversupplied market: if you stand still, you go backwards."
Follow us on Twitter: @CNBCWorld
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61fd1b211cc4354f677014b4803e0e3a | https://www.cnbc.com/2015/05/12/hang-on-tight-markets-go-on-wild-ride.html?__source=fincont&par=fincont | Hang on tight, markets go on wild ride | Hang on tight, markets go on wild ride
VIDEO3:1903:19Bonds selloff: What it means for currenciesWorldwide Exchange
Safe-haven bond markets succumbed to heavy selling once more early on Tuesday, sending equity markets down sharply while the euro jumped 1 percent against the dollar.
The benchmark 10-year U.S. Treasury yield, which moves in the opposite direction to the price, rose to about 2.35 percent, the highest level since December, and Germany's 10-year Bund yield soared over 10 basis points to about 0.72 percent.
European stock markets were broadly lower, with Germany's blue-chip Dax index down more than 2 percent at one point.
Photographer | Collection | Getty Images
Analysts said the reasons for the global market volatility wasn't down to any one reason.
These included a scaling back of European deflation expectations, sparking the sell-off in bonds that began last month; and a perception that a rise in U.S. interest rates was likely to come later rather than sooner – something that was boosting the euro, which in turn was pressuring European stocks.
Read MoreFed's Dudley applauds 2015 rate hike consensus
"The fact of the matter is that the concerns about deflation in Europe have been overstated, so we are seeing a reaction in yields and this is pushing the euro up and the Dax down," Michael Hewson, chief market analyst at CMC Markets U.K., told CNBC.
"People are also talking about Friday's non-farm payrolls report being positive but it wasn't really, so that has pushed back talk of a rate hike soon," he added.
Last week's jobs report, perhaps the most closely watched U.S. indicator, showed the U.S. economy created 223,000 jobs in April. But March non-farm payroll growth was revised down to 85,000 from the 126,000 previously reported.
Fast and furious
It was the sell-off in global bond markets Tuesday that continued to attract the most attention given the ferocity of the moves seen in recent weeks.
German Bund yields have led the move higher in debt yields, climbing sharply from a record low of about 0.05 percent in April as the European Central Bank implemented a 1 trillion euro asset-purchase program to boost deflation and a sluggish economy.
Higher Treasury yields meanwhile mean higher borrowing costs for corporates, which could hit share prices around the world, analysts said.
"Folk have woken up to the reality that although global growth is still tantalising, growth signals are starting to emerge, deflation expectations are falling and against this backdrop it did not make sense to have yields where they were," Bill Blain, a senior fixed income strategist at Mint Partners in London, told CNBC.
"The fact that we have bond rates rising will hurt stocks," he said.
VIDEO3:5103:51Seeing normalization in yields: ExpertsSquawk Box
Euro firm, so is oil
A rebound in oil prices from a rout between June last year and January has also added to a scaling back of deflation expectations, analysts said. Data released last month showed the euro zone ended four months of deflation in April.
And on Tuesday, oil prices extended recent gains with Brent futures up more than 2 percent at $66 a barrel and U.S. crude oil futures up almost 2 percent at about $60 amid fears over unrest in Yemen and a weaker dollar.
Read MoreGet ready for another oil price dip: Goldman Sachs
The euro was trading at about $1.1263, up one percent on the day and about 7 percent higher from a low of $1.05 hit in March. (Tweet this)
"The currency market moves are difficult to understand on their own, there is a dollar sell-off across the board," Steven Englander, global head of G10 strategy at Citi, told CNBC.
"There was a sense that the Fed may not deliver what was in the $1.05 (euro/dollar) price and there's also a view that Europe's economy is not in bad shape," he added.
Follow us on Twitter: @CNBCWorld
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4b742dcb6cae192e24fe42c769e86e2e | https://www.cnbc.com/2015/05/12/this-will-be-critical-for-space-travel-spacex-exec.html | THIS will be critical for space travel: SpaceX exec | THIS will be critical for space travel: SpaceX exec
VIDEO5:3805:38SpaceX COO on competition: Hard to catch us Squawk Alley
Space travel will hinge on one key factor: the reusability of rockets, Gwynne Shotwell, president and COO of Space Exploration Technologies, said Tuesday.
"It's critical to move life to other planets. You can't imagine what would air travel be like if you tossed the aircraft flying from Los Angeles to New York. It would be very expensive; it would be incredibly prohibitive, so it's critical for us to have human access for recoverability," Shotwell told CNBC's "Squawk Alley."
Read More Meet the 2015 CNBC Disruptor 50 companies
Shotwell added that the Elon Musk-founded company will recover one of its rockets, and relaunch it, this year.
SpaceX, however is not the only competitor within the reusable-rocket market. On April 13, United Launch Alliance, a joint venture of Lockheed Martin and Boeing, unveiled the Vulcan, a reusable rocket.
"We have years of experience on the recoverability and the reusability [of rockets]. Though it's great to see others follow in our footsteps, I think it's going to be hard to catch us," Shotwell said.
Shotwell also discussed SpaceX's financial situation.
Read More 50 disruptive start-ups revolutionizing business—and the world
"I anticipate our revenues to grow. They have grown year over year since 2011," she said, adding the company has hedged against possible downturns by diversifying its clientele.
"We have NASA as customers," Shotwell said. Soon the company will have national security space launches and "we're actually starting to dominate in the commercial arena as well," she added.
Read More Can SpaceX win the multibillion-dollar global rocket war?
Shotwell also said that she does not see a need for additional capital. "We're running our R&D as well as the company off our revenues."
—Reuters contributed to this report.
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5c961abd51d2d3d0d00c4d366a99a6ad | https://www.cnbc.com/2015/05/12/us-stocks-open-lower-as-yields-hold-higher.html?__source=fincont&par=fincont | Stocks close mildly lower as yields pause rally; AOL jumps 18.5% | Stocks close mildly lower as yields pause rally; AOL jumps 18.5%
VIDEO1:3301:33Pisani: 10-Year yield problem for marketPower Lunch
VIDEO2:4002:40Bonds will control short-term direction of stock market: ProPower Lunch
VIDEO4:1804:18Cashin: Bond bull market over?
U.S. stocks closed mildly lower on Tuesday, recovering from sharp morning losses as investors found some relief from a slight recovery in bonds. (Tweet This)
"Obviously the bond market led action this morning," said Quincy Krosby, market strategist at Prudential Financial. It's a "continuation of the rollercoaster ride we had last week. In the absence of market-moving data the market has been subject to these (bond) swings."
She noted some support from corporate dealmaking.
In an unexpected morning announcement, Verizon is buying AOL for $50 per share or $4.4 billion in cash, with AOL CEO Tim Armstrong continuing to lead the company after it becomes a wholly owned Verizon subsidiary. The Internet firm surged more than 18.6 percent on the news, while Verizon closed down 0.4 percent.
"Typically (deals are) supportive of the market but right now we're fighting some pretty big macro trends," said Art Hogan, chief market strategist at Wunderlich Securities, referring to the global selloff in bonds.
The Dow Jones Industrial Average failed to hold slight gains in afternoon trade after recovering from a 180-point plunge in the open. The Nasdaq also gave up attempts to advance, while the S&P 500 never broke into positive territory and traded just below the flatline.
"The turnaround on the rise up in yields certainly has a positive effect on the loss we saw in equities," said Robert Pavlik, chief market strategist at Boston Private Wealth. "Really the selling (in bonds) is begetting more selling. People know there's a real possibility interest rates are going to move up this year."
"If you're a long-term investor I would not be worried about interest rates because they're not going to be moving sky-high this year," he said.
Yields gave back gains after reaching multi-month highs on Tuesday morning, staying within a range. The benchmark 10-year Treasury bond yield traded near 2.26 percent after touching a 6-month high of 2.366 percent. The 30-year bond yield held near 3.02 percent after reaching a 6-month high of 3.06 percent.
"The bond volatility is going to continue for a while, at least until the next Fed meeting as people try to get their arms around" the timing of a rate hike," said JJ Kinahan, chief strategist at TD Ameritrade.
The rapid decline in yields after touching highs Tuesday morning signaled a peak in the 10-year for some analysts.
MacNeil Curry, global head of technical strategy at Bank of America Merrill Lynch, said he was looking for a top between the 2.305 and 2.328 percent zone on the 10-year yield. "That was the zone we were looking for because it was the top of the channel from the January highs of 2014. This whole downtrend started back in January, a year and a half ago," he said.
In the first of three bond auctions for the week, the Treasury Department auctioned $24 billion of 3-year notes at a high yield of 1 percent. The bid-to-cover ratio, an indicator of demand, was the highest since February.
Crude oil settled up 2.5 percent at $60.75 a barrel on the New York Mercantile Exchange. Oil extended gains on OPEC's forecast for increased demand. The rise came despite Goldman Sachs' morning note that said the rally in oil prices was premature and itself preventing a decrease in oversupply.
Gains in oil pressured the Dow transports, sending the index 1.2 percent lower as all constituent stocks declined.
Marc Chaikin, CEO of Chaikin Analytics, said the decline in transports was "not a major concern" as the S&P 500 continued to hold above a support level of 2,070.
"Futures were way down in the pre-market, pushing us down to support levels and the market's come right back from those levels. I think that's fabulous," he said. "U.S. equities are attractive and will continue to be once we get past this May-June period."
The months mark a lull between quarterly earnings reports and Federal Reserve Open Market Committee meetings.
Earlier, the Dow futures briefly fell about 140 points as yields rose. The U.S. dollar fell about half a percent, with the euro at $1.122.
Analysts said the U.S. bond market movements was mostly triggered by the selloff in German government debt. The 10-year bund yield traded near 0.67 percent, about a 22 percent increase for 2015 but still 13 percent below 6-month highs.
"First of all the European reversal is the focus, but (their bonds have had) extremely low rates and they bounced back to really low rates. Inflation in oil and weakening dollar-euro has helped with that reversal," said Mariann Montagne, senior investment analyst at Gradient Investments.
European equities slid on Tuesday, with the benchmark German DAX index about 2 percent lower.
Greek Prime Minister Alexis Tsipras on Tuesday called on lenders to break an impasse in cash-for-reform talks. Earlier, Greece emptied an emergency IMF holding account to repay 750 million euros ($839 million) due to the international lender, a Greek central bank official said in a Reuters report. The move avoided default but underscored the dire state of the country's finances.
The recent selloff in bonds, which paused last Thursday and Friday, accelerated Monday afternoon and continued into Tuesday's morning trade before slowing again.
Brandon Swensen, co-head of U.S. fixed income at RBC Global Asset Management (U.S.), said the rapid movement was due to "thin markets."
"We think an important story in the bond market in 2015 is a general lack of liquidity which directly exacerbates price swings," he said, noting increased volatility in fixed income since October 2014. "This is largely the result of shrinking dealer inventories as they cope with new regulations on multiple fronts."
Read MoreBond yields spike, pressuring global stocks
Despite the decline in equities, most analysts noted that the major indices remain near records and are confident in the stock market's long-term ability to move higher.
"The shifts on the macro front have investors on edge, but the action has not damaged the bullish technical posture of most equity benchmarks," BTIG's chief technical strategist Katie Stockton said in a note. "We continue to believe the SPX will be able to surmount final resistance on improved intermediate-term momentum. The concern that accompanies down-days has far outweighed the excitement that surrounds up-days, which we see as a positive."
San Francisco Federal Reserve President John Williams said in prepared remarks for a Harvard Club address that raising rates "a bit earlier" allows the Fed to increase rates more gradually.
Jack Ablin, chief investment officer at BMO Private Bank, said the recent gains in bond yields could indicate changing sentiment on rate hike timing. He noted that the 10-year note historically follows GDP and is far below that level.
"Investors may finally be anticipating the long-awaited increase in the Federal funds rate," he said in a note. "Massive liquidity fueled by overly easy central bank policies has pushed a multi-year bond rally to ridiculous levels – and the unwind is only beginning."
Of the little economic data due Tuesday, the Job Openings and Labor Turnover Survey showed job openings down slightly and new hires little changed in March.
The U.S. budget surplus for April was $157 billion, a 47 percent jump from the same period last year, the U.S. Department of the Treasury said.
Earlier on Tuesday, the National Federation of Independent Business said its Small Business Optimism Index rose 1.7 points to 96.9 last month, with owners in the energy field surprisingly bullish about capital expenditure and hiring plans. The increase adds support to views that economic growth is rebounding after a dismal first quarter, Reuters said.
Stocks closed moderately lower on Monday, giving back some of Friday's rally on the April employment report.
Major U.S. Indexes
The Dow Jones Industrial Average closed down 36.94 points, or 0.20 percent, at 18,068.23, with Intel the greatest laggard and Wal-Mart leading gainers.
The closed down 6.21 points, or 0.29 percent, at 2,099.12, with materials leading eight sectors lower and energy and telecommunications the only advancers.
The Nasdaq closed down 17.38 points, or 0.35 percent, at 4,976.19.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, pared gains to trade near 14.
"A breakdown of technical support level was averted as bond prices reversed course," Peter Cardillo, chief market economist said in a note. "The movement in (the) VIX index remained fairly contained during the early weakness, suggesting support levels remain strong."
Decliners were a step ahead of advancers on the New York Stock Exchange, with an exchange volume of 699 million and a composite volume of 3.1 billion in the close.
Gold futures settled up $9.40 at $1,192.40 an ounce.
In stock news, Castleton Commodities International will buy Morgan Stanley's physical oil business in a long-awaited deal.
The government said MetLife's suit fighting its so-called "SIFI" designation should be dismissed. The insurer earlier this year challenged the decision to designate it as systemically important and subject to tighter scrutiny. The Justice Department said MetLife is "significantly interconnected" with other financial companies.
Meanwhile, Apple is in talks with Alibaba to bring its mobile payments system to China, according to an interview with Chinese news agency Xinhua.
Read MoreEarly movers: AOL, MS, HTZ, TSLA, AAPL, GPS & more
Plus, on Monday, General Electric said for the first time it might be willing to make concessions in order to win European approval to acquire the power equipment unit of France's Alstom.
—Reuters and CNBC's Patti Domm and Peter Schacknow contributed to this report.
On tap this week:
Tuesday
Earnings: Allianz, EnCana, McKesson, Zillow, Voxeljet, Vivint Solar, International Flavors and Fragrances
Wednesday
Earnings: Macy's, Cisco Systems, Shake Shack, Nissan, SAB Miller, Ralph Lauren, Precision Castparts, Markit
8:30 am: Retail sales
8:30 am: Import prices
10:00 am: Business inventories
1:00 pm: $24 billion 10-year note auction
Thursday
Earnings: Kohl's, Nordstrom, Party City, Applied Materials,Symantec, El Pollo Loco, King Digital
8:30 am: Initial claims
8:30 am: PPI
1:00 pm: $16 billion 30-year bond auction
Friday
Earnings: Nippon Telegraph, Petrobras
8:30 am: Empire State survey
9:15 am: Industrial production
10:00 am: Consumer sentiment
4:00 pm: TIC data
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bbec0573ad727492d31e7de7f910631a | https://www.cnbc.com/2015/05/12/why-does-tom-brady-make-so-little-in-endorsements.html | Why does Tom Brady make so little in endorsements? | Why does Tom Brady make so little in endorsements?
VIDEO0:3900:39Brady's 'Deflategate' punishmentNational Football League
The National Football League suspended Tom Brady for four games for his role in the deflation of footballs last season. The New England Patriots quarterback will lose his salary for those first four games, and there might be some impact to his endorsement deals. Here's the thing though: He only makes an estimated $7 million in endorsements annually, according to Forbes.
While a lot of athletes make more off the field than they do on it, it turns out that NFL players are the exception to that rule. At $7 million, Brady is almost at the very top in terms of NFL players' off-field earnings. His endorsements include Movado, Under Armour and Ugg.
Peyton Manning leads the sport at about $12 million in endorsements. Contrast that with a sport like golf, for example, where several players—many not even household names, are making more than $7 million from their sponsors. The median income of golf's top 50 players was $5.2 million away from the course—almost what the NFL's golden boy makes. The top two golfers in endorsements, Tiger Woods and Phil Mickelson, each make about $50 million from sponsors—not even in the same ballpark as what Brady and Manning get.
That's a huge disparity, and begs the question: Why do players in the NFL, America's No. 1 sport, make so little in endorsements?
"It's simply the helmet theory. Football is a sport behind pads, which makes it very hard to relate and market the players," one NBA co-owner told CNBC. He also pointed out that "the lack of major shoe sponsorships also plays a part, considering how much weight Adidas, Nike and now Under Armour put behind their top-tier endorsed players."
Consider that in a sport like basketball, consumers can wear in real life the same shoes the players wear on the court. That doesn't work in football, since wearing football cleats to school or work isn't so practical.
"Among team sports, basketball and soccer players make more in endorsements because the stars in those sports truly stand out," said Patrick Rishe, director of the sports business program at Washington University in St. Louis. "They are visible during play, not wearing helmets, exude greater athleticism and those sports have greater international appeal."
Rishe also noted that athletes in individual sports like race car drivers, tennis players and golfers make more in endorsements because "they are the team." The NFL is "the least transportable of the top U.S. sports leagues" across the globe, and a top star like Brady only plays half the game anyway.
"No matter how thorough the research, these lists are still best guesses and estimates and can't by nature reflect the total size of some deals," said Whistle Sports President Jeff Urban, who once headed sports marketing and sponsored major athletes at Gatorade.
"NASCAR, boxing and the PGA Tour, among other sports, gives the athletes the opportunity to wear their sponsors very visibly while competing and thusly more opportunity for sponsorship fees. Football players can't."
So far no sponsors have left Brady. Requests for comment from Brady's sponsors and his agent, Donald Yee, have not been returned.
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f14f866c2637f94563cb7704e3179182 | https://www.cnbc.com/2015/05/13/17m-women-could-lose-breast-cancer-screening-guarantee.html | 17M women could lose breast cancer screening guarantee | 17M women could lose breast cancer screening guarantee
Obamacare might mean a lot fewer tests for breast cancer for a lot of women—17 million less, one study suggests.
A controversial new recommendation says women in their 40s at average risk for breast cancer might not need to get an annual mammogram. The guidance is based on a belief that mammograms can lead to overdiagnosis and treatment that, on balance, is worse than waiting until women are older to begin more routine screenings.
Read MoreASCO data drop: What to watch
This recommendation may ultimately result in 17 million insured women losing guaranteed screenings without out-of-pocket payments, according to a new analysis by Avalere Health released Wednesday.
Fuse | Getty Images
The recommendation made April 20 by the U.S. Preventive Services Task Force, if adopted after a public comment period, would give a "C" rating to mammograms for women age 40 to 49 years old.
Only preventive procedures rated "A" or "B" by that task force are required to be covered by insurers at no extra, out-of-pocket cost to a patient under the Affordable Care Act. The comment period on the recommendations ends May 18.
The USPSTF's recommendations contradict those of the American Cancer Society, which recommends that every woman age 40 and over get a mammogram every year. Such screening is currently provided at no out-of-pocket cost for most insured women.
"The USPSTF is working to balance the lifesaving benefits of breast cancer screening against the potential risks for overdiagnosis and unnecessary treatment for lower-risk women," said Caroline Pearson, senior vice president at Avalere Health. "By linking the ACA rules to USPSTF decisions, coverage for preventive services will continue to evolve as new research and evidence becomes available."
Read MoreHow to save $500M in Rx spending? Write an article
Avalere found that most of the women in their 40s who would lose guaranteed coverage of mammograms without cost sharing would be those with employer-provided health insurance: 13.4 million women.
In its draft recommendation, the USPSTF said, "The decision to start screening mammograms ... should be an individual one," and that for women at average risk of breast cancer most of the benefits of mammography come from biennial screening from age 50 to 74.
"Women who place a higher value on the potential benefit than the potential harm may choose to begin biennial screening between the ages of 40 and 49 years," the draft recommendation said.
"All women undergoing regular screening mammography are at risk for the diagnosis and treatment of noninvasive and invasive breast cancer that would otherwise not have become a threat to her health, or even apparent, during her lifetime (known as 'overdiagnosis'). This risk is predicted to be increased when beginning regular mammography before age of 50 years," the recommendation said.
It also said that women with a parent, sibling or child with breast cancer "may benefit more than average-risk women from beginning screening from the ages of 40 and 49."
The USPSTF also recommended that women between the age of 50 and 74 get mammograms only once every two years, giving that frequency a "B" rating.
The task force's recommendations echo its November 2009 recommendation, which also gave a "C" grade to mammograms for women in their 40s.
Read MoreFew people cost Medicaid a bunch
Because of controversy over that recommendation, Congress inserted a workaround in the ACA, which effectively maintained the "B" rating for that age group that predated 2009, and therefore forced insurers to cover annual mammograms without any out-of-pocket copayment or deductible from patients.
A group of more than 60 members of Congress, including two breast cancer survivors, have asked the Obama administration to disregard the new recommendations.
"Years of science and medicine have shown that appropriate screening can lead to early detection and save lives," said a letter from some senators to Health and Human Services Secretary Sylvia Burwell, according to The Hill.
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dbd56d8069e8a71ad6c85004eb62ea83 | https://www.cnbc.com/2015/05/13/europe-seen-higher-as-growth-data-looms.html?__source=fincont&par=fincont | Europe ends lower after weak US data, German GDP misses | Europe ends lower after weak US data, German GDP misses
VIDEO2:1702:17Europe ends lower after weak US data
European equities reversed earlier gains to end lower on Wednesday with investors reacting to weaker-than-expected U.S. retail data, corporate earnings and new economic data from the euro zone.
The pan-European Euro Stoxx 600 index closed 0.2 percent lower, after most major bourses turned lower on the U.S. data.
London's FTSE 100 closed provisionally 0.1 percent higher, while the French CAC finished around 0.4 percent lower.
Germany's DAX tumbled to close 1.2 percent lower, after its economic growth figures missed expectations.
More broadly, GDP growth figures for the euro zone showed expansion of 0.4 percent for the first quarter of 2015, below market estimates, but better than in the U.S.
France's economy was shown gathering pace, but Greece was back in a technical recession.
Read MoreEuro zone GDP comes in at 0.4% in Q1, below estimates
Retail sales data in the U.S. for April were flat, with the ex-autos figure up just 0.1 percent, below estimates of a 0.5 percent gain. The U.S. dollar hit its lowest level in around three months on Wednesday after the data, supporting the euro as investors pushed the expectations of a interest rate rise further into the future.
U.S. stocks traded narrowly mixed on Wednesday, with bond yields advancing towards recent highs.
Back in Europe, shares of FTSE 100-listed Mondi closed nearly 9 percent higher, after the paper firm highlighted a first-quarter rise of 29 percent for its operating profit.
U.K. housebuilder Barratt announced strong demand and rising sales in a trading update on Wednesday; shares closed around 4 percent higher.
In the U.K., the Bank of England delivered its inflation report on Wednesday, in which it cut its growth forecasts and said inflation would remain low this year. U.K. unemployment data for March was also released, showing that the country's jobless rate has fallen to its lowest since mid-2008.
Follow us on Twitter: @CNBCWorld
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ec11ace0b613a4fe3bb9d92c31afc875 | https://www.cnbc.com/2015/05/13/facebook-now-hosts-news-stories-on-its-app-via-instant-articles.html | Facebook now hosts news content on its app | Facebook now hosts news content on its app
VIDEO0:2900:29Facebook's new initiativeSocial Media
Facebook has confirmed that it will host content from news publishers on its mobile app, which will allow users to read articles without having to click through to another website. The move could open a new stream of ad revenues for content companies, but risks increasing their reliance on the social network.
Nine launch partners - The New York Times, National Geographic, BuzzFeed, NBC, The Atlantic, The Guardian, BBC News, Spiegel and Bild – are part of the Facebook scheme called "Instant Articles."
The articles will be interactive and include the ability to view videos, maps and photos by tilting your phone, and even comment on or like a single line in a story. Facebook claims the in-app stories will load 10 times faster than when people click a link to an article on an external site.
Facebook
"Fundamentally, this is a tool that enables publishers to provide a better experience for their readers on Facebook," Facebook's Chief Product Officer, Chris Cox, said in a press release.
"Instant Articles lets them deliver fast, interactive articles while maintaining control of their content and business models."
Reports about the service surfaced earlier this year amid concerns that it could take eyeballs away from publishers' sites and hit advertising revenue.
But Facebook has tried to make its terms appealing to news publishers, allowing them to keep all of the revenue they gain from selling advertisements in their articles on Facebook.
Read MoreThis Facebook search feature could worry Google
If the publishers have unused ad inventory – space for ads -- they can sell it through Facebook's own network, and keep 70 percent of that revenue.
Instant Articles publishers will also be able to track its traffic on the social media site with analytics tools.
VIDEO2:5402:54Facebook takes on GoogleFast Money
The opportunity is particular prescient as Facebook already eclipses Twitter as a source of referral traffic for news websites. That, coupled with the fact that a rapidly increasing number of users are consuming news via mobile devices, will likely make Facebook's initiative appealing to publishers.
"We have a long tradition of meeting readers where they are and that means being available not just on our own sites, but on the social platforms frequented by many current and potential Times users," The New York Times Company President and CEO, Mark Thompson, said in a statement.
For Facebook, the scheme will help keep users on its app for longer -- a key focus for the company, given that over 70 percent of its advertising revenue now comes from mobile.
Of course, there are also risks for news publishers -- if Facebook changes the terms and conditions of the service down the line, for instance, or if a publisher's operations on the social networking website begin to take traffic away from its own website. Unsurprisingly, content organizations want the initiative to be sustainable.
"It is then vital that, over time, Instant Articles delivers recurring benefit for publishers, whose continued investment in original content underpins its success," Tony Danker, international director of Guardian News & Media, said in a statement.
But Facebook has moved to assuage those fears.
"We don't want to try and devour, and, like, suck in the Internet," Facebook's Cox told Re/code in an interview earlier this year. (Tweet this)
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0707f7d4e7089027e7676ed958305336 | https://www.cnbc.com/2015/05/13/lisnr-aims-to-disrupt-bluetooth-founder.html | LISNR aims to disrupt Bluetooth: Founder | LISNR aims to disrupt Bluetooth: Founder
VIDEO4:1504:15LISNR: Calls inaudible with Smart Tone technologySquawk Box
LISNR co-founder and CEO Rodney Williams has a simple explanation for what his start-up does: "we connect."
It's how the the 3-year-old company manages to connect its users—including businesses—that earned LISNR $4.4 million in funding and a spot on CNBC's Disruptor 50 list.
Read MoreDisruptor No. 12: LISNR—What are you listening to?
"We connect any device with a speaker or microphone," he said. "We've essentially made it very easy for any speaker to be used to connect devices, whether that's for experiences, or whether that's for device-to-device" communication, he told CNBC's "Squawk Box."
The Cincinnati-based company uses proprietary technology to transmit messages and data through ultrasonic sound, rather than Wi-Fi or 4G wireless networks. Essentially, it turns users' smart devices into an alternative to Bluetooth, the popular short-range wireless tech.
Williams said the technology enables greater efficiency and accuracy than Bluetooth over a wider range without taking a huge toll on battery life. An Apple Watch that relies on LISNR's ultrasonic waves would get five to seven times the battery life than one using Bluetooth, according to Williams.
Read More 'Disruptor' DocuSign raises $233M for 'Global Trust Network'
LISNR aims to help brands connect with their target audience, whether that's a cable station pushing additional smartphone content to a viewer watching one of its shows or a sports team that wants to send information to fans at its stadium.
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a45bd99918c99439ecc82f81304f93a9 | https://www.cnbc.com/2015/05/13/macys-falls-short-whats-behind-its-rollercoaster-results.html | Macy's falls short; what's behind its rollercoaster results | Macy's falls short; what's behind its rollercoaster results
For six years, Macy's seemed untouchable.
In an impressive stretch spanning second quarter 2007 and first quarter 2013, the mid-tier department store beat earnings expectations every time, according to Retail Metrics, making it one of the most-loved names in the retail space.
People at the entrance of a Macy's store in Jersey City, N.J.Getty Images
But times have changed. Although the company remains a favorite among analysts, it's fallen short on earnings expectations three of the last eight quarters—a trend that continued with its most recent report on Wednesday. Revenue has also been shaky, with same-store sales declining three of the last five quarters, and missing forecasts all but once over that time frame, according to Retail Metrics. (Tweet This)
Read More5 stocks that almost always beat earnings
In the latest quarter, investors appeared skeptical of the retailer's laundry list of excuses and proposed fixes, sending the company's shares down more than 2 percent in midafternoon trading. There was some truth behind the justifications, said Ken Perkins, president of Retail Metrics. Still, the company's choppy results underscore the tough position of department stores, as mall traffic continues to decline and consumer spending shifts toward restaurants, cars and technology.
"The department store space right now is very tricky," Perkins said.
VIDEO2:5902:59Retail sales flat in April
Among the factors that dented the company's sales in the first quarter was international tourism, Chief Financial Officer Karen Hoguet said during a conference call. International tourism—which accounts for about 5 percent of Macy's annual sales, and plays the biggest role at its New York, Las Vegas and other flagship locations—hurt same-store sales growth by 1 full percentage point. The strong dollar has similarly hurt results at companies including Ralph Lauren and Tiffany.
Second, the well-documented slowdown at the West Coast ports caused "fresh fashion" to hit the floor later than usual, meaning shoppers missed out on deep markdowns on stale merchandise. Hoguet also blamed the "unseasonably cold start" to the period, adding that the company's stores in southern markets outperformed.
Read MoreMacy's joins bargain game in new plans for growth
Though Macy's also faces internal challenges—something Hoguet readily acknowledged—Perkins said the company's excuses did have validity.
"The West Coast delays have clearly had an impact on a number of retailers ... we all know the dollar's impact has been wreaking havoc on a lot of multinationals," Perkins said. And while he said he hates to use weather as an excuse, "It was just a nightmare this winter. I don't think that's a 'dog ate my homework' excuse either."
Macy's also admitted that some of its wounds were self-inflicted—most specifically, what Hoguet referred to as a steeper-than-expected "learning curve" after its decision to reorganize its merchandising and marketing divisions. The CFO said she is hopeful that as the year progresses, this reorganization will help boost Macy's results.
Read MoreForget discounts—Retailers' new bag of tricks
Macy's, still considered one of the best-run companies in retail, is looking for new ways to spur growth amid changing consumer needs. In February, the department store said it would acquire beauty retailer Bluemercury for $210 million in cash, adding Wednesday that it will open 14 new stores under the nameplate this year. Just last week, the company announced it will open four off-price "Macy's Backstage" locations in the metropolitan New York area this fall.
It also plans to double down on the millennial-skewed wedding category, focus on further growing sales at its 150 top-performing stores and potentially build out its brand internationally. So far, its upscale Bloomingdale's nameplate operates a store in Dubai, United Arab Emirates, under a license agreement, and it's bringing both a Bloomingdale's and Macy's store to Abu Dhabi in 2018 under a similar agreement.
Analysts haven't given up on the name. Despite falling short in the first quarter, Macy's maintained its full-year outlook to earn between $4.70 and $4.80 a share on revenue growth of roughly 1 percent. It also announced a 15 percent boost to its dividend and a share repurchase plan of $1.5 billion.
Stifel Nicolaus analyst Richard Jaffe wrote in a note to investors Wednesday that Macy's focus on a strong product assortment and making its stores and website easy to shop will continue to help it gain share.
Read MoreWhy Macy's latest bid for growth may struggle
Ahead of the company's results, Deutsche Bank analyst Paul Trussell spoke optimistically about the company's international business, telling CNBC it "has a unique brand that could potentially move beyond its current footprint."
Investors will get a better sense for how the department stores are holding up when J.C. Penney, Kohl's and Nordstrom report this week.
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b08f2ac06f17ae6f2b437858d115cdc2 | https://www.cnbc.com/2015/05/13/trading-a-career-in-finance-for-a-cookie.html | Trading a career in finance for a cookie | Trading a career in finance for a cookie
VIDEO5:3205:32Trading a career in finance for a cookiePower Pitch
So-called on demand businesses are on the rise—from car services to cleaners, even marijuana and now, cookies. A new start-up called Doughbies delivers handmade cookies in 20 minutes or less.
Co-founder Daniel Conway says Doughbies are "just like mom used to make, when you need them most."
Conway traded a career in venture capital for a cookie. But not just any cookie. He's built the start-up around his mom's chocolate chip cookie and the recipe is a secret.
Conway and co-founder Mariam Khan hire local bakers to hand make Doughbies' cookies, which come in chocolate chunk with sea salt or peanut butter, at a commercial kitchen in San Francisco.
"We call ourselves 'the world's largest local bakery.'" Conway added that his product arrives with "that local, fresh from the oven taste."
The freshly baked cookies are delivered with the help of a team of drivers who currently make curbside deliveries to 10 ZIP codes in San Francisco.
The start-up will deliver as few as three cookies or a box of one dozen is $22 with no charge for delivery. Conway said the company's average delivery time is 12 minutes and Doughbies will give customers a store credit if it takes longer than 20 minutes.
But Alicia Syrett, a member of New York Angels, who has mentored more than two dozen start-ups, questioned Conway on whether Doughbies will get eaten up by much bigger competition like Seamless or even the new UberEATS food delivery service.
Conway responded that his niche delivery service runs more efficiently than larger third-party vendors by eliminating the middleman, connecting customers directly to his cookies.
"So our products are always fresher," he said.
Doughbies’ Chocolate Chunk with Sea Salt cookies.Source: Doughbies
Doughbies delivery drivers are independent contractors, and Conway says that gives the company the ability to expand quickly.
However, early stage angel investor Alain Bankier, who co-founded the Saveur Food Group, expressed concerns about the start-up's ability to scale.
But Conway said rapid growth is baked into the Doughbies business model, "Versus cooking on stovetops, we can do thousands of cookies in one oven per hour."
