Europe hits Russia's biggest banks

Sberbank serves more than half the Russian population and has millions of customers abroad.

LONDON (CNNMoney)

Publishing details of new measures aimed at disrupting activity in Russia's banking, oil and arms industries, the EU said Sberbank (SBRCY)and VTB Bank were now banned from raising medium and long-term finance in Europe.

Also on the list: Gazprombank, VEB and Russian Agricultural Bank -- state-controlled banks that can no longer tap European financial markets.

Four of the banks were already subject to similar U.S. sanctions. But Sberbank had managed to escape punishment until now.

Sberbank is a Russian heavyweight, accounting for nearly 30% of all Russian banking assets.

More than half of Russia's population are Sberbank customers, and it provides nearly a third of all loans, providing vital funding for the struggling economy.

It counts France's BNP Paribas (BNPQF) as a strategic partner.

Related: Cold War-style tension hits Western companies

Europe has been shaken into taking tougher action by the downing of a Malaysian airliner over eastern Ukraine earlier this month, and by Moscow's continued support for the separatist rebels Western officials blame for the crash.

Apart from restricting Russia's access to finance, Europe has imposed an arms embargo and will make it more difficult to export some oil-related equipment and technology to the energy-dependent economy.

The EU had trailed the U.S. in taking action over the Ukraine crisis, largely because of fears of damaging a relationship worth $500 billion in trade and investment each year.

Russia's economy is already suffering from the impact of sanctions, and that is beginning to hurt Western firms with significant business ties.

First Published: July 31, 2014: 12:28 PM ET

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T-Mobile soars on French takeover rumor

T-Mobile shares jumped 6% on a report about a buyout bid emerging out of France

NEW YORK (CNNMoney)

The news that France's Iliad might be making an offer for T-Mobile quickly ripped through the markets, causing T-Mobile's (TMUS) stock to briefly be halted. It also drove Sprint (S) down 5%, as the wireless company had been rumored to be crafting its own buyout of T-Mobile.

Iliad may have sensed an opening to leap into the world's biggest wireless market.

Related: FTC says T-Mobile charged customers for bogus fees

According to The Wall Street Journal, Iliad made an offer to take control of T-Mobile less than a week ago.

It's not clear what T-Mobile's response to the bid was nor what the structure of such a deal would look like. The situation is also clouded by the fact that T-Mobile's market cap of about $25 billion dwarfs Iliad's -- around $16 billion.

T-Mobile declined to comment on the report.

Related: T-Mobile just made it a lot easier to stream music

Previous reports indicate Sprint, roughly the same size as T-Mobile, is pursuing a combination with T-Mobile as a way to catch up with industry leaders Verizon (VZ, Tech30) and AT&T (T, Tech30).

However, a Sprint/T-Mobile tie-up would likely be met with scrutiny from regulators, which in 2011 blocked AT&T's attempted buyout of T-Mobile.

First Published: July 31, 2014: 12:24 PM ET

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Women on U.S. currency? 'A pretty good idea,' says Obama

Who would you like to see on a $1 bill?

NEW YORK (CNNMoney)

A young girl's letter to President Obama sparked a discussion about the possibility of adding women's faces on American currency. Obama mentioned the letter at an appearance Wednesday in Kansas City, Mo.

"And then she gave me like a long list of possible women to put on our dollar bills and quarters and stuff, which I thought was a pretty good idea," Obama said.

So did the Internet.

Related: Daughters earn more than their moms did -- but not their dads

Soon, there was Oprah on a $20 bill thanks to New York Magazine, Harriet Tubman on a $100 bill from The New Republic and questions across the Twitterverse on why Beyoncé doesn't have her own bill (she is, after all, called Queen Bey).

Though there isn't currently a woman on a paper note, there was once, in 1886. Martha Washington appeared on the $1 silver certificate, which could be redeemed for silver coins.

Women have graced two dollar coins made mostly of copper. Susan B. Anthony is on one that looks something like a quarter, and Sacagawea is on what's known as the "golden dollar." Those coins remain in circulation, but are not currently in production.

Which lady of history would you like to see grace your greenbacks? Vote!

First Published: July 31, 2014: 12:21 PM ET

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Cronut creator unveils ice cream sundae in a can

NEW YORK (CNNMoney)

The chef behind the infamous Cronut, Dominique Ansel, announced his newest concoction: an ice cream sundae ... in a can.

The "Pop It" dessert was devised in collaboration with designer Lisa Perry to celebrate art and pop culture.

"For someone less gourmet, it tastes like a souped-up root beer float," said a spokeswoman for Dominique Ansel Bakery.

But for those with more refined palettes, there's quite a bit of culinary genius that went into these sundaes. There's root beer and stracciatella ice cream, mascarpone semifreddo and macerated cherries, a meringue kiss and marshmallows (to help keep the ice cream from turning into a frozen block). The cans are lined with chocolate and sealed in a pop-top lid, channeling Andy Warhol's classic soup cans.

Ansel is all about creativity and inventions (he changes up his menu every six to eight weeks) -- but don't expect to see this dessert on his New York City bakery's revolving menu. The sundaes will be sold for one day only on Saturday, August 2 -- in the Hamptons, N.Y. And only 500 will be available for purchase.

Related: Yes, Americans want bacon with that

Other inventions of Ansel's -- like the Cronuts ($5), Frozen S'mores ($7) and Cookie Shots ($3) -- have been major moneymakers. The bakery consistently attracts 100 to 200 people as early as 6 a.m. every morning, waiting to taste his treats.

But with the "Pop It" sundaes, Ansel isn't hoping for another moneymaker. In fact, according to the spokeswoman, they don't expect any profit to be generated. 20% of the proceeds from the $15 sundae will be donated to City Harvest, a New York food rescue organization.

Ansel has long tried to use his culinary expertise for good causes, according to his spokeswomen. In February, Barney's New York hosted a one day only Cronut pop-up shop; proceeds benefited the Heart of Los Angeles, a nonprofit that helps under-served youth.

So, will someone else steal Ansel's canned sundae idea to turn a profit?

"I don't think he'd be surprised either way," said the spokeswoman.

First Published: July 31, 2014: 10:47 AM ET

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Can Whole Foods turn itself around?

NEW YORK (CNNMoney)

Whole Foods, the leading organic grocery chain, with 388 stores in North America and the United Kingdom, reported tepid sales growth and a cautious outlook for the next quarter late Wednesday.

Shares of Whole Foods (WFM) sank more 3% on Thursday on the news. The stock is now down 35% this year, making it one of the worst performers in the S&P 500.

Whole Foods said comparable store sales increased just 3.9% in its most recent quarter. That's far below Whole Food's long-term target of 6% growth.

The Austin-based company has been at the forefront of the shift in Americans' eating habits towards organic produce, dairy products from grass-fed cows and non-genetically modified proteins. But as demand for high quality food has increased, so have the number of specialty stores seeking to cash in on the trend.

Related: Whole Foods stock is rotting away

Sprouts Farmers Market (SFM), which went public in 2013, and The Fresh Market (TFM) both compete directly with Whole Foods. Privately held Trader Joe's is also giving Whole Foods a run for its money.

Kroger (KR), America's largest supermarket chain, has been stepping up its presence in the organic market as well. So are big-box retailers Wal-Mart (WMT) and Target (PBCFX).

The sell-off has even prompted rumors that Whole Foods could be a takeover target.

In response, Whole Foods unveiled a number of new initiatives Wednesday aimed at "differentiating" its brand highlighting its "value" offerings.

Whole Foods plans to open a total of 38 new stores this year and will remodel stores that are 10 years old. It is also rolling out a national advertising campaign this fall and is experimenting with home delivery and online ordering.

Walter Robb, co-chief executive of Whole Foods, said the company is "seeing signs of stability in our sales trends and our strategic initiatives will help generate further momentum."

Related: Another food scandal? KFC just can't win

The company, which some consumers critically refer to as "Whole Paycheck" because of its high prices, has also been opening stores in low-income neighborhoods, including a new location in Chicago. The goal is to help bring healthy options to so-called "food desert" communities and position Whole Foods to benefit from gentrification.

But analysts seem skeptical.

"While [Whole Foods] is taking action to address sales weakness, we do not expect progress on these initiatives to meaningfully benefit comparable store sales in the near term," said Joe Agnese, an analyst at S&P Capital IQ.

The company did a good job managing its expenses in the past quarter, but the new initiatives and store openings could put pressure on profit margins going forward, according to analysts at Credit Suisse.

Even with the recent decline, Whole Foods stock still doesn't look cheap, according to analysts at Jefferies. Whole Foods currently trades at nearly 23 times next year's earnings estimates, compared with about 15 for the S&P 500.

Still, some analysts believe the company is moving in the right direction.

Kate Wendt, an analyst at Wells Fargo Securities, said the steps the company is taking make the case for renewed sales growth "more credible."

First Published: July 31, 2014: 12:08 PM ET

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How to shop for back-to-school tax-free

NEW YORK (CNNMoney)

Starting this week, 15 states are offering tax breaks that can save shoppers between 4% and 7%. (Mississippi had a tax holiday in July).

Families with kids in K-12 will spend an average of $669.28 prepping for back-to-school this year, according to the National Retail Federation, so that kind of savings can really add up.

The breaks tend to apply to clothing, computers, software and school supplies, with the "holiday" usually being a two- or three-day period at the beginning of August or a longer sale toward the middle of the month.

But shoppers can't run out and buy lots of designer duds or high-end Apple computers, since most of the state tax holidays have restrictions. Most don't allow tax breaks on items that cost more than $100, according to Carol Kokinis-Graves, senior state tax analyst for Wolters Kluwer, CCH, which released a report on the holidays. Some exclude sports equipment and jewelry.

Also, while you'll get a break on state taxes, local taxes can still apply.

Related story: Six endangered brands

Those limits are why Lyman Stone, an economist at the Tax Foundation's Center for State Tax Policy, said he doesn't think the holidays do much to boost a state's revenue growth.

He said studies have shown that the holidays only shift when families buy goods, not how much they spend. He adds that retailers sometimes fail to apply the tax break or simply try to get around it.

"All these extra people go to the stores, so stores can afford to raise prices a bit," Stone said.

Related story: Autopsy of America: Photos of dead shopping malls

The good news is that you can usually shop online and still get the sales tax break, although you may have to pay up for shipping to ensure you take delivery before the end of the holiday period.

If you're looking for some stand-out deals, a few states offer sales with fewer limits.

In Missouri, shoppers can spend as much as $3,500 on a computer tax-free. Louisiana has a lump-sum break on $2,500 in spending, and South Carolina's list of non-tax items includes bed linens, shower curtains and other dorm room goods.

If they look enticing to you but you don't live in these states, feel free to hop in the car: Kokinis-Graves says she doesn't think she has "ever come across" a residency requirement.

First Published: July 31, 2014: 10:45 AM ET

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Wall Street wants tax holiday to be a QE4

NEW YORK (CNNMoney)

No, not another federal holiday to honor a dead president. (Coolidge, perhaps?) We're talking about an IRS holiday from Congress that would allow U.S. companies to bring back some of the $2 trillion in cash they've been stashing overseas to avoid paying taxes.

Such a move would give companies fresh powder to deploy on M&A, stock buybacks and even hire new workers.

"It could potentially act as a very potent market stimulus," Jeff Kleintop, chief market strategist at LPL Financial, wrote in a recent note. He compared the impact to a fourth round of quantitative easing from the Fed and even dubbed it QE4.

Related: When U.S. companies dodge taxes, is it unpatriotic?

While a tax holiday doesn't appear imminent, it has recently been floated by some leaders in Congress.

And there is a precedent for such a move. Congress ushered in a tax holiday in 2004 that paved the way for $362 billion of foreign profits being brought back onshore.

Here's how it works: Under the current system, companies don't need to pay the 35% corporate income tax on most overseas profits until they are "repatriated." And that cash can stay overseas indefinitely.