Stephanie Palmeri, a principal at SoftTech VC, said most on demand companies establish mobile access to gain momentum and the lack of a Doughbies mobile app is a real disadvantage for the start-up.
For now, Conway said his clients are getting their cookie-fix via orders placed on desktop. "Our hours are 12:00 to 4:00 p.m. when most of our customers are actually at their desk in the office." But ultimately the start-up said it will be raising funds to go mobile.
Doughbies launched in November 2014 and is an alum of the 500 Startups accelerator program, where it received a $100,000 investment after graduating.
Conway told CNBC his start-up is gross margin profitable, but would not disclose revenue or future fundraising plans.
—CNBC's Kelly Lin and Raimondo Parisi contributed to this story.
—Comments, questions, suggestions? We'd love to hear from you. Follow us @CNBCPowerPitch and join the #PowerPitch conversation.
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4d3ea98d40f44898df1c04c0e599a269 | https://www.cnbc.com/2015/05/14/2-trains-derail-days-after-deadly-amtrak-accident.html | 2 trains derail days after deadly Amtrak accident | 2 trains derail days after deadly Amtrak accident
VIDEO1:1601:16Freight train derails near PittsburghSquawk Alley
Two U.S. trains slipped off their routes on Thursday, two days after a deadly Amtrak accident near Philadelphia, according to reports.
Parts of a freight train derailed in Pittsburgh on Thursday morning, leaving some cars overturned or detached from their wheels, according to local station WPXI. No injuries were immediately reported.
A minor derailment also took place in South Carolina with no injuries reported, according to Georgia outlet WRDW. The engine compartment of another Amtrak train caught fire in Milwaukee on Thursday afternoon, though no passengers were hurt.
The incidents come as the Philadelphia accident—which left eight people dead and more than 200 injured—places scrutiny on the state of America's infrastructure and railroads.
"If we are going to have safe transportation systems in America, you have to invest in them. You have to keep up with state-of-the-art infrastructure," former U.S. Secretary of Transportation Ray LaHood said in an interview with CNBC's "Power Lunch" on Wednesday.
Read MoreAmerica in infrastructure crisis: Ray LaHood
"We haven't done that," he added.
National Transportation Safety Board investigators determined the Amtrak train was traveling at more than 100 mph—twice the area's speed limit—before it derailed while rounding a sharp curve Tuesday. The train may not have crashed if the stretch of rail had a congressionally-mandated pace control, NTSB board member Robert Sumwalt said Wednesday.
However, the NTSB stressed it could not yet conclude speed alone caused the accident.
Read MoreNTSB: Derailed Amtrak train was traveling more than 100 mph
LaHood on Wednesday called U.S. infrastructure—including roads and bridges—a "limp along, go along" system that Congress has a difficult time funding.
On Wednesday, the House Appropriations Committee voted in favor of transportation infrastructure legislation that would cut Amtrak funding by $252 million in fiscal 2016.
House Speaker John Boehner, R-Ohio, on Thursday dismissed claims that a lack of Amtrak funding could have played a role in the crash.
— Reuters contributed to this report
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7b56563a200cc5bef9a26e9ac62d89fd | https://www.cnbc.com/2015/05/14/funding-for-on-demand-start-ups-hits-frenzy.html | Funding for 'on-demand' start-ups hits frenzy | Funding for 'on-demand' start-ups hits frenzy
VIDEO3:3003:30Billions pouring into on-demand apps: ReportMobile
The on-demand start-up space has never been hotter.
Research firm CB Insights released a report Thursday highlighting just how much money is rushing into start-ups like Uber, Airbnb and Instacart. Investment activity is red-hot, with funding rising to $4.1 billion in 2014, a jump of more than 500 percent year-over-year.
That rush of capital is showing no signs of letting up. The first-quarter of this year marked the highest quarterly funding total on record as start-ups raised $787 million across 22 deals.
At the current run rate, analysts at CB Insights say 2015 is on pace for a new funding record that could more than double 2014's total.
So, which of these start-ups is raising the most money? Uber, by a mile.
The ride-hailing app raised 39 percent more funding than all other on-demand services last year—combined. And CEO Travis Kalanick is busy raising even more money to fuel his startup's global ambitions.
There are reports that the San Francisco-based company plans to raise as much as $2 billion in new funding, which could value Uber at $50 billion or higher.
After Uber, the most well-funded on-demand start-ups are Lyft, Airbnb, Instacart and Eventbrite. In total, these five companies are valued at a staggering $57 billion. (Instacart told CNBC they're raised $275 million to date.)
There are a lot more professional investors now hoping to commit capital in this sector, and own a piece of what they hope could be the next Uber. In 2010, there were less than 20 VC investors that had done a deal in on-demand mobile services. Through the end of April of this year, there were nearly 200.
Read More CNBC's Disruptor 50: The list
The most active venture capitalist in this space over the past five years has been SV Angel. Ron Conway, a legend of angel investing who was an early backer of Google, Facebook, and Twitter among others, founded the venture firm.
SV Angel's approach to investing is different than its rivals. Rather than make a limited number of big bets, its partners commit a series of smaller investments in early-stage companies, realizing that many will fail but those that become billion-dollar companies will more than make up for the write-offs.
PeopleImages.com | Getty Images
Brian Pokorny, a General Partner of SV Angel, told CNBC that he's bullish on this space. The smartphone has upended the relationship between companies and consumers. Now, thanks to the global popularity of those hand-held computers, entrepreneurs are redefining entire industries from grocery shopping to pharmaceuticals, he said.
For example, with the Instacart app, users can now order groceries right to their doors within an hour. Luxe Valet allows for on-demand parking and valet services. Or there's NimbleRX, a new SV Angel-backed start-up that delivers drug prescriptions to its users. In other words, consumers no longer need to wait in line at the local pharmacy.
Pokorny says he believes that investment activity in these kinds of start-ups will continue at a strong pace, given the potentially transformative and disruptive nature of the services.
"There is a massive shift taking place, and there are an increasing number of industries that can be impacted," he says, adding, "In 10 years, we'll look back and wonder how the world existed before this technology."
There are risks for both investors and entrepreneurs when money is so relatively easy to raise, however. For one, many of these start-ups will fail. In fact, partners at SV Angel assume that 40 percent of the startups they fund will ultimately go belly-up.
Pokorny highlights another risk: if raising ever-larger rounds of financing from VC's is simple then start-up founders might not be as innovative or as driven. In such an environment, entrepreneurs can become more complacent and less scrappy. Still, Pokorny says that's a problem that ultimately self-corrects.
"If entrepreneurs don't execute then the problem solves itself," he says. "They won't be able to raise another round of funding."
Uber, Lyft, Airbnb and Eventbrite didn't respond to requests for comment.
Read More Why Uber's valuation might be bad for start-ups
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507dc2785bd189a9fa0e313c4b6ded20 | https://www.cnbc.com/2015/05/14/look-to-europe-not-fully-valued-us-expert.html?__source=fincont&par=fincont | Look to Europe, not 'fully valued' US: Expert | Look to Europe, not 'fully valued' US: Expert
VIDEO2:5902:59Two things that keeps market movingPower Lunch
U.S. markets seem "fully valued" and better opportunities exist in other pockets of the globe, one market watcher said Thursday.
U.S. stocks were trading more than 1 percent higher Thursday as the traded above its record close. Perceived overvaluation in stocks make Europe and Japan more appealing, said Jeff Hussey, global chief investment officer at Russell Investments.
"There's a variety of metrics out there that make the market look fully valued if not rich. So we've been neutral U.S. equities since December and have been favoring Europe and Japan as some alternative areas for better return prospects," he said in a CNBC "Power Lunch" interview.
Traders work on the floor of the New York Stock Exchange.Lucas Jackson | Reuters
The German DAX has fallen more than 5 percent in the last month, while the Japanese Nikkei is down 2 percent in that span. Hussey believes they have more upside than major American indices.
Read MoreEurope stocks: Foot on brake or full steam ahead?
He added that he would be "happy" to see a 5 percent pullback in U.S. stocks.
U.S. equities may not have reached their peak, Tony Roth, chief investment officer at Wilmington Trust, said Thursday. Stocks could still move higher as it could take months for the Federal Reserve to abandon its near-zero interest rate policy.
Roth said he does not see a market correction approaching in the near future, he told "Power Lunch."
Read MoreStock breakout? Investors watch data for support
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9fcf76eb5085ba85a86ec01b9c4b2df0 | https://www.cnbc.com/2015/05/15/13-wacky-and-original-start-up-ideas-raising-millions.html?page=9 | 13 wacky and original start-up ideas raising millions | 13 wacky and original start-up ideas raising millions
E+ | Getty Images
Each year, CNBC creates its list of "disruptors," private venture-backed companies that are shaking up the status quo, threatening the public giants or otherwise upsetting the apple cart.
This year a new crop of innovative businesses has been chosen from the hundreds of nominees for the 2015 CNBC Disruptor 50 list. Sadly, that means hundreds of noteworthy new businesses with interesting ideas had to be turned away.
It seemed unfair to send them all away without some kind of consolation prize, so for that reason, CNBC presents its list of Disruptor honorable mentions. These companies didn't crack the top 50 in our Disruptor ranking, but they are original concepts that have raised millions of dollars in venture capital. We wouldn't be surprised if a few of them make you ask, "Why didn't somebody think of it before?" and show up on a CNBC Disruptor 50 list in the future.
Read ahead to see 13 interesting ideas that caught our attention.
—By Eric Rosenbaum and David Spiegel, CNBC.comPosted 15 May 2015
DogVacay CEO Aaron Hirschhorn and “Rocky”Source: DogVacay
A recent episode of HBO's start-up satire "Silicon Valley" opened with a couple of baby-faced engineer boys pitching a dog-sharing app. It was an inspired bit showing the insane levels to which the sharing economy could be taken—until you realize that apps doing exactly this already exist. Making the comedy all the more frightening.
Dogs are big start-up businesses, though, and some models do make a lot of sense. Camp Bow Wow, a high-end version of the venerable kennel, was acquired last year by multibillion-dollar veterinary care company VCA (ticker symbol WOOF).
So don't expect Santa Monica, California-based DogVacay, an online community of more than 20,000 vetted pet sitters in the U.S. and Canada, to roll over. The company is rolling in some serious VC cash—approximately $47 million from backers, including Andreessen Horowitz, Foundation Capital and Benchmark.
DogVacay's vetting process for pet hosts is stringent—only 13 percent of host applicants are approved. The company claims the proof of its success is that pet owners initially think of its service as a backup plan, but after using DogVacay once, it becomes their No. 1 option for pet-sitting.
Source: Doctor on Demand
Providing comfort to millions of anxious Americans watching "Oprah" wasn't the end of Dr. Phil's efforts to soothe the nation. Dr. Phil is now in the start-up game. Who knew!
The legendary TV doc, along with his son Jay McGraw, creator and producer of the syndicated TV show "The Doctors," launched San Francisco-based Doctor on Demand in 2012. It's an app that connects patients with certified M.D.s who can diagnose and prescribe treatment for common ailments, including cold, cough, flu, rashes, allergies, skin conditions and pediatric questions.
The start-up claims that 17 out of the top 20 things patients go to urgent care for can be effectively treated over video, and that's why it's the fastest-growing virtual medical practice in the U.S. Users enter symptoms, allergies and a brief medical history and are instantly connected to a board-certified M.D. licensed in their state. Prescription can be electronically sent to a pharmacy. For a 15-minute medical "visit," patients pay $40 (specialist fees can vary). It's also working on partnerships with the nation's largest insurance carriers.
The company has raised $24 million in venture funding from investors, including Venrock, Shasta Ventures and none other than Sir Richard Branson.
True & Co.Source: True & Co.
Frederick's of Hollywood filed for bankruptcy last month, which could have meant that Victoria's Secret's conquest of the women's intimate apparel sector was complete, except for the rise of tech-based intimate apparel start-ups like True & Co.
True & Co. is sort of like the bra-building version of the human genome project. Its bras are designed based on millions of pieces of female-focused body data collected from more than 1.5 million women (and counting).
A spokesperson for the San Francisco-based True & Co. said the existing players, like Victoria's Secret, Nordstrom and Macy's, "oversexualize" lingerie to make the conversation about intimates taboo and keep women quiet. So it wants to unfasten the bra industry, playing down the sex appeal and raising the science. The "TrueSpectrum" includes 22 unique bra silhouettes that fit the more than 6,000 different body types it has identified.
It has raised $6 million from investors, including First Round Capital, Cowboy Ventures and Crosslink Capital.
Source: Casper
Wake up, America! Sleeping is about to be reinvented.
Mattresses are a $13-billion-a-year industry, but is going to the mat with the current duopoly represented by Tempur-Sealy and Serta Simmons (who control more than 70 percent of the market) as well as main retailers Mattress Firm, Sleepy's and Macy's, really what customers want?
New York City-based Casper, the friendly online mattress firm, cuts out all the sales jargon and decision-making over whether to buy a plush top vs. a pillow top by offering only one option: a semifirm mattress in six sizes. Casper then compress-ships the mattress in a box delivered to your door. Its offer comes with a 100-night home trial and a no-questions-asked full refund.
Not sold on the concept yet? The company has posted $20 million in sales in 10 months and has attracted $15 million from investors, including Lerer-Hippeau Ventures, which backs CNBC Disruptor 50 companies Warby Parker, Oscar and Birchbox.
Remember, when Zappos first launched, who would have ever believed that buying a shoe online was a good idea?
Roadie app.Source: Roadie
The U.S. Postal Service may be perennially bankrupt, but what's the long-term answer? Uber or UPS, or Uber meets UPS? Or something like that.
Roadie is an app-based shipping community that takes advantage of "excess capacity" in passenger vehicles. In plain English, your stuff can hitch a ride with someone traveling where you want your stuff to end up. It is a big market: 250 million cars on the road daily carrying 1 billion square feet of excess capacity.
Atlanta-based Roadie ships local and long haul, same day, next day and on weekends. The Roadie app pays drivers for trips they were already taking and offers free roadside assistance, roadside discounts and tax write-offs on miles drivers were already logging.
Uber has its own version of a local courier service, called Uber Rush. But that hasn't stopped Roadie from raising $10 million from investors, including Tomorrow Ventures, Square co-founder Jim McKelvey and even the venture arm of its "bitter rival": the UPS Strategic Enterprise Fund.
Source: Cohealo
Sharing economy, meet the MRI and operating table.
Boston-based Cohealo's platform allows hospital groups to share their equipment, optimizing usage and saving costs. And if there ever were a slow-moving, bureaucratic industry that could use some efficiency, it's hospital operators.
The idea is catching on. Cohealo claims three of the country's five largest health systems are now customers. Doctors can get the latest surgical equipment delivered to them on demand. Patients can have procedures performed at the care facilities most convenient to them, and hospitals can be smarter about purchasing patterns.
Cohealo has raised $10 million from Romulus Capital and Krillion Ventures, though CEO Mark Slaughter said the most important seed capital came from "mom and dad."
Source: Jet.com
Wal-Mart killed brick-and-mortars, and Amazon in turn is killing all the mom-and-pop shops plus Wal-Mart, so who can crush both of the retail giants, and big-box membership clubs? Maybe Jet.
Montclair, New Jersey-based Jet claims its customers get access to the lowest prices on millions of items—a recent New York Times review claimed that's a pretty accurate claim. How does it beat Amazon? A proprietary pricing algorithm, of course, which adjusts prices in real time in response to a shopper's basket, and guides shoppers to order items that are cheaper to fulfill. CEO Marc Lore knows a thing or two about competing with Amazon: He founded Diapers.com to take on Amazon, before selling out to it.
Jet's annual membership fee of $49.99—its sole profit model—is half Amazon Prime's $99 fee. (Wal-Mart is about to launch its version of Prime at a $50 annual cost.) Jet membership doesn't include free shipping like Prime. For that, customers have to spend at least $35, and shipping times can vary (3-5 days standard/2 days for consumables). Slower shipping lowers pricing.
Maybe the most amazing pricing is Jet itself, which hasn't even begun service but has raised $220 million from investors, including NEA, Google Ventures, Bain Capital Ventures and Accel Partners.
Source: LexShares
We live in a litigious society, and based on the crowded courts, you could say that lawsuits are a shared societal investment. Hedge funds and pension funds know that, and among the esoteric stuff in which they invest—royalties from David Bowie records and highway toll plazas—are also legal spats. Now the hedgies have some courtroom competition.
LexShares is an online marketplace that allows individuals to invest in litigation, connecting plaintiffs in commercial legal disputes with investors to fund their cases. It claims to be the only company enabling investment in lawsuits online.
New York City-based LexShares compares its asset class to the early days of the private equity industry in the 1980s. You could also claim its like a Kickstarter campaign meets late-night class-action lawsuit TV advertisement. Currently, it has a whistleblower case against a government contractor, a product liability case against a Fortune 500 manufacturer, and a fraud case against an oil and gas developer listed on its site.
It has raised more than $1 million—though it declined to be more specific—in a previous financing led by Atlas Venture, which invests in early stage tech and life sciences companies.
Source: Goldbely
The food industry is under attack—not just science-based meat and dairy alternatives like CNBC Disruptors' Impossible Foods and Hampton Creek but the whole food chain. Blue Apron, which is a subscription-based meal-kit company, is seeking funds to secure a valuation of $2 billion. Instacart is shopping a multibillion-dollar valuation based on delivering groceries.
Goldbely is a food start-up of a different flavor. Think Omaha Steaks and Harry & David re-invented for the e-commerce era. Its online platform connects local food purveyors like bakeries, restaurants, chocolate makers, cheesemongers and coffee shops directly with consumers so the food makers don't need to fight for shelf space at a Whole Foods or big-box retailer. It's farm to table with a stop on the Internet in between.
Because San Francisco-based Goldbely is online, the company said more than 50 percent of its orders come from people living outside the top 50 U.S. metro markets, giving Goldbely a huge addressable market the supermarket chains aren't targeting. It has more than 300 food partners across 45 states, growing at a 300 percent annual rate.
The specialty food market is estimated by the Specialty Food Association as a $109 billion cart waiting to be filled, and that's resulted in $3 million in seed funding from Intel Capital, Y-Combinator and VC luminary Tim Draper or Draper Fisher Jurvetson.
PillPack packetSource: PillPack
Social Security isn't the only one having a hard time keeping up with the country's aging demographic.
Somerville, Massachusetts-based PillPack, a full-service pharmacy that packages and ships medication in doses for patients, says that right now it can't hire fast enough to meet demand. And that's because it claims that whether it's Walgreens, CVS, Duane Read or Rite Aid, the prescription medication drugstore experience is broken, especially for patients with more than one prescription.
As so many of the VC-backed start-ups show, tech-based delivery of everyday life essentials is one of Silicon Valley's bigger bets. With PillPack, a shipment arrives every two weeks with all of the pills organized in a packet based on date and time, and the packet is refilled automatically by a pharmacist.
It has raised $12.9 million from investors, including Founder Collective, Atlas Venture and Accel Partners.
Source: Adore Me
Sex sells—specifically, in the $24 billion amply sized lingerie market—and True & Co. isn't the only tech-based startup hoping to upend undergarments.
Adore Me is a lingerie company that pitches itself as the Amazon meets Zara meets Victoria's Secret of e-commerce. The company sells all of its designs on the Adore Me website and mobile app. If you haven't heard about it yet, that might soon change. Adore Me has launched a national TV campaign, including spots on Bravo, Lifetime and MTV.
Adore Me also boasts Victoria's Secret former design director Helen Mears, and the secret to that lingerie giant's success is being revealed in ways it might rather cover up. On the 2014 Inc. 5000 list, Adore Me ranked No. 3 among the fastest-growing companies in New York City (out of roughly 200 New York City businesses).
The company also relies on some of the secrets of its shoppers: One of its differentiating factors is an online quiz that asks consumers what they are interested in so Adore Me can plan its inventory and designs accordingly.
It has raised $11.5 million in venture capital from investors, including Upfront Ventures, RedHills Ventures and Mousse Partners.
Source: Classy
Kickstarter likes to crowdfund gadgets, beach coolers and yes, even potato salad recipes, to the tune of tens of millions of dollars in start-up revenue. Classy, on the other hand, is the world's largest fundraising platform for social good organizations. Since 2011, it's enabled 1.3 million people across 300,000 individual campaigns to raise more than $130 million for social good organizations.
Health care, education, poverty, disaster relief and animal welfare are among the areas in which San Diego-based Classy.org has run campaigns.
When it comes to tech investors, Kickstarter was all over the Pebble smartwatch. Classy, meanwhile, has attracted the attention of Salesforce.com—the tech giant is among investors who have given $8 million in total funding to the site. The Salesforce Ventures investment and partnership with the Salesforce Foundation has helped Classy to bring another 200 organizations onto its platform in the past year.
Now Classy says it's also beginning to work with some of the world's largest intergovernmental organizations.
Jibo robotSource: Indiegogo
DogVacay has just scratched the surface of the tech-based future of the family pet. Forget Fido. How long before the beloved family robot is also being placed in the care of a trusted A.I. au pair?
Meet Jibo, the world's first family robot, with wit, heart (maybe not) and general helpfulness around the increasingly connected home. Jibo does it all: attentive companion (unlike a spouse), family helper (no background check necessary) and family communications (whereas family members typically speak over one and other, now they can speak through Jibo). The TV and gaming console, for their part, simply allow us to ignore everyone else.
During a two-month crowdfunding campaign last year, Cambridge, Massachusetts-based Jibo raised $2.3 million. Jibo is also a YouTube celebrity, amassing more than 9 million views. It has since raised $25.3 million from investors, including RRE Ventures, CRV, Flybridge Capital Partners, Two Sigma Ventures, Formation 8 and Samsung Ventures.
Founded by Cynthia Breazeal, director of the Personal Robots Group at MIT, Jibo's human handlers also include CEO Steven Chambers, formerly president of voice-recognition company Nuance Communications (you've heard of Siri, right?); Andy Atkins, former director of engineering at Netflix; and Todd Pack, former principal engineer at iRobot.
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697dc5a22bebd084d62a7320cd1e946d | https://www.cnbc.com/2015/05/15/beepi-aims-to-change-the-way-you-shop-for-used-cars.html | Beepi aims to change the way you shop for used cars | Beepi aims to change the way you shop for used cars
VIDEO2:4202:42Beepi challenging car buying habitsSquawk Box
Beepi, an Internet-based used car retailer that delivers vehicles to buyers' homes before they've taken them for a test drive, is raising another $300 million in venture capital to fund its expansion nationwide.
The Silicon Valley start-up, which is changing the way people buy and sell preowned vehicles, currently operates in California, Arizona and Texas. It hopes to have a presence in every major city by the end of the year.
The company's planned growth comes as customers start to warm up to the idea of buying a used car online, even though it may seem a little strange at first.
"It is definitely a little scary to make such a major investment without ever having sat in the car or driven it," said Miles Johnson, a Mountain Valley, California, resident who recently bought a 2012 Honda Civic through the site.
Read MoreRental car firms stall with investors
Similar to how retailers sell shoes online to customers who haven't tried them on, Beepi is taking a digital approach to cars and trucks, albeit with a much higher price tag.
The company's business plan is pretty straightforward: to remove the hassle of finding, negotiating and ultimately buying or selling a used vehicle. It only handles models that are less than 6 years old, have fewer than 60,000 miles and have never been in accident. Technicians at the company's Fremont, California, distribution center perform a 185-point inspection to ensure they're in good condition. In addition, buyers have 10 days to return the vehicle.
The company is targeting $350 million in revenue this year, up from $100 million last year.
Read MoreAmerica's new favorite: Small SUVs and crossovers
"People nowadays are used to buying things online. They are used to transacting with Amazon, they are used to transacting with others and so buying a car online is the next logical step," said Owen Savir, who started Beepi last year with a friend.
Dan Delima of Millbrae, California, holds a check from Beepi after selling his Nissan LEAF (on the flatbed truck behind him) to the used car website.Phil LeBeau | CNBC
For those selling their car, Beepi guarantees a sale within 30 days at a price $1,000 higher than they would get from a local dealer—something it's able to do, in part, because it doesn't have as heavy a cost structure. It determines the price through a proprietary algorithim that calculates how much a particular model is selling for in different areas.
Dan Delima, who lives in Millbrae, California, said selling his 2013 Nissan LEAF through Beepi made sense because of the convenience. Earlier this month a Beepi truck pulled up in front of his home, loaded his vehicle on the flatbed and he was given a check for $20,000.
Read MoreTake a ride in the new Camaro
"Just meeting one set of people to inspect my car and take the photos was way worth it," Delima said.
Beepi is not alone in racing to alter the way used cars are bought and sold. Driveshift.com is another start-up connecting buyers and sellers online. Like Beepi, it looks to attract customers by eliminating the hassle of visiting auto dealers to negotiate or take a test drive. But different from Beepi, Driveshift.com also offers to bring vehicles to prospective buyers for test drives before they buy a particular model.
More than 40 million used cars are sold in the U.S. each year, with a good percentage of the deals done privately after owners listed their car or truck in a classified ad. Millions more sell through dealers. In both cases haggling for the best price is a big part of the process.
Despite Beepi's guarantees, there is sure to be hesitation from some consumers. Although shoppers are becoming more comfortable making big-ticket purchases on the Web, many prefer to touch, feel or otherwise test products before they hand over their credit card. Conventional wisdom dictates drivers should take a car for a spin before they commit.
For people like Johnson, however, buying a car or truck online is the way of the future. As he looked at the Civic he just bought, he couldn't wait to get the keys into the ignition and take it for a drive.
"It's the moment of truth. I finally get to test it out and see exactly how it works," he said. "I don't think I am in for any surprises."
Questions? Comments? BehindTheWheel@cnbc.com.
UPDATE: This story was updated to include news about Beepi's new round of funding.
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3e812341141d3f9fa6c2f3d9912acde1 | https://www.cnbc.com/2015/05/15/modi-li-in-worlds-most-powerful-selfie.html | Modi & Li in world's most powerful selfie? | Modi & Li in world's most powerful selfie?
Watch out, Kim Kardashian.
The leaders of two of the world's fastest growing countries just made selfie history. (Tweet This)
Tweet: India's Modi & China's Li
India's prime minister Narendra Modi, in the middle of a three-day visit to China, posed for a selfie with China's premier Li Keqiang in front of what appears to be China's Temple of Heaven. Combining GDP from both countries, the selfie captures more than $10 trillion, according to numbers from World Bank.
Read More India a year after Modi's election: The bullish case
Some realizing how rare it is for world leaders to pose for such photos capitalized on the moment...and the Retweets.
Tweet: Where selfies are concerned, there's always scope for one more!
Sure, a picture can say a thousand words—but it's not every day one can speak for over a third of the world's population.
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bd50896b39fc529c6ed17069e61cad0b | https://www.cnbc.com/2015/05/18/japan-gdp-consumers-still-pinching-pennies.html | Japan GDP: Consumers still pinching pennies | Japan GDP: Consumers still pinching pennies
Kevin Winter | Getty Images
Hit by a tax hike, lower real wages and higher prices, Japanese households have been cutting back on spending, and the GDP data on Wednesday is expected to confirm they are holding back economic growth.
"Real wages have fallen by around four percent since Prime Minister Shinzo Abe came to power and household spending will be the big swing factor for economic growth going forward," Capital Economics' Japan economist Marcel Thieliant told CNBC by phone.
Just when a weaker yen had been pushing up the cost of imported goods, Japanese consumers were hit in April 2014 by the first consumption tax hike in seventeen years.
In response, Japan's households have been slashing their spending and unwittingly helped tip the economy into a technical recession from which it has struggled to emerge from.
Gross domestic product (GDP) data due Wednesday is expected to show the world's third-largest economy grew and annualized 1.5 percent for the three months ending March 2015, unchanged from October-December's revised reading. The economy contracted in both the second and third quarters of 2014.
"Household spending is the chief factor holding back economic growth and there is no sign of consumers starting to spend again," Mizuho Securities' chief market economist Yasunari Ueno told CNBC by phone. "And nothing, not exports nor investments – not even public investments, is compensating for the weakness in consumer spending," he said.
Tight-fisted Mrs. Watanabe
So far, the data suggest that Mrs. Watanabe has no intention of loosening her tight grip on households' purse strings.
In the three months following the April 2014 tax hike, consumer spending contracted by five percent quarter-on-quarter, and only inched by 0.3 percent and 0.5 percent in the two following quarters, respectively.
VIDEO3:3703:37Why Japan is in deep troubleCapital Connection
But between January and March 2015, consumer spending will again stagnate and come in flat on a quarterly basis, according to Nomura's May 1 GDP preview note.
It's not only higher taxes that are biting, however. The government's economic policies have also been pushing up the price of imported goods.
Prime Minister Abe's policies, dubbed Abenomics, have sharply depreciated the yen and helped boost profits at Japan's blue-chip exporters, but also driven up the cost of everyday shopping items.
No relief ahead
In theory, the weaker yen and collapsing oil prices were supposed to have positive effects too: the cheaper cost of importing oil would help lift economic growth and trigger a virtuous cycle of higher prices driving up wages, according to the government's scenario.
Instead, the rising cost of food may cancel out any benefits of cheaper oil prices. In the meantime, the hoped-for wage increases have failed to materialize, analysts said.
If anything, the belt tightening by households may only be depressing capital investments in the services sector, which generates over 70 percent of Japan's GDP, according to World Bank data. Real capital investment may have fallen fell by 0.2 percent in the last quarter of fiscal 2015, according to Nomura.
With few signs that Mrs. Watanabe will start spending again anytime soon, economists are keeping their growth targets for the next fiscal year through to March 2016 at modest levels.
Mizuho's Ueno, who sees a "cloudy" outlook for the economy, forecasts GDP will grow by just 0.7 percent.
Capital Economics' Thieliant has the growth rate at 0.8 percent, which he sees as "reasonable, in a country where the working age population is shrinking by 1.5 percent a year."
Correction: An earlier version of the article stated that Capital Economics' forecast for fiscal 2015 was 1.5 percent. The forecast for fiscal 2015 has been corrected to 0.8 percent.
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f4d8d6d5f130015c7e3b58eb550bd131 | https://www.cnbc.com/2015/05/18/rbas-easing-bias-explicit-in-minutes.html | RBA's easing bias 'explicit' in minutes | RBA's easing bias 'explicit' in minutes
John Phillips | Digital Editor | CNBC
The Reserve Bank of Australia (RBA) left open the possibility it might cut interest rates further, minutes from its May 5 meeting showed, triggering a slump in the Australian dollar on Tuesday.
In the minutes from the meeting that saw the RBA cut rates to a record low of 2 percent, the central bank acknowledged that board members had agreed not to give guidance on future policy action at that time.
But this does not limit its ability to adjust policy again at future meetings.
The Australia dollar fell to a session low of $0.7954 before rebounding to $0.7991.
"Members agreed that...the statement communicating the decision would not contain any guidance on the future path of monetary policy," the minutes said.
"Members did not see this as limiting the Board's scope for action that might be appropriate at future meetings," it added.
The move to refrain from providing a forecast earlier this month had many market watchers penciling no more easing from the central bank in the near term, sparking a rally in the Aussie dollar.
"Today's RBA minutes from the May board meeting provided little new information on the economy. The minutes did, however, provide an explicit easing bias – something that was absent from the post-meeting statement," said Felicity Emmett of ANZ Research.
The RBA said members were aware of the potential risk that low rates could spur excessive borrowing from already highly geared households and fuel even stronger growth in housing prices, particularly in Sydney.
"On the data available for this meeting, however, it did not appear that the growth of housing credit, either for investment or owner-occupancy purposes, had been increasing over recent months," it said.
In fact, housing price growth outside of Sydney and Melbourne had declined, the RBA added.
"The Bank would continue to work with other regulators to assess and contain the risks arising from the housing market."
The RBA said a cut in rates would provide additional support to economic activity by reinforcing encouraging trends in household demand. In turn, this would support non-mining business investment and ultimately lead to stronger labor market condition.
On the Australian dollar, board members again agreed that a weaker currency was both likely and necessary, particularly given the significant declines in key commodity prices.
The RBA next meets on June 2.
- Reuters contributed to this report.
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3a7d3f030c1f47a2d19fa65d8f3de231 | https://www.cnbc.com/2015/05/18/us-fed-should-aim-to-overshoot-2-inflation-evans-says.html | US Fed should aim to overshoot 2% inflation, Evans says | US Fed should aim to overshoot 2% inflation, Evans says
Faced with U.S. inflation running too low for too long, the Federal Reserve should aim to boost inflation above the central bank's 2-percent target by keeping interest rates near zero until early next year, a top Fed policymaker said on Monday.
"Policy should be sufficiently accommodative so that ... the odds should favor modestly overshooting our 2 percent target sometime in the medium term," Chicago Fed President Charles Evans said in remarks prepared for delivery in Stockholm.
Charles Evans, president of Federal Reserve Bank of Chicago.Melody Hahm | CNBC
"To establish adequate upward momentum in inflation, I think it likely also would be appropriate to increase the fed funds rate target only gradually for a while after the first rate hike."
A voting member this year on the U.S. central bank's policy-setting panel, Evans marshalled what have become his usual arguments for holding rates low until early 2016, longer than nearly all his fellow U.S. central bankers think would be appropriate.
Repeating much of an early May speech word for word, he said unemployment at 5.4 percent is still about a half a percentage point higher than it ought to be.
Read MoreTraders watch formore signs of economic stall
And inflation, which by the Fed's preferred gauge of underlying trends rose just 1.3 percent over the last year, probably will not return to the Fed's target for another three years, he said.
His call for the Fed to purposely weigh the odds in favor of overshooting its own inflation target, however, is new.
VIDEO5:3705:37Fed's lift-off likely in December: Credit AgricoleSquawk Box Asia
Evans warned that by not aggressively moving to boost inflation, the public may begin to assume the Fed is content to miss its own goals, undercutting the effectiveness of U.S. monetary policy.