Apple (AAPL, Tech30), for example, has more than $50 billion sitting overseas. That's money Apple could be using to build new plants, reward investors with fatter dividends or snatch up a hot tech company. (SnapChat, maybe?)

The current rules, which Democrats and Republicans acknowledge are broken, have helped fuel a series of "inversion" deals that hurt federal tax revenue.

These transactions occur when a U.S. corporation moves its legal headquarters overseas after buying a foreign company that is based in a low-tax country. Medtronic's (MDT) takeover of Ireland's Covidien (COV) and drug maker AbbVie's (ABBV) plan to move to the U.K. by buying Shire (SHPG) are examples.

Related: More companies bail on U.S. for lower taxes

Under a tax holiday, companies could bring their overseas profits back to the U.S. and only pay a reduced tax rate. It was 5.25% in 2004.

"It would impact capital spending, employment, dividend payouts. It'd have a very therapeutic effect on the economy and the market," said Peter Kenny, chief market strategist at The Clearpool Group. "Many companies would love to bring capital back to the United States -- but it's just so prohibitive."

Shot in the arm for stocks: A tax holiday could also help offset the dwindling stimulus from the Fed, which this week dialed back QE by an additional $10 billion. The Fed is expected to end QE for good by October.

If companies brought back $1 trillion of overseas profits, that would match the Fed's peak annual bond-buying pace. (The Fed had been buying as much as $85 billion a month.)

Related: U.S. companies should pay U.S. taxes

But a tax holiday wouldn't boost stocks across the board. Large multinational companies that make a big chunk of their profits overseas would stand to benefit the most, said Bruce McCain, who helps oversee more than $20 billion at KeyCorp.'s Key Private Bank.

Mixed fiscal fallout: If endorsed by Congress, a tax holiday would also help pad Treasury's coffers in the short term through an influx of corporate income tax revenue.

However, it's not clear a tax holiday would help the country in the long run.

The Joint Committee on Taxation recently estimated a tax holiday would slash federal tax revenue by $96 billion over the next decade. That's because multinationals may continue hoarding cash overseas under the assumption that another tax holiday would be just around the corner.

There's also no guarantee that companies would use the cash for hiring. A report by the Center on Budget and Policy Priorities concluded that the 2004 tax holiday "did not produce the promised economic benefits" because companies mostly bought back stock instead of investing the money to grow their businesses.

Clearly a tax holiday would be more effective if it was part of a broader reform of the tax code.

But there's a better chance of "Sharknado 2: The Second One" winning an Emmy than this divided Congress puling off an overhaul of the tax system in a midterm election year.

First Published: July 31, 2014: 10:54 AM ET

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WWE slams workers by axing 7% of jobs

NEW YORK (CNNMoney)

WWE (WWE) revealed plans on Thursday to slash 7% of its workforce in an effort to save cash.

A WWE spokesman said the job cuts will impact all business units and locations. He said the pink slips will begin flying on Thursday.

The cost-cutting moves amount to a loss of around 60 jobs based on the company's headcount of about 850 people.

The job cuts come despite the fact that WWE CEO Vince McMahon declared in the company's earnings release that its "core business metrics remain strong."

The comments mirror ones made by biotech giant Amgen (AMGN), which earlier this week announced plans to cut 15% of its workforce, but declared it was making the move from "a position of strength."

Related: Amgen joins job-cut parade

As is often the case, WWE investors responded favorably to the belt-tightening. The company's shares popped 8% on Thursday morning on the news and stronger-than-expected earnings.

After topping $30 in March, WWE shares have taken a smackdown, losing more than one-third of their value over the past three months alone.

WWE continues to try to transform its business model into one that more closely resembles a media tech company.

The wrestling heavyweight plans to expand its network globally on August 12 and reported a jump in media revenue during the second quarter.

Related: WWE is the ultimate SmackDown stock

The influx of media revenue is offsetting trouble in other areas of its business. Live event sales have taken a hit due to lower attendance and consumer products revenue has tumbled amid slower video game sales.

WWE's job cuts come during a time of relative strength in the jobs market.

While Amgen and other big companies like Microsoft (MSFT, Tech30) have recently cut jobs, the U.S. added 1.4 million jobs during the first half of 2014. That's the best first-half performance since 2006.

Economists polled by CNNMoney believe the employers added another 230,000 jobs during July, signaling continued improvement in the labor market.

First Published: July 31, 2014: 11:12 AM ET

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FCC calls Verizon plan to throttle connections 'disturbing'

FCC chairman Tom Wheeler's got some harsh words for Verizon.

NEW YORK (CNNMoney)

Federal Communications Commission chairman Tom Wheeler sent a letter to Verizon (VZ, Tech30) questioning its plan announced last week to slow down 4G connection speeds for certain customers with unlimited data plans. The news was first reported by Mashable, which posted a copy of the letter online.

Wheeler didn't mince words in his criticism of the wireless giant, saying he was "deeply troubled" by the initiative.

Verizon no longer offers unlimited data plans to new customers. But subscribers who signed up for unlimited plans before Verizon ditched them in 2012 can keep those plans -- provided they pay full price when they get a new phone. The company said last week that it would occasionally slow the connection speeds of those customers during times of heavy network usage if they fall within the top 5% of data users.

Related: FCC to investigate Netflix-Verizon spat

The telecom giant said it would throttle speeds to help manage its network. But Wheeler rejected "network management" as a justification for slowing connections of paying customers. He called Verizon's actions "disturbing," suggesting that the company was trying to force people into usage-based plans, in which customers pay per gigabyte.

"'Reasonable network management' concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams," he wrote. "I know of no past commission statement that would treat as 'reasonable network management' a decision to slow traffic to a user who has paid, after all, for 'unlimited' service.'"

Verizon said Thursday that it would send an official response to Wheeler once it had "received and reviewed" the letter.

"[W]hat we announced last week was a highly targeted and very limited network optimization effort, only targeting cell sites experiencing high demand," the company said in a statement. "The purpose is to ensure there is capacity for everyone in those limited circumstances, and that high users don't limit capacity for others."

Verizon says unlimited data users will only experience slower speeds while performing high-bandwidth activities like online gaming or streaming video.

Related: Amazon and Google bash FCC's Internet fast lane plan

The FCC is currently in the process of finalizing new regulations on "net neutrality," or how broadband Internet providers can treat traffic on their networks. Those rules won't apply to the wireless services, however, which are more lightly regulated.

From a regulatory perspective, mobile connections differ from broadband in part because wireless spectrum -- the collection of frequencies over which all wireless transmissions travel -- is a finite resource. That means managing traffic can be more challenging for carriers.

The FCC auctions off spectrum rights to private companies, and Wheeler said Verizon's new policy could violate the terms of ownership for the high-speed spectrum it currently holds.

First Published: July 31, 2014: 11:17 AM ET

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Is the iPad doomed?

Uh oh. That arrow's pointing the wrong way.

NEW YORK (CNNMoney)

Easy, there, tiger. Tablets are still popular and sales are growing -- 11% last quarter, to be precise, according to tech consultancy IDC.

Still, that's a far cry from two years ago, when tablets were growing at a 60% clip. Meanwhile, the iPad has been in the doldrums, posting a 9% sales decline last quarter, which was preceded by a 16% slump the quarter before that.

So what's going wrong? There are three big obstacles facing the market that are impacting demand for tablets: Smartphones are getting bigger, tablets last a while and businesses aren't buying them.

Smartphones are getting bigger. Like, seriously huge. Samsung's popular Galaxy S5 has a 5.1-inch screen. Its Galaxy Note smartphone has a 5.5-inch screen, and Apple (AAPL, Tech30) is expected to release an iPhone 6 of the same size this fall. Amazon's (AMZN, Tech30) Kindle Fire tablet is just 1.5 inches bigger.

"If you just want to view information, which is really what a tablet is for, now there are mobile phones that are starting to approach the size of a small tablet," said Zeus Kerravala, principal analyst with ZK Research.

Who needs a tablet when you're already carrying one around in your pocket?

Related: IBM to start selling Apple iPhones and iPads

Tablets last a while. Unlike smartphones, there's not much incentive to buy a new tablet every two years.

Most people buy unsubsidized, Wi-Fi-only tablets without a contract from their wireless carrier. And there really isn't that much difference between Apple's new iPad Air and the original iPad that came out four years ago.

"Once you have a tablet of a certain generation, it's not clear that you have to move on to the next generation," Best Buy CEO Hubert Joly told Re/Code.

Businesses aren't buying tablets. PCs are everywhere in corporations, but tablets are harder to come by. Corporate IT departments are notoriously slow at adopting new technologies, and security remains a concern.

But that also means there's a huge growth opportunity.

Apple and IBM announced a partnership earlier this month aimed at solving the corporate tablet problem. Apple will deliver iPads to IBM (IBM, Tech30), which will load them with industry-specific apps for businesses in the banking, health care, insurance, retail, travel and transportation sectors.

That's why analysts think tablets could get a second wind later this year.

"We believe that stronger commercial demand for tablets in the second half of 2014 will help the market grow," said Jean Philippe Bouchard, IDC's research director for tablets. "We will see more enterprise-specific offerings, as illustrated by the Apple and IBM partnership, come to market."

So the tablet's not dead. It's just resting.

First Published: July 31, 2014: 10:59 AM ET

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Only 63% of American adults are in labor force

NEW YORK (CNNMoney)

As of June, only 63% of Americans over age 16 participate in the labor force, meaning they either have a job or are actively looking for one. That number is around its weakest level since the early 1980s.

Unless there's a major change in policy, the White House expects the labor force participation rate will flat-line and then continuing falling, even as the economy returns to full strength.

In a report issued Thursday, the president's Council of Economic Advisors laid out several hypothetical scenarios for how the labor force participation rate could evolve over the next decade. They're not technical forecasts, but they all have one thing in common: They're all declining lines.

Related: Great jobs report: Strong hiring, unemployment down

The U.S. population is aging: The finding isn't surprising. Independent economists generally agree that the labor force participation rate will continue falling in the future as the U.S. population ages. As baby boomers retire and live longer than prior generations, it's only natural that a greater portion of the U.S. population won't be active in the job market.

The big question, however, is: Just how much of the labor force's ongoing declines are due to baby boomers?

The CEA economists have their own estimates. The labor force participation rate declined from around 66% at the end of 2007, to 63% in mid 2014. They calculate that half of that decline is due to the aging population.

Another sixth is due to a common phenomenon that occurs in recessions: Some workers decide to hold off on looking for jobs until the economy improves. Perhaps they go back to school to beef up their résumé, or they may choose to take care of children or elderly parents, while waiting out the weak job market.

Finally, CEA estimates the other third of the decline was due to other factors, including ongoing historical trends.

Related: See who is getting hired these days...

Labor force participation for "prime-age" men (ages 25 to 54) for example, has been declining since the 1950s, and for prime-age women, it's been declining since the late 1990s.

Growing concern: Regardless of the reasons, declining labor force participation is a worrisome sign because it may mean the U.S. economy has less potential to grow going forward. The implications are far-reaching, when a smaller part of the population is producing goods and services, paying income taxes, and basically supporting a larger non-working population.

CEA economists note that they believe immigration reform is the single most powerful policy that could counteract a declining labor force.

Immigrants tend to be younger and participate more in the job market, and a report from the non-partisan Congressional Budget Office last year estimates that the Senate's immigration reform bill could increase the labor force by 6 million people by 2023.

Read the full CEA report on labor force participation here.

First Published: July 17, 2014: 11:08 AM ET

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Cold beer battle heats up in Indiana

Jay Ricker wants to be able to sell cold beer in his convenience stores, but Indiana law says it has to be warm. He's taking it to court.

NEW YORK (CNNMoney)

The law allows only liquor stores to sell cold beer "to go" in the Hoosier state.

But grocers and other stores, such as Kroger (KR), Wal-Mart (WMT), Costco (COST), CVS (CVS) and Walgreen (WAG), have to sell their beer warm.

Now a group of Indiana stores is suing the state, and have also filed an appeal in federal court, hoping to change the law, which they say "lacks common sense."