Most Fed officials, including Fed Chair Janet Yellen, expect economic conditions will be ripe for higher interest rates sometime this year. Some economists have recently warned that if the economy continues to underperform expectations, the Fed may need to delay a rate hike beyond September, when most currently expect the Fed to act.
Evans, however, downplayed the economy's weak first quarter, saying it was probably transitory.
Instead he argued that the so-called equilibrium real rate - the interest rate at which the economy can function at full health - is still low enough to justify near-zero rates.
Only when the equilibrium real rate is "well north" of actual short-term interest rates and is rising "smartly" will there be enough upward pressure on inflation to justify raising the Fed's target rate, he said.
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75409e96629a4f8ee8ff2b254f56dda8 | https://www.cnbc.com/2015/05/18/us-stocks-open-mildly-lower-rising-yields-greece-eyed.html | Dow, S&P close at records despite rising yields, Greece concerns | Dow, S&P close at records despite rising yields, Greece concerns
VIDEO3:4103:41Cashin says: Where's the short covering?World Economy
VIDEO2:2902:29Clock is ticking for GreecePower Lunch
VIDEO1:1001:10Risks to the bull market
U.S. stocks closed higher on Monday, with the Dow Jones industrial average and S&P 500 ending at new records, as investors shook off earlier concerns about Greek debt and a renewed rise in bond yields. (Tweet This)
"The decision today by markets is the path of least resistance is up and today's data didn't change our view about whether or not we get a (second-quarter economic) bounce," said John Canally, investment strategist and economist at LPL Financial.
The major indices extended gains in afternoon trade after earlier fluctuating around the flatline.
"Some people (were) a little bit on the sidelines and they're going back into stocks because they don't want to miss out," said Robert Pavlik, chief market strategist at Boston Private Wealth.
Read More'Twilight zone' market could see big correction: Strategist
The Dow Jones industrial average set a record for the fifth time in 2015, closing above its previous closing and intraday high of 18,288.63. The S&P 500 closed at a record for the third day in a row, its ninth for the year, passing its closing high set on Friday and topping its intraday high of 2,125.92.
The Nasdaq Composite ended 20 points within its closing record, outperforming the major indices with the iShares Nasdaq Biotechnology ETF (IBB) gaining 1.3 percent.
"I get a sense that investors want to rotate out of bonds into stocks and having a dovish Fed speaker helps," said Jack Ablin, chief investment officer at BMO Private Bank. "Having the Fed on the sidelines is probably the biggest thing—a Fed reluctant to tighten is emboldening investors."
Speaking early Monday at the Swedish capital, Chicago Fed President Charles Evans said the U.S. Federal Reserve could look at a rate hike in June if the economy is strong enough, Reuters said. His speech argued for rates to start rising in early 2016.
Evans told reporters if the Federal Open Market Committee had confidence that inflation was going to move up and that first quarter economic softness was temporary, "you could imagine a case being made for a rate increase in June."
Most of the second-quarter data reports have showed a slower-than-expected rebound from a weak first quarter.
"The focus is back on the macro," said Art Hogan, chief market strategist at Wunderlich Securities. "All things equal we're really going to have a focus on the European markets."
He noted little market-moving news on Monday for U.S. stocks as just a few retail names post earnings and most data reports come later in the week.
The only data out Monday was the National Association of Home Builders' survey, which showed builder confidence slipped two points in May, missing expectations of a slight gain. Housing starts and existing home sales come out later in the week, along with the Federal Open Market Committee's meeting minutes.
Apple closed up more than 1 percent after activist investor Carl Icahn said in an open letter to CEO Tim Cook that the tech company's shares remain undervalued and are worth almost double the current price.
A U.S. appeals that Apple won in 2012 against Samsung Electronics. In a mixed ruling, the court said the iPhone maker's trade dress (a trademark on how a product is presented for sale) could not be protected.
In Europe, stocks closed higher amid abating fears that Greece is on the verge of bankruptcy.
"Regardless of how the Greek impasse resolves itself, the global financial markets' ability to blissfully ignore Greece suggests that it expects one of two outcomes: (i) that a Greek default/exit is nowhere in the realm of possibility, or that (ii) even if Greece were to exit the Euro, the authorities have appropriately 'foamed down the runway' to curtail any contagion and the world will emerge largely unscathed from Grexit," MatlinPatterson's chief risk officer Ashwin Bulchandani said in a note.
Earlier, U.S. stocks opened mildly lower as European equities dipped on news that a Greece government spokesman said on Monday that authorities will pay public-sector wages and pensions in May, but needs a deal with creditors by the end of the month.
Read MoreWatch out: Greece's 'endgame' is in sight
Greece proposed to its international lenders that Europe's bailout fund pay back maturing Greek government bonds held by the European Central Bank as a way to overcome a funding crunch, Finance Minister Yanis Varoufakis said on Monday in a Reuters report. Athens could then pay the European Stability Mechanism (ESM), at a later date, Varoufakis told the annual assembly of the Greek Industrial Federation.
National officials in Athens also sent a letter to the International Monetary Fund that showed Greece came close to defaulting on a 750 million euro ($860 million) repayment last week, local newspaper Kathimerini and the Financial Times reported.
"Some of those markets in Europe have come under some pressure because of concerns about Greece and high flying bond yields," said Nick Raich, CEO of The Earnings Scout.
The DAX reversed losses to close higher, helped by a weaker euro at $1.135, while the ATHEX Composite ended up 1.6 percent after dipping 2 percent.
Greek bond yields soared, with the 10-year leaping 7 percent, as a leaked internal memo from the International Monetary Fund said the country had little chance of making the June 5 payment.
Spanish and Italian bond yields also briefly jumped more than 7 percent, while the German bund yield gained 3 percent to yield 0.65 percent.
U.S. Treasury yields edged higher, with the 10-year note yield briefly topping 2.23 percent and the 30-year climbing as high as 3.03 percent. Most analysts said bond yields remain in a range, as longer-term yields remain below 6-month highs touched last Tuesday.
"The rise in yields is not a concern about inflation or about the Fed. It simply reflects that global growth is better," Canally said.
The U.S. dollar gained more than 1 percent after posting five straight weeks of losses on Friday.
Analysts noted that morning losses in U.S. equities remained muted despite the renewed concerns about Greece.
"The market is acting on technical factors and remains strong," said Peter Cardillo, chief market economist at Rockwell Global Capital. "I think a deal will be reached (on Greece)—probably get down to the wire. Investors will keep an eye on that."
"We're probably going to stay range-bound with the S&P 500 trying to reach 2,130 - 2,135," he said.
Read MoreMarket's new biggest fear: Economic stall
The S&P 500 eked out a record on Friday for the second day in a row, while the other major indices advanced towards recent highs.
Crude oil pared early gains, with the contract for June delivery settling down 26 cents, or 0.44 percent, at $59.43 a barrel, as dollar strength and a bearish analyst outlook weighed on the commodity. Also adding to some volatility, the June contract will expire Tuesday after the close.
Earnings expected after the closing bell on Monday include Urban Outfitters, Agilent and Momo.
Major U.S. Indexes
The Dow Jones Industrial Average closed up 26.32 points, or 0.14 percent, at 18,298.88, with Intel leading advancers and Chevron the greatest laggard.
The closed up 6.47 points, or 0.30 percent, at 2,129.20, with financials leading seven sectors higher and materials the greatest laggard.
The Nasdaq closed up 30.15 points, or 0.60 percent, at 5,078.44.
The CBOE Volatility Index (.VIX), considered the best gauge of fear in the market, traded below 13.
Advancers were a step ahead of decliners on the New York Stock Exchange, with an exchange volume of 660 million and a composite volume of nearly 2.9 billion in the close.
Gold futures settled up $2.30 at $1,227.60 an ounce.
Cree jumped nearly 6 percent on the announcement that the LED manufacturer's wholly owned Power and RF subsidiary submitted a draft registration statement on a confidential basis to the Securities and Exchange Commission for a potential initial public offering of the unit's Class A common stock.
Skyworks leaped 5.6 percent on news it expanded its product offering for components that could be used in Internet of Things applications related to smart lighting.
GoPro gained 2 percent after being upgraded to "perform" from "underperform" by Oppenheimer, which maintains long-term negative biases but does not see notable near-term headwinds.
Endo International closed down 5.3 percent after the firm said it will buy Par Pharmaceutical from private equity firm TPG for $8.05 billion in cash and stock. Par was taken private by TPG in 2012 for just under $2 billion.
Ann Inc., the parent of Ann Taylor and Loft, surged nearly 20 percent after news that it will be acquired by ascena retail group for $47 per share in cash and stock. Justice and Lane Bryant are among the brands currently owned by ascena.
Read MoreEarly movers: ENDP, ANN, BABA, INTC, COP, TM & more
Talks of a possible Intel purchase of Altera have resumed, according to the New York Post. The two discussed a deal earlier this year without resolution.
—CNBC's Peter Schacknow contributed to this report.
On tap this week:
Monday
Earnings: Urban Outfitters, Take Two Interactive
Tuesday
Earnings: Wal-Mart, Home Depot, TJX, Dick's Sporting Goods, Medtronic, Autodesk, Red Robin Gourmet Burgers, Vodafone, Analog Devices
08:30 a.m.: Housing starts
Wednesday
Earnings: Lowe's, Target, Staples, Target, Salesforce.com, Synopsys, American Eagle Outfitter, Rexnord, Eaton Vance, Hormel Foods, Burberry, L Brands, Sears Holdings
03:00 a.m.: Chicago Fed's Evans on economic growth, monetary policy, Munich
02:00 p.m.: FOMC minutes
Thursday
Earnings: Hewlett-Packard, Intuit, Williams-Sonoma, Gap, Trina Solar, Toro, The Buckle, Ross Stores, Aeropostale, Aruba Networks, Brocade
08:30 a.m.: Initial claims
10:00 a.m.: Existing home sales
01:30 p.m. Fed Vice Chairman Stanley Fischer on economic outlook at ECB forum
07:00 p.m.: San Francisco Fed President John Williams on impact of form
Friday
Earnings: Campbell Soup, Deere, Foot Locker, Ann, Mentor Graphics, Krispy Kreme
08:30 a.m.: CPI
09:45 a.m. Manufacturing PMI
01:00 p.m. Fed Chair Janet Yellen at the Greater Providence Chamber of Commerce on economic outlook
More From CNBC.com:
How to play weak Q2 earnings season: AnalystsWhy stocks shouldn't fear the 'Mayan temple effect'No stock bubble yet—and here's why: BlackRock
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673f79b4d5bc826a258067717d19853b | https://www.cnbc.com/2015/05/19/cant-kill-off-the-patent-trolls-yet.html | Can't kill off the patent trolls yet | Can't kill off the patent trolls yet
The U.S. Patent and Trademark Office (USPTO) seal is displayed outside the headquarters in Alexandria, Va.Andrew Harrer | Bloomberg | Getty Images
The number of patent litigation cases filed in U.S. courts dropped in 2014, the first decrease in five years. That's according to a new report from PricewaterhouseCoopers.
"It's a sea change from the past, especially the last four years," said Chris Barry, a partner with PwC's forensic services practice and the lead author of the report. After patent lawsuits doubled since 2009 to more than 6,000, they dropped by 12 percent in 2014.
The report, which CNBC got an early look at, comes out Wednesday. It credits the Supreme Court's decision in Alice Corp. v. CLS Bank for much of the drop in patent litigation. The case, which was decided in June 2014, raised the bar for software patents, the sort that many nonpracticing entities (aka NPEs, or patent trolls) prey upon.
"We'll probably see this trend continue, and more dramatically," Barry said. That's because the case was concluded halfway through 2014, meaning a full year's worth of effects in 2015 should really show a big decline.
The increase in litigation action coincided with—though outpaced—a dramatic rise in the number of patents granted by the U.S. Patent and Trademark Office. Critics contend that regulators have become lax, approving too many patents with questionable specs.
Big tech companies like Apple and Amazon saw a decline in the number of lawsuits filed against them in 2014, according to data from Patexia. Apple was sued 44 times in 2014, 10 fewer than the previous year. And Amazon fielded only 29 patent lawsuits in 2014, down from 45 in 2013.
Lawsuits against and between big tech companies—for things like have led to calls for reform to the patent system. A number of bills have been introduced, but Congress has failed to pass any.
Barry said it's unlikely there will be significant patent reform now, because the Supreme Court's decision should help pave the way to minimize the reach and effect of vague and loose patents. "My sense is there might be less imperative to get that done," he said.
As patent trolls reduced their number of lawsuits in 2014, they saw mixed success in their results. Even though overall median damages continued their downward slide, to $2.9 million for the 2010-14 period, damages going to patent trolls increased to $8.9 million in the same period.
In the cases that they won, patent trolls got 4.5 times more in damages than actual practicing entities (companies with patents who actually do real work).
Patent holders involved in a lawsuit should try to face a jury, if the case goes all the way to trial. Juries found in the patent holder's favor 75 percent of the time in 2014, according to the report. At the same time, juries handed out awards that were 31 times bigger on average compared to the median bench award. That is a massive difference.
The courts have become busy as the number of patent lawsuits clogged up the system over the past decade and it now takes an average of 2.4 years to reach that point. Still, only 3 percent of cases actually make it that far, Barry said. Most are settled and don't see the inside of a courtroom.
The report should be welcome news for those critics who say patent trolls are stifling American innovation and bemoan Congress' inactivity on patent reform. "There's still a lot of action around protecting intellectual property," Barry said. "However I think a lot of the more specious cases are being driven out of the system."
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d7964408d1e368e52d9cdee25b56a514 | https://www.cnbc.com/2015/05/19/does-being-verified-on-twitter-really-matter.html | Does being verified on Twitter really matter? | Does being verified on Twitter really matter?
Source: Twitter
Before any official press release from the White House, Twitter users knew that President Barack Obama started @POTUS thanks to the little blue checkmark beside his handle. In a little under six hours, the Twitter verified account became the fastest to reach a million followers.
Did being President Obama's official account help its velocity? Most likely yes. Did having Twitter's official seal of approval aid a bit? Probably not when it came to adding followers, said Joe McCaffrey, head of social marketing at Brooklyn-based digital agency Huge. However, he pointed out that for companies, the blue checkmark does come with marketing perks.
"It's a symbol in terms of clout," he said.
Read More Obama's new personal Twitter account
Twitter's elusive verification badge is something that has to be granted to you from the powers that be at the company and cannot be requested by the public. According to the social media platform, It doesn't take into account how many followers you have or what you tweet about. Instead it grants the honor to users who tweet about popular topics such as music, acting, journalism or politics. Once bestowed, it signifies that the sentiments expressed are from the user. CNBC reported earlier this year that Twitter may allow users in the future to pay a small fee to get the verification badge, but that has yet to happen.
"Part of the power behind it is users can't submit," McCaffrey said.
Jill Sherman, a senior vice president of social and content strategy at Boston digital agency DigitasLBi, explained with the prevalence of fake and parody accounts on social media, having the check mark can help an official account stand out. Verified handles also show up more often in searches, which can increase engagement.
"People look for that little blue badge," she said. "It gives people a new level of confidence."
It's especially useful when trying to get out official statements and breaking news. Sherman highlighted the case of where a fake Hampton City, Virginia, schools account impersonating Superintendent Linda Shifflette tweeted schools were closed, leading parents to keep their kids at home. Sherman said in this case, having a verified account could have stopped the confusion. (The schools did end up closing that day due to the weather, but the decision was made after the phony tweet.)
Besides those points—and ultimate bragging rights—being verified doesn't really matter. Even when the agencies work with social media influencers on behalf of brands, they don't look for the blue checkmark before signing a contract. Huge's McCaffrey said it picks partners that fit its clients' ad campaign targets, and vets the users by looking through their Twitter history, as well as seeing if they worked with brand competitors in the past. Nor does having the badge lead to extra payment, he added, since social media influencers get paid based on potential impressions derived from follower count.
Read More 140 things you don't know about Twitter
Digitas' Sherman added that five years ago online influencers handled their own affairs, but most of the top talent are represented today through multichannel networks or other managers. These established businesses provide a level of verification themselves.
"It can take a very long time to get verified by Twitter if you're somebody that created their own online brand," Sherman said. "A lot of people we work with we know well and we work with often, and they have gigantic followerships. We don't let (not having the badge) stop us."
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27d5858c0d116f0179ccf43f9b724ef1 | https://www.cnbc.com/2015/05/19/ecbs-coeure-rapidity-of-recent-european-bond-selloff-is-worrying.html | ECB's Coeure: Rapidity of recent European bond selloff is worrying | ECB's Coeure: Rapidity of recent European bond selloff is worrying
The recent European government bond market selloff was a normal correction but the rapidity of the adjustment is worrisome and indicates "extreme volatility" in the market, Benoit Coeure, a member of the European Central Bank's Executive Board, said.
Read MoreOuch! That bondselloff cost how much?
The ECB, which is buying 60 billion euros ($67.3 billion) of assets per month as part of its quantitative easing programme, will "slightly" increase purchases in May and June due to low market liquidity in July and August, but these adjustments are unrelated to the bond market volatility, Coeure said in a closed-door speech delivered on Monday and published on Tuesday.
Benoit CoeureJason Alden | Bloomberg | Getty Images
"I do not see the recent reversal in the price of Bunds and other sovereign bonds as a cause for concern, insofar as it reflects a market correction," Coeure said. "It is the rapidity of the reversal that worries me more."
"After several similar episodes, it is yet another incident of extreme volatility in global capital markets showing signs of reduced liquidity," he said.
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0bc6029b6c0e8b915a094bb5db6c7eda | https://www.cnbc.com/2015/05/19/europe-seen-higher-greek-deal-eyed.html?__source=fincont&par=fincont | Europe ends sharply higher on ECB QE pledge | Europe ends sharply higher on ECB QE pledge
VIDEO0:5000:50Europe ends sharply higher, ECB comments
European equities finished sharply higher on Tuesday, with investors reacting to corporate earnings and focusing on comments by a member of the European Central Bank (ECB).
The pan-European Euro Stoxx 600 Index closed higher by around 1.7 percent, as cyclical stocks like autos posted strong gains.
Benoit Coeure, a member of the European Central Bank's Executive Board, moved to reassure investors on Tuesday morning. He said that the ECB would front-load its asset purchase scheme and said he was concerned about the pace of a recent bond market selloff.
Read MoreEuro, yields slide as ECB gets heavy on QE
The French CAC and the German DAX surged after the dovish comments, with both indices finishing over 2 percent higher. London's FTSE lagged to close up around 0.3 percent.
In individual stocks news, Anglo-Dutch multinational publishing firm Reed Elsevier saw its shares climb by as much as 3 percent due to an analyst upgrade from Goldman Sachs.
European automakers like Daimler and Renault rallied, ending around 3 percent and 5 percent higher respectively after the comments from the ECB.
In other stocks news, Vodafone shares closed more than 3 percent down after posting full-year results.
Across the Atlantic, U.S. stocks traded in a narrow range on Tuesday, trying to build on positive momentum from Europe after a record close on Monday, while investors kept an eye on rising bond yields and the strengthening dollar.
VIDEO2:0802:08European markets close: Powerful rallySquawk Alley
On the data front, U.K. inflation data for April showed that consumer prices fell into deflationary territory for the first time since 1960. Meanwhile, a second reading of euro area inflation confirmed it was flat in April compared to the year before.
German investor sentiment fell sharply in May from the month before, according to a closely-watched survey published on Tuesday.
Concerns about Greece continue to rumble, with the country locked in debates with its international bailout supervisors over a cash-for-reforms deal.
Nonetheless, the Athens Composite index rallied to close around 2.6 percent higher on Tuesday.
"For all the talk of so-called red lines among the various parties involved in the Greece debt talks, markets still remain remarkably sanguine about the prospects of some form of deal between Greece and its creditors in the coming days," Michael Hewson, the chief market analyst at CMC Markets, said in a note.
Follow us on Twitter: @CNBCWorld
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04d9b7e41634fe40ca65561e76d84121 | https://www.cnbc.com/2015/05/19/icahn-nets-34-billion-on-apple.html | Icahn nets $3.4 billion on Apple | Icahn nets $3.4 billion on Apple
VIDEO4:5504:55Icahn: Apple will do a TV Halftime Report
VIDEO4:4204:42Carl Icahn on Apple: It's a 'no-brainer'Halftime Report
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Carl Icahn's big bet on Apple is now one of the greatest trades of all time.
Icahn has made about $3.4 billion on the technology company since he first tweeted about the position on Aug. 13, 2013, according to a CNBC analysis of public ownership disclosures and stock prices. (Tweet This)
Read MoreIcahn: Apple shares should double
That gain puts Icahn in elite company. John Paulson's Paulson & Co. made about $15 billion shorting subprime mortgages in 2007; George Soros' Soros Fund Management made an estimated $1 billion shorting the British pound in 1992; David Tepper's Appaloosa Management made about $7.5 billion mostly by going long financial stocks in 2009; and Bill Ackman's Pershing Square Capital made about $3 billion betting on General Growth Properties from 2008 to 2014.
When asked if the Apple trade was one of the greatest of all time, Icahn declined to comment on the profit but told CNBC.com this, "I will certainly say Apple is one of the greatest companies of all time."
Read MoreApple shelves TV plans, despite Icahn's hopes: Rpt
VIDEO2:1702:17Carl Icahn: Apple worth $240/share todaySquawk Alley
Icahn, who owns more than 52 million shares today, could make even more on Apple.
On Monday, he sent a letter to Apple CEO Tim Cook saying he values the company's shares at $240 (the shares trade around $130 today).
At the value Icahn is suggesting, Apple would be a nearly $1.5 trillion company. Monday's letter, which was also signed by Brett Icahn and David Schechter, called for accelerated Apple buybacks.
Read MorePortfolio manager: Ihope Icahn is right about Apple
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c477caf4b5e10b78a7ea53cee9602d47 | https://www.cnbc.com/2015/05/19/life-is-good-for-bert-and-john-jacobs.html | Life is Good's $100 million ad-free global success story | Life is Good's $100 million ad-free global success story
For a company with more than $100 million in sales and merchandise in over 4,500 stores in 30 countries, you may be surprised to hear what Life is Good co-founders Bert and John Jacobs aren't doing.
Advertising.
The Life is Good brand started in 1994 with $78 dollars and 48 T-shirts featuring a stick-figure named Jake, and it's grown into a global phenomenon relying on an idea radical to the status quo on Madison Avenue: depending on a community to spread the "good" word.
John and Bert Jacobs, Life is goodSource: Life is good
"We don't have to scream about Life is Good," Bert Jacobs said at the iCONIC conference in Chicago on Tuesday. "We don't have any signs there that say Life is Good [at our events]. What's the halo effect to our brand? I think it's better than interrupting them to talk about ourselves, which is what advertising has been for decades and decades."
While many companies spend millions of dollars on advertising every year, Life is Good's advertising approach can be summed up by the '60s hippie expression: "spreading good vibes."
A dialogue between consumers and businesses—with businesses listening to consumers—is the result of a community first being formed.
Capitalism works. It really does work. And in the digital age, consumers are co-authoring the stories of a brand. They are beginning to vote with their dollar. That's a healthy thing for business, because consumers are building business or they are tearing them down.Bert Jacobsco-founder of Life is Good
"We want to work with anyone who is inventive, creative and that can say that life is good in their own words," Jacobs said. "It's building our business together. We are introducing them to millions of Facebook fans who haven't heard of them. So we are trading. We are not necessarily trading dollars and cents. We are trading community members."
The lifestyle brand—which sells everything from the original T-shirts to a full line of men's, women's, children's and home collections all featuring the brand of optimism—currently has more than 2.5 million Facebook followers and over 253,000 Twitter followers.
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"Capitalism works. It really does work. And in the digital age, consumers are co-authoring the stories of a brand. They are beginning to vote with their dollars," Bert Jacobs said. "That's a healthy thing for business, because consumers are building business or they are tearing them down."
The brand generated $3 million in sales by 2000 and had plans to publicize its brand through radio advertisements. However, the company's plans changed when the brothers began receiving letters from people who had been moved by their products. One letter came from twin brothers who had suffered medical complications due to their premature birth but had remained optimistic with the help of stick-figure Jake.
"What do you do when you get a letter like that?" Bert Jacobs asked. The brothers pulled out of the radio contract and used their advertising budget to sponsor a pumpkin festival in Maine. The company raised over $100,000 dollars for camps for children with life-threatening conditions.
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After the success of their pumpkin festival, Bert and John created Life is Good Playmakers, an accredited public chairty, as a way to further its vision of "spreading good vibes." Its mission is to aid children who face poverty, illness and violence to focus on opportunities rather than obstacles.
The charity is funded in part by donations, but the majority of funding comes from product sales. Life is Good donates a minimum of 10 percent of all sales to their nonprofit agenda.
"The profitability of the for-profit side should always feed the nonprofit side. ... You don't have to choose between for profit and nonprofit. You can integrate these things," Bert Jacobs said. "It is important to our customer base. They react positively to it."
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By 2005, sales had grown to $50 million without a single ad.
Life is Good recently partnered with Grammy award winner Zac Brown at the Hangout Music Festival in Alabama to support its own charity as well as Brown's passion project Camp Southern Ground. The company offered a limited-edition T-shirt for any gift of $35 or more donated to the Life is Good Playmakers.
"It isn't just a product to them anymore. They look at it in a way that says, 'Wow, this is something I belong to.' It's a club. It's a cult," Bert Jacobs said. "Whatever you want to say. But it builds businesses in a positive way, and it's authentically making the world a better place."
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06caaaed894ef952abab5b59352fdd90 | https://www.cnbc.com/2015/05/19/narendra-modi-some-in-india-impatient-for-faster-change.html | Narendra Modi: Some in India impatient for faster change | Narendra Modi: Some in India impatient for faster change
Outside the Gateway of India in Mumbai, a crowd of locals with big smiles chanted "Acche din ayenge"—better days ahead—as Narendra Modi was declared the next prime minister of India.
VIDEO1:1901:19India stocks cool downPower Lunch
Almost exactly a year later, some Indian market-watchers are getting impatient for better days. (Tweet This)
"Modi has been high on rhetoric and short on delivery in his first year, and his many constituencies feel they have been fed empty promises," said Manu Bhagavan, a professor of history at Hunter College in New York.
Economists and investors trumpeted Modi as a sort of Ronald Reagan of India, a man who could get down to business and prescribe the right medicine for the country's heavily regulated economy.
Global leaders have been getting in line to meet and greet Modi, who most recently visited China, where he was seen taking a selfie with Premier Li Keqiang.
"As branding exercises go, it's been a performance worthy of Madison Avenue," said Bhagavan.
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Clearly, many investors have been pleased with Modi—especially last year, when stocks leaped after his election. Other investors, however, were hoping that by now Modi would be done traveling around the globe promoting India, and instead getting down to reforming the economy in New Delhi.
"There's no doubt India's economy has improved, but we were expecting more after 12 months," said an Indian billionaire who spoke to CNBC on the condition of anonymity.
There's more than enough to work on. Inflation, while improved from two years ago, was still high at 6.4 percent in 2014, according to the World Bank. Corporate earnings have disappointed. Locals on the ground say India is still dealing with corruption and red tape.
Not that all of that is in Modi's control. The slow progress of reform made by Modi's BJP party is due at least in part to political pushback from the upper house of India's parliament, where Modi does not have majority of the seats. Market watchers say that hurdle will continue to hurt the prime minister's ability to enact reforms, such as liberalizing the rules around foreign direct investment in the country.
Indian Prime Minister Narendra Modi attends the India-China Business Forum in Shanghai, May 16, 2015.Aly Song | Reuters
HSBC, which recently downgraded India to "underweight" from "overweight," said future interest rate cuts—and the presumed stimulus they would provide—are dependent on real economic reforms.
"The size of (Reserve Bank of India) rate cuts beyond 2015 will depend largely on structural reforms. If they materialize, there could be space to cut. But if not, the RBI may just have to sit tight," wrote Pranjul Bhandari, chief India economist, in a research note to clients.
The major other challenge facing India involves external factors, such as the price of oil. Brent crude's drop from $115 in July to near $50 earlier this year was seen as a big gift to India, a net importer of oil. Lower prices narrowed India's current account deficit, diminished inflation and led to the Reserve Bank of India's cutting rates twice this year. But with prices rebounding, analysts are unsure whether another rate cut is in the cards.
Much will depend on the amount of headway Modi makes in the coming months.
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"Modi is now beginning to engage much more with the chief ministers of various states to promote growth and investment. After one year in office, he probably realizes that imposing change from the center in a diverse country like India is very difficult," said Ruchir Sharma, managing director and head of Emerging Markets Equity and Global Macro at Morgan Stanley Investment Management.
As investors reprice their expectations, the euphoria out of Indian stocks has been sucked out. The Bombay Sensex, the popular benchmark, is down on the year, after climbing nearly 30 percent in 2014.
Despite the challenges Modi faces, most portfolio managers are still bullish on India long term, citing a young talent pool, stable government and a hands-on central bank. Geoff Dennis of UBS says that given the political constraints under which Modi has to operate, his reform program should be judged over a full five-year term of office, not in the first 12 months.
"There is no reason to panic," said Dennis.
"This is a marathon, not a sprint, and it's been a good start [for Modi]," said Sam Gupta, CEO of Grand Trunk Capital.
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0d21719baeabc73586683c2a36695196 | https://www.cnbc.com/2015/05/19/the-incredible-shrinking-wall-street-banks.html?__source=fincont&par=fincont | The incredible shrinking Wall Street banks? | The incredible shrinking Wall Street banks?
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VIDEO3:0503:05The play on banks
Like a dog with some really big fleas, the largest U.S. banks are likely to start shaking off some assets.
After decades of swallowing up their smaller competitors, regulatory and political pressure is putting warehouse financial institutions on the firing line to divest their businesses.
While too-big-to-fail banks have only gotten bigger since the financial crisis, analysts view that trend as about to change.
"We expect more divestiture to come from universal banks as higher capital requirements, the Volcker rule and higher liquidity requirements are fully phased in," Keefe, Bruyette & Woods said in a report for clients. "We believe this trend will create opportunities for small and midsized firms in the U.S. and abroad."
Five of the nation's biggest banks control a record 45 percent of the industry's total assets while the eight so-called universal banks hold about 60 percent of the total, according to KBW and SNL Financial.
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However, much of the growth has come in the form of cash on hand as regulations require more of a cushion for banks, particularly those with more than $50 billion in assets. Dodd-Frank rules as well as Basel III guidelines are redefining the way banks will operate in the future.
"Prior to the financial crisis, consolidation was a consistent profitable investment theme in financial stocks," KBW wrote. "Since then, and with the labeling of the country's largest banks as globally systemic, the reverse has been true: the fragmentation of the largest financial firms is creating arguably the best opportunities in the sector."
Indeed, despite a growing cash pile banks have been shedding assets over the past five years:
Addition and subtraction since 2010
Bank Assets ($billions) Acquisitions Divestitures Difference JPMorgan Chase2,5771628-12Bank of America2,144772-65Citigroup1,832971-62Wells Fargo1,738291118Goldman Sachs86522175Morgan Stanley829522-17Bank of New York Mellon399954State Street279725Total104228124
Two examples KBW cited of moves that will become a longer-term pattern: Royal Bank of Scotland in March shedding $3.2 billion of its stake in Citizens Financial Group; and General Electric announcing in April that it would be dumping $200 billion of financial assets.
Big banks already have been shuttering branches, cutting them in record numbers in 2014 as part of a continuing pattern.
Bank earnings have remained strong, with financials broadly gaining 18.3 percent in the first quarter. About 54 percent of banks beat estimates, with profits flat quarter over quarter and up 13 percent annualized.
Stocks have done well, also.
S&P 500 banks have gained 1.8 percent year to date, which actually is underperforming the broader index. But they've been on fire lately. Banks in the index have gained 5.4 percent over the past month and 6.2 percent in the past three months. JPMorgan Chase, for one, was trading near all-time highs Tuesday.
KBW, though, believes investors should look to the future, which will include smaller big banks and a more fragmented industry.
Here's a list of the stocks KBW analysts see as benefiting from big banks selling off parts of their operations:
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f168f23e87ec27280bd3e3be7240e3b5 | https://www.cnbc.com/2015/05/20/40-percent-of-unemployed-have-quit-looking-for-jobs.html | 40 percent of unemployed have quit looking for jobs | 40 percent of unemployed have quit looking for jobs
VIDEO0:3900:39Unemployed are simply giving up
At a time when 8.5 million Americans still don't have jobs, some 40 percent have given up even looking.
The revelation, contained in a new survey Wednesday showing how much work needs to be done yet in the U.S. labor market, comes as the labor force participation rate remains mired near 37-year lows.
A tight jobs market, the skills gap between what employers want and what prospective employees have to offer, and a benefits program that, while curtailed from its recession level, still remains obliging have combined to keep workers on the sidelines, according to a Harris poll of 1,553 working-age Americans conducted for Express Employment Professionals.
On the bright side, the number is actually better than 2014, the survey's inaugural year, when 47 percent of the jobless said they had given up.
"This survey shows that some of the troubling trends we observed last year are continuing," Bob Funk, CEO of Express Employment Professionals and a former chairman of the Federal Reserve Bank of Kansas City, said in a statement. "While the economy is indeed getting better for some, for others who have been unemployed long term, they are increasingly being left behind." (Tweet this)
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Duration matters: The longer someone was out of work, the more likely it is that they've quit looking.
Of the total, 55 percent who were unemployed for more than two years fell into the category; 32 percent of those idle for 13 to 24 months and 34 percent out for seven to 12 months had quit as well. Just 21 percent out for three months or less had stopped looking.
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Overall, nearly 1 in 5 (19 percent) said they spent no time looking for work in the week previous to the survey. Just 10 percent said they spent more than 31 hours looking.
Unemployment compensation also matters.
Federal guidelines allow for 26 weeks of unemployment compensation, though extended benefits are available in some circumstances.