On the books since the early 1960's, the Indiana rule says that the temperature of beer sold in stores has to be warm, unless sold in liquor stores. Regular store owners say it hurts them.

"Basically liquor stores have a monopoly," said Jay Ricker, owner of the Ricker's convenience store chain, and a plaintiff in the suit. "People want to grab a six pack and go home, and they expect products that are immediately consumable. That puts us at a disadvantage."

Related: Craft beer craze finally hits the South

A change in the law would also be good for consumers, store owners say, because competition would bring prices down.

The average surcharge for cold beer is $1 at about 300 liquor stores surveyed by Scot Imus, who heads the Indiana Petroleum Marketers & Convenience Store Association, and represents more than 250 convenience store operators across the state, 90% of whom also sell gasoline.

"The first thing that happens when you buy a case of beer at a liquor store is that the clerk touches it first to see if it's cold. If it's cold, they'll charge you more for it," Imus said.

Related: Is craft beer really a good business bet?

However, liquor store owners claim that the fight isn't about cold or warm beer, or about bringing the price of beer down. It's about national supermarket chains not wanting to be tied down by local alcohol rules.

Liquor stores in Indiana require customers, and clerks, to be at least 21 years of age. Clerks also need to have their own permits, and be certified to sell beer -- rules that other retailers don't have to follow.

It's safer, said Patrick Tamm of the Indiana Association of Beverage Retailers, a group that represents 1000 liquor stores.

The reason why this fight is headed to court is also because cold beer is a business driver. Store owner Ricker said that when people pick up cold, rather than warm, beer they typically buy add-on items like chips, jerky, and other munchables.

He points out that the law also doesn't apply to wine. Ricker is allowed to sell ice-cold wine, which typically has higher alcohol levels than beer.

"Indiana needs to get out of the dark ages. Consumers should be able to get products when they need them," Ricker said.

First Published: July 17, 2014: 11:23 AM ET

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Fiat: We're not talking merger with VW

Fiat shares jumped after a German magazine reported Volkswagen is considering a takeover of the automaker - a claim Fiat denied.

LONDON (CNNMoney)

Germany's Manager magazine reported that Volkswagen (VLKAF) is considering a full or partial takeover of Fiat (FIADF), which bought bankrupt Chrysler in 2009.

Controlling shareholders have held a series of discussions about a deal, the magazine reported, citing unnamed company sources.

"Fiat states that they have not held discussions with Volkswagen regarding a potential merger," the Italian automaker said in a statement.

Volkswagen declined to comment.

Manager said the Agnelli family that controls Fiat wants to concentrate on the Ferrari sports car brand, but withdraw from its other carmaking activities.

The German automaker would use Chrysler's dealer network and its range of SUVs and pickups to challenge global rival General Motors (GM).

Related: Most iconic American cars

Shares in Fiat gained 1.7%, while Volkswagen shares fell 2% in European trading. Italian stocks were 1.5% weaker.

Chrysler has enjoyed success under Fiat's ownership. It returned to profitability in 2011 and has been steadily improving sales and market share.

Worldwide vehicle sales last year were 2.4 million, up 9% from 2012, driven by a 14% increase in U.S. retail sales. Chrysler is targeting worldwide shipments of 2.8 million vehicles this year, up from 2.6 million in 2013.

Fiat completed its Chrysler takeover in January when it agreed to pay $3.65 billion for a 41% stake owned by the United Auto Workers union's health trust.

Shares in a new parent company -- Fiat Chrysler Automobiles -- are due to start trading in New York and Milan later this year.

First Published: July 17, 2014: 8:52 AM ET

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Here's Google's plan to rid the world of cyberattacks

The Internet is full of bugs, and Google just launched a superhero team to kill 'em all.

NEW YORK (CNNMoney)

They're looking to exterminate those nasty computer bugs that let hackers and government spies sneak into our computers -- not just for Google, but for everyone.

The special team is called Google Project Zero. And whether you use products by Adobe (ADBE), Apple (AAPL, Tech30), Microsoft (MSFT, Tech30) or software most people don't know by name, the team is working on it.

"You should be able to use the Web without fear that a criminal or state-sponsored actor is exploiting software bugs to infect your computer, steal secrets or monitor your communications," Chris Evans, a Google researcher who's leading the new effort, wrote in a blog post.

Related story: Your Internet security relies on a few volunteers

Project Zero is made up of some of the world's smartest, well-intentioned hackers. They spend their days poking at holes in computer code we all rely on -- and making sure those holes get patched.

The Project Zero name comes from the very types of bugs they're trying to eliminate: "zero day" vulnerabilities, which are never-before-seen software flaws that hackers love to exploit.

When Google researchers discover flaws in another company's software, they'll quietly alert that firm. If nothing gets done soon, they'll go public with it on their blog. And if the bug is particularly critical, they'll put extra pressure on the company and try to develop an alternative themselves, Google (GOOG) told Wired, which first reported the story.

The team already spotted holes in Apple's iOS device software and Microsoft's malware protection program, and it got public nods from both.

Related: Cybersecurity: How safe are you?

There's clearly a need for this kind of help. Devastating bugs that undermine our privacy and financial safety have been found in little-supported, community-maintained software we all use. That was the problem that led to the Heartbleed bug in April and the similar Handshake bug in June.

Why the stroke of benevolence? Google says it's part of the company's all-around altruistic mission to make the world a better place. And ex-Google folks tell CNNMoney they back that up 100%.

But it's also good business.

"Google realized early on that what's good for the Internet is good for Google," said Shuman Ghosemajumder, an executive at cyberdefense firm Shape Security.

Related story: Chinese hackers broke into U.S. federal employee network

By creating Project Zero, Google is helping shoulder a burden presently carried by nonprofits. Groups like the Electronic Frontier Foundation spot digital weaknesses that threaten online safety and develop privacy tools. But now those volunteers have help from a superpower -- with super money.

"The level of investment and resources, access to Google infrastructure and knowledge takes it to a completely different level," Ghosemajumder said.

Also, putting together a ragtag team of coding geniuses is a relatively small cost for Google compared to what it's getting.

"This gives Google the reputation of taking security seriously," said Jay Kaplan, an ex-NSA analyst who now leads the cybersecurity firm Synack.

First Published: July 17, 2014: 7:12 AM ET

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Would you order this $78 taco?

These caviar tacos grace the menu of 'Rose.Rabbit.Lie.,' a restaurant inside The Cosmopolitan Las Vegas.

NEW YORK (CNNMoney)

From tacos and flatbread to pasta and burgers, caviar -- those shiny little balls usually passed on a small spoon by a white-gloved waiter -- is shedding its stuffy image and lending a highbrow take to a regular meal.

"It's about sharing in that little taste of luxury," said Wesley Holton, executive chef of "Rose. Rabbit. Lie." at The Cosmopolitan of Las Vegas.

His menu offers both tacos and flatbread with caviar. A taco with Hackleback caviar costs $15; one with Russian Osetra caviar, a more expensive variety, is $78. The flatbread, which has egg, bacon and a large dollop of caviar, is $19.

Flatbread with caviar is also served at Petrossian, an upscale restaurant in West Hollywood, Calif. It's a small dish and costs $28. The restaurant also offers pasta made with a caviar powder, which is created from dried caviar in a process the restaurant says is secret.

"You can grind it right on top of an omelet or pasta, as we do," said Rori Flynn, a Petrossian employee. She said it adds a nice crunch.

Related: Great potato salad for (waaayyyy) less than $40,000

Flynn said the chef, Giselle Wellman, works to incorporate caviar in many different dishes.

"People can be a little nervous about caviar so she tries to put it in a form that's approachable to everyone," Flynn said.

Caviar is served in various amounts. A kilo at 'Rose. Rabbit. Lie.' costs as much as $5,054.

It would be understandable to assume caviar is a delicacy reserved for the 1%. Those salt-cured fish eggs can be pricey, and often are treated with serious ceremony. An ounce of the good stuff can cost nearly $350.

For those wanting to retain some of caviar's exclusivity without the tradition, there's always the fancy burger. Petrossian offers a caviar hamburger, though it isn't on the regular menu, so customers need to know to ask for it. It includes caviar aioli and costs $75. A smaller version is available on the happy hour menu for $15.

Meanwhile, Manhattan burger joint Beer & Buns offers a burger with beluga caviar and foie gras piled on top of a Kobe beef patty for $250.

Related: 'The most expensive thing I ever bought'

That's less than the world record for the priciest burger, a title held by New York restaurant Serendipity 3. That caviar-topped burger costs $295, and also comes with a donation to charity. It is available by appointment only.

For those who don't want to make a burger appointment, or spend that kind of money, Serendipity 3 offers a burger with black caviar, sour cream and cucumber slices for only $18.50.

Over at Las Vegas' "Rose. Rabbit. Lie.," chef Holton hopes that even as caviar appears on more everyday dishes, it will still be considered special and celebratory.

"But it would be nice to see it be a little bit more popular," he said, "where people aren't intimidated to order it."

What's the most expensive restaurant item you've ever ordered? Tell us -- and if you have a photo, show us -- at #BigMoneyMeal @CNNMoney or email jillian.eugenios@cnn.com. The best responses may appear in a future CNNMoney feature.

First Published: July 17, 2014: 7:07 AM ET

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Americans take a vacation from U.S. stocks

NEW YORK (CNNMoney)

The Investment Company Institute reported Wednesday that investors have pulled money from American mutual funds for 11 consecutive weeks. There was an especially big dip of $8.9 billion the first week in July when the Dow hit 17,000.

Investors aren't just taking their money out and holding it in cash. They are putting into foreign stocks and corporate debt.

Related: Lower safe haven demand is helping keep CNNMoney's Fear & Greed index into neutral territory

Phil Camporeale, a client portfolio manager for JP Morgan Asset Managment's Global Multi-Assets Group, is surprised that his clients are choosing to pursue cheaper valuations in Europe and emerging markets.

"People were wildly, wildly afraid of the asset class," he said, referring to last year's Federal Reserve-driven "taper tantrum" that sparked a flight from risky emerging markets.

"Coming into this year, you had a lot of people underrating that asset class, and now they've had to run to cover it," he said.

He still thinks the U.S. is a good place for investors. The S&P 500 index is still beating both MSCI's World Index and Emerging Markets indexes for the year.

CNNMoney's recent survey of investment strategists echoed that sentiment. Most of the 22 experts surveyed are still bullish on American stocks.

Related: Check out which individual markets are having a better year than the U.S.

But the ICI data is just one way to look at things. Research firm EPFR's fund flow data, which also includes exchange-traded fund (ETF) flows, displays a much cloudier picture. American stocks are still seeing negative flows for the past few weeks, but the shift isn't as dramatic.

"What you're seeing is a continuation of a trend that you've been seeing for a couple years now," said Sean Collins, ICI's senior director of industry and financial analysis. Mutual funds are getting replaced with index funds and ETFs.

Corporate debt is also having a good year thanks to persistently low interest rates. The difference in yields between the bonds of America's companies and Treasury debt are the smallest they've been in almost seven years. Anyone looking for yield is buying "high yield" or even emerging market debt.

Related: Investors hungry for corporate bonds

Mike Chadwick, CEO of Chadwick Financial, said that while his clients in the 30s and 40s have faith that everything from stocks to bonds will continue to ride higher, his other investors are less sure.

"The older, more sophisticated client is far more concerned about where we go from here."

First Published: July 17, 2014: 7:01 AM ET

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Microsoft cuts 18,000 jobs

NEW YORK (CNNMoney)

The software giant said it would cut 18,000 jobs within the next year -- about 14% of the company's 125,000 employees. That's by far the largest round of layoffs in the company's history.

The previous record came during the lowest point of the Great Recession, when Microsoft (MSFT, Tech30) cut more than 5,000 jobs in 2009 -- the first mass layoff in the company's history.

Most of the latest round of layoffs -- 12,500 -- will come from Nokia's devices and services business that Microsoft recently bought. In a memo to Microsoft's staff, Nadella said that Microsoft found many redundancies between the two companies, including both professional and factory workers.