Nearly 9 of out 10 respondents (89 percent) said they would "search harder and wider" for work if their benefits ran out. Moreover, in a series of statements about benefits, the one that garnered the most agreement, with 69 percent, was that benefits were "giving me a cushion so that I can take my time in searching for a job," while 59 percent said compensation "has allowed me to take time for myself," 36 percent agreed that it "has allowed me to turn down positions that weren't right for me" and 40 percent agreed "I haven't had to look for work as hard knowing I have some income to rely on."
Of those out of work and not receiving benefits—those who have quit looking are not eligible—22 percent said their benefits had run out and 32 percent said they weren't eligible.
Read More
The decline in labor force participation, in fact, has been a key to the drop of the unemployment rate in the post-recession economy. The jobless rate has slid from a high of 10 percent in October 2009 to its current 5.4 percent, the lowest level since May 2008. However, the participation rate has fallen from 66.1 percent to 62.8 percent during the same period.
Benefit programs have expanded as well, even as unemployment compensation dropped from the 99 weeks of eligibility during when the jobless rate was much higher.
The Supplemental Nutrition Assistance Program—food stamps—now serves 45.7 million Americans, down from nearly 48 million in 2012.
"Over the last year, we have seen the unemployment rate go down, but we too easily forget that there are people still hurting, still wanting to work, but on the verge of giving up," Express Employment's Funk said. "I believe everyone who wants to work should have a job, so we must not overlook those who have been left behind and left out of the job market."
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1f371916f3c2b51644762317919baef2 | https://www.cnbc.com/2015/05/20/scientists-cure-disorders-in-mice-by-resetting-their-brains.html | Scientists cure disorders in mice by resetting their brains | Scientists cure disorders in mice by resetting their brains
A team of scientists has cured a brain disorder in adult mice by rebooting the rodents' brains and allowing them to rewire themselves.
Adam Gault | Getty Images
The research demonstrates that certain features of young brains can be recreated in mature brains, even in parts of older brains that scientists believed were impervious to change.
It could also pave the way for treating a variety of developmental disorders that begin relatively early in life.
In the early years of life, brains in animals are malleable. The cells in the brains begin making connections at early ages and strengthen those connections throughout life. Those early stages where the brain is rapidly making connections among cells are called critical periods.
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The brain continues to change throughout life, but it grows more and more difficult to break certain kinds of connections as time passes. That means it becomes harder for the brain to undo problems it may have undergone early in its development.
But Sunil Gandhi and his colleagues at the University of California, Irvine, have found a way to hit the reset button in certain regions of the brain even later in life, allowing the organ to rewire itself and iron out the kinks that can lead to disorders. (Tweet This)
The team published its results online in the journal Neuron this week. The research was funded by a grant from the High-Risk, High-Reward program at the National Institutes of Health.
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In their study, the scientists implanted special cells into the brains of adult mice that suffered from a disease called amblyopia, sometimes called lazy eye.
Amblyopia is not a problem with the eye itself, but usually results instead from a problem in the connection between the eye and the brain.
The cells that Gandhi's team implanted in the mice emit a chemical called GABA, which is found in many places in the brain. GABA is an "inhibitory neurotransmitter." It prevents certain parts of the brain from becoming overexcited and causing dysfunction. Scientists have connected deficiencies in those inhibitory neurons not only to amblyopia but also to disorders such as autism and schizophrenia.
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The GABA-emitting cells Gandhi and his team implanted in the mice spread throughout a section of the brain and hooked into its circuitry, essentially creating a new critical period that allowed the brain to rewire itself and cure the mice of their disorder.
"I have to say it was mind blowing," Gandhi said. "I began these experiments with colleagues about eight years ago, and all throughout we were subject to concern that this enterprise we were engaged in was far fetched."
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The results were surprising in part because the implants were placed in a region of the brain called the neocortex, where scientists have never observed new cells to grow in adult brains. They therefore believed that the region would be would be a hostile environment for implanted cells.
"The neuroscientist has a default expectation that it is not possible to wire in [to the neocortex] like that," Gandhi said. "It's kind of like a Black Swan phenomenon, that now that we have the evidence, a lot of people will treat it as obvious, but I can tell you that there is a long list of my senior colleagues that thought this was impossible."
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Gandhi said the process could become a powerful investigative tool for understanding how some disorders work in the brain, and could help create therapies for epilepsy, schizophrenia and autism. It could also assist with conditions such as pain from spinal cord injury or stroke recovery.
"With all potential therapies involving placing cells in the brain, one has to be very cautious," Gandhi said. "But what we hope is that this study, along with many others, begins to open the door to the therapeutic viability of cell-based approaches."
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36b364074f86adf8c188983c75e74f47 | https://www.cnbc.com/2015/05/20/the-void-plans-virtual-reality-theme-park.html | Welcome to ‘The Matrix’? Theme park with virtual reality twist | Welcome to ‘The Matrix’? Theme park with virtual reality twist
Put your headsets on and get ready! A startup called The Void plans on taking video-gaming junkies to a whole new dimension by opening a set of immersive virtual reality theme parks.
This month, The Void announced plans to open the first of what it hopes will be many "virtual entertainment centers," in Pleasant Grove, Utah by June 2016.
The VoidCredit: The Void
The center will combine the physical environment with virtual reality technology to create what could be the ultimate gaming experience. The Void CEO Ken Bretschneider, who has invested $13 million of his own money in the project, hopes it will "fulfill a promise of what a virtual reality (VR) experience can and should be."
Gamers will be able to choose an individual "game pod" in the center, enabling them to take part in a variety of adventures, from dinosaur safaris to fighting aliens in futuristic battlefields.
"At The Void, you will walk into new dimensions and experience worlds without limits. From fighting intergalactic wars on alien planets, to casting spells in the darkest of dungeons, The Void presents the Future of Entertainment," the company's website says.
The Void aims for the theme park to be affordable and accessible to a wide range of people, with each experience lasting for 30 minutes and tickets seen costing between $29 and $39.
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Tech giants like Samsung, Sony and Google have been battling for years to bring VR into consumers' homes and the much-hyped Oculus Rift headset is set to hit shop shelves at the start of 2016.
However, James Jensen, chief technology officer and co-founder of The Void, told CNBC that the company's theme parks would utilize the full potential of VR, with a level of detail that consumer VR products could not match for years.
"Consumer VR products will only ever be able to bring people to a different reality visually. At The Void we bring the complete sense of reality, 4-D effects, amazing sound, smells, ability to move around naturally and cinematic visuals tap into all the senses of the human body," said Jensen.
The VoidCredit: The Void
To create the full experience, gamers will be equipped with specialized hardware and software, including a head-mounted display that will provide visuals and sound for the virtual world, along with tracking sensors and microphones for in-game communication and accuracy.
Gloves and a motion-tracking vest will be worn to enhance senses and environmental effects and each pod will be kitted out with physical elements such as elevation changes, touching structures and temperature adjustments.
Each theme park will contain between eight and 10 pods, with up to 10 individuals in each pod for a "family friendly" experience.
Read MoreWhat's next for virtual reality? Think social
The VoidCredit: The Void
Jensen said The Void would offer visitors free-to-play games for mobiles and desktops, enabling them to earn credits for upgrades to their characters and experiences and hopefully incentivizing them to return to the theme park.
Currently, the Void is taking potential sponsors, partners and investors around its first center and is refining its technology in preparation for next summer's open.
"We are all excited to bring this next evolution of entertainment to the world," Jensen said.
The Void hopes to locate future centers in major cities across Europe, Asia and the Americas.
Read MoreThe UK gets its first capitalist theme park
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77d1c29d5c9e0c5ef684d06627d440fe | https://www.cnbc.com/2015/05/21/179-million-picasso-buyer-still-at-large.html | Pablo Picasso's “Les femmes d’Alger (Version O)”Justin Tallis | AFP | Getty Images
Questions continue to swirl about the buyer of Pablo Picasso's "Femmes d'Alger" (Version "O") at Christie's New York last week.
Sold to an anonymous telephone bidder for $179 million dollars, the Picasso canvas shattered all previous records for the most expensive artwork ever purchased at auction.
Read MorePicasso becomes the most expensive artwork sold at auction
Reports Thursday identified former Qatari prime minister Hamad bin Jassim bin Jaber Al Than as the buyer.
But sources tell CNBC's "Power Lunch" say the Qatari billionaire is "definitely not" the deep-pocketed collector of this painting.
So who was it?
As it stands, there are only a few dozen individuals and institutions in the world that can afford works in this lofty price range, including billionaire financier Leon Black, who purchased Edvard Munch's "The Scream" for $119 million at Sotheby's in 2012.
Black is the founder of Apollo Global Management and sits on the boards of the Metropolitan Museum of Art and the Museum of Modern Art.
Read MoreWho will buy "The Scream?"
In 2014, Elaine Wynn, ex-wife of Wynn Resort mogul Steve Wynn was identified as the buyer of Francis Bacon's triptych "Three Studies of Lucian Freud," for $142.4 million at Christie's. Ms. Wynn has a net worth of nearly $1.9 billion.
At the time of the Bacon sale, other names mistakenly linked as the mystery collector included Russian oligarch Roman Abramovich and Qatari royal family member Sheikha Mayassa.
The previous owner of the Picasso, widely considered the artist's masterpiece, was identified by Christie's as "distinguished private European collection."
The painting last sold in 1997 for $31.9 million dollars
Christie's was contacted for this story but did not disclose the identity of the Picasso buyer.
Read MoreMonet, Monet, Monet...Money!
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817ecd828070f69ece6166b881267ba7 | https://www.cnbc.com/2015/05/21/american-diversity-cities-where-it-works.html | American diversity: Cities where it works | American diversity: Cities where it works
VIDEO1:4201:42America's most diverse citiesTop, Best, Most
Minorities will be the majority in the United States in 30 years, according to the Census Bureau.
Some cities are already well on the way.
May is Asia Pacific Heritage month, and WalletHub has looked at America's Most Diverse Cities, ranking them not just on racial and ethnic diversity, but also combining research on diversity in economies and how well higher education and income levels are dispersed across different groups.
Read More Bluetooth or brakes: What car shoppers care about
The top 20 cities include places such as Dallas (16th), New York (19th) and Renton, Washington (6th).
However, the top five have one thing in common: They're in California.
Los Angeles, CaliforniaDavid Sucsy | Getty Images
No. 5: Sacramento
California's capital ranks high in "Ethno-Racial & Linguistic Diversity" as well as "Household Diversity" (meaning a variety of households beyond the traditional nuclear family). Less than 35 percent of residents are non-Hispanic whites, according to the Census Bureau, and one in five residents was born outside the United States.
No. 3: Anaheim, California, and San Diego (tie)
"America's Finest City" is tied with "The Happiest Place on Earth, "and both boast diversity and relative prosperity.
San Diego's minority communities make up a total of 55 percent of the population, and it ranks near the top in economic class diversity. Nearly one in three businesses is owned by a woman, and the median household income is $64,000, much higher than the national average of $53,000.
Anaheim, home to Disneyland, is just behind San Diego in terms of economic class diversity, but it has a more diversified economy. More than half of the city's residents are Latino, who also own more than one in five businesses. The city has the largest population in Orange County, a place filled with a range of ethnic communities exercising growing political clout.
Read More Where millennials should go to school...and stay
No. 2: Long Beach, California
The city that brought you Snoop Dogg and motorcycle phenom Jesse James (talk about diverse!) ranks highest of the top five in ethnic/racial/linguistic diversity. In addition to a large Latino population, Long Beach also has large African-American and Asian communities. One in four Long Beach residents were born outside the U.S., and while the city ranks high in educational opportunities across diverse communities, 20 percent live below the poverty level.
No. 1: Los Angeles
The City of Angels boasts the largest communities outside their home countries of many nations: Korea, Iran, Thailand, Mexico, El Salvador. You get the picture. There are signs everywhere for Koreatown, Chinatown, Little Tokyo and Little Armenia.
Nearly half of L.A.'s population is Latino, 11 percent is Asian, and 10 percent is African-American. WalletHub ranks L.A. first in terms of educational diversity, and it ranks high in racial and ethnic diversity. However, one area lacks diversity here in America's second-largest city: incomes. The gulf between rich and poor in La-La Land is still as big as the Pacific.
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d9cbb7c7ebe72fb6582591995bcdf360 | https://www.cnbc.com/2015/05/21/dollar-regains-footing-rises-after-us-inflation-data-uptick.html | Dollar regains footing, rises after US inflation data uptick | Dollar regains footing, rises after US inflation data uptick
Getty Images
The U.S. dollar turned higher on Friday, spurred off its early losses by a U.S. inflation report that indicated underlying pressures are building and thereby bolstering the case for the U.S. Federal Reserve to raise interest rates later this year.
"Stronger inflation, along with stronger growth data, is something that the Fed certainly wants to see," said Brian Daingerfield, currency strategist at the Royal Bank of Scotland in Stamford, Connecticut. "Rate hike expectations have likely been brought forward as a result of some of the stronger data today."
Read MoreUS consumer prices soft, underlying inflation pushes up
The euro's gains were cut and the buying momentum for the dollar increased as the morning New York session incorporated the U.S. Consumer Price Index data.
While the CPI gained 0.1 percent in April, down from the prior month, the so-called core CPI, which strips out food and energy costs, increased 0.3 percent, the largest rise since January 2013, after advancing 0.2 percent in March.
VIDEO2:1302:13Vulnerable markets ahead of rate hikeClosing Bell
The euro was last down 0.94 percent at $1.1006. It earlier fell 0.94 percent to a session low of $1.10055 on the EBS trading platform. It was the weakest point since April 29 and put the euro on track for its worst weekly performance since August 2010.
The dollar climbed 0.4 percent to 121.53 yen, just off a fresh 10-week high of 121.57 yen. Earlier trading left the dollar flat against the yen after a Bank of Japan meeting presented a slightly more upbeat view of the economy that gave no sign it was ready to do yet more to support growth.
Read MoreWhy Tsipras needs to turn on the charm with Merkel
Investors gleaned more views about the state of the U.S. economy in hopes of attaining a better understanding of when U.S. interest rates may rise from a speech by Federal Reserve Chair Janet Yellen.
Yellen on Friday said a rate hike will be appropriate this year if the economy improves.
Read MoreEconomist says Fed policies could lead to disaster
In Europe, Germany's often market-moving Ifo data had prodded the euro marginally higher, while there was little sign at an EU summit of the breakthrough in talks on Greece.
European Central Bank chief Mario Draghi warned in a speech that future economic growth would be modest.
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ca4e74c06cfcadcd0862474ebc29f5bb | https://www.cnbc.com/2015/05/21/gold-steadies-as-dollar-falls-june-rate-rise-prospects-dim.html | Gold edges lower as dollar cuts losses after data | Gold edges lower as dollar cuts losses after data
Sergio AlexanderGetty Images
Gold fell on Thursday as the dollar cut losses after U.S. data showed economic momentum was improving, but the downside was limited by signs the Federal Reserve was unlikely to raise interest rates in June.
The number of Americans filing new claims for unemployment benefits rose slightly more than expected last week, data on Thursday showed. But the four-week moving average of claims, considered a better measure of labour market trends as it irons out week-to-week volatility, fell 5,500 last week to 266,250. That was the lowest level since April 2000.
Spot gold was down 0.3 percent at $1,205 an ounce, while U.S. gold futures for June delivery were down 0.3 percent at $1,205 an ounce.
Read MoreFed sees weakness as 'transitory,' all but rules out June hike
"We had a good run up and every rally is seen as an opportunity to take profits ... the market remains elastic, good buying on the dips and selling on the rallies, we have been doing this for the past 18 months," Ross Norman, CEO of broker Sharps Pixley, said.
Minutes of the Fed's April meeting, released on Wednesday, showed policymakers believed it would be premature to raise interest rates in June.
VIDEO4:1704:17As Fed plays waiting game, buy selectively: Pro
That view was widely held in the market following disappointing U.S. economic data over the past few weeks that weighed on the dollar, in turn helping gold hit a three-month high of $1,232.20 on May 14.
The minutes showed Fed officials pushing the prospect of a rate increase later into the year, further dampening appetite for the dollar, which fell 0.3 percent versus a basket of leading currencies.
Higher U.S. interest rates would increase the opportunity cost of holding non-yielding bullion.
Gold prices have struggled to break out of a $1,170-$1,230 an ounce range since mid-March, hamstrung by uncertainty over the timing of a U.S. rate rise.
However, investor sentiment has turned bearish in recent days as prices have fallen from the three-month highs reached earlier this week.
Outflows in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, continue to undermine investor sentiment. Holdings of the fund fell 0.41 percent to 715.26 tonnes on Wednesday, the lowest in four months.
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50f827b0a27fe354f9b2dd276c57b9e0 | https://www.cnbc.com/2015/05/22/7-major-housing-markets-now-overvalued.html | 7 major housing markets now 'overvalued' | 7 major housing markets now 'overvalued'
VIDEO1:4601:46Home price being pushed higher
Home prices are pushing peak levels again, and this time they're doing it without the help of easy credit.
Now, an increasing number of local markets are considered overvalued. Tight supply and strong demand pushed the median price of homes sold in April to $219,400, up nearly 9 percent from a year ago, according to the National Association of Realtors. While that is still below the 2006 peak of $230,400, the Realtors' Chief Economist, Lawrence Yun, said he expects to approach that level this year.
Given that income growth is not even close to matching home price growth, certain housing markets are pushing past what is considered sustainable, based on the median income. Seven out of the top 100 metropolitan U.S. housing markets are thus overvalued, according to a new study by CoreLogic, a real estate analytics company. That's up from four just last fall.
Read MoreDenver housing: Rocky Mountain high and HOT
"It is a little bit worrisome because the markets are becoming overvalued without strong demand," said Sam Khater, deputy chief economist at CoreLogic. "If there were more construction, these markets would not be overvalued."
Aerial view of an Austin, Texas suburb.David Sucsy | Getty Images
Four of the seven are in Texas: Austin, Houston, Dallas and San Antonio. These markets did not surge and crash during the last housing boom. Instead, they were fueled by oil and gas, which pushed both prices and population. Prices there are now at historic highs, with Dallas home values 15 percent above their peak in 2007. Austin home prices are 39 percent above what CoreLogic considers sustainable. Texas has been here before, but for different reasons.
"It doesn't mean we will see what happened in the early '80s," Khater noted, referring to the real estate crash back then. "Because the Texas markets are not nearly as overvalued as they were then. There is also not the same dislocation in nonoil segments."
Read MoreA house that thumbs its nose at the drought
The Texas economy is far more diverse now, with technology, health care and insurance sharing the wealth. The state is therefore not nearly as susceptible to movements in oil prices. That said, home building analysts are watching Texas carefully, waiting to see any impact lower crude prices will have on both jobs and housing demand.
Also on the list is Charleston, South Carolina, where home prices are still below their peak of 2007 but where prices are considered overvalued.
"They're one of the healthiest markets in the country. They have good job growth and very strong newly built home sales," said Khater.
Read MoreWater, millennials drive Portland, Oregon, housing
Miami and Washington, D.C., round out the list of seven, but home prices in both markets are still well below their 2007 peaks. Miami is being fueled by foreign cash, which accounts for the gap in home prices and local median incomes. Washington, which includes the northern Virginia and Maryland suburbs, is one of the most affluent areas in the country. It has also not seen enough home construction, both of which push home prices higher.
While these seven cities are considered overvalued, they are also regarded as healthy, at least according to Khater. That is because prices are being driven by low inventory amid subpar demand, not by easy credit and, as happened during the last housing boom, outright fraud among both borrowers and lenders.
"They can be overvalued, but be active and healthy and not so out of whack that it implies a bust," he added.
They are, however, worth watching, especially Texas, where oil could still have a negative impact on the health of housing.
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a01a7386fb3ee4595c98c1274eac3d6f | https://www.cnbc.com/2015/05/22/californias-drought-no-match-for-its-tourism-industry.html | California's drought no match for its tourism industry | California's drought no match for its tourism industry
Low water levels are visible at the Los Capitancillos Recharge Ponds in San Jose, Calif.Getty Images
What drought?
Despite strict water restrictions in California, water parks like Splash Mountain are still splashing, fairways are still green and showering at hotels (albeit with a suggested time limit) is still possible.
That's what operators at an array of theme parks, golf courses, hotels and lush resorts throughout the state hope travelers will keep in mind, as they make travel plans this summer.
"The drought is affecting California's tourist attractions in very different ways, but most tourists are unlikely to be affected since businesses have merged water conservation practices with their overall operations," said Ryan Becker, vice president of communications at Visit California.
During 2014, travel and tourism expenditures in the state totaled $117.5 billion. That meant jobs for more than 1 million people and $9.3 billion in state and local tax revenues. Given those numbers, there's plenty of incentive for California to keep tourism afloat during these dry times.
Read MoreCalifornia drought: New water rules may not work
Worries about the drought don't seem to be keeping travelers from heading to the Golden State. (Tweet this.)
"We are not seeing any unusual fluctuations in travel to California beyond the expected seasonal summer influx," said Kurt Weinsheimer, vice president of business development at Sojern.
And despite some year-over-year drop-offs in a few Golden State spots, Priceline reports that four of the top 10 destinations for Memorial Day are in California: San Diego, Orange County, San Francisco and central Los Angeles.
At least for now, vacationers aren't wringing their hands over the drought.
"Will it make a difference if I ask for a glass of water at the Cliff House [in San Francisco]? I'm thinking, no," said Seattle resident Peg Boettcher. She adds that despite the dry conditions, she's been noticing a lot of television ads for California lately featuring "swimming pools and water and splashing around and bathing suits and the like."
All fountains and water-themed attractions are currently fully operational at Disneyland and Disney's California Adventure Park in Anaheim—including major draws like "It's a Small World," "Pirates of the Caribbean" and Grizzly River Run. Thanks to a water conservation program that dates back to 1955, the house that Walt built is still able to pull in thousands of thrill seekers.
"We have the infrastructure in place that allows us to recycle nearly all the water used at the resort," said Disneyland spokeswoman Cathi Killian.
VIDEO1:4801:48Cali drought: Farmers scapegoated? Power Lunch
Knott's Soak City Waterpark also recycles and reuses almost all its water.
"Unlike your toilets and sinks at home, this is a closed loop system, which means the water remains in the system and is constantly tested and treated in a safe manner just like an aquatic swimming pool," Knott's Berry Farm said in a statement.
Read MoreWilliam Shatner's California drought solution
In addition to urging guests to reuse towels and forgo daily bed linen changes, many hotels are planting drought-tolerant landscaping that replaces natural lawns with artificial turf. In addition, they are speeding up schedules for installing water efficient toilets.
"Saving water is not a new concept for hotels in California, but now many properties are getting creative with their efforts," said Kevin Carroll, executive director of the Hotel Council of San Francisco.
"Given the crisis—and it is a crisis from a water standpoint—you have to take it to the minute level," said Tom Klein, regional vice president for the seven Fairmont Hotels and Resorts in California.
Klein said Fairmont guests now receive a card advising of the drought conditions, and explaining how much water can be saved by taking short showers (about 2.5 gallons per minute). They are also encouraged to reuse towels and bed linens (about 20 gallons a day), although its not mandatory.
At resorts with golf courses, "we've reduced sprinkle time and are only watering areas essential to the game," said Klein.
Just off the coast of Southern California, Catalina Island hotels, vacation rentals and restaurants are working hard to meet water restrictions imposed by Southern California Edison. Those efforts actually started eight months before the recent statewide cutbacks announced by Gov. Jerry Brown.
Businesses on the island—and across the Golden State—are going the extra mile to emphasize the importance of conservation.
"Vacation rentals and hotels have mounted small hourglass devices in the showers to get you moving quickly and, where appropriate, restaurants and sandwich shops are using paper plates and disposable cutlery so they don't have to run dishwashers," said Jim Luttjohann, president and CEO of the Catalina Island Chamber of Commerce and Visitors Bureau.
At Sierra Mar, the restaurant at Big Sur's Post Ranch Inn, executive chef John Cox has his staff using compressed air, instead of the spray nozzle at the kitchen dish station normally used to clean plates.
By doing that "we have been able to reduce the usage of the water in that area by 80 percent, and actually increased productivity," said Cox. Several other restaurants in the state have already switched to this system, while many others are pricing equipment and running numbers on how much they can spend and save.
"California has an estimated 60,000 full-service restaurants," said Cox, "If each of these restaurants switched to compressed air for precleaning plates and could save even just 250 gallons per day, that would equal over 5 billion gallons of water per year."
—Harriet Baskas is the author of seven books, including "Hidden Treasures: What Museums Can't or Won't Show You," and the Stuck at the Airport blog. Follow her on Twitter at @hbaskas. Follow Road Warrior at @CNBCtravel.
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9ada978795e57f32c18bb70d447fd000 | https://www.cnbc.com/2015/05/22/how-sharing-failure-stories-has-become-a-global-movement.html | Confessions of an entrepreneur: Raw and unedited | Confessions of an entrepreneur: Raw and unedited
VIDEO4:3204:32A coming-out party in Singapore for business failuresStreet Signs Asia
Leaving her ego at the door, Elisha Tan, a 27-year-old Singaporean tech entrepreneur, stood up in front of an of audience over 100 people to talk candidly about her startup's failure – a topic few in the industry are brave enough to discuss publicly.
Speaking at F---up Nights – an event hosted by The Hub Singapore and Cut The Small Talk, earlier this week, she delivered a raw, unedited version of her journey building Learnemy - an online platform to help Singapore-based students to find tutors in the city-state – and the moment she decided to call it quits.
While the website enjoyed a certain measure of success, she struggled to get users to come back to her website once they had connected with their instructors. After months of searching for a solution, including traveling to Silicon Valley to seek advice from the pros, she found herself at a dead end.
Elisha TanAngela Ognev
"At this point of time, I was out of my head, burnt out emotionally and mentally," Tan, who had been working on the site for three years, revealed. "So I decided to call it quits."
"Killing my startup was one of the hardest things I've had to do in my life," she added. "Everyone tells you [it's] painful, but I don't think pain encapsulates it."
While her website still exists, she is no longer managing it on a day-to-day basis.
Tan was one of four entrepreneurs selected to share a business failure story at F---up Nights – an event, as insinuated by its name, designed to encourage open and honest conversations on the realities of the startup world.
Read MoreWomen entrepreneurs don't need to go it alone
While there's a "hot new startup" in the limelight every other week, the unfortunate truth is that around nine out of ten startups actually flop.
F---up Nights provides a platform for entrepreneurs to share where they went wrong to help their peers avoid making the same mistakes.
The concept, born in Mexico back in 2012, has fast turned into an international movement, with events being held in cities across the world. The Hub Singapore, which is a co-working space, plans to host the event once every two months.
The arrival of F---up Nights in Singapore couldn't be more timely, with the city-state becoming one of the most vibrant startup scenes in Asia thanks to a range of government policies to support entrepreneurs through funding, financing schemes and tax incentives.
Gouri Mirpuri, co-founder of The Hub Singapore hopes that events such as these will help Singaporean entrepreneurs shake off the stigma attached to failing.
"In Singapore, failure can often be seen as a loss of face – that perception needs to be broken because failure is very much part of the journey," Mirpuri told CNBC.
Read MoreStart-up: Need a man? Just rent one.
Failure tends to be taken more heavily here compared to the West for a myriad of reasons, says Mirpuri.
"First, it's expensive. Sure taxes are low but the cost of real estate and labor are not cheap," she said.
"Second, there's a fear of what society will say. That holds one back and makes failure less acceptable," she added.
The Hub SingaporeAngela Ognev
Fear of failure means that anxiety and depression are prevalent in the startup realm, with founder suicides becoming a very real problem for the industry.
Tan said one of her motivations for sharing her failure story was to help in the prevention of such tragedies.
"I want to show people that there's a light at the end of the tunnel and you can still be a good place after failing. There's no need to consider suicide," said Tan, who now works at Tech in Asia – an online technology media company.
The event received a highly encouraging response from members of the audience, largely made up of local and expatriate entrepreneurs.
"Listening to the speakers gets me reflecting on the things I've been doing, I've done similar f--- ups. It's nice to hear it from someone else," Arjun Sigh, a Singaporean entrepreneur running an education website, told CNBC.
Budding entrepreneur Iqbal Ibrahim also found similar value in the event. While not currently working at a startup, he came to hear about the journeys of the speakers.
"It was useful to understand that it's not always just a rosy picture – there are ups and downs in the roads and it is how you manage them."
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442a0e1709b860c845c5189ca754a196 | https://www.cnbc.com/2015/05/22/is-finland-really-getting-ready-for-war-with-russia.html | Is Finland really getting ready for war with Russia? | Is Finland really getting ready for war with Russia?
VIDEO0:3500:35Finland and Russia tensions grow
Finland has informed its 900,000 military reservists of what their roles would be in the event of a military crisis against a backdrop of rising tensions between Russia and its neighbors.
The letters campaign by the Finnish army has ostensibly been carried out to "keep in touch" with its reservists, the Finnish Defense Ministry said on its website, and reservists have been asked to update their personal details that the army holds for them.
The letters have been sent as a result of "an extensive reform starting in 2008 affected the task of many reservists and the Defense Forces contacted the reservists to inform them what their individual role would be should Finland enter a conflict," the military's website noted.
The timing of the letters that has raised eyebrows, however, as relations between Russia and its neighbor Finland sour.
Martti Kainulainen | AFP | Getty Images
Russia has become increasingly isolated on the global stage for over a year now as a result of its annexation of Crimea and role in the recent conflict in Ukraine. Nonetheless, it has been conducting military exercises over the last year, including in the Baltic Sea near the shores of Finland – as well as other northern European countries.
Read MoreUkraine's economy may shrink 10% in 2015
Finland shares a land border with Russia but neither country is a member of the military alliance NATO, potentially making it more vulnerable to any future Russian aggression.
Seemingly aware of the potential military risks, the defense ministers of Nordic nations Sweden, Norway, Finland, Denmark and Iceland warned in April this year that Northern Europe must prepare for possible crises or incidents because of Russia.
Read MoreNew sanctions on Russia are 'economic war'
"Russia's leaders have shown that they are prepared to make practical and effective use of military means in order to reach their political goals, even when this involves violating principles of international law," the ministers wrote in a joint statement in Norwegian newspaper Aftenposten, Reuters reported.
Finland's army has around 16,000 members, although the number rises when including its Naval and Air Forces. The forces would be given a significant boost were reserves to be called up.
Reservists are those "who are liable for and have completed their military service," the Finnish Defence Forces (Finland's military) said on its website.
Read MoreThis key indicator shows how bad it is in Russia
The first letters were sent at the start of May with the final batch sent out in the last few days. Reservists were told by Finland's Defense Forces that within the letters:
"You will find your own details and your wartime assignment in the appendix with the letter. In other words, you can see whether you have an assigned wartime task, are in the reserve or have been reserved for other tasks by your employer."
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7236021e6fee93cb78806577d49f036a | https://www.cnbc.com/2015/05/22/ukraines-economy-may-shrink-by-10-in-2015.html | This country's economy may shrink by 10% in 2015 | This country's economy may shrink by 10% in 2015
Ukraine may have dropped out of the headlines but its economic troubles are worsening as it continues to battle with separatists—and bondholders.
The country's economy is seen shrinking by a steep 5.5 percent this year by the International Monetary Fund (IMF). However, this could prove optimistic—Exotix, a merchant bank specializing in emerging markets, sees Ukrainian gross domestic product (GDP) shrinking by nearly 10 percent in 2015.
Pacific Press | Getty Images
"Ukraine is now fighting on two fronts, in the East with the separatists and now with the bondholders in the context of discussions on restructuring the sovereign and state-owned bank debt," said Jakob Christensen, senior economist at Exotix, in a research note on Thursday.
On Friday, the European Commission signed off on 1.8 billion euros ($2.0 billion) of extra financing for Ukraine, after the Ukrainian government sought the right from its parliament this week to suspend foreign debt payments.
"If the moratorium is imposed, it would be a default event according to the bond documentation, which would be quite messy for both sides," said Christensen.
He added that the negotiations posed downside risks to bond prices and that Exotix had downgraded its recommendation on the debt to "sell" from "hold" as a result.
Read MoreSovereign Debt: CNBC Explains
In addition to aid from Europe, Ukraine has received a $17.5 billion bailout from the IMF. This program is due for review next month, by which point the country is expected to have restructured its debt burden to make savings of around $15 billion. However, the review may be delayed as Ukraine insists that such savings cannot be reached without a haircut to the principal (the amount borrowed that remains unpaid)—an argument that bondholders reject.
The ongoing conflict with pro-Russian rebels in eastern Ukraine saw one civilian killed on Friday, after a major coke plant owned by Ukrainian steel company Metinvest was shelled. Plus, the military in Kiev reported that three Ukrainian servicemen had been killed and 12 wounded in the past 24 hours, according to Reuters.
Moscow continues to deny that it is backing the separatists in eastern Ukraine. However, two Russian men captured by Ukrainian forces told Russian newspaper Novaya Gazeta on Friday that they were in the country on Moscow's orders, according to Reuters.
Read MoreIs Finland really getting ready for war with Russia?
Meanwhile, Ukraine has also been hit by the collapse in oil prices and international sanctions on Russia, which remains its major trading partner.
In addition, Ukraine is beset by hyperinflation, with prices seen rising by 33.5 percent across 2015 by the IMF.
The country's internal political situation also remains fragile following the ouster of Ukraine's pro-Russian President Viktor Yanukovych in February 2014. Political risk consultancy Teneo Intelligence rates Ukraine as "high risk" among emerging markets for instability over the coming 12 months.
"Three countries—Venezuela, Ukraine and Yemen—are characterized as high risk due primarily to existing or potential social and military conflict," said Teneo Managing Director Wolfango Piccoli in a note on Thursday.