Microsoft didn't identify which regions the job cuts would come from, only saying it has laid off 1,351 employees in the Puget Sound, Wash., area where Microsoft's headquarters are located. Those cuts represent about 3% of the employees based in the region. The majority of Nokia employees work in Finland.

Microsoft is also cutting 5,500 other jobs at the company. As part of the company's new strategy, which Nadella outlined in a separate memo to employees last week, Microsoft will focus intently on improving its mobile and cloud productivity software, including Office 365, Windows Phone, Windows Azure, Skype, OneDrive and Bing.

Nadella said Microsoft was in need of a "culture change." Microsoft's rivals, including Google (GOOGL, Tech30), Apple (AAPL, Tech30) and Amazon (AMZN, Tech30), have in many ways beaten Microsoft at the mobile and cloud game in recent years. Mobile and cloud are where most of the tech industry's growth is coming from.

Related: Did Apple and IBM just kill BlackBerry?

As part of the company's strategy shift, Nadella said Microsoft would kill off Nokia's short-lived "Nokia X" Android smartphone experiment. Those low-cost phones will soon be made to run Windows in an effort to help Microsoft gain traction in the fast-growing budget smartphone business.

Many of the job cuts will come from the management ranks, as Nadella pledged to have fewer layers of "top-down and sideways" oversight "to accelerate the flow of information and decision making."

"We will simplify the way we work to drive greater accountability, become more agile and move faster," Nadella said. "The overall result of these changes will be more productive, impactful teams across Microsoft."

As the company cuts jobs, Nadella noted Microsoft will also be hiring in those "strategic areas" that he laid out last week.

Nadella said the first 13,000 job cuts would come in the next six months, and Microsoft said it expects the layoffs to cost the company up to $1.6 billion over the next year.

Though Microsoft is laying off a massive number of employees, it doesn't come close to the biggest job cuts in corporate history. IBM (IBM, Tech30) cut 60,000 jobs in 1993 as part of a massive restructuring of the tech giant. During the Great Recession, Citigroup (C) slashed 75,000 jobs between 2008 and early 2009. And Hewlett-Packard (HPQ, Tech30) laid off 27,000 employees in 2012.

Microsoft's shares rose more than 3% Thursday morning.

First Published: July 17, 2014: 8:38 AM ET

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Barbie cries for help: Mattel shares plunge

NEW YORK (CNNMoney)

Mattel (MAT), the largest company in the toy industry, reported a sharp drop in sales and earnings during the second quarter.

Shares were down 6% on Thursday.

Its traditional toys -- iconic brands like Barbie -- aren't resonating as much in the digital age.

Sales fell for most of Mattel's leading brands, including a 15% drop for Barbie. Fisher-Price, which makes toys for infants and toddlers, had a 17% sales drop. Barbie was partially impacted by people buying Frozen dolls instead.

Earnings fell to 8 cents per share, down from 20 cents in the same period last year. Mattel said earnings were hurt by costs associated with the acquisition of MEGA Brands, which it bought in February for $460 million.

One of the few bright spots for Mattel was the line of American Girl dolls. The company also continues to see strength in sales of toys linked to Disney's Frozen franchise.

Gallery: Exclusive: Toymakers unveil new 'Frozen' products

But the company is facing a number of long-term headwinds.

Bryan Stockton, chief executive at Mattel, said the company is making progress on a number of initiatives aimed at boosting sales in the "all-important back half of the year."

Toy makers, like most retailers, earn the bulk of their profits in the holiday period. Mattel plans to ramp up advertising as it tries to regain momentum heading into 2015.

Thomas the tank engine to the rescue? Looking ahead, Stockton said Mattel plans to bring back its "historic line" of American Girl dolls, including "our beloved Samantha," one of the original dolls. In addition, the company plans to open specialty stores around the "Thomas & Friends" line of toy trains.

Mattel is also excited about the upcoming Star Wars movie, given the licensing agreement it has with Hot Wheels.

Stockton said the global toy business is "doing well," citing growth of between 3% and 4%. International markets are the "number one growth opportunity" for Mattel, he added.

Mattel has been shaking up its management team this year as it looks for ways to compete with digital toys. In May, it named Richard Dickson as chief brands officer.

"This validates our belief that innovation will drive growth, and that toy and digital play both share time in a child's life," he said.

First Published: July 17, 2014: 8:39 AM ET

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Stocks tumble after Malaysian jet crash

NEW YORK (CNNMoney)

A Malaysian Airlines jet reportedly crashed in Ukraine. The airline has confirmed that it lost contact with the plane in Ukraine, near the Russian border. Many European markets are now down more than 1%, gold is jumping up and U.S. markets are sliding as well.

The Dow is down around 60 points (0.35%) after dipping as far as 90 points down. The S&P 500 is off about 0.6%, and the Nasdaq is hanging around negative 0.8%.

As further indication of the market jitters, gold prices ticked 1.5% higher, and the VIX index, a measure of market volatility that's sometimes called the "Fear Gauge" The VIX "Fear Gauge" is about 17% higher.

Here are the other things to watch in today's trading:

1) Tech Movers: Microsoft (MSFT, Tech30) announced a staggering 18,000 job cuts to come this morning. The move signals that new CEO Satya Nadella means business about turning around the computing giant. Most of the cuts are coming from the Nokia brand, but some of the bleeding will come from Microsoft proper. The stock is up about 0.7%.

Related: Layoffs part of "culture change" at Microsoft"

In other tech news, flash drive maker Sandisk (SNDK) is getting hammered to the tune of an 13% drop heading into lunch. The company beat on earnings and revenue this quarter, but that wasn't enough to satisfy Wall Street. It said in an earnings release that it brought in a record $1.6 billion in revenue for the quarter, but its margins are shrinking.

Related: Compare Microsoft and Sandisk to CNNMoney's Tech30

2) Playtime less fun at Mattel: Barbies and Hot Wheels aren't entertaining kids like they used to. Mattel saw tepid growth that was far less than Wall Street was expecting. The stock has fallen 6% so far today.