"The government in Kiev will likely remain cohesive in the near future because the conflict in eastern Ukraine discourages political in-fighting. However, splinter groups from individual parties have started to appear, which may challenge government stability in the first half of 2016," he added.
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2f195edce1ca93a47c255014dad246fd | https://www.cnbc.com/2015/05/24/loan-recovery-eludes-indias-banks-despite-outpacing-china.html | Loan recovery eludes India's banks despite growth pick up | Loan recovery eludes India's banks despite growth pick up
A customer is seen outside the State Bank ATM in Jaipur, Rajasthan, India.Sanjit Das | Bloomberg | Getty Images
A recovery in India's credit growth could elude the country's banks until early 2016, despite an economy that in the first three months of this year is expected to have outpaced China.
A 12.6 percent growth rate in lending in the fiscal year that ended on March 31 was the lowest in almost two decades, and would have been lower but for a surge in the last two weeks. In the two weeks to May 1, it slowed to 10.5 percent.
Reporting earnings for the quarter ending in March, India's top bankers said they had seen an increased level of inquiries from firms and individuals. But there was no substantial rise in loans, meaning a full recovery could still be months away, as India's debt-burdened firms battle to get back on track.
That lag contrasts with official growth figures that are expected to show this week that India's economy grew 7.4 percent last fiscal year -- numbers likely to again confound economists and firms still suffering from slack demand.
VIDEO3:5303:53RBI rate cut on June 2 is a given: Deutsche BankCapital Connection
"The project pipeline which was very, very thin even last quarter, we are now beginning to see more and more projects coming in," said Arundhati Bhattacharya, chairman of State Bank of India, the country's largest bank.
"My own anticipation is another two quarters down the line we should definitely begin to see this pick up happening, and the last quarter of the financial year... should be quite good."
Bhattacharya forecast loan growth of 14 percent for the current financial year to March 2016 for SBI. That compares with an adjusted 10.5 percent in the year just ended.
"People who meet us are all very hopeful and bullish on a recovery starting. Some queries have started coming for new proposals also, but not in a very big way," said Ashwani Kumar, chairman of state-owned Dena Bank.
"This was not the scenario four or five months back."
Read MoreIndian billionaire worries about disruptive technology
India's firms have seen debt levels nearly triple in the past five years and are struggling to digest debt already on their balance sheets after two years of weak economic expansion.
"I look at infrastructure, and in this industry there is not much change. Banks are a little wary of lending to infrastructure because there have been delays and other problems," said Issac George, chief financial officer of infrastructure firm GVK.
Although bank loans still account for bulk of the credit in India, another factor that has weighed on bank loans is cheaper availability of funds through commercial papers and bonds.
Commercial paper issuances jumped more than 80 percent last fiscal year, according to estimates from rating agency ICRA. Including commercial papers, bonds and overseas borrowing, total credit available in the system grew 14.5 percent last year -- outpacing growth in bank loans.
"What is really hitting the credit growth for banks is that investments are not really picking up," said Vibha Batra, group head of financial sector ratings at ICRA. "Even if this investment proposals start coming in, it won't be before the second half that you would see a meaningful credit growth."
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157953afef16ee2a7dce3cc747dd658b | https://www.cnbc.com/2015/05/25/european-shares-seen-flat-amid-low-volumes-greece-fears.html?__source=fincont&par=fincont | Europe closes lower, Spanish, Greek stocks tumble | Europe closes lower, Spanish, Greek stocks tumble
European equities closed lower on Monday amid low volumes, with a number of markets shut for the holiday weekend.
The London Stock Exchange and its German counterpart were both closed for the Whit Monday holiday, while markets in the U.S. were closed for Memorial Day.
The pan-European FTSEurofirst 300 closed around 0.1 percent lower, with the French CAC index ending around 0.5 percent lower.
The benchmark Spanish IBEX index ended more than 2 percent lower after the ruling People's Party (PP) took a battering in regional and local elections on Sunday, as voters punished Prime Minister Mariano Rajoy for four years of severe spending cuts and a string of corruption scandals. This was viewed as worrying indicator ahead of national elections expected in November.
Italian stocks followed the Spanish IBEX lower, with the FTSE MIB ending down around 1.7 percent.
The Athens Composite index closed more than 3 percent lower, as fears of after the country's interior minister, Nikos Voutsis, threatened to default on loan repayments due to the International Monetary Fund on Sunday.
Asian stocks shrugged off a dismal lead from Wall Street to trade higher on Monday, with markets in Tokyo and Shanghai scoring fresh multi-year highs.
China's benchmark Shanghai Composite surged to its highest level since January 2008 and a and better-than-expected export data delivered a cheer to Japan's Nikkei 225, which hit its highest level since 2000.
Read MoreJapan's April exports climb 8% on-year
Meanwhile, bourses in Hong Kong and South Korea were closed for public holidays.
Talks between Greece and European finance ministers will kick off again on Wednesday. Greek Prime Minister Tsipras and Jeroen Dijsselbloem, president of the Eurogroup, will both speak at the European Parliament on Thursday.
GDP figures are due on Friday from the U.S. and will almost certainly show the world's biggest economy contracted last quarter.
In Europe, data due this week includes German and French consumer confidence readings.
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d4e9ef5dcc36fb85689e8126fdbbd5bc | https://www.cnbc.com/2015/05/25/military-benefits-give-returning-veterans-a-head-start.html | Military benefits give returning veterans a head start | Military benefits give returning veterans a head start
As America pays tribute on Memorial Day to U.S. service members who gave their lives for this country, it's also important to remember others who have served and are still with us.
Some veterans and their families may face significant financial challenges as they transition to civilian life, and many may not be aware of many of the benefits to which they are entitled.
The Post-9/11 GI Bill is one of the best-known military benefits for veterans, paying for full tuition and fees at a college or university, a monthly housing allowance while you are in school and $1,000 a year for books and supplies. But it may not cover all education costs.
That's where the Leave No Veteran Behind program comes in. The non-profit organization offers retroactive scholarships for veterans who are not covered by the GI Bill.
"Some had family medical issues which made it take longer to earn their degree. Some wanted a higher degree when their GI Bill benefits would only cover an Associates' degree," said Eli Williamson, co-founder of Leave No Veteran Behind. "Some veterans may have entered the military with a degree and student loans. The GI Bill does not work retroactively, so they still must find a way to pay off that student debt."
A file photo of the U.S. military in Tbilisi, Georgia.David Mdzinarishvili | Reuters
The Tillman Military Scholars program, sponsored by the Pat Tillman Foundation, also provides scholarships for veterans as a supplement to the Post-9/11 GI Bill to cover tuition and fees, books and living stipend, for those pursuing undergraduate, graduate or post-graduate degrees as a full-time student at a public or private, U.S.-based accredited institution.
While student loan debt may only be an issue for some veterans and their families, many more may face the financial challenge of paying off credit card debt. Research from the FINRA Foundation shows military service members are more likely to have a greater number of credit cards and more "costly credit card behaviors" than civilians.
Veterans may not be aware of special credit cards with lower interest rates that are designed for military service members and their families. USAA, Pentagon Federal Credit Union and Naval Federal Union are among some of the financial services firms offering lower rates, according to Bankrate.com and Credit Karma. Also veterans should be aware of the Servicemembers Civil Relief Act, which can help to limit the interest rate on certain debts of service members even after they become civilians.
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e9e6a4c4727dce7c86bc7c837461a6f4 | https://www.cnbc.com/2015/05/25/spains-ruling-peoples-party-gets-worst-election-results.html | Spain's ruling PP gets worst local election result | Spain's ruling PP gets worst local election result
Jasper Juinen | Getty Images
Spain's ruling People's Party (PP) took a battering in regional and local elections on Sunday after voters punished Prime Minister Mariano Rajoy for four years of severe spending cuts and a string of corruption scandals.
In a test of the national mood ahead of general elections expected in November, the PP suffered its worst result in more than 20 years to herald an uncertain era of coalition as new parties rose to fragment the vote.
Spaniards rejected the stability offered by the PP and rival Socialists which have alternated in power since the end of dictatorship 40 years ago and opted for change in the shape of new parties - market-friendly Ciudadanos ('Citizens') and anti-austerity Podemos ('We Can').
Rajoy's future looked bleak as his strategy to bet on an accelerating economic rebound to win a second term later this year was seriously undermined by his party's poor showing.
"It's a drubbing for the PP. The fear factor did not come into play and people voted for Podemos and Ciudadanos," said Jose Pablo Ferrandiz of leading pollster Metroscopia.
VIDEO4:1104:11What you need to know about Spain's elections
Although the PP got more votes than any other party, it and the rival Socialists fell short of overall majorities in most areas. The two parties will have to negotiate coalitions with minority parties in the 13 of Spain's 17 regions that voted on Sunday alongside more than 8,000 towns and cities.
Spain has virtually no tradition of compromise politics and the fragmented vote is likely to result in weeks of pact-building in the regions which hold substantial devolved power and determine spending in key areas like education and health.
"Market sentiment towards Spain may be favourable but the political scene is becoming a lot more fragmented, boding ill for the formation of a stable and strong government after the parliamentary vote later this year," said Nicholas Spiro, analyst at Spiro Sovereign Strategy.
"Burnt out"
The PP got its worst result in countrywide municipal elections since 1991 and lost its absolute majority in regional bastions Madrid and Valencia, where potential left-wing coalitions could send the party into opposition for the first time in 20 years.
Read MoreHas Europe's populist tide peaked?
"I used to vote for the PP but they are burnt out, they have been in power for too long. It's time to clean the slate," said Nacho, a 56-year-old doctor in Valencia who voted for Ciudadanos.
At the PP headquarters in Valencia, dozens of shell-shocked supporters, many of them young activists, fought back tears as they received the news their party would also likely lose control of the city to a left-wing coalition.
In Madrid city, where there has been a PP mayor since 1991, Rajoy's party marginally beat a leftist platform backed by Podemos and headed by 71-year-old retired judge Manuela Carmena. But there as well the Podemos-backed alliance is likely to team up with the Socialists to win power.
Podemos, often compared to Greek radical left party Syriza, had toned down its policies in recent weeks, scrapping more extreme ideas like defaulting on the national debt.
Read MoreWealth gap widens in developed world
"It's time for total change," said 31-year-old teacher Natalia Cendejas in Madrid's old quarter, Lavapies, where immigrants and the working class rub shoulders with bohemians and tourists.
In Barcelona, another left-wing coalition headed by former community activist Ada Colau and backed by Podemos beat pro-independence parties Convergencia i Unio (CiU) and Esquerra Republicana de Catalunya (ERC), in a setback for the Catalan separatist movement.
"The people have won here, not a bunch of initials," Colau said to cheering supporters, referring to the scramble of initials representing traditional Spanish political parties.
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54a47825d75a026b1982dc7bdac3c61a | https://www.cnbc.com/2015/05/25/thai-military-has-limited-time-former-pm.html | Thai military has limited time: Former PM | Thai military has limited time: Former PM
VIDEO5:1605:16Ex-Thai PM: Time to end constitutional debateSquawk Box Asia
A year after the military took power in Thailand, the regime has postponed elections but the country's former Prime Minister warns the junta may be running on limited time.
"I have always been supportive of a referendum and I think it's important that rules in the form of a constitution should be approved by the people," Abhisit Vejjajiva, former Prime Minister of Thailand, told CNBC. But "the last thing the country wants a year from now is to still be debating about the constitution…it's time that we move on," he said.
One year after the army took power in a coup, the military government is promising to hold a referendum on a new constitution that will pave the way for elections in early 2016. However, on May 19, Prime Minister Prayuth Chan-ocha conceded that holding a referendum would delay the general elections.
"I said it should be around beginning of the year, April or May, but if we have to do a referendum it should be pushed back by around three months," Prayuth said, according to a Reuters report.
The military government is making concessions and has, for the sake of appearances and in response to concerns from the business sector, recently revoked martial law and decided instead to rule through an emergency provision of the interim constitution, Human Rights Watch Asia advocacy director John Sifton said in a blog.
"Anybody who wants to make a long term commitment, who wants a certain degree of certainty as to where Thailand is heading – they don't have that, and until we have the final part of road map, that's not going to return," said Abhisit, who was in office between 2008 and 2011.
Economy stalled
Foreign investors, in particular, have continued to flee, and have sold $270 million of Thai stocks so far this year, and have offloaded $4 billion worth of equities since the political crisis started with mass street protests in November 2013, according to Morgan Stanley.
Kevin Winter | Getty Images
Neither has military rule helped Thailand's economy.
Gross domestic product in 2014 grew by just 0.7 percent on-year, a sharp contraction from the growth of 2.9 percent in 2013 and 6.50 percent in 2012.
Things are beginning to look up, but only a little.
In the first quarter of 2015, the economy grew a seasonally adjusted 0.3 percent from the previous quarter, above expectations for a contraction, but analysts said that was due to revising the October-December period's figures lower.
The government is forecasting growth of between three and four percent for 2015, but that may be optimistic, according to analysts.
Domestic demand fell off a cliff after the coup and a recovery in a "post-coup environment tends to be more subdued than during a regular growth cycle," the bank said in a note last week. Coupled with the high levels of debt accumulated by the private sector, "there is unlikely to be much pent-up demand to look forward to," said Morgan Stanley. The bank is projecting growth of between 2.6 and 3.6 percent for 2015.
"The business world can accept short term pain if at end of that, we move to a more transparent system," said Abhisit.
But "until we have the final part of road map, [investors are] not going to return. I think you have to accept that's a fact of life... which is why I think even the regime recognizes it has limited time," he said.
---Leslie Shaffer contributed to this article
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d45a0ccb85f8c84c9ffc113233a47b70 | https://www.cnbc.com/2015/05/26/19-famous-companies-that-originally-had-different-names.html | 19 famous companies that originally had different names | 19 famous companies that originally had different names
As they say: It's all in the name.
In many cases, a brand's name can make or break it. Did you know that many household-name companies actually started out with completely different names? Here's a list of some of the biggest brands you may not have known any other way.
1. Quantum Computer Services » AOL
Founded in 1985, Quantam Computer Services was renamed America Online in October 1991. In April 2006, America Online officially adopted its AOL abbreviation exclusively.
2. BackRub » Google
Back in 1996, the world's number one search engine was created under the name "BackRub." Creators Larry Page and Serge Brin's renamed their business and technology Google in 1998. It's "a play on the word 'googol,' a mathematical term for the number represented by the numeral 1 followed by 100 zeros. The use of the term reflects their mission to organize a seemingly infinite amount of information on the web, says Google.
3. Sound of Music » Best Buy
Sound of Music, an electronics store specializing in high fidelity stereos, was founded in 1966, pulling in $1 million in revenue and about $58,000 in profits in its first year. In 1981, Sound of Music's largest and most profitable store was hit by a tornado. The store then held a "Tornado Sale" of damaged and excess stock in the store's parking lot; the company advertised the sale by promising "best buys" on everything. Sound of Music made more money during this "best buy" four-day sale than it did in a typical month – thus, the store was renamed to Best Buy in 1983.
4. Apple Computers » Apple, Inc.
Founded in 1976, the tech giant we know today as Apple was originally named Apple Computers by founders Steve Jobs, Ronald Wayne and Steve Wozniak. In 2007, Jobs announced that the company was dropping the word "Computer" from its name to better reflect their move into a wider field of consumer electronics. "The Mac, iPod, Apple TV and iPhone. Only one of those is a computer. So we're changing the name," he said.
Read MoreApple crowned world's top brand—but watch Alibaba
5. Research in Motion » Blackberry
Founded in 1984, Research in Motion was the first wireless data technology developer in North America. In January 2013, the company announced that it would change its name to BlackBerry after the widely known smartphone device in an effort to revive the declining brand.
6. Brad's Drink » Pepsi-Cola
Back in 1893, a North Carolina pharmacist named Caleb Bradham started experimenting with a few soft drink recipes. One of these bore his name: "Brad's Drink." In 1898 Brad's Drink was renamed to Pepsi-Cola and would become one of the world's most recognized brands.
7. Tokyo Tsushin Kogyo » Sony
Established in 1946, a radio repair shop was founded under the name Tokyo Tsushin Kogyo and was responsible for Japan's first transistor radio in 1955, and the world's first transistor television in 1960. The company name was changed to Sony Corporation in 1958.
8. Starbucks Coffee, Tea and Spice, Il Giornale Coffee Company » Starbucks
With a name inspired by Moby Dick, "Starbucks Coffee, Tea and Spice" was established in 1971. In 1983, Howard Schultz, Starbucks' CEO, left the company for a short period of time to start his own Italian-style coffeehouses under the name Il Giornale. Four years later, he purchased the original company and chose to bring back the Starbucks name.
9. Blue Ribbon Sports » Nike
Nike was formerly known as Blue Ribbon Sports and originally operated as a distributor for the Japanese shoemaker Onitsuka Tiger. Initially founded with just $1,200 in the bank, the company later took on the name Nike – after the Greek goddess of victory.
10. DrivUrSelf » Hertz Rent-A-Car
John Hertz bought a car-rental operation from founder Walter L. Jacobs in 1923. Hertz, the president of Yellow Cab and Yellow Truck and Coach Manufacturing Company, took on the company under the name Hertz Drive-Ur-Self. The company was acquired in 1926 by General Motors Corporation and was later bought by Omnibus Corporation before taking on a new name – The Hertz Corporation.
11. AuctionWeb » eBay
Launched in 1995, eBay was initially named AuctionWeb – one of four sites housed under founder Pierre Omidyar's umbrella company called eBay Internet. The other three sites included a travel site, a personal shipper site and a site about the Ebola virus. Spurred by the media referring to AuctionWeb as eBay, the company made the name change official in 1997.
12. Computing Tabulating Recording Corporation » IBM
The company we now know as IBM was founded in 1911 as the Computing-Tabulating-Recording Company (CTR) through a merger of the Tabulating Machine Company, the International Time Recording Company, and the Computing Scale Company. CTR was eventually changed to "International Business Machines" in 1924 – the abbreviation IBM shortly followed.
13. Marafuku Company, Nintendo Playing Card Company » Nintendo
Created in 1889, the playing cards company Marafuku Company changed its name to Nintendo Playing Card Company in 1951. The company changed its name to Nintendo in 1963 and started manufacturing games in addition to playing cards.
14. Pete's Super Submarines » SUBWAY
In 1965, Pete's Super Submarines opened in Bridgeport, Connecticut selling 312 sandwiches on the first day. One year later, the company's name changed to Doctor's Associates Inc., after co-founder Dr. Peter Buck, who held a Ph.D. and hoped to earn enough money in the sandwich business to pay his college tuition. After little success under the two previous names, Buck and co-founder Fred DeLuca gave it a third try using the name Subway.
15. Wards Company » Circuit City
The first Wards Company store was opened in 1949 by Samuel S. Wurtzel. The name "Wards" was actually an acronym of the founder's last initial and the initials of members of his family: W = Wurtzel; A = Alan; R = Ruth; D = David; S = Sam. Wards experimented with several retail formats, including smaller mall outlets branded "Sight-n-Sound" and "Circuit City." Sight-n-Sound and Circuit City stores were eventually replaced by the Circuit City Superstore format. Wards Company officially changed its name to Circuit City and became listed on the New York Stock Exchange in 1984.
16. Stag Party » Playboy
The infamous Playboy magazine almost bore a different name. Hugh Hefner has said that he wanted to call his magazine Stag Party but changed it to Playboy as a last minute decision. "I wanted to call the magazine Stag Party, influenced by a cartoon book that I had. I was looking for a male figure of some kind and I thought of an animal in tuxedo will set us apart," Hefner said in an interview. One month before publishing, Hefner received a letter from Stag magazine saying that the name was an infringement on their title – he quickly changed the name to Playboy.
Getty Images
17. Firebird » Firefox
Mozilla's famed browser hasn't always held this widely-known moniker. The company came to find that the name Firebird was also in use by another open source project and wanted "to be responsive to the concerns of fellow open source developers." Another name for the red panda, the name Firefox seemed to meet all of the company's needs: "It's similar to Firebird. It's easy to remember. It sounds good. It's unique. We like it," the company said.
18. Confinity » PayPal
Initially founded as a Palm Pilot payment and cryptography company back in 1998, Confinity was named to "merge the words confidence and infinity." One year later, the company was renamed PayPal after a Confinity engineer developed an online demo that allowed people to email payments. The company was later acquired by eBay for $1.5 billion in July 2002.
19. Jerry's Guide to the World Wide Web » Yahoo
Co-founders Jerry Yang and David Filo were PhD students at Stanford when they created what would become one of the world's largest search engines. "Jerry's Guide" was soon renamed to Yahoo, which stands for "Yet Another Hierarchical Officious Oracle."
Want more? Here are 13 well-known logos with hidden images.
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fc9ca437379f10db17899ad4a5549308 | https://www.cnbc.com/2015/05/26/charter-agrees-to-buy-time-warner-cable-for-195-a-share.html | Charter agrees to buy Time Warner Cable for $195 a share | Charter agrees to buy Time Warner Cable for $195 a share
VIDEO4:3204:32Charter strikes a deal to buy TWC
VIDEO1:5001:50Charter to buy Time Warner Cable for $55 billionSquawk Box
VIDEO2:5102:51Pro buyer of Charter Communications hereSquawk Box
VIDEO2:3202:32Charter to pay $100/share cash plus 0.54 sharesSquawk Box
VIDEO0:3700:37Charter and Time Warner Cable make it official
Charter Communications confirmed Tuesday it will purchase Time Warner Cable for $55 billion in a deal that would merge the second and third biggest U.S. cable companies and create a larger rival to Comcast Corp.
The deal values each Time Warner Cable share at about $195.71 based on Charter's closing price on May 20, the companies said in a statement. The transaction will include a $2 billion breakup fee.
Time Warner Cable shares were up around 5 percent in premarket trading; Charter's were up slightly.
Charter also announced it would acquire Bright House Networks, the sixth-largest U.S. cable company, for $10.4 billion. The combined companies could have as many as 23 million total customers, just behind Comcast's 27.2 million customers. (Comcast owns NBCUniversal, CNBC's parent company.)
Bright House and Charter had extended their merger talks after Comcast's deal with Time Warner Cable fell through. Charter's previous agreement with Bright House was contingent on Comcast's completion of the buyout of Time Warner Cable.
CNBC's reported details of the impending deal on Monday.
The announcement comes a month after Comcast dropped plans to purchase Time Warner Cable for about $45 billion. That deal faced challenges from the Federal Communications Commission, which was concerned the combined companies would exercise to much control over broadband Internet networks.
The price Charter will pay represents a 23-percent premium over the Comcast deal. Matt Harrigan, cable and satellite analyst at Wunderlich Securities, told "Squawk Box" that Time Warner Cable CEO Rob Marcus and his team deserve credit for turning around customer count since the Comcast agreement was struck.
Time Warner Cable reported a 3.5 percent rise in revenue as it added more residential video and high-speed data subscribers than expected in its latest quarterly report. It also added a net 30,000 residential video customers in the first quarter, more than double the 11,800 market research firm FactSet StreetAccount had estimated.
"Certainly there will be some synergies here, but when you look at where it was a year and a half ago, when it was really bleeding video customers, and you were absolutely dead in the water on broadband, I think probably $140 or so was about the right price [then], because there was a lot of risk," Harrigan said. "I think some of that perception of risk has dissipated."
Read More It's time to embrace online video: Time Warner Cable CEO
Investors should not entirely discount risk because the cable industry may see competition heat up even more, he added.
A merger of Charter and Time Warner Cable, with other related deals, would eliminate one of the country's top Internet providers and control more than 20 percent of the broadband market, according to data from MoffettNathanson.
The Comcast-Time Warner Cable deal rejected by regulators would have created a provider with roughly 40 percent of the U.S. high-speed Internet market.
Charter hopes its deal for Time Warner Cable will be viewed more favorably by regulators. FCC Chairman Tom Wheeler reached out to the chief executives of the two companies last week to convey that the agency is not opposed to any and all cable deals, The Wall Street Journal reported. Any deal would be considered on its own merits, the paper quoted Wheeler as saying.
Read MoreGuess what Big Media pitched the ad guys
"The FCC reviews every merger on its merits and determines whether it would be in the public interest," Wheeler said in a statement Tuesday. "In applying the public interest test, an absence of harm is not sufficient. The Commission will look to see how American consumers would benefit if the deal were to be approved."
Wunderlich Securities has a pretty high degree of certainty that the deal will get done, Harrigan said. "I think it could be conceived as pro-competitive, and certainly offer more diversity of choice."
—CNBC's David Faber and Reuters contributed to this story.
—Disclosure: Comcast owns NBCUniversal, the parent company of CNBC and CNBC.com. Harrigan does not own shares of Time Warner Cable or Charter Communications. His firm does not hold greater than a 1 percent share in the stock and does not provide investment banking services to either company.
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f005d2318162509a5b5b324528b6b815 | https://www.cnbc.com/2015/05/26/cnbc-digital-video-exclusive-democratic-presidential-candidate-bernie-sanders-sits-down-with-cnbcs-chief-washington-correspondent-john-harwood.html?__source=ft&par=ft | CNBC Digital Video Exclusive: Democratic Presidential Candidate Bernie Sanders Sits Down With CNBC’s Chief Washington Correspondent John Harwood | CNBC Digital Video Exclusive: Democratic Presidential Candidate Bernie Sanders Sits Down With CNBC’s Chief Washington Correspondent John Harwood
WHEN: Today, Tuesday, May 26
WHERE: CNBC.com's Speakeasy with John Harwood - http://www.cnbc.com/id/102694355
Senator Bernie Sanders of Vermont is the only self-described socialist in Congress. Now he is mounting a longshot bid for the 2016 Democratic presidential nomination against his former Senate colleague Hillary Rodham Clinton, who served most recently as Secretary of State. Mr. Sanders calls for nothing less than a "political revolution" that would use tax policy to reverse what he calls the massive transfer of wealth from ordinary families to the most affluent over the past generation. He sat down to spagehetti and meatballs with John Harwood at a bistro near the Capitol.
A transcript of Speakeasy with John Harwood featuring Senator Bernie Sanders follows. All references must be sourced to CNBC.com:
HARWOOD: People on Wall Street, people in business..some have even likened the progressive/Democratic crusade to Hitler's Germany hunting down the Jews. What do you think when you hear stuff like that?
SANDERS: It's sick. And I think these people are so greedy, they're so out of touch with reality. They think they own the world. And the idea that anybody like me or anybody else are challenging them and say, may be, just maybe there's something wrong when 99% of all new income goes to the top 1%. Oh, this is Hitlerism that you suggest that. What a disgusting remark. If you have seen a massive transfer of wealth from the middle class to the top one-tenth of 1%, you know what, we've got to transfer that back. Radical socialist Dwight D. Eisenhower was president, I think the highest marginal tax rate was something like 90%.
HARWOOD: When you think about 90%, you don't think that's obviously too high?
SANDERS: No. What I think is obscene and what frightens me is, again, when you have the top one tenth of 1% owning almost as much wealth as the bottom 90%. Does anybody think that that is the kind of economy this country should have? Do we think it's moral? You got people not workin' one job. They're workin' two jobs, three jobs. People scared to death about what happens tomorrow. Half the people in America have less than $10,000 in savings.
HARWOOD: Hillary Clinton and Bill Clinton, in the last 16 months, have made $30 million making speeches. What does that kind of money do to a politician's perspective on the struggles you were just talking about?
SANDERS: Well, theoretically, you could be a multibillionaire and, in fact, be very concerned about the issues of working people. Theoretically, that's true. When you hustle money like that, you don't sit in restaurants like this. You sit in restaurants where you're spending-- I don't know what they spend -- hundreds of dollars for dinner and so forth. That's the world that you're accustomed to and that's the world view that you adopt. I am not going to condemn Hillary and Bill Clinton because they have made a lot of money. That type of wealth can, you know, has the potential to isolate you from the reality of the world.
HARWOOD: You and I talked some months ago. You said you were going to take a look at running, and you weren't going to do if it was a fool's errand, it if it wasn't viable. What did you see that made you think it was viable?
SANDERS: There is more discontent and more anger at the establishment – that is the corporate establishment, the political establishment, the media establishment if you like.
HARWOOD: Is Hillary Clinton the establishment?
SANDERS: I think it's hard not to acknowledge that Hillary Clinton is part of the establishment. I think that's hard not to acknowledge.
HARWOOD: I've heard a lot of Democrats say, "It's great that Bernie's running. Of course he won't win the nomination." And I wonder if you have any idea that you're, in the end, gonna be seen as this giant cruise ship is rolling by, and you're in a paddle boat, yelling after it and not making an impact.
SANDERS: John, let me say this. I fully concede that I get into this race as a major underdog. No question about it. I've said before though, don't underestimate me. I think we're gonna do better than people think. And I think we got a shot to win this thing.
About CNBC:
With CNBC in the U.S., CNBC in Asia Pacific, CNBC in Europe, Middle East and Africa, CNBC World and CNBC HD , CNBC is the recognized world leader in business news and provides real-time financial market coverage and business information to approximately 371 million homes worldwide, including more than 100 million households in the United States and Canada. CNBC also provides daily business updates to 400 million households across China. The network's 15 live hours a day of business programming in North America (weekdays from 4:00 a.m. - 7:00 p.m. ET) is produced at CNBC's global headquarters in Englewood Cliffs, N.J., and includes reports from CNBC News bureaus worldwide. CNBC at night features a mix of new reality programming, CNBC's highly successful series produced exclusively for CNBC and a number of distinctive in-house documentaries.
CNBC also has a vast portfolio of digital products which deliver real-time financial market news and information across a variety of platforms. These include CNBC.com, the online destination for global business; CNBC PRO, the premium, integrated desktop/mobile service that provides real-time global market data and live access to CNBC global programming; and a suite of CNBC Mobile products including the CNBC Real-Time iPhone and iPad Apps.
Members of the media can receive more information about CNBC and its programming on the NBC Universal Media Village Web site at http://www.nbcumv.com/mediavillage/networks/cnbc/.
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d0f4c895063ee3aaa1cae76cfa045f02 | https://www.cnbc.com/2015/05/26/dollar-regains-mojo-on-rate-view.html | Dollar hits 8-year high vs yen, euro firms | Dollar hits 8-year high vs yen, euro firms
Getty Images
The dollar rose against most major currencies on Wednesday, hitting an eight-year peak against the yen on expectations the Federal Reserve would raise interest rates later this year due to signs the U.S. economy is recovering from an anemic first quarter.
The euro recovered from a one-month low versus the greenback following reports of progress between Greece and creditors toward a deal that would unlock cash for the debt-laden nation to avert default.
The dollar's gains were also fed by automatic sell orders for the yen which had traded in a relatively tight range versus the greenback, traders said.
"We broke out of a technical pattern because of the general dollar strength," Marc Chandler, chief global currency strategist at Brown Brothers Harriman & Co. in New York, said of the Japanese currency.
Japanese Economics Minister Akira Amari said earlier Wednesday while recent movements reflected the dollar's gain rather than the yen's fall, excessive currency moves were undesirable, echoing earlier signals from the finance ministry and Bank of Japan.
VIDEO1:4901:49Dollar wrecking ballFast Money
Traders brushed off Amari's comments with the dollar touching a multi-year high of 124.07 yen on the EBS trading system. It last traded up 0.71 percent at 123.86 yen.
The euro's bounce against the dollar was modest, however, as European officials downplayed a Greek debt accord was near.
"All those comments have to be taken with a big pinch of salt, but it's helping there are signs we are moving toward a deal," said Charles St. Arnaud, currency strategist at Nomura Securities International in New York.
The euro fell earlier on revived view that the U.S. currency would push toward parity with the European Central Bank's plan to accelerate its bond purchases for its 1.1 trillion euro quantitative easing program.
Read MoreGuess who's back? Dollar shines
The euro was last up 0.08 percent at $1.08905 after touching one-month low of $1.0819 earlier on the EBS platform.
Renewed enthusiasm in the greenback boosted the dollar index to its highest in more than a month at 97.775. It was last up 0.08 percent at 97.37.
Tuesday's better-than-expected U.S. data on core business spending, new home sales and consumer confidence failed to renew bets the Fed would end its near zero rate policy at its June meeting, but they supported the notion it would do so by year-end, analysts said.
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7e7b0cb5ff532ac3939e4c13e9fe0f03 | https://www.cnbc.com/2015/05/26/procter-gamble-explores-3d-bioprinting.html | Procter & Gamble puts skin in 3D bioprinting game | Procter & Gamble puts skin in 3D bioprinting game
Procter & Gamble headquarters in Cincinnati.Getty Images
Forget 3D printing of cheap plastic figurines and toys, the next frontier for the technology involves printing living human tissue.
Procter & Gamble has become the latest household name to explore 3D bioprinting, which could provide a quicker and cheaper way to test its products for toxicity and efficacy.
The world's largest consumer goods company will on Tuesday launch a grant competition in Singapore, asking academics to submit research proposals on 3D bioprinting applications that would be relevant to P&G.
"We want to look at the possibilities of bioprinting. It's definitely a very strong emerging area," said Professor Elena Lurie-Luke, who heads up P&G's Global Life Sciences Open Innovation business.
Bioprinting works by taking cultured human cells and forming a bio-ink, which is then placed into cartridges that contain a syringe fitted with an extrusion nozzle for printing.
VIDEO6:3706:37The future of 3D printingInvesting Edge
The bioprinter deposits a pattern of cells in layers, interspersed with a water-based gel known as hydrogel that is used as a kind of scaffolding for the cells. The printed tissue is then left to grow naturally, and the hydrogel removed.
P&G is not the only company eyeing up the emerging technology. L'Oréal, the French cosmetics group, said earlier this month it was partnering with US bioprinting start-up Organovo to 3D print human skin.
L'Oréal already has a laboratory in Lyon, France, which focuses on producing in vitro skin tissue. It was set up in 2011 to expand L'Oréal's use of the method as cosmetics companies began moving away from animal testing.
Read MoreHow we're fighting the strong dollar impact: P&G
"We have a number of different in vitro skin models we're working on because we are very involved in beauty care. If companies are doing innovation and interested in new tools then bioprinting should very much be on their horizon," said Ms Lurie-Luke.
Bioprinting is also being looked at by pharmaceuticals companies as a way of speeding up and lowering the cost of drug development and testing. Organovo, the world's first publicly traded 3D bioprinting company, has developed living liver tissue for medical and drug research and clinical trials.
Some experts believe it could also one day be used to produce replacement organs for patients desperately in need of a transplant — but this is unlikely to become a reality in the next 20 years.
While conventional 3D printing of plastics has been around since the 1980s, bioprinting is still in the early stages of development. The technology is currently being used for research, but a few companies — such as Organovo — are attempting to commercialise the production of bioprinted tissues.
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3D printing helps to speed up the tissue-making process and make it more precise. Previously scaffolds were created by hand — or 3D printed — and then the cells were positioned using a handheld pipette.
P&G's new grant is part of a five-year S$60 million scheme with the Singapore government's Agency for Science, Technology and Research. It is open to any of the country's research institutes.
"There's a lot of interest from both consumer goods companies and big pharma in bioprinting. P&G's strategy to launch a grant competition is probably a very cost effective way of trying to get a snapshot of all the possibilities," said Brian Derby, professor of materials science at the University of Manchester.
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c60258f931e5e429c3e5eab07cc163d3 | https://www.cnbc.com/2015/05/26/samsung-galaxy-s6-edge-gets-a-superhero-makeover.html | Samsung Galaxy S6 Edge gets a superhero makeover | Samsung Galaxy S6 Edge gets a superhero makeover
VIDEO0:3300:33Samsung launches Iron Man phone
Marvel fans, this one is for you.
Samsung Electronics launched a limited Iron Man edition of its Galaxy S6 Edge on Tuesday, in the company's latest push to promote its curved screen smartphone.
The 64GB device features the signature red and gold color scheme of Iron Man with a matching wireless charger.
"The limited edition Iron Man Galaxy S6 edge embodies the power of the iconic Avenger with a dual-curved edge design and advanced features that will provide Marvel fans with the ultimate entertainment experience," Younghee Lee, executive vice president of global marketing, IT & Mobile Division at Samsung Electronics, said in a statement.
VIDEO0:3200:32Samsung's retention rate risingEnterprise
The phone will be available in Korea on May 27 and in China and Hong Kong in June.
As Samsung's smartphone business flounders amid stiff competition from arch rival Apple and low-cost Chinese handset manufactures, its latest Iron Man Galaxy S6 Edge could help generate some fresh buzz around its offerings.
Read MoreSamsung's challenge to the Apple Watch revealed
"If someone wants to buy me the new Iron Man Samsung S6 I would love you forever #forreal," wrote one user on Twitter.
"Looks pretty cool! Even if I would never buy a #samsung mobile... ;)," another commented.
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5bf004fe800b106ebd2260241ffa9d32 | https://www.cnbc.com/2015/05/26/the-ice-bucket-manufacturing-challenge.html | How Mr. Ice Bucket is freezing out the competition | How Mr. Ice Bucket is freezing out the competition
VIDEO1:3301:33The real ice bucket challengeMade in America
You will find an ice bucket in every hotel room, but you have probably never given it much thought. Unless you're Fred Haleluk, the CEO and president of Mr. Ice Bucket, a New Brunswick, New Jersey-based company that manufactures ice buckets in the United States.
For 50 years, Mr. Ice Bucket has been the oldest continuously managed ice bucket manufacturing facility in the world. Its claim to fame: They use only local U.S. artisans, who are passionate about churning out a high-quality product.
And high-end hotel chains are their biggest customer. If you have stayed at well-known hotels such as the Venetian, Trump properties or Marriott, you may find the smiley Mr. Ice Bucket logo on the bottom.
"We sell between 150,000 to 210,000 ice buckets in a year ... and most of the volume comes from the hotel industry," Haleluk said. His company brings in more than $7 million in sales, with ice buckets retailing between $20 and $75.
We've been promoting 'Made in America' big-time. We go out of our way to say it. In the beginning, nobody cared, really. But I can say in the last three years, people care.Fred HalelukCEO and president of Mr. Ice Bucket
In 1965, when Haleluk founded Mr. Ice Bucket, he had 13 competitors in the U.S. After buying out seven of his competitors, including Lancaster Colony's ice bucket division, Haleluk now owns one of the only two companies to manufacture ice buckets in the country. He told CNBC he controls about 50 percent of the U.S.-made market.
But about a decade ago Mr. Ice Bucket started to see sales melt as overseas imports, especially from China, started entering the market, at a much lower cost.
Haleluk said the quality of these imports simply does not compare to his company's. "The quality is like night and day. I never worry about a Chinese product at all. It's when I have to sell on price that we can't sell on price at all," Haleluk told CNBC.
Read MoreAn outfitter says good-bye to the Letterman show
In fact, the new push for Mr. Ice Bucket is to expand into more retail stores after Wal-Mart and Target stopped carrying the brand after they were undercut by imports from China.
Approximately 60 percent of Mr. Ice Bucket's sales are to hotels and 30 percent to retail stores, including Nordstrom and online retailer Amazon.
A worker adds a liner and handle at the Mr. Ice Bucket factory in New Brunswick, New JerseySource: CNBC
To put a chill on the overseas competition, Mr. Ice Bucket began promoting the "Made in America" aspect of its operations over the past decade. But it's not just a logo—there are logistical advantages for customers as well.
Because the raw materials, such as vinyl and cardboard, are sourced from the U.S. and manufacturing is done at two factories in the U.S.—one in New Brunswick, New Jersey, and the other in Jackson, Ohio—customers can get their ice buckets quickly. "We can manufacture a bucket and send it out the same day if we have to," Haleluk said.
The quick turnaround time is especially helpful for hotel customers, because due to hotel budgets, ice buckets are often one of the last things ordered, Haleluk said. "We do more rush orders for hotels, I think, than any product out there. All of a sudden we'll get a call and they say, 'Can you make 423 ice buckets and get them to us within five or six days?'"
There's another reason that ice buckets are always in high demand among hotel customers.
"We found that the more popular or prestigious the hotel is … that people take the ice bucket as a souvenir. ... They're the type of hotel that gives us a lot of repetitive business," Haleluk said.
Mr. Ice Bucket is now starting to see more retail business and he's even been invited back to show his product to Wal-Mart and is hopeful that the retail giant will make an order.
"We've been promoting 'Made in America' big-time. We go out of our way to say it. In the beginning, nobody cared, really. But I can say in the last three years, people care," Haleluk said.
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e9077038ed9ad0630083662ed45083be | https://www.cnbc.com/2015/05/27/mortgage-applications-drop-16-as-refinancing-stalls.html | Mortgage applications drop 1.6% as refinancing stalls | Mortgage applications drop 1.6% as refinancing stalls
With the average rate on the 30-year fixed mortgage now decidedly above four percent, borrowers are pulling back from refinances and struggling to make home purchases during a historically busy time of year for housing.
Total mortgage application volume fell 1.6 percent on a seasonally adjusted basis from one week earlier, for the week ending May 22, according to the Mortgage Bankers Association (MBA). While volume is still higher than a year ago, it has fallen 10 percent in the last four weeks.
Read MoreUS new home sales,prices rise strongly
"Mortgage rates continued to climb last week due to stronger home sales, rising inflation, and further signals that the Fed is likely to raise their target rate this year. Refinance volume dropped to its lowest level since January," said Michael Fratantoni, chief economist for the MBA.
Applications to refinance, which are extremely rate-sensitive, fell 4 percent from the previous week and the refinance share of total applications fell to 51 percent. This as the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.07 percent from 4.04 percent, with points increasing to 0.35 from 0.32 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.
After sitting unchanged for two weeks, purchase activity picked up very slightly, led by low or no down payment Veterans Administration (VA) loans. Purchase volume rose one percent week to week and is now 14 percent higher than the same week one year ago. VA loans made up 12 percent of total application volume, indicating that the least expensive loans are becoming a growing share.
Read More7 major housing markets now 'overvalued'
Mortgage rates have not moved much in the past few days but have been plenty volatile in the past few weeks. Increasing talk of higher rates in the second half of this year has some analysts suggesting that buyers who need to borrow had better do it now. While rates have surprised to the downside in the past year, this particular rise appears to be more stubborn.
"Rates have made several attempts to move lower after spiking in early May, but each time they've quickly run out momentum," noted Matthew Graham of Mortgage News Daily. "Underlying market conditions are once again signaling a bounce attempt is underway, but it's not safe to plan on the good times continuing until/unless we see several days in the near future with even stronger improvements."
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3439bae678531b207beacde5b0fc93cd | https://www.cnbc.com/2015/05/27/power-pitch-revamping-radio.html | A start-up revamping radio | A start-up revamping radio
VIDEO5:3005:30Revamping radioPower Pitch
A new start-up aims to turn the dial on the radio industry.
Hitch Radio founder Ayinde O. Alakoye said, "Radio's heard by 94 percent of the U.S., but its live nature makes it really hard to share, so we've created Hitch Radio, the world's first instant messaging app for live broadcast radio."
Alakoye's goal is to capitalize on what he calls radio's flawed distribution model. And he says he has the chops to pull it off. He's a former radio ad sales executive and one of the original creators of the iHeartRadio.
In his latest venture, Hitch Radio, listeners get access to 20,000 stations around the world via their smartphones. Users can search by song, artist or genre. But unlike other music apps, Hitch Radio users can instant-message their friends about what they're listening to. If the message goes unopened within 3 minutes, which happens to be the average length of a song, the message disappears.
Richard Price | Getty Images
Hitch Radio is available on both iOS and Android and is free to use.
Nat Burgess, an angel investor and CEO of the Corum Group, is concerned the app is "immature."
He cautioned that the start-up would "live and die" based on its ability to nab listeners.
Hitch Radio allows users to sync up with their friends.Source: Hitch Radio
Alakoye told CNBC he expects to nab more users by getting "star drivers". So a Katy Perry fan could essentially 'hitch a ride' in real time with Perry to hear what she's listening to. He would not disclose any celebrities he's in talks with.
Jessica Peltz, a venture capitalist with KBS Ventures, said the music industry's notorious legal challenges could pose a threat to the start-up.
But the founder said he's not concerned. "Our business model is that we pay radio stations 75 percent of our revenue and they actually pay 100 percent of the royalties to the artist for every song that's played, so there's no royalty challenge for us," Alakoye told CNBC.
According to Alakoye, since launching in March, the Hitch Radio app has hit over 15,000 downloads. "We anticipate being profitable within the next 12 months," Alakoye said.
He added that the company has an advertising deal with Google. He said the internet giant will also provide engineering resources to help build out the Hitch Radio app.
So far the start-up has raised $2 million dollars and is looking to raise $6 million in its seed round.
—Comments, questions, suggestions? We'd love to hear from you. Follow us @CNBCPowerPitch and join the #PowerPitch conversation.
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384cd237b2b6cdbc1bfb9c60124170e3 | https://www.cnbc.com/2015/05/27/robots-learn-to-adapt-to-damage-the-way-animals-do.html | Robots learn to adapt to damage the way animals do | Robots learn to adapt to damage the way animals do
A group of computer scientists has a found a way to allow robots to adapt to handicaps in much the same way animals and humans do.
A robot automatically learns to keep walking after damage via a newly invented "Intelligent Trial & Error'" algorithm.Source: Antoine Cully/UPMC
If it works, it could mean that less-fragile robots will be better able to work in a wider range of jobs in more treacherous conditions, from building to bomb detection. It also could mark a big step toward creating robots that learn.
Robots have the potential to perform better than human beings at tasks in fields as varied as medicine, manufacturing and even the military. But they lack several key traits of humans and animals, and one of them is the ability to learn how to quickly get back to work when something goes wrong.
Read MoreGood news for America's workers: You matter again
A person who loses the use of an arm can swiftly learn to use the other arm to compensate. A dog that loses a leg can still walk reasonably well on the other three. (Tweet This)
But a broken limb can render a robot completely useless, because most robots do not know how to work around injuries.
Some current methods used with robots involve running diagnostic tests to figure out what is wrong with a broken robot, which can be time-consuming and may require an engineer. Other methods involve a robot testing which out of every possible behavior might compensate for damage. Since there can be an incredibly large number of actions a robot can take, that method can also take a long time.
So scientists at Pierre and Marie Curie University in France and the University of Wyoming gave a robot the sorts of tools animals use to learn—a range of previous experiences to draw on for understanding, and a way of predicting which behaviors are most likely to work in a given situation.
The team published the results in the journal Nature on Wednesday.
The robots in the study were equipped to run simulations that plotted out the best possible actions they could take to perform a task such as walking. The robots ran the simulations when they were first deployed, so they already had the information on hand. The robots were not simply storing information on all of the possible ways they could walk—they were actually predicting the effectiveness of different styles of walking.
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One six-legged walking robot ranked 13,000 styles of walking based on their effectiveness. Once damaged, the robot was able to begin testing the walking styles it predicted to be most effective, slowly ruling out options until it arrived at the best choice.
That's similar to the kind of knowledge animals have—humans, for example, don't simply try new ways of walking at random. Past experience helps them choose the kinds of gaits that are going to be most comfortable, and quickest. The same goes for just about any action animals perform.
That knowledge about which actions are likely to work best is what separates the team's new method from most of those currently available, according to the researchers. They even refer to it as a "simulated childhood," because it mimics the kinds of memories that enable animals to learn new behaviors.
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"Once damaged, the robot becomes like a scientist," said lead author Antoine Cully in a press release. "It has prior expectations about different behaviors that might work, and begins testing them. However, these predictions come from the simulated, undamaged robot. It has to find out which of them work, not only in reality, but given the damage. Each behavior it tries is like an experiment and, if one behavior doesn't work, the robot is smart enough to rule out that entire type of behavior and try a new type."
The team was able to get their six-legged robot to walk well again in only a few minutes after two of its six legs were broken.
The researchers said their method is faster and cheaper than many existing techniques because it does not require the robot (or its operator) to diagnose a problem—the robot is only measuring its performance, so it simply figures out what other action will work best as its circumstances change.
Read More
The team said its research could work for any kind of action a robot takes. They noted, for example, that robots could become far more effective in search-and-rescue missions. A robot damaged by falling debris could still find a new way to function in a situation where time is short and lives are at stake.
But the team hopes its discovery will allow robots to quickly learn how to do anything. (Tweet This)
"Until now, nearly all approaches for having robots learn took many hours, which is why videos of robots doing anything are often extremely sped up," the team wrote in a statement attached to the study. "Watching them learn in real time was excruciating, much like watching grass grow. Now we can see robots learning in real time, much like you would watch a dog or child learn a new skill."
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2889098ac66d9759cd5a0b5348190f73 | https://www.cnbc.com/2015/05/27/tiffany-posts-earnings-that-top-expectations.html | Tiffany earnings, revenue top estimates | Tiffany earnings, revenue top estimates
VIDEO0:3400:34Tiffany gets its sparkle backLuxury
Tiffany on Wednesday delivered quarterly earnings and revenue that topped analysts' expectations.
The company's net income fell to $104.9 million, or 81 cents per share, in the first quarter ended April 30 from $125.6 million, or 97 cents per share, a year earlier.
Revenue fell to $962.4 million from $1.07 billion a year ago, as a strong dollar discouraged tourists from spending in its U.S. stores and reduced the value of overseas sales.
Analysts expected the retailer to report earnings of 70 cents per share on $919 million in revenue, according to a consensus estimate from Thomson Reuters.
While revenue fell year over year, Ike Boruchow, senior research analyst at Sterne Agee, noted that Tiffany beat expectations in every geographic region. He singled out its business in Europe as a bright spot.
"Luxurywise, I think Europe is on sale right now if you look at what the exchange rates have done to the price proposition there. I think you're seeing a lot of tourist flows there," he said on CNBC's "Squawk Box."
Total same-store sales fell 7 percent.
The retailer's shares moved sharply higher in premarket trading following the announcement.(Get the latest quote here.)
Tiffany shares have dropped more than 20 percent this year. The luxury retailer has taken part of that hit since its quarterly results in March, when it reported a decline in revenue on flat holiday sales.
U.S. comps returned to positive territory in the most recent quarter, giving investors a reason to be more confident, Boruchow said.
—CNBC's Terri Cullen and Tom DiChristopher and Reuters contributed to this report.
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e8e7d266cd970100ed65c7a58b58223d | https://www.cnbc.com/2015/05/27/wealthy-need-to-worry-about-health-costs-too.html | Wealthy need to worry about health costs, too | Wealthy need to worry about health costs, too
VIDEO1:2801:28Retire Well: Managing healthcare costsDebt
When it comes to planning for long-term health-care costs, the rich are a lot like most Americans—they haven't given it much thought.
Nearly half of wealthy individuals polled by U.S. Trust say they haven't done much planning for the potential need for long-term care.
However, the wealthy do feel secure about medical costs now and in retirement, with 70 percent saying they feel financially prepared for those costs, according to the new survey. (Tweet this)
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In past surveys, health issues have been top of mind for the wealthy, but even the rich tend to put off planning for long-term care, which is difficult for many of us contemplate, said Chris Heilmann, a managing director at U.S. Trust.
Getty Images
The wealthy are willing to invest in maintaining their health, he said. More than half expressed an interest in getting full-body scans and genetic screening in order to assess their health, according to U.S. Trust's 2015 "Insights on Wealth and Worth." The survey questioned 640 individuals with more than $3 million in investible assets.
The trend toward testing was especially pronounced among high net worth millennials, who were the most likely to explore testing and have a doctor on retainer through concierge medicine.
Read MoreWorried about outliving your money?
However, scans and screenings can only go so far. When it comes to long-term care health care in retirement, 32 percent of those surveyed expect to stay in their homes with private home care, while 1 in 5 expect to be cared for by a loved one in their homes.
Long-term care can come with a hefty price tag, which is why U.S. Trust urges wealthy clients to consider elder care planning assistance with third-party providers who assist with issues like home care services and nursing home selection.
"It's a bigger financial impact and a bigger toll simply because the costs of health care and long-term care continue to escalate," Heilmann said.
Independent wealth advisor Debra Brede said many of her clients expect their wealth will allow them to effectively self-insure their long-term care health costs. But even for a couple with assets of $2 million, the toll of long-term care can derail financial plans, she said.
"The drag is on the remaining spouse, the one that's not sick," said Brede, president of DK Brede Investment Management outside Boston. "When the other one passes on and uses up a lot of the funds, the one that hasn't gone through it is the one that's going to suffer later."
"Don't look at long-term care or health issues as just financial," concurred Heilmann. "Look at them in terms of your family and the social dynamics that would result from that."
Financial advisors say long-term care insurance can serve as an important way to help finance home care and nursing home costs. But a number of insurers have limited coverage in recent years, after losing money on mispriced policies over the last two decades.
It is easier to gain coverage when you're young and healthy, often through an employer group plan, but it requires paying in for years and possibly never seeing the benefits.
Read MoreWeighing the pros, cons of long-term-care coverage
For high net worth individuals, another option is a hybrid life insurance plan that allows withdrawals for long-term care.
"There are an array of products from a life insurance standpoint … where you can look at death benefits and you can look at life settlement benefits" to pay for health costs, said Heilmann.
For older individuals, some universal life insurance plans will provide a way to set aside health costs, while offering a way to preserve part of their estate.
"You take a certain amount of money, $100,000 or $200,000 out of your portfolio, and they'll give you a certain amount of coverage," said Brede. "If you don't use it, your heirs will get it back."
"People look at this in terms of 'Yes, I want to be cared for in terms of my long-term care health needs, but I also have an interest in passing assets on to family members.' They also want to engage in philanthropy," said Heilmann. "In other words, they want to do it all."
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4ff21272242018dbc4ec2a2f30c78de4 | https://www.cnbc.com/2015/05/27/will-a-reverse-mortgage-be-your-friend-or-foe.html | Will a reverse mortgage be your friend or foe? | Will a reverse mortgage be your friend or foe?
Your nest egg is small. Your retirement income is limited. And you're sitting on a highly appreciated asset—your home. A reverse mortgage, which lets you convert some of that equity into cash, might just solve the problem.
Depending on your health and financial stability, however, it could also create new ones.
Alberto Pomares | E+ | Getty Images
"Reverse mortgages can be an effective tool for retirees, but the problem is that the interest rates tend to be higher than for other home loans," said Grafton "Cap" Willey, managing director at CBIZ MHM tax accounting and consulting firm. "I've also seen people outlive their ability to take any more equity out of their home and then they're forced to make tough decisions."
Indeed, cash-strapped seniors who spend all their available equity and later fall behind on property taxes and homeowner's insurance, he said, must sell their home and downsize, go back to work if they're able, or face foreclosure.
A reverse mortgage—the federally insured version is called a Home Equity Conversion Mortgage, or HECM—is a loan that enables homeowners age 62 and older to cash out a portion of the equity in their home.
Read MoreThe upsides to downsizing
The amount homeowners can borrow varies by lender but generally is based on age, home value and the interest rate at the time they close.
The National Reverse Mortgage Lenders Association offers an online calculator that gives borrowers a better idea of how much they might be eligible to take out.
As the name implies, the mortgage payment stream under such loans is reversed.
Instead of making monthly payments to a lender, as with a traditional mortgage, the lender pays the borrower, who may receive the proceeds as a lump sum, monthly payment or line of credit.
Your loan balance accumulates over the life of the loan.
VIDEO4:0604:06Protecting your retirement incomeRetirement
There are no restrictions on how the funds may be used, and many seniors opt to pay off unexpected medical bills or renovate their home so they can age in place, Willey said.
Borrowers aren't required to repay their reverse mortgage loan as long as they live in their home. But the balance must be repaid when the last surviving borrower dies, sells the home or moves out.
Thus, if the borrower becomes sick and moves to a nursing home, he or she is required to notify the lender within six months. Most allow for an additional six-month extension, but the loan becomes payable in full after the home has been vacant for 12 months.
"We often tell people that if they are not well and there's a chance they may end up moving to a nursing home in the near future, that a reverse mortgage could be a very expensive way to borrow money for a short-term need," said Lori Trawinski, a certified financial planner and director of the AARP Public Policy Institute.
Interest rates on a reverse mortgage vary by lender, but start at about 4.25 percent for a fixed-rate loan, 2.4 percent for a monthly adjustable and 2.9 percent for an annual adjustable.
Borrowers must also pay an annual mortgage insurance premium, which protects their estate in the event that the future value of their home when they sell is not enough to pay back the reverse mortgage. That adds another 1.25 percent.
As such, the Consumer Financial Protection Bureau advises homeowners to take out only as much money as they need so they don't pay more in interest and mortgage insurance than necessary.
Read MoreRetirees say there's no place like their own home
On top of interest and mortgage insurance premiums, borrowers who assume a reverse mortgage loan will also pay several thousand dollars in closing costs; an appraisal fee, which averages about $450 (appraisal, inspection, lender title policy) and an origination fee.
The maximum origination fee for HECMs is 2 percent of the initial $200,000 of the home's value and 1 percent of the remaining value, with a cap of $6,000.
Some lenders, however, are willing to reduce or waive those fees.
All homeowners should understand both the costs and risks associated with reverse mortgage loans before putting their biggest asset on the line, Trawinski said.
"I think the most important thing to understand about reverse mortgages is that these are loans, and with any loan comes obligations," she said.
Read MoreCan you deal with retirement yet?
Borrowers, for example, must remain current on their property taxes, homeowner's insurance and any annual association fees they may owe. They must also maintain their home in its current condition.
Failure to meet those terms could result in foreclosure.
For that reason, HUD requires homeowners to meet with a HECM counselor before they are approved for a reverse mortgage.
To curb the rising incidence of reverse mortgage foreclosures and restrict seniors from burning through their equity on day one, HUD also implemented a cap in 2013 on the amount borrowers can take out in the first year as a lump sum. Generally, that's 60 percent of their initial principal limit.
An exception is made if you owe an existing mortgage or have other required payments, allowing borrowers to take out enough to pay off their mortgage or other payments (including upfront loan fees), plus cash of up to 10 percent of the initial principal limit.
As of March 2, 2015, HUD required new borrowers to complete a financial assessment to gauge their ability to comply with the mortgage requirements.
HUD examines borrowers' income sources and expenses and also looks at payment histories for property taxes and other financial obligations.
"That's totally new," Trawinski said. "HUD is trying to make sure that people have the ability to sustain ownership, and if they don't have money for property taxes and homeowner's insurance available, they'll require a set-aside of loan proceeds."
We encourage homeowners to ask as many questions as possible. ... Get the advice of a financial advisor, elder attorney or independent expert.Lori Trawinskidirector of the AARP Public Policy Institute
The CFPB advises that, before they apply for a reverse mortgage, homeowners with minimal retirement income first determine whether they qualify for state and local programs, including subsidized housing and utility discounts, that would help lower their bills.
They should also consider whether downsizing to a more affordable home might make more sense.
Trawinski said reverse mortgages are best suited for homeowners who are healthy, intend to stay in their home for the long haul and are financially stable but may need extra cash to supplement Social Security or pay off medical bills.
Read MoreDon't crack your nest egg
Before you pull the trigger, she said, be sure to consider alternatives and make sure you're in a position to comply with the debt obligations.
"We encourage homeowners to ask as many questions as possible and learn what they can," Trawinski said. "If there's something they don't understand, get the advice of a financial advisor, elder attorney or independent expert."
—By Shelly Schwartz, special to CNBC.com
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ab5b77f769ec103913436ff170a636d8 | https://www.cnbc.com/2015/05/28/oil-price-why-further-falls-may-be-on-the-way.html | Oil price: Why further falls may be on the way | Oil price: Why further falls may be on the way
Daniel Acker | Bloomberg | Getty Images
Those hoping for a bit of oil price stability after the past few months' volatility may be disappointed.
Next week's Organisation of Petroleum Exporting Countries (OPEC) meeting is widely expected to be another case of the cartel sitting on its hands, and maintaining levels of oil production despite historically low oil prices.
This shouldn't be any surprise to markets – yet there are other warning signs ahead. After the last meeting in January, crude prices (WTI crude) fell to a six-year low of less than $45 a barrel, then recovered to around $65 a barrel, as the growth in U.S. supply – the main reason why OPEC has been so stubborn about cutting output -- slowed in response to lower prices.
Oil falls below $45 as OPEC plays hardball
And it looks as though OPEC may be getting the result it wished for. The growth in supply from oil producers outside OPEC is forecast to slow from 2.1 million barrels a day b/d) in 2014, to 1.3 million b/d in 2015 and 0.1 million b/d in 2016, according to analysts at UBS.
There have also been huge cuts in capital expenditure at the oil giants, with reductions of between 15-30 percent commonplace as the industry gets to grips with lower prices.
However, the decline in rig count has slowed down recently, indicating that the recent price recovery has led to more optimism among producers, and the decline in production may be levelling off.
VIDEO1:5701:57Energy opportunities: A time of great changeWorldwide Exchange
For Saudi Arabia's plans to undercut producers with higher costs, continued rises in the price will be unwelcome. At last week's level of $65 per barrel, U.S. shale starts looking economical to produce again.
There are other factors suggesting that another fall may be close.
Net long positions – or the most speculative positions - in oil have risen to all-time highs, as analysts at Credit Suisse point out. The last time that speculative positions peaked and started falling, back in June 2014, a 60 percent oil price plummet resulted (although oil prices were much higher then).
Bulls are backing oil price breakthrough
Much of the recent oil price gains can be attributed to the fall of the U.S. dollar, which Keith Parker, head of global asset allocation research for the Americas at Barclays, thinks has boosted the oil price by 6 percent. If the currency in which oil is bought and sold strengthens further, oil should fall again.
However, despite being drowned out by the market's pessimists, there are still some oil price bulls out there - notably analysts at Bernstein, who argue that the shale supply will continue to decline, driving prices up to $85 a barrel next year.
- By CNBC's Catherine Boyle
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6d16f4b6f723acef8cb03745a5daeb23 | https://www.cnbc.com/2015/05/28/paul-singer-this-is-the-new-big-short.html | Paul Singer: This is the new 'big short' | Paul Singer: This is the new 'big short'
VIDEO0:4800:48Billionaire Paul Singer's new 'big short'Squawk Box
Billionaire investor Paul Singer says he has spotted the next big thing to bet against: bonds.
"Today, six and a half years after the collapse of Lehman, there is a Bigger Short cooking. That Bigger Short is long-term claims on paper money, i.e., bonds," Singer wrote in a letter to investors of his hedge fund firm Elliott Management obtained by CNBC.com.
"Bigger Short" is a play on "The Big Short," the book by Michael Lewis describing how a tiny group of investors made huge sums of money for their contrarian bets against mortgage-backed securities before the collapse of the housing market in 2007 and 2008.
VIDEO3:1803:18Bubble in bonds?Halftime Report
Read MorePaul Singer: Economy stinks and Obama, ECB to blame
"Central bankers have chosen, and doubled down on, a palliative (super-easy money and QE), which is unprecedented and extreme, and whose ultimate effects are unknowable," Singer wrote of governments stimulating markets, in part through the purchase of bonds.
Singer has long been a critic of mainstream economic policy, particularly taking on high debt to spur financial recovery.
"Asset prices are skyrocketing because of massive public-sector purchases. The tinkering and experimentation that characterizes each round of novel central bank policy leads to more and more complicated unwanted consequences and convolutions," Singer wrote. "Central bankers are, in our view, getting 'pretzeled' by all this flailing, yet they deliver it with aplomb and serene self-confidence. Are they really taming volatility with their bond-buying, or just jamming it into a coiled spring?"
That makes for risk that many don't see, according to Singer.
"Bondholders ... continue to think," he wrote, "that it is perfectly safe to own 30-year German bonds at a yield of 0.6 percent per year, or a 20-year Japanese bond (issued by the most thoroughly long-term-insolvent of the major countries) at a little over 1 percent per year, or an American 30-year bond at scarcely above 2 percent per year."
The opportunity, then, is to short bonds.
"Today, the Bigger Short is in a much larger marketplace," Singer wrote of bonds compared to subprime mortgages, "so it can be undertaken in whatever size one can stomach, and the cost of effectuating it during the waiting period is really low."
"However," Singer added, "the power of the herd on the current upward bond price stampede is beyond anyone's control, so one can lose money waiting for the trade to work out."
Read MoreOuch! Hedge funders stung by Obama, Clinton barbs
A spokesman for Elliott declined to comment.
The firm managers more than $26 billion and invests across a range of asset classes, including bonds, stocks and commodities. Its main fund, Elliott International Limited, fell 0.5 percent over the first quarter, according to the letter.
The fund has produced annualized returns of 12.3 percent since inception in December 1994, easily beating stocks and bonds over the same period.
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9526079b03680e6d9a931a158342979b | https://www.cnbc.com/2015/05/28/super-luxury-suv-sales-up-44-percent.html | Super-luxury SUV sales up 44 percent | Super-luxury SUV sales up 44 percent
Have a spare $75,000 to spend on a new vehicle?
There's no shortage of choices, but increasingly, the wealthy are opting for super-luxury SUVs instead of traditional sedans.
According to Truecar, the number of SUVs that have sold for at least $75,000 this year is up an astounding 44 percent. ( Tweet this ) That compares with 13.2 percent growth for cars above $75,000.
The Lamborghini SpA Urus SUV.Nelson Ching | Bloomberg | Getty Images
It's a trend that Truecar President John Krafcik said is just beginning, as more high-end automakers enter the space. On Wednesday, Lamborghini became the latest brand to confirm it will add an SUV to its lineup, with what many are calling the "Rambo Lambo." It's expected to hit showrooms in 2018, after which Lamborghini plans to sell 3,000 each year.
Read MoreLamborghini SUV to hit the road in 3 years
The luxury SUV will join the likes of the Porsche Cayenne, Cadillac Escalade and Land Rover's Range Rover, as well as forthcoming models from Tesla, Bentley and a rumored model from Rolls-Royce.
"In the next few years, uber-premium SUVs will outsell uber-premium sedans. It's just a matter of time," Krafcik said.
Read More
Below are details on other ultraluxury SUVs that are headed for the market.
VIDEO1:5901:59Small SUVs, big sales Power Lunch
Tesla Model X
Deliveries of this electric SUV will start late this summer. The price has not yet been announced, but Tesla expects the Model X to sell for roughly the same price as the Model S, which has an average transaction price of $93,000.
Bentley Bentayga
This ultra-luxury 4x4 SUV will be shown for the first time later this year and go on sale next year. The price is expected to be announced closer to launch.
Aston Martin
Aston Martin debuted its DBX Concept crossover SUV at the Geneva Auto Show in March. It's expected to go on sale in 2019.
Rolls-Royce 'Project Cullinan'
Rolls has not yet officially unveiled its first SUV, but the brand has released images of a test model. It's widely believed it won't be long before the brand officially joins the super luxury SUV market.
If you were hoping to see Ferrari on the list, no such luck. Despite rumors that have swirled over the past few years, executives for the Italian luxury brand have repeatedly denied there are plans to build a Ferrari SUV.
"Other than Ferrari, every exotic brand will have an SUV in their lineup. It's not a question of if, but rather when," Krafcik said.
Questions? Comments? BehindTheWheel@cnbc.com.
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fd00f4845d9b32e73c90cb76a10ea6f6 | https://www.cnbc.com/2015/05/29/hows-hillary-doing-wish-we-could-tell-you.html | How's Hillary doing? Wish we could tell you | How's Hillary doing? Wish we could tell you
I've been inside Hillary Clinton's national campaign headquarters in Brooklyn.
Outside the offices of Hillary Clinton's campaign headquarters.John Harwood | CNBC
I've talked with "senior officials" about her bid for the White House. They sat in these chairs.
An office room inside Hillary Clinton's campaign headquarters.John Harwood | CNBC
Wish I could tell you more. But they said very little.
Notice that I typed very little and not "very little," because under the ground rules of Thursday's briefing reporters were not allowed to quote their words directly.
You're not missing much.
The former secretary of state plans to kick off the heavy-rhetoric stage of her campaign on June 13. I can't say where or what time because the senior officials wouldn't say.
Read More
She plans to lay out some policy proposals after that. Can't say which ones.
She'll take questions from reporters. Can't say how often.
She'll start having rallies. Not too many, because the election's a long way away. But some.
She might take a summer vacation, which means reporters covering her can, too. Don't know when, but one senior official observed that summer vacations traditionally occur in mid-August.
Her aides are organizing furiously in the early battlegrounds of the nomination fight (Iowa, New Hampshire, Nevada, South Carolina) because they are competing in every state. They take the primary challenges of Bernie Sanders, Martin O'Malley and perhaps others very seriously.
They are also taking their Republican opposition very seriously—some in the sprawling GOP field more seriously than others. Can't specify which ones.
Read More Rick Santorum officially launches presidential bid
They are raising lots and lots of money and are pleased with how much is pouring in. But they absolutely, positively are NOT seeking to raise $2 billion, which some journalists have reported is their goal.
VIDEO3:2003:20Hillary Clinton's next moveSquawk Box
They are building a large digital constituency for their efforts to communicate and mobilize voters on social media. Are they starting with the lists from President Barack Obama's organization, and Hillary Clinton's 2008 campaign? Can't say for sure, but they're exploring lots of lists.
Her husband, Bill, and daughter, Chelsea, will play roles in her campaign. Can't say exactly what, or when.
She's feeling more in control of her campaign effort this time around, unlike 2008 when she sometimes felt the campaign was controlling her.
Controversies over her emails as secretary of state or the Clinton Foundation have not inflicted significant political damage. That's because voters who might support her see the controversies as politically motivated.
Read MoreBernie Sanders on income inequality and the Clintons
She might even be able to expand the roster of battleground states beyond those Obama targeted. Can't say which ones.
I'd show you pictures of the office and desks where campaign officials do their jobs, but the post-briefing tour was deemed off-the-record.
There will be more briefings, however. Stay tuned.
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ab50183a1e7d949eb2804ef100b1b76d | https://www.cnbc.com/2015/05/29/its-a-very-strong-sellers-market-redfin-ceo.html | It's a very strong seller's market: Redfin CEO | It's a very strong seller's market: Redfin CEO
VIDEO2:2002:20Strong sellers market: Redfin CEOPower Lunch
New home sales surged in April, pending sales of existing properties are up, and so are home prices.
In other words, the real estate market is "really hot" right now, according to the CEO of online real estate search and brokerage firm Redfin.
"It's a very strong seller's market. We've got homes selling in 45 minutes in places like Omaha and Atlanta," Glenn Kelman said in an interview with "Power Lunch" earlier this week.
Read MoreHot housing? Still a great time to buy: Home Builders Assoc.
The whole country "has been on fire in the past few months. It's just a really hot market, probably unsustainably hot."
A slew of positive economic data was released this week, suggesting the housing market recovery was gaining traction.
Glenn Kelman, CEO of RedfinDavid Paul Morris | Bloomberg | Getty Images
Pending sales of existing homes for April rose 3.4 percent from March, to the highest level in nine years, according to figures released Thursday by the National Association of Realtors. Pending sales are now up 14 percent from a year ago.
Read MoreHouse flipping: Tips for big returns
New home sales are also on the rise, jumping 6.8 percent in April to a seasonally adjusted annual rate of 517,000 units, the Commerce Department said Tuesday. That spike was higher than analysts had expected.
Meanwhile, the closely-watched S&P/Case-Shiller Index showed housing prices in 20 cities climbed 5 percent year-over-year in March.
Supply is still tight, and buyers are flooding into the market trying to beat mortgage rate increases, Kelman noted. Many market watchers expect the Federal Reserve to begin raising interest rates in September, which will push up mortgage rates.
"Most of the buyers we talk to are really frustrated because they're getting into bidding wars, not just with two or three other buyers but with 5, 10 ,15 buyers," he said.
"Some of our markets are saying this is crazier than we ever saw in 2007, 2006 so really we're going to see stronger price increases over the next two or three months than we saw previously," Kelman added.
Read More7 major housing markets now'overvalued'
Despite soaring prices, most economists are not yet convinced the housing market is in bubble territory. That's most likely because they're starting from such a low base: in the wake of the 2008 crisis, housing fell into depression territory, as prices swooned by more than 30 percent from peak to trough.
However, he thinks sooner or later prices are going to get ahead of what people are willing to pay and mortgage rates will begin to rise.
"We think that when rates go up, buyers are going to take a step back and we're not going to see the same appreciation," he said. "The people who are borrowing money need to get into the market. But if you're not borrowing money it might be better to sit back and wait until the fall."
—Reuters contributed to this report.
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3394f1cb08bf522284cb6d46fabe0a8c | https://www.cnbc.com/2015/05/29/the-true-cost-attacks-the-business-of-fast-fashion.html | 'The True Cost' attacks the business of fast fashion | 'The True Cost' attacks the business of fast fashion
Maybe next time you'll think twice before buying that $3 T-shirt.
"The True Cost," an eye-opening documentary that examines the business of fast fashion, scrutinizes the process every step of the way—from the overworked, underpaid factory workers in Bangladesh, to the American consumers who view cheap apparel as a disposable item, all the way through to the after effects of pollution in developing countries.
Filmmaker Andrew Morgan, who raised nearly $80,000 through Kickstarter, said his idea for the documentary was sparked by the 2013 factory collapse in Dhaka, Bangladesh, which killed more than 1,000 people. That disaster for the first time made him question how his clothing was made—and what he found out, he said, was heartbreaking.
Film still taken from "The True Cost""The True Cost"
Morgan's film follows a 23-year-old Bangladeshi garment factory worker named Shima, who made the equivalent of $10 a month when first on the job. In an attempt to improve the factory's unsafe working conditions and earn a living wage, she and several other workers started a union. When they gave the factory owner their list of demands, they were severely beaten.
Read MoreAmazon sees Wal-Mart's bet, raises ante
Aside from the low pay, the film shows how factory workers are confronted each day with a hot and chemical-ridden work environment. Many of the buildings are also structurally unsound. Prior to the collapse at the eight-story factory in Bangladesh, workers were required to enter the building despite reporting cracks in the walls.
According to the film, the three worst disasters in the history of the global fashion industry happened within the same year, killing more than 1,500 people.
Beyond the toll on workers in impoverished nations, the documentary showed the environmental aftermath caused by toxins used to farm cotton and tan leather, as well as landfills filled with unwanted clothing. These practices have caused severe disabilities among the population in places like Punjab, India.
"When I hear a phrase like 'environmental damage,' it's like that still is in the category of a very esoteric, far off someday [thing]," Morgan said. "To be in those places and to realize that's actually [the] impact that's being felt by real human beings today... that was jarring."
Film still from "The True Cost""The True Cost"
Though Morgan points a firm finger at fast-fashion companies including H&M, Zara and Forever 21, "I don't want to put all the blame [on] the back of fast fashion," he said. "It did not invent a very irresponsible way of manufacturing, it did not invent overmarketing the consumption of things. ... It just came in and took it about as far as we could possibly go."
In particular, he said, these companies have done so by making apparel so cheap that people view it as a disposable good. In the U.S., clothing consumption has risen 400 percent in the past two decades, Morgan said.
An H&M representative said the film "raises important questions for the fashion industry, which H&M welcomes." The company, which owns six brands and operates more than 3,600 stores around the world, said it has also taken "significant steps to address the valid concerns raised."
Read MoreThe latest retailer to jump on the discount bandwagon
As examples, H&M cited that it is now the largest user of organic cotton in the world, and it uses technologies that allow it to make new garments from recycled fabrics, therefore limiting the use of natural resources.
"We want our customers to feel proud to wear clothes made in Bangladesh and Cambodia and to be confident that they have been produced with respect for the environment and for the people who made them," the company said. "We believe affordability and sustainability can go hand in hand and we will openly demonstrate our commitment to meet this ambition."
A representative of Inditex, the parent company of Zara, said that although most of its manufacturing takes place in European areas, "the company has implemented straight procedures to monitor all the supply chain through nine clusters in the different geographical areas."
The company added that it works with the Federation of Unions IndustriALL, which represents 50 million workers around the globe, and follows the guidelines of the International Labor Organization's Better Factories program, as well as the the criteria of the United Nations' Global Compact.
"Inditex agrees with the opinion of the Ethical Trading Initiative and understands that all the room for improvement in this never-ending task of achieving better supply chains must come from the joint effort of all the players involved in the industry," the firm said.
Forever 21 declined comment.
"The True Cost," which showed at the Cannes Film Festival, hit select U.S. theaters Friday.
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15e9935accfb67d38e1c4b3711d64ae1 | https://www.cnbc.com/2015/05/29/we-are-in-the-middle-of-a-currency-war-analyst.html | We are in the middle of a currency war: Strategist | We are in the middle of a currency war: Strategist
VIDEO6:3606:36Volatility from Greece is good: Pro
There is a currency war going on—one in which the Federal Reserve is the least able to play, said David Woo, head of global interest rates and currencies research at Bank of America Merrill Lynch, on Friday.
The European Central Bank statement during a dinner last week regarding the purchase of more bonds is a strong signal it doesn't want the euro to go back over $1.15, said Woo during an interview with CNBC's "Squawk on the Street."
"You could argue that the U.S. got back on the street playing that game," explained Woo. "Now, the U.S. cannot tell others they cannot play this game."
Read More Europe shares close sharply lower on Greek fears
With inflation picking up and better performance from U.S. companies, the Fed has less of a reason to get engaged in this war at the moment, said Woo.
A woman walks past an exchange office in Moscow.Vasily Maximov | AFP | Getty Images
As the deadline for a debt payment by Greece draws closer, the volatility of currencies has increased. The country is supposed to pay about 300 million euros ($329 million) to the International Monetary Fund on June 5, but creditors have been worried about Greece's ability to make the payment.
Woo added that the latest data show 5.6 billion euros leaving the Greek banking system for elsewhere—double the March figure. He added that this might force a showdown into the end of June.
Meanwhile, Wells Fargo's Scott Wren, also on "Squawk on the Street," said that the volatility was creating more of a chance to buy stocks.
"Volatility is going to hopefully cause more buying opportunities. Even in a worst-case scenario for Greece, which I don't think is going to happen, they are going to Band-Aid this thing and kick it down the road," said Wren.
Read MoreGreek talks 'progressing'…so where's the deal?
Woo said that his biggest worry is Asia, especially China. With the Chinese yuan one of the strongest currencies and Germany's exposure to China, there might be some problems for the euro.
"I think the euro will have an issue," said Woo. "German exposure is more than U.S exposure to China."
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37d277d27d1aed922c5d51e2acfc1cae | https://www.cnbc.com/2015/05/31/cancer-drug-stocks-set-to-move-on-asco-news.html | Cancer drug stocks set to move on ASCO news | Cancer drug stocks set to move on ASCO news
The stock-moving news flow started early out of the American Society of Clinical Oncology meeting in Chicago.
On Friday, Bristol-Myers Squibb shares sank 6 percent after it unveiled findings for its immunotherapy Opdivo in the most common form of lung cancer, called non-squamous non-small cell lung cancer. The study showed the medicine helped some patients live longer than the chemotherapy docetaxel, but disappointed investors when it showed it may work less well in patients whose tumors don't express a marker known as PDL1, short for programmed cell death.
Read MoreTrading pharma: 5 plays on Bristol's rough day
"Tumors with low PDL1 expression do not appear to derive a benefit from Opdivo over docetaxel," Evercore ISI analyst Mark Schoenebaum wrote in a research note Friday. The data "appear to open the door to competitors in the second-line setting (such as Merck and Roche) who are a little further behind but are expected to file soon."
Attendees walk through the lobby at the American Society of Clinical Oncology (ASCO) annual meeting in Chicago. (File Photo).Tim Boyle | Bloomberg | Getty Images
Other analysts argued the market reaction was overdone. Alex Arfaei at BMO Capital Markets, in a research note Friday, said that "even in low PDL1 patients... Opdivo has a superior profile than the standard of care," and that it should still dominate the market.
The drug is part of a class known as checkpoint inhibitors that empower the immune system against cancer. Immunotherapy in general is a key focus at the conference, dominating headlines with drugs being developed by Merck, Roche, AstraZeneca and others in addition to Bristol-Myers.
Read More
Bristol also presented several other datasets on Opdivo at the conference, including a combination study with its other immunotherapy drug, Yervoy. Opdivo's on the market for melanoma as well as another form of lung cancer, advanced squamous non-small cell lung cancer. Merck's Keytruda, in the same class, is on the market in melanoma.
Outside the immunotherapy world, Clovis Oncology, a smaller drug maker, had data on two medicines, rociletinib for lung cancer, and rucaparib, for ovarian cancer.
Cory Kasimov, an analyst with JPMorgan, described the company's showing at ASCO "controversial," calling the data a "mixed bag."
"Overall we are encouraged by the impressive response rates and duration of response seen so far with rucaparib, and think that it compares favorably to the data we have seen from other PARPs in ovarian cancer to date," Kasimov wrote in a Sunday research note, referring to the drug's mechanism of action. "Under normal circumstances, this update could get investors to take a much closer look at this candidate, but for now we expect ruca to still be overshadowed by roci."
Kasimov called Clovis' data on rociletinib "so-so," noting it showed the drug helped patients live eight months without their cancer progressing, down from 10.4 months previously reported, and short of the 13.5 months for a competing drug from AstraZeneca, known as AZD9291. Clovis' drug has a side effect of high blood sugar, which the company said could be managed with commonly used medicines.
VIDEO2:5602:56This could be a new way to treat cancer
ASCO also saw updates on medicines for multiple myeloma from Johnson & Johnson, Amgen and Celgene. J&J's daratumumab is in the middle stages of testing, and Cowen analyst Josh Jennings said last week the drug may get approved based on the data being presented at ASCO. Amgen and Celgene both had updates on their approved drugs Kyprolis and Revlimid that Kasimov described positively.
Data from a late-stage study of CTI BioPharma's drug for the bone marrow disorder myelofibrosis were included in the "late breakers," among the most highlighted datasets of the conference. The medicine, pacritinib, "represents an advance in our field," Dr. Lloyd Damon, a clinical professor in the department of medicine at the University of California San Francisco, said in a presentation Saturday. CTI is partnered with Baxter on the medicine.
Read MoreHere's why Puma, Clovis shares are poised to move
An increased focus was also turned on the high cost of many of the medicines highlighted at the conference, a side effect increasingly being referred to as "financial toxicity."
In a high-profile presentation at the meeting, Memorial Sloan Kettering Cancer Center's Dr. Leonard Saltz highlighted combination therapies in particular, saying the costs—often more than $10,000 for each drug alone—are unsustainable.
There are still two more days of ASCO, with more updates expected from Puma Biotechnology and others. In addition to updated data on its breast cancer drug neratinib, which disappointed investors on an initial look earlier in May, Puma hosts an investor event Monday night that analysts say could be key to changing the market's mind on the drug.
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4e9b42dd9decf7b0ade6fdd8ee56d986 | https://www.cnbc.com/2015/06/01/this-mom-gets-paid-to-review-websites.html | This mom gets paid to review websites | This mom gets paid to review websites
We could all benefit from listening to our mothers more and, apparently, so could the Internet.
That's the idea behind a new user-experience (UX) critiquing service, which gets a real-life mom to review websites. The company then publishes a screencast of the mom using the website and delivers a report complete with some "some motherly UX advice. "
"Dear internet: My mom is tired of your sh**," the company's website reads. "She can't understand your website and it isn't her fault."
Courtesy theuserismymom.com
The User is My Mom charges $75 per site review. It splits the proceeds with 65-year-old Pam – chief website tester and mother of entrepreneur and developer, Scotty Allen.
"In many ways, my mom is a great user to have. She spends plenty of money online, and is a natural born evangelist for things she likes, and an active anti-evangelist for things she doesn't," Allen told CNBC via email.
There is a huge number of Internet-users just like her that websites need to cater to, he explained: "People with good computer fundamentals, but who lack the necessary context to figure out confusing user interfaces or poorly explained services."
And he's not the only person to recognise the importance of usability.
Lins Karnes, managing director and executive producer of digital production agency B-Reel London, has worked with the likes of Google, Facebook, Spotify and H&M. He said that companies often fail to rigorously test user experience.
"People should never underestimate how this can impact their business," Karnes told CNBC, adding that a poorly-designed website could ultimately impact a firm's bottom line.
Services like The User is My Mom, "accentuate the need to think about websites and interfaces as intuitive," he said.
The User is My Mom's Allen and co-developer Richard Littauer help Pam with reviews, making themselves available for questions along the way.
They convinced Pam to take part following the success of sister project, The User is Drunk, which sees Littauer get tipsy and review sites for a fee.
But Littauer insists it's no joke.
"Drunk people have interesting insights. First off, they're brutal - they don't care about your website, they care about getting what they want," he told CNBC.
"Secondly, they are less likely to put effort into figuring something out, and less likely to figure things out in general."
The User is Drunk was so successful that Littauer had to up the price from $50, to $250, and eventually to $500, in order to slow demand.
Since launching in March, Littauer has reviewed over 40 websites for companies like Gizmodo, vacation rental service HomeAway, and educational game portal Mathbreakers. He said some had paid top price, but wouldn't give further details.
Read MoreGoogle embraces 'mobile-friendly' sites in search shake-up
The service's popularity was what led Pam to get involved.
"I told her Richard was tired of getting drunk for money. And I told her I'd split the money with her," Allen wrote on the website.
The tongue-in-cheek overview also warns: "She may miss some things. She will probably get distracted...She may review Facebook, Twitter or the Internet at large by accident while reviewing your website - we're sorry."
But there are some restrictions -- porn sites need not apply, and Allen writes that he will refund the money if he's too embarrassed to show Pam the client's content.
Pam is currently the sole mom reviewer on offer, but Allen said he's already looking through 25 additional applications.
"Most people are really enthusiastic about recommending their moms. We've clearly hit on something that strikes a chord - technology is still really frustrating to use, particularly if you lack a lot of the context that people that grew up with it have," he added.
But applicant's shouldn't expect a full time job. Pam is still tutoring high school students on the side, and spends free time hiking and quilting.
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d26cdc42aef66ff136b519e243564557 | https://www.cnbc.com/2015/06/01/us-personal-income-up-04-in-april-vs-03-increase-expected.html | US personal income up 0.4% in April vs. 0.3% increase expected | US personal income up 0.4% in April vs. 0.3% increase expected
VIDEO2:4702:47Personal income up 0.4%Squawk Box
U.S. consumer spending was unexpectedly flat in April as households cut back on purchases of automobiles and continued to boost savings, suggesting the economy was growing moderately early in the second quarter.
The Commerce Department report on Monday also showed no inflation pressures, with a price index for consumer spending recording its smallest gain since late 2009 on an annual basis.
Read MoreWhy the Fed may be forced to raise rates
The unchanged reading in consumer spending followed an upwardly revised 0.5 percent increase in March. Consumer spending in April was also curbed by weak demand for utilities as the temperatures warmed up.
Economists polled by Reuters had forecast consumer spending, which accounts for more than two-thirds of U.S. economic activity, increasing 0.2 percent in April. March's outlays were previously reported to have increased 0.4
VIDEO0:3300:33Consumer spending flat for AprilRetail
When adjusted for inflation, consumer spending also was unchanged in April after rising 0.4 percent in March.
The economy is slowly rebounding from its first-quarter slump, hamstrung by a strong dollar and deep spending cuts in the energy sector, which has been slammed by a plunge in crude oil prices.
Gross domestic product contracted at a 0.7 percent annual rate in the first three months of the year.
But with output held down by a confluence of temporary factors, including a problem with the model the government uses to smooth the data for seasonal fluctuations, the decline in GDP likely overstates the economy's weakness.
Read MoreRate hike needed to pop bubbles: Robert Shiller
While anemic consumer spending added to industrial production data in suggesting growth was tepid at the start of the second quarter, upbeat reports on the labor market, business spending plans and housing have hinted at some building up of momentum.
With the tightening jobs market expected to boost wage growth, consumer spending is expected to accelerate in the coming months, also supported by the massive savings households accumulated from cheap gasoline prices.
In April, personal income rose 0.4 percent after being flat the prior month. That reflected a jump in wages and salaries. With income outpacing consumer spending, the saving rate increased to 5.6 percent.
Read MoreRecord number of Americans leasing autos
With consumption muted, inflation pressures were benign in April. A price index for consumer spending was unchanged after rising 0.2 percent in March. In the 12 months through April, the personal consumption expenditures (PCE) price index edged up 0.1 percent, the smallest gain since October 2009.
Excluding food and energy, prices ticked up 0.1 percent for a third straight month. The so-called core PCE price index increased 1.2 percent in the 12 months through April.
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9f1fec962fba2b9da07faa4a563e99cf | https://www.cnbc.com/2015/06/01/will-these-big-obamacare-rates-get-approved.html?__source=healthpocket | Will these big Obamacare rates get approved? | Will these big Obamacare rates get approved?
VIDEO4:1804:18Obamacare unraveling could be lose/lose for both sides: Kavita PatelSquawk Box
VIDEO0:3700:37Health insurance rates may go upObamacare
VIDEO0:4100:41CNBC explains: Obamacare in 2015Obamacare
VIDEO3:1103:11Obamacare check up
There are some eye-popping proposed Obamacare rate increases for next year. But whether they turn out to be the norm or the exception won't be known until October.
The federal agency in charge of Obamacare revealed on Monday afternoon details of many of the Obamacare insurance plans requesting premium rate hikes of 10 percent or more for 2016.
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The data, which can be accessed at RateReview.HealthCare.gov. includes exactly how much more an insurer wants to charge next year, and the justification for that increase.
But information about lesser price increases being proposed, or even proposed price decreases, were not released. That makes it impossible, for the moment, to determine just how much insurers want to raise their premiums overall in the United States for 2016.
The Centers for Medicare and Medicaid Services released the proposed hikes of 10 percent or more in 37 states using the federal HealthCare.gov insurance platform, as well as several other states using their own Obamacare insurance exchanges. Two of the biggest states, California and New York, do not have proposed rates on RateReview.HealthCare.gov yet.
Both plans sold on government-run Obamacare exchanges and ones sold off those exchange are included on RateReview.HealthCare.gov.
Read MoreGOP Obamacare 'fix' has big risks
A check of the site for Georgia found that Aetna HMO plan sold on HealthCare.gov is seeking a 15.57 percent increase in its monthly premiums. And Alliance Health Plans in Georgia is asking for a whopping 37.85 percent premium hike for its SoloCare individual plan sold on that same federal insurance exchange.
In the Midwest, Blue Cross Blue Shield of Illinois asked for price increases of 12.83 percent for one plan, but also wants a 29.09 percent hike for another plan, and a 38.24 percent bump for a third plan. More than 329,000 current Blue Cross Blue Shield Customers are in those or similar plans now.
Blue Cross Blue Shield, in its rate filing wrote, "The main driver of the increase in the proposed rates is that the actual claims experience of the members in these individual ... policies is significantly higher than expected."
People sit with an insurance agent as they purchase health insurance under the Affordable Care Act in Miami.Getty Images
CMS noted, however, that "insurance companies project that most people will be enrolled with proposed rate increases of less than 10 percent."
"The Affordable Care Act requires that insurers planning to significantly increase plan premiums submit their rates to either the state or federal government for review," says the Rate Review page on HealthCare.gov. "The rate review process is designed to improve insurer accountability and transparency. It ensures that experts evaluate whether the proposed rate increases are based on reasonable cost assumptions and solid evidence and gives consumers the chance to comment on proposed increases."
But insurance experts said the incomplete data release, and the fact that regulators can in many states affect the final rate determinations, makes it unclear whether overall Obamacare rates are likely to be significantly higher in 2016, or whether more moderate price hikes can be expected.
Proposed rates can, and are likely to change before becoming final in October, right before open enrollment for Obamacare plans for 2016 begin. And the proposed rate increases released Monday reflect suggested prices before the application of tax credits, or subsidies, that nearly 90 percent of Obamacare exchange customers receive. Those subsidies can significantly reduce monthly premiums for people with low and moderate incomes.
"This is a very incomplete picture because it doesn't include the plans that are seeking small increases, or even decreases," said Larry Levitt, a senior vice president at the Kaiser Family Foundation, and a leading Obamacare expert. "Analyzing this is like trying to gauge the average height of Americans by looking at only NBA players."
"These increases aren't final, and they're balanced out in many case by insurers who are not increasing premiums by that much," Levitt said.
Still, while "I do think it's too early to generalize," Levitt said, "I do think that the increases in general will be bigger for 2016 than in 2015."
Read MoreDon't mess with Medicaid expansion? Texas' lesson
"There's no question there will be some steep increases for 2016, which highlights once again the need for consumers to shop around, because better deals will be available."
Cori Uccello, an actuary and senior health fellow of the American Academy of Actuaries said, "I wouldn't use this [data] to determine what the average rate increases will be" for Obamacare plans in 2016.
"Looking at rate submissions is not the same as what the rates are going to be," said Uccello, whose group is made up of experts who help insurers set prices for their health plans.
CMS does not have power over how much insurers can charge for Obamacare plans, but state regulators in about two-thirds of the United States do have the power to influence how much plans can charge.
CMS's posting of the proposed increases of 10 percent or more, which the agency did not do last year, also gives the public the opportunity to comment on the insurers' higher range of proposed hikes.
"The rate review process kicks off an important set of steps designed to provide consumers and others the opportunity to weigh in on proposed rate increases of 10 percent or more," said Andy Slavitt, the acting CMS administrator. "These specific rates will be subject to vigorous rate review and revision and the final rates customers will see this fall will reflect the breadth of choice and competition in the marketplace."
In a press release announcing the data, CMS noted that Obamacare customers "do not have to stay in their plans if they do not agree with the rate increases or other features of their plan.
"For 2015, 29 percent of all HealthCare.gov consumers who re-enrolled in coverage shopped and chose different plans," CMS said. The data dump by CMS sent insurance researchers scrambling to look at the proposed rate increases
"We're pulling down the rate filings, and we're trying to take a look at them," said Kev Coleman, head of research and data at HealthPocket, a insurance premium comparison site. "We're not expecting to have any type of preliminary analysis until early next week."
Read MoreObamacare case is political pickle for Republicans
"It's a very tedious, manual process," said Coleman. "But it's really important because this helps consumers understand their health-care cost."
Coleman said he had predicted in 2012 that Obamacare plans would not clearly reflect the cost of insuring people until 2016.
He said that is because in the first year of Obamacare plans, 2014, open enrollment continued through mid-May, only a month or so before proposed rates were due for 2015. The tight time frame, and the fact that most customers signed up in the final two months of open enrollment, gave insurers very little data about their customers' health status and utilization of medical benefits.
Insurers now have more extensive data on which to base their rate submissions.
"This year is really interesting for those of us who are analyzing the health insurance market," Coleman said.
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5cdabbfc8ea0dbaffcdd0f627ea723ff | https://www.cnbc.com/2015/06/02/bp-ceo-bob-dudley-shale-revolution-very-painful-for-much-of-world.html | BP CEO: Shale revolution 'very painful' for much of world | BP CEO: Shale revolution 'very painful' for much of world
VIDEO2:2502:25BP CEO: Shale gas revolution is 'very painful'
VIDEO3:2803:28Expect OPEC to stay on course: BP CEOSquawk Box Europe
VIDEO2:2502:25BP not susceptible to takeover: BP CEO Squawk Box Europe
The shale gas revolution will be "very painful for many parts of the world," with the U.S. potentially the globe's new swing producer, the head of BP told CNBC on Tuesday.
The nascent shale industry—in which "unconventional" gas is drilled from the ground through hydraulic fracturing or "fracking"—is heavily dominated by the U.S. It has boomed in recent years, partly as a result of access to cheap financing, helping to push global oil prices to record lows.
BP CEO Bob Dudley told CNBC that the "revolution" meant the U.S. might supersede Saudi Arabia as the world's major swing oil producer, able to alter its production to balance supply and demand.
BP workers inspect a section of oil transit pipeline.Kimberly White | Bloomberg | Getty Images
He saw the price of oil—which has recovered somewhat this year but is still down around 40 percent from the $100+ levels seen before July 2014—remaining "lower for longer."
Read MorePipe dream: Why US oil will never go it alone
"There will undoubtedly be stress out there if oil prices stay lower," Dudley said.
Patrick Pouyanne, the CEO of French oil giant Total, added that there would be a "lag time" before declining production costs affected shale output.
"It will have an impact on the supply of U.S. shale oil or shale gas, but not immediately," he told CNBC at a seminar of the Organization of Petroleum Exporting Countries (OPEC) on Wednesday in Vienna.
VIDEO2:4002:40Total CEO: Volatility is embedded in oil marketWorldwide Exchange
Dudley warned that there could be further consolidation in the energy industry if oil prices remained low, but that he saw BP as neither "predator nor prey" currently.
Along with shale gas production, the refusal of OPEC to cut production is viewed as a factor in the tumble in oil prices. The body will hold a key meeting on Friday at which it is expected, once again, to hold production at 30 million barrels of oil per day.
Read MoreSaudi oil minister 'not stressed' as OPEC meet looms
Dudley said that the "winners" from low oil prices were "clearly" importers like China, India, Indonesia and much of Europe. Even the U.S. was a beneficiary, he said, because the coastal states are predominately net importers of oil rather than exporters.
VIDEO1:0801:08Where is the price of oil?Oil
He added that BP intended to maintain its presence in Russia, despite tensions with the West, with no plans to sell its 20 percent stake in Rosneft. The Russia oil company is majority-owned by the Russian state and CEO Igor Sechin has close ties to Vladimir Putin.
Read MoreRosneft chief earns up to $4.7M in basic salary
"We stay out of the politics," said Dudley, adding, "We have a lot of experience in Russia … our commitment is to remain."
Total's Pouyanne added that the price of oil was not only a question of supply and demand, but of geopolitics.
"When you see the situation today in the Middle East compared to last year, there is quite a lot of turmoil," he told CNBC.
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14f533ce74978f24d85cace3f687c605 | https://www.cnbc.com/2015/06/02/buying-a-home-dont-make-these-costly-mistakes.html | Buying a home? Don't make these costly mistakes | Buying a home? Don't make these costly mistakes
VIDEO1:2901:29Three tips for first-time homebuyersHousing
VIDEO1:5401:54Tips on how to buy a carAutomobiles and Components
VIDEO1:3901:39How to boost your credit scoreCredit
VIDEO1:5801:58Picking the best credit card for youCredit Cards
The housing market is still going strong and millennials are a big factor.
Total mortgage application volume surged 25.5 percent on a seasonally adjusted basis for the week ending Oct. 2 compared to the previous week, according to the Mortgage Bankers Association. Applications to refinance and to purchase homes are now at the highest level in five years.
Millennials represent the largest share of homebuyers, according to an analysis by the National Association of Realtors. Nearly one-third of all homebuyers, and 68 percent of first-time buyers, were 34 or younger last year. (Tweet This) And those numbers are expected to grow.
Read MoreDon't be 'house poor': Know your market
Buying your first home or know someone who is? Here are three common, and potentially costly, mistakes to avoid.
Mistake #1: Overestimating what you can afford.
Real estate brokers say first-time buyers often focus on the down payment and monthly mortgage amount when calculating how much they can afford and forget to factor in closing and other costs.
"They get to the closing and they're shocked by the amount of money they have to pay," said Vicki Fillet, certified financial planner and president at Blueprint Financial Planning in Hoboken, New Jersey.
Read MoreHouse flipping: 5 tips for big returns
It's important to remember too that monthly payments include not just the mortgage, but interest, taxes and insurance—something that buyers can often forget when figuring out their budgets.
It's a good idea to get pre-approved for a mortgage loan so you know how much a bank is willing to lend you before you make an offer on a home. But keep in mind that the amount you're pre-approved to borrow from a mortgage lender may be more than you can actually afford once you factor in taxes, insurance and other costs like condo or homeowners' association fees and maintenance.
As a general guideline, your total monthly payment (including mortgage principal, interest, real estate taxes and homeowners insurance) shouldn't exceed 28 percent of your gross, or pretax, income.
While some sellers are still asking for 20 percent down payments, it's possible to pay much less. Mortgage giants Fannie Mae and Freddie Mac announced guidelines late last year for loans with down payments as low as 3 percent under a new program largely aimed at first-time homebuyers. Just remember that the lower your down payment, the bigger your mortgage loan (and the more you'll pay in interest).
Read More7 major housing markets now 'overvalued'
Mistake #2: Letting your emotions get the best of you.
Don't get so attached that you buy with your heart and not your head. "It's difficult not to get emotionally attached. Homeownership is an investment in your future," said Chris Polychron, president of the National Association of Realtors.
But be careful. Get too emotionally attached and it can set you up to spend more than you can afford.
Cathy Moyano of Coccia Realty in Kearny, New Jersey, recommends prioritizing what you want in your home. Make a list of the most important qualities, whether you want a certain school district, updated bathrooms, a backyard, etc. Then figure out what you aren't willing to give up. You won't find the perfect home that meets your entire list so narrowing it down to what matters most can help you through your search process.
A real estate agent can help facilitate the searching and buying process. Using apps and sites like Zillow, Trulia, StreetEasy and Redfin can also help speed up your search.
Mistake #3: Not planning ahead.
Once you've narrowed the search and you are ready to make on offer, check with your agent about the demand. Is the home getting multiple offers? Has it sat on the market a long time? Will it require a lot of upgrades?
Make sure you get a thorough inspection. Fillet said buyers often don't get an inspector with expertise to check the pipes, the plumbing, or air conditioning. You want someone who knows what they are doing, not just an inspector from the real estate broker, she said.
Read MoreHousing by the numbers: Something is weird
Remember the resale opportunities. Consider the school district, Fillet said, because even if you don't have children or plan on having any, the next buyer might.
Don't overly improve the property either or "over customize to your personal taste," Moyano said. "Let's say you've painted your dining room purple, before you sell it, paint it back to a neutral color. This sounds like a little thing, but it does leave an impact on when you're showing homes."
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90b07462ad1fe98bf42b21011a9620b2 | https://www.cnbc.com/2015/06/02/multiple-bomb-threats-about-us-aircraft-in-the-air.html | Multiple hoax threats against US aircraft: Govt | Multiple hoax threats against US aircraft: Govt
VIDEO1:2301:23Airline bomb threats not credible: Govt. sourcesSquawk Box
Multiple bomb threats against U.S. aircraft were made on Tuesday, according to NBC News. Government sources said the threats were not credible.
The threats, five in total, were similar to chemical weapon threats against aircraft last week. It was determined that the claims were fake, and there was speculation that the threats could have been made by an ISIS "lone wolf," NBC News reported.
A U.S. Airways flight and its passengers were searched after the plane landed Tuesday morning at Philadelphia International Airport.
The airport confirmed there was an ongoing police investigation after Flight 648 from San Diego landed as scheduled, with 93 people aboard.
"The TSA Operations Center in Washington, DC had received a phone threat stating that there was an explosive device on the plane," Philadelphia Police Chief Inspector Joe Sullivan told NBC News. "Out of an abundance of caution" the airport declared a bomb threat and moved the plane to a remote area.
In addition to the U.S. Airways flight, threats were made on a Delta flight to Atlanta, a United flight to Chicago O'Hare, a Korean Air flight to San Francisco and a Volaris Air flight to Gudalajara, Mexico, according to government sources.
All planes except the Korean Air flight are safely on the ground—that one is set to land around 2:22 p.m. ET.
Read More FAA briefly halts all United Airlines flights
The threats come after Homeland Security Secretary Jeh Johnson reassigned the acting administrator for the Transportation Security Administration after earlier ordering improved security at U.S. airports.
It followed media reports that checkpoint screeners failed to detect mock explosives and weapons in 95 percent of tests carried out by undercover agents.
Read MoreTSA chief out after agents fail airport breach tests
—NBC News and Reuters contributed to this report.
CORRECTION: An earlier version of this article misidentified one of the airlines that received a threat.
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0f6caf6e833f2f46f589f0745b1b9c20 | https://www.cnbc.com/2015/06/02/retail-bank-branch-is-doomed-and-banks-dont-know-it.html | Retail bank branch is doomed, and banks don't know it | Retail bank branch is doomed, and banks don't know it
Big banks are rolling out futuristic branches to keep up with the technology cutting-edge, but according to financial technology experts, it's a major waste of time and money. Within a decade the retail bank branch model will be dead.
"Finance will be the most disrupted industry in the next 10 years," said Peter Diamandis, executive chairman and co-founder of Singularity University, at the Exponential Finance conference in New York City on Tuesday.
The most obvious loser, according to experts, is at the level of the retail branches. "Bank branches will most be gone ... this decade," Diamandis said.
A prototype of a Diebold bank branch of the future.Source: Diebold
Brett King, founder of mobile banking app Moven, said the banking industry will experience more disruption in the next 10 years than in the previous 300 years.
"Bank tellers will be the telegraph operators of 21st century when we look back in 100 years, the most-impacted job," King said. "This will hurt."
Last year saw the highest level of bank branch closures in the U.S. in history, according to FDIC data.
The number of people expected to come online in the near future across the globe is a primary reason for the pessimism about the branch model's future.
By 2020 at least 66 percent of the global population will be online, according to a conservative estimate from PHD Ventures. That would mean an additional 3 billion global consumers. Diamandis thinks that number will come in even higher—as many as 5 billion new consumers—backed by Internet-expansion projects like Mark Zuckerberg's Internet.org and Google's Project Loon.
"That's 3 to 5 billion new customers not accounted for in the global economy today entering it. I don't know why financial services companies don't get it," Diamandis said.
The biggest banks in the world in 2025 will be technology companies, and banks that grew through branch acquisitions in the '80s and '90s, that grew by physical bank presence, will have a real problem.Brett Kingfounder of Moven
Jay Sidhu, chairman and CEO of Customers Bancorp, which owns the BankMobile app, said in the U.S. alone there are 68 million individuals who are unbanked or underbanked. Forty percent of millennials would consider banking without a branch, according to Accenture.
Meanwhile, 70 percent of the unbanked in Africa would have to spend their entire life savings to get to a branch.
Read MoreWelcome to the faceless future of banking
Banks' biggest mistake is still thinking of communities as geographic markets, Sidhu said. "I was walking today, and there were 20 bank branches in six blocks on Madison Avenue. That's $30 million in rent," Sidhu said. "Putting screens in branches ... Why, when we all have screens in our pockets? Citibank's 'bank of the future' in Union Square ... It was built in [2010] and looks like a bank of the '60s to me," he said, adding, "Bank branches are mausoleums."
Since 2011, 700 million global consumers have begun banking on their phone. The U.S. bank branch model, which peaks at a total of roughly 95,000 branches, is now down to 86,000 branches. Sidhu expects that number to come down over the next three to five years, but there may still be as many as 75,000 bank branches because "the banks don't get it. Banks are like Kodak," he said.
Why financial firms are investigating bitcoin tech
A big reason for the bold predictions about the divergent fortunes of banking apps and branches: There are 8,000 fintech start-ups in the U.S. today, more than the number of savings and loans with charters. There is also more venture capital investment in fintech than traditional banking industry investment in bank transformation. A total of 36 fintech unicorns now exist globally, by King's count, and another 32 fintech start-ups are on their way to a unicorn valuation soon.
Read MoreBiometrics and mobiles: Banking's future
"The biggest banks in the world in 2025 will be technology companies, and banks that grew through branch acquisitions in the '80s and '90s, that grew by physical bank presence, will have a real problem," King said. "They may have to give away the retail business."
Yet he said right now the big-bank thinking is the opposite: Many banks continue to make the mistake of spending significant sums on bank branches that look more like Apple stores thinking the consumers will return. "It's not a design issue. It's not branches not being pretty enough. It's a behavior problem," King said, adding, "People just don't need branches, and this decline will speed up." He added: "In 2020 more people will be banking on their mobile phones than have ever banked before, and that's just five years away."
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eaa2ee653d9f24cea35398940e538fab | https://www.cnbc.com/2015/06/02/sorry-cuba-not-ready-for-real-estate-investors-ross.html | Sorry, Cuba not ready for real estate investors: Ross | Sorry, Cuba not ready for real estate investors: Ross
VIDEO3:0303:03Cuba not ready for biz?Squawk Box
After a recent trip to Cuba, billionaire real estate developer Stephen Ross said Tuesday the country isn't really open for business as long as the Castro government is in power.
"You hear a lot about Cuba. You hear a lot about what opportunities there might be in Cuba. I didn't find there were lot of great opportunities. It was like going back in time," the chairman and founder of global real estate firm The Related Companies said Tuesday on CNBC's "Squawk Box."
President Barack Obama moved to normalize ties with Cuba at the end of last year, making it easier for American tourists to visit the country. On Friday, the United States dropped Cuba from its list of state sponsors of terrorism.
Ross said he does not expect to see any real change in Cuba so long as the country's leaders remain in power. Fidel Castro and his brother, Raul, have maintained control of the country for more than half a century.
"You need a government that really wants change, that really wants business, and really wants to see growth, and you don't really have any of that feeling at all," Ross said.
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c7583c8b0f2a0bfdb34c77f0149682a5 | https://www.cnbc.com/2015/06/02/twitter-is-set-to-fly-trader.html | Twitter is set to fly: Trader | Twitter is set to fly: Trader
VIDEO2:5902:59Twitter is set to fly: TraderTrading Nation
Twitter shares have been grounded since plunging more than 26 percent on April 28, but according to one trader who relies heavily on the technicals and options market, the little blue birdie could be ready to fly again.
"Weak guidance really hurt this stock. It went from $52 to $36 [in one day] but now we're in a consolidation phase, and I think it could be set to rally between now and the end of the year," technical analyst Andrew Keene said Tuesday on CNBC's "Trading Nation."
Keene's chart work suggests that Twitter is sitting on solid support at $35, "this is where the stock saw a double bottom back in December and January," he said. In addition to that near-term support at $35, Keene said Twitter has long-term support at $30. "If we get back below that $30 level, however, it could really get ugly. But I don't see that happening."
Instead, Keene expects shares of Twitter to rally back above $50 by the end of the year, or 37 percent higher than current levels. So to make a bullish bet, Keene sold the January 30/20 put spread for $1.50 and then used the proceeds to purchase the January 48-strike calls for $1.50. "If the stock breaks under $30 I start losing money, I don't make money or lose money between $30 and $48, so if the stock just sits here, no harm no foul," said Keene, founder of Keene on the Market. Above $48 Keene begins to see profits.
"I expect to see a lot of upside in Twitter," said Keene.
To note, Keene had a similar call in GoPro two months ago, and since then the trade has been quite profitable.
Want to be a part of the Trading Nation? If you'd like to call in to our live Monday show, email your name, number and a question to TradingNation@cnbc.com
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a3f66a8d3353216453733d5c453fab66 | https://www.cnbc.com/2015/06/02/will-you-trust-a-robot-to-manage-your-money-when-youre-64.html | Will you trust a robot to manage your money—when you’re 64? | Will you trust a robot to manage your money—when you’re 64?
Companies that deliver automated online investment advisory services, the so-called robo-advisors, have proved they can effectively compete for investing dollars, taking in billions in investor assets in the past few years. That might not seem like much from the $16 trillion pie of individual investments, but it's already forced a response from investing heavyweights, including Charles Schwab, Vanguard and Fidelity.
Their success, they like to sometimes quip, comes from clients who prefer to never deal with a human or receive a phone call. That works in the early days of the era of the digital native, but will it still work when the digital natives turn 64?
ArtBox Images | Getty Images
As younger investors create families with greater financial complexity, including mortgages and the prospects of multiple college tuition bills, will they still trust a robot to manage their money?
The robo-advisors, not surprisingly, exude confidence.
"I feel absolutely confident that we can handle more complicated financial lives," said Jon Stein, CEO of Betterment.
Stein is not alone. Robo-advisors are working to address more complicated financial situations, whether that involves things like an inheritance, college savings or estate planning. They either are improving their automated services or providing on-staff experts who can give the kind of personalized attention that typically has been the domain of certified financial planners.
Read MoreRobo-advisors have yet to prove their worth: Analysts
Robo-advisors collectively manage an estimated $20 billion, which is predicted to reach $450 billion worldwide by 2020, according to research firm MyPrivateBanking in its recent 2015 report on the ways in which robo-advisors are infiltrating the wealth management industry.
Along with providing automated, algorithm-based portfolio management advice, some offer automatic portfolio rebalancing, tax-loss harvesting and other online tools that help clients determine how to invest their money.
One of their biggest appeals is what they charge clients: less than the industry standard of 1 percent of assets managed.
"It's a digital delivery that's cheaper and faster," said Will Trout, a senior analyst for research and consulting firm Celent. "But in terms of the more complex things, [robos] are taking baby steps."
Adam Nash, president and CEO of Wealthfront, is unconcerned, espousing the faith in tehcnology that you would expect from a Silicon Valley executive. His company focuses squarely on millennials, and because the industry is in its infancy, Nash thinks the technological advances that will end up helping his clients 20 years from now are yet to be realized.
"We're open to providing anything that customers find important," Nash said. "But we'll probably do that through improved technology. We're incredibly bullish about what will be possible for us to do to meet the needs of [millennials]."
He added that Wealthfront has a team of certified financial analysts who can respond to client questions. But if a request is beyond what the team is equipped to do, they refer clients to, say, an accountant or an attorney.
At FutureAdvisor, Will Tuhacek is a senior wealth advisor. He spends much of his days talking to clients, whose investments—regardless of where they are held—are tracked at the company.
"We can do a high-level review of their portfolio and all of their accounts. That allows us to make recommendations [about their financial profile]," Tuhacek said. "So is that [certified financial planner] advice? Partly. Full advice? No."
But, he added, having staff on hand to answer financial-planning questions is the direction in which the company wants to go.
When life gets more complicated, people often prefer a conversation to an interface.Naureen HassanSchwab executive vice president and head of Schwab Intelligent Portfolios
At Betterment, if a client's situation is complicated, the company will refer the person to an in-house CFP—if the assets held there are at least $1 million. Alternatively, a client can be referred to an outside advisor who uses Betterment's institutional platform. Roughly 100 investment advisory firms use Betterment's platform for their clients, including fund and brokerage giant Fidelity Investments.
Financial services behemoths also have entered the space to varying degrees. Vanguard Group, which eschews the robo-advisor term, views its new Personal Advisor Services platform as a hybrid approach. It offers technological tools online but also gives clients access to human advisors.
Read MoreRobo-advisor Betterment works with Fidelity in RIA push
"It incorporates a relationship with an advisor on an ongoing basis," said Katie Henderson, a Vanguard spokeswoman.
Vanguard's service requires a minimum of $50,000. The company has about 300 full-time advisors on staff. The majority of them are CFPs; those who are not CFPs are working toward earning that designation, Henderson said.
Charles Schwab launched its robo platform, called Schwab Intelligent Portfolios, in March. The service requires a $5,000 minimum investment, which gives the client access to personal advice.
"When life gets more complicated, people often prefer a conversation to an interface," said Naureen Hassan, a Schwab executive vice president and head of Schwab Intelligent Portfolios, in response to an email query.
She added that clients have access to people and to financial planning. "It's a critical component of what Schwab can provide and people need," she said.
Regardless of the big names being in the space, the smaller robos feel well positioned to meet the needs of investors, no matter what their age or financial profile. And their services might not include traditional human advice.
Nash, of Wealthfront, pointed out that Schwab evolved from a discount brokerage 40 years ago to a major player in the money-management business. And, he said, no one could have predicted that. His message is, basically, don't discount the impact that technology will have on the investment and financial-planning world.
"Over the next five, 10 or 25 years," Nash said, "We'll see a phenomenal improvement in technology that will help people reach their financial goals."
—By Sarah O'Brien, special to CNBC.com
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4dc9ca1ec3df316cc847fad571986ca3 | https://www.cnbc.com/2015/06/03/a-new-take-on-takeout.html | A new take on takeout | A new take on takeout
VIDEO5:1205:12New take on takeoutPower Pitch
Despite a growing appetite for on-demand delivery, it's a crowded plate. But one San Francisco based start-up aims to stand out with its new take on takeout.
Bento delivers Japanese cuisine curbside. Customers order and customize their meals via a mobile app, and the food shows up within minutes.
CEO Jason Demant said: "This is the product I wanted to order every day. It didn't exist, so we built it."
One of the many Bento dishes created by Chef Mattin Noblia.Source: Bento
Demant loves Asian food. So much so, he created Bento.
A "bento" is a common Japanese meal served in a box-shaped container. It typically comes with a protein, vegetables and rice.
Demant's version of the bento box has one main dish, along with four sides, which customers choose through the free iOS app. Entrée choices change daily, and range from Mongolian beef to pad Thai. "Top Chef" contestant Mattin Noblia creates the menu out of a commercial kitchen in San Francisco. This is also where the team prepares and cooks the food. Each meal costs $12, plus tax and tip.
Customers can track their orders and Demant told CNBC the average delivery time takes 15 minutes. When the driver arrives on location, he or she assembles the containers of food into Bento's specially designed box.
Bento’s specially-designed box.Source: Bento
But it's this on-site assembly that could be problematic. Alicia Syrett, a board member of New York Angels, said she's worried about Bento's ability to comply with food-safety and sanitation standards.
Demant stressed that once food leaves the kitchen the driver doesn't open the containers. He added: "That's how our whole system is built and modeled. We've gone through all the necessary regulations with the San Francisco Health Department and any cities we expand to in the future, we'll do the same."
Nikhil Kalghatgi, a partner at Vast Ventures, questioned how Bento expects to compete with other on-demand food players.
Read MoreHere are the GrubHub's priciest delivery and takeout burgers
Demant said that unlike its competitors, Bento let's people customize every part of their meal. "You're really getting the exact meal that you want," he said.
For now, Bento only delivers in San Francisco, but the CEO told CNBC the start-up has plans to expand to Oakland and Palo Alto by the end of this year.
The company launched in March 2015 and has raised $325,000. Bento is seeking $1 million in its seed round and currently has seven employees.
--Comments, questions, suggestions? We'd love to hear from you. Follow us @CNBCPowerPitch and join the #PowerPitch conversation
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2af7a934b36ddc49496c4ca0c0cd4a13 | https://www.cnbc.com/2015/06/03/can-the-us-win-the-robotics-war-on-the-factory-floor.html | Can the US win the robotics war on the factory floor? | Can the US win the robotics war on the factory floor?
In late 2013, two former University of Tokyo professors entered their humanoid robot into a competition sponsored by the U.S. Defense Advanced Research Projects Agency (DARPA). After completing a series of rescue challenges—piloting a vehicle and climbing up a ladder, among them—the SCHAFT S-One robot easily took first place in the inaugural DARPA Robotics Challenge trials.
Rethink Robotics
It could be argued, however, that SCHAFT's big victory came months earlier, when search technology giant Google acquired SCHAFT, not to mention a handful of other robotics companies, for an undisclosed amount. Two months ago Google entered a partnership with Johnson & Johnson subsidiary Ethicon to begin developing surgical robots that one day will work side by side with doctors in the operating room.
Other large, U.S.-based technology companies have also recently been putting more of their money into robotics. In 2012, Amazon spent more than $700 million to acquire Kiva Systems, which makes a mobile robot for carting items sitting on shelves over to packers working inside Amazon fulfillment centers. In 2013, Apple announced it was investing more than $10 billion in supply-chain robots.
While interesting developments on their own, taken together these moves represent a galvanizing moment for the U.S. robotics industry. According to the International Federation of Robotics, the worldwide market for industrial robotics systems is worth $29 billion.
About 235,000 robots are already in use inside U.S. factories, placing the U.S. second to Japan in robot use, according to May numbers from the Robotic Industries Association (RIA). Advances in technology are making robots less expensive, pulling them out of the military and medical realms and pushing them into smaller and medium-size companies, private tech firms and even the consumer market. For years Japan has dominated the robotics industry.
Read MoreRobots: The new low-cost worker
Now the U.S. and a handful of other players, including South Korea and China—today the largest robot market in terms of annual sales—are looking to own corners of an exponentially growing field.
"The most important thing about the robotics industry—now it's starting to see this global understanding that robots can help companies of all sizes in every industry," said Jeff Burnstein, president of the RIA. "That's really exciting, and that's what's going to drive the future here."
Where the U.S. stands to take the lead in the robotics industry is inside the factory.Henrik ChristensenKUKA chair of robotics at the Georgia Institute of Technology
Globally, Japan is still the leader in industrial robotics, according to Burnstein. But an aging population, coupled with a growing need for in-home service robots, will shift the focus of Japan's robotics industry over the next decade, and health-care robotics in Japan will likely overtake industrial uses. Early leaders are already developing products. There's Panasonic, with its Resyone robotic wheelchair bed, and Asratec, with its humanoid ASRA C1.
"The products coming out of Japan in the last 10 years have been targeted at the aging population," said Henrik Christensen, the KUKA chair of robotics at the Georgia Institute of Technology. "I don't think we're going to see as many humanoid robots in the U.S. in the short term. … Japan is way ahead of us."
Where the U.S. stands to take the lead in the robotics industry is inside the factory, Christensen said, in part because the salaries of workers in places where the U.S. has traditionally outsourced are now going up.
"Over the last 10 years, salaries in China have gone up by 350 percent," he said. "So if we're looking at 10 years ago, it was very hard to compete with manual labor in China. Over the same period, [U.S.] salaries have gone up less than 10 percent. … So it makes sense to manufacture more in the U.S. than 10 years ago."
While robots have been a staple of the American automotive industry for decades, the big push in the U.S. now is on collaborative robots. The National Robotics Initiative, launched by the Obama administration in 2011, has spent about $300 million in new robotics research and development that's "been very focused on robots working with humans," Christensen said. Picture the factory of the future, where a robot named Baxter stands ready to complete the day's tasks. He has two arms with multiple axes of rotation, just like a human's arms, and 360-degree sonar capabilities.
"Collaborative robots is a place where we've got a significant opportunity," said Jim Lawton, chief product officer at Rethink Robotics, the Boston-based manufacturer of the Baxter robot. "Most of the technology that's required to be able to build this next wave of robotics exists in the U.S." Lawton said the U.S. holds an advantage when it comes to robots with advanced vision capabilities and anticipatory artificial intelligence.
Read MoreWorld's angriest robot: Checking in on your company sometime soon?
"We've been doing robotics for years, but everything's starting to line up," said Ayanna Howard, a professor in the Institute for Robotics and Intelligent Machines at Georgia Tech. "Computing is amazing. The actuations, electronics and motors that you need to make robots function in the real world are getting cheaper. Everything's kind of coming together."
VIDEO2:3502:35Building up the robot industry Made in America
Whether these developments on the home front represent any type of race globally is a matter of debate. Christensen said that for companies in need of the venture capital to build a robotics company, "the U.S. is the best." Lawton argues that the drivers of manufacturing and competitiveness will be robotics.
Read MoreWhy you shouldn't fear the robot revolution—yet
"There's a land grab now for who's going to own the home, who's going to own the factory," he said. "One of the strategies is robots are the vehicles to do that. I don't think we can afford to sit on the sidelines of this."
Japan, as it has felt the heat of other competitors in the global market, has certainly taken moves to redouble its efforts for the coming robotics revolution. As Reuters reported in the fall, the government is planning regulatory reforms that are aimed at tripling Japan's robotics market to $21 billion by 2020.
But the pie seems to be big enough for multiple countries to take a bite of, even as a company like Google—which declined an interview for this article—spends hundreds of millions buying up multiple robotics start-ups.
"It shouldn't be seen as a competition between two countries," said Martial Hebert, director of the Robotics Institute at Carnegie Mellon University. "Some opportunities will be taken by some countries, others by other countries. … But it's a really exciting time."
—By Andrew Zaleski, special to CNBC.com
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a2895d59c65abd06ad5547248c9395d1 | https://www.cnbc.com/2015/06/03/google-to-companies-pay-hackers-who-hack-you.html | Google to companies: Be nice to hackers | Google to companies: Be nice to hackers
Hackers who manage to infiltrate a company's network and then tell them about it should be thanked and paid, according to Google's cyber chief.
"It used to be that if you told an organization that you broke into their environment, they would typically respond with a legal cease and desist letter. They would stop you, put a gag order on you can't tell anybody," director of security for Google Apps Eran Feigenbaum said during a speech on Tuesday at the InfoSecurity conference in London.
"We've take a different approach, where we actually thank people."
Cybersecurity hit the headlines last year after a number of high profile hacks on companies including on Sony and eBay exposed weakness in the defences of even the world's biggest organizations.
John Lund | Blend Images | Getty Images
Data breaches are invariably financially damaging for businesses and are set to cost companies $2.1 trillion globally by 2019, increasing to almost four times the estimated cost of breaches in 2015, according to Juniper Research.
There has been a rise in recent years of so-called "white hat hackers" or ethical hackers - people who attack a firm's systems in order to find security flaws.
This approach to cybersecurity has made some companies nervous and even lead to legal cases against hackers who breached a firm's networks. But Feigenbaum said this is the wrong approach.
Last year, Google had a $1.5 million pot of money that it distributed to people who found so-called "zero day vulnerabilities" in Google software or flaws that the U.S. search giant didn't know existed. This led them to establish a team of elite hackers dedicated to finding such security holes.
"You get a whole new set of eyes. Even with 450 security professionals looking and working on a regular basis to make sure our software's secure by working with the security community you get a whole extra bench, thinking of things that you may not have thought of," Feigenbaum told CNBC after his keynote address.
"So encouraging them to do the right thing by treating them with respect, paying them, giving them acknowledgement is important."
Google is not the only company to employ such tactics. United Airlines announced last month that it would offer up to a million air miles to hackers who can find security bugs in its network.
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6219ee86c8adc9608ede972fabc95811 | https://www.cnbc.com/2015/06/03/most-older-americans-fall-short-on-retirement-savings.html | Most older Americans fall short on retirement savings | Most older Americans fall short on retirement savings
VIDEO0:5100:51Retire well: Salary saving tipsDebt
VIDEO1:0701:07Retire well: How to not outlive your moneyAnnuities
VIDEO1:4501:45How to balance retirement and college savingsRetirement
How bad is America doing when it comes to retirement savings? The Government Accountability Office looked into the question, and its answer is sobering.
A new GAO analysis finds that among households with members aged 55 or older, nearly 29 percent have neither retirement savings nor a traditional pension plan. (Tweet This)
"There hasn't been a significant increase in wages, people have student loans and other debt, and many are continuing to struggle financially," said Charles Jeszeck, the GAO's director of education, workforce and income security, which analyzed the Federal Reserve's 2013 Survey of Consumer Finances to come up with its estimates. "We aren't surprised that people have not saved a lot for retirement."
Even among those who do have retirement savings, their nest eggs are small. The agency found the median amount of those savings is about $104,000 for households with members between 55 and 64 years old and $148,000 for households with members 65 to 74 years old. That's equivalent to an inflation-protected annuity of $310 and $649 per month, respectively, according to the GAO.
"I don't care what anyone says. That's not enough income for retirement," said Anthony Webb, senior research economist at the Center for Retirement Research at Boston College, who reviewed the GAO report.
Read MoreHow early retirees are different
Social Security remains a fundamental part of most Americans' retirement plans, with benefits providing most of the income for about half of households age 65 and older, according to the GAO. (Tweet This)
The agency studied the level of Americans' retirement savings at the request of Sen. Bernie Sanders of Vermont, an independent who is seeking the Democratic nomination in the 2016 presidential election and is also the ranking Democratic member on the Senate's subcommittee on primary health and retirement security.
Estimates about the size and scope of the retirement savings problem vary widely, the GAO found. In addition to examining the Survey of Consumer Finances, it reviewed nine studies conducted between 2006 and 2015 by a variety of organizations, including academics, benefits consultant Aon Hewitt, the Employee Benefit Research Institute (EBRI) and the Investment Company Institute. Based on these reports, it concluded that one-third to two-thirds of workers are at risk of falling short of their retirement savings targets, in part because of the range of assumptions about how much income is required in retirement.
Read MoreSocial insecurity: Many expect no retirement cash
The research that the GAO examined consistently showed that people aged 55 to 64 are less confident about their retirement and plan to work longer to afford retirement. However, a 2012 study by the EBRI found that about half of retirees said they retired earlier than planned because of health problems, changes at their workplace or having to care for a spouse or another family member. This suggests "that many workers may be overestimating their future retirement income and savings," wrote GAO researchers.
"EBRI's model does show that a significant percentage of households will run short of money in retirement," said Jack VanDerhei, EBRI's research director. "This is because we model all the major risks in retirement."
Read MoreAre you ready for the retirement 'danger zone'?
Reports like those and the GAO analysis should serve as a wake-up call about the lack of Americans' retirement savings, said Catherine Collinson, president of the Transamerica Center for Retirement Studies.
Transamerica's retirement research, which wasn't included in the GAO's review, doesn't give board projections about America's retirement readiness because retirement is "a very personal question," she said. But Collinson stressed the need for more people to calculate their projected retirement needs and to plan ahead accordingly. "As a society, we cannot do enough to raise awareness about the magnitude of this problem."
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f645dd0de7410de463175c863255b890 | https://www.cnbc.com/2015/06/03/some-almay-simply-american-makeup-made-in-china.html | Why 'Made in USA' labeling is so complicated | Why 'Made in USA' labeling is so complicated
With July Fourth approaching and Memorial Day just past, patriotism is in full bloom. It's arguably the best time for manufacturers and other companies to promote American-made products.
"Now is the season for 'Made in USA,' " said Sarah Wagner, editor and founder of "USA Love List." Wagner has been sourcing and hunting for unique "Made in USA" goods for her website for more than three years.
But amid conversations about reshoring and more domestic manufacturing, the process behind "Made in USA" labeling can be opaque.
The latest in the label drama: Country singer Carrie Underwood. The former "American Idol" winner is featured in a "Simply American" advertising campaign. Almay's homepage encourages fans to use the hashtag "#simplyamerican" for social media posts.
Source: Almay
The problem is that "Simply American" suggests Almay's beauty products are made domestically, said Bonnie Patten, executive director of Truth in Advertising.org, a nonprofit organization. While a company spokeswoman says nearly 90 percent of Almay products, including makeup remover, are American made, other products are made in China, the Czech Republic, Germany and Canada. Truth In Advertising.org has complained to the Federal Trade Commission and New York Attorney General's Office about what it says are Almay's false claims.
To be fair, the Revlon-owned Almay brand does not appear to have violated labeling requirements, and it is diligent about labeling the origins of its products. Beyond the ad campaign, Almay packaging details which specific countries the products are made including components' origins.
But using a broad definition of "American" can often run the risk of raising red flags.
Blogger Wagner said she recently saw a set of American flags for sale with the label language, "Proudly 'Made in USA,' assembled in China." What does that even mean?
"The Almay Simply American campaign captures the essence of the 'American Beauty Look,' which is simple, luminous and fresh faced," according to Revlon, in a statement emailed to CNBC.com. "Simply American does not imply, nor intend to imply, made in the USA."
But Truth In Advertising.org's Patten argues false-packaging claims hurt the efforts of companies that do make "Made in USA" a top priority. "Patriotism is a great marketing tool," she said. "Consumers are more likely to buy products marketed as made in the U.S. and are willing to spend more money."
Read More'Made in China' becoming increasingly 'Made in USA'
Companies large and small have discovered the potential in showcasing a product's evolution, including its manufacturing origins.
Apple's iPhone is designed by Apple in California, and assembled in China.
Retail catalogs and e-commerce sites feature lengthy product descriptions. Artisanal, one-of-a-kind backpacks and canoes made from regional materials and decades-old craftsmen traditions. Words like "heritage" and "authentic" come up a lot.
Such language in part implies that the goods generate American manufacturing jobs. In recent years, the narrowing labor cost gap between the U.S. and other countries including China, and cheaper energy prices have helped support American manufacturing. Especially after the Great Recession, more Americans began connecting the dots that foreign-made goods—piled high in big box-store carts—equals fewer U.S. jobs.
In fact, both American and Chinese consumers are willing to pay at least a 10 percent premium for "Made in USA" goods, including baby food, appliances, electronics and apparel, according to research from the Boston Consulting Group.
Read MoreWhy the 'Made in China' model is weakening
But the lure of the iconic "Made in USA" label is about more than manufacturing math, and the inference of quality and safety.
American-made labeling appeals to consumers' appetite for shopping, wrapped in feel-good packaging. We want to buy stuff, and more of it. Product-specific knowledge feels cool and "insidery." It makes consumers feel special.
"People love to hear stories about the products they use," Wagner explained. "It adds something interesting to their purchase." Her most popular blog posts include details on state-specific "Made in USA" goods.
This growing story-behind-the-product strategy has helped launch makers of handmade goods on online platforms including Etsy. The Brooklyn-based company, which went public in April, features many American-made products. Of course you want a crafted, wooden cheese board—in the shape of your home state.
But unpacking the nuts and bolts of "Made in USA" labeling is complicated. And sometimes there's outright labeling fraud.
"What we're seeing is a lot of false made-in-America labeling," said Hal Sirkin, senior partner at the Boston Consulting Group.
Fake American-made labeling got on Sirkin's radar about two years ago. Details have emerged about customs officials unpacking presumably American-made flags actually made in China—with the word "flag" misspelled as "flagg."
And in some instances, it can be tougher in one state than another for companies to secure American-made tagging, given the vagaries of labeling guidelines and their interpretation.
VIDEO1:3601:36Made in America: Golden Bear SportswearMade in America
The Federal Trade Commission has "Made in USA" guidance for companies.
What does "Made in USA" mean?
If a company wants to make a "Made in USA" claim, the guideline states "all or virtually all" of the product has been made in America.
The FTC considers other factors, including how much of the product's total manufacturing costs can be assigned to U.S. parts and processing.
What does "Assembled in USA" mean?
If a product carries the label, "Assembled in the USA," it must have undergone a "substantial transformation" on U.S. soil, according to the FTC.
But as Wagner points out, words like "substantial" and "virtually all" leave room for interpretation among manufacturers.
Variations on "Made in USA," including "designed in" and "assembled in," are good signs suggesting where something is made is influencing consumer choices. "That's a sign that 'made in America' matters," said BCG's Sirkin. "Companies want to have it on their box."
What's happening with American-made guidance in California?
Current state law prohibits companies from making "Made in USA" claims unless each and every part comes from the U.S. State legislators are reviving a debate to allow businesses to use the iconic label if "virtually all" of a product's parts are made in the U.S.—basically lower than the current state threshold.
What about label compliance?
The FTC can take action against companies that make false or misleading product claims.
But no agency can police every product on the market.
I've seen several versions of "Made in USA" seals. What's going on?
Beyond federal guidelines, privately owned organizations have emerged with their own branded, American-made certification processes and seals of approval. They sometimes charge a fee for their proprietary certification.
An FTC spokeswoman and the office of New York Attorney General Eric Schneiderman declined to comment on the Almay-specific complaint.
A Nashville-based publicist for singer Underwood did not respond to requests for a response.
Revlon also said, "Almay's packaging clearly states their sources and complies with FTC rules regarding 'Made in USA.' "
In the end, the "Made in USA" label debate is likely to grow and evolve. Said Sirkin of BCG: "People want to know whether a product is made in America."
Read MoreAmerican manufacturing and welding to women: We want you!
UPDATED: This story has been updated to include additional manufacturing facts about Almay.
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