One bright spot for the company is American Girl doll sales, though it's a small part of the company's business.

Related: Trouble in Toy Land for Mattel

3) No Hangover for Time Warner: After rejecting an $80 billion bid from Rupert Murdoch's Twenty-First Century Fox (FOX), Time Warner (TWX) saw its 17% jump in yesterday's trading. Investors don't think that will be the end of things. The stock is up another 3.5% today. Fox shares are flat.

Related: Rupert Murdoch wants Time Warner for size, sports and ego

4) Health care hullabaloo: Insurer UnitedHealth Group (UNH) put out good results for the quarter, with earnings and revenue that beat expectations in all categories based on growth from all its business units and higher enrollments. The stock is up 3.3%.

A host of other insurance stocks are also up today. Humana (HUM) is up 3.7%, Aetna (AET) is up 2.4% and WellPoint (WLP) shares are trading 2% higher.

5) Things looking good for banks: Morgan Stanley (MS), the last big American bank to report earnings this quarter, did better than Wall Street was expecting. It beat estimates for both earnings and revenue on the back of a strong performance from its units in stock trading and investment banking. The stock is up about 1%.

Related: JPMorgan, Goldman Sachs smiling today

Rebounding bank performance is a good sign for the economy. Solid economic data also keeps rolling in for the U.S. On Thursday, initial jobless claims were once again lower than expected, coming in at 302,000.

6) Overseas markets: Russian sanctions and possibly worries about the crash are fueling a sell-off in European stocks. The FTSE 100 is down about 0.7%, and the German Dax is off more than 1%. The Russian RTS index is down just less than 4%.

Asian stocks ended the day mixed, though Taiwanese stocks fell more than 0.8%. Oil is also ticking higher since some of sanctions impacted a Russian energy company.

First Published: July 17, 2014: 10:08 AM ET

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Russian markets rattled by new sanctions

Russian markets have been on a wild ride this year as investors and traders worry about the fall-out from the Ukrainian crisis.

NEW YORK (CNNMoney)

The country's benchmark Micex index fell more than 2% and the ruble was down about 1% against the dollar Thursday after the U.S. government unveiled a new round of sanctions against several Russian businesses and individuals.

President Obama said he expected the sanctions would weaken the Russian economy and further isolate the country. His comments came as European leaders announced they would be drafting a new list of sanctions targets by the end of July.

The West is using sanctions to punish Russia for its continued support of armed separatists who are battling the Ukrainian military in the east of the country.

Related: Malaysian Airlines plane down over Ukraine

The new U.S. measures target two banks, two energy companies, eight arms firms, a shipping facility and various Ukraine separatists.

The U.S. stopped short of imposing trade sanctions on entire sections of the oil-rich economy, but experts said the latest moves could still have painful consequences.

"With the new round of sanctions, the risk of a Russian recession rises further," said Berenberg chief economist Holger Schmieding.

William Jackson from Capital Economics said that the new sanctions could damage investment in the country, which would hurt Russia's economic growth.

The latest measures prevent two of the country's leading energy companies -- Rosneft and Novatek -- and two major banks -- Gazprombank and VEB -- from raising medium and long-term financing from U.S. sources. The other targets have had their U.S. assets frozen and have been cut off from doing business with American companies and individuals.

Shares in Rosneft dropped by about 4% and Novatek stock was down by more than 5%.

Rosneft's CEO Igor Sechin said the decision to place sanctions on his company were "groundless, biased and illegal," saying the company was not involved in the crisis in Ukraine.

Russia's economy has been struggling over the last few months. It was already slowing before the Ukraine crisis began, and sanctions have made the outlook even weaker. The International Monetary Fund forecast in late April that growth would slump to just 0.2% this year, down from 1.3% in 2013.

Related: Russia cuts off natural gas supplies to Ukraine

Russian markets have been on a wild ride this year as investors try to assess how far the U.S. and Europe will go with their sanctions and how bad the fighting will get in Ukraine.

The Micex stock market index plunged by 21% between January and the middle of March, then recovered all those losses before turning lower again this month. It stands 4% down so far this year.

The ruble has also fluctuated wildly versus the U.S. dollar. Its losses for the year currently stand at about 6%.

First Published: July 17, 2014: 12:32 PM ET

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Crumbs: Not dead yet

NEW YORK (CNNMoney)

A group of investors including CNBC host Marcus Lemonis are preparing a bid to save the high-end cupcake chain, according to the business news network. The network said he would discuss the plans Thursday afternoon.

In response, Crumbs (CRMB) CEO Edward Slezak said the company is "pleased to be in talks with various interested parties that are allowing us to pursue all of our options for the business."

The company's stock soared more than 1100% -- to about 36 cents -- on the news. It had traded as high as $3.49 in 2013, but opened at just 3 cents Thursday morning.

Crumbs closed all of its stores on Monday, but has been struggling for some time. It began closing stores in 2013 amid steep losses. At the end of the first quarter this year, it had 65 locations in 12 states.

--CNNMoney's Chris Isidore contributed to this report

First Published: July 10, 2014: 12:43 PM ET

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LeBron's road to becoming a billionaire

Whether LeBron James remains with the Miami or returns to Cleveland, his ultimate goal is to become a billionaire.

NEW YORK (CNNMoney)

But whichever city he picks, the contract will be only a small part of his eventual goal: becoming a billionaire.

Not that James will be playing for pocket change. He's expected to sign for the maximum allowable contract under the National Basketball Association 's labor agreement. And he's already been paid about $128 million in his first 11 years as a pro.

But those contracts are dwarfed by his endorsement deals. Before he played his first minute in the NBA, Nike had signed the then-teenager to a seven-year, $90-million endorsement deal. Other deals include those with Coca-Cola (KO), McDonald's (MCD), Samsung (SSNLF) and Dunkin Brands (DNKN).

Related: Five insane Samsung gadgets

Published reports put his endorsements deals at between $38 million to $53 million in the past year, more than any other athlete. His current deal with Nike (NKE) alone is worth an estimated $20 million a year in endorsement income and royalties on his brand of sneakers.

But even his total endorsements come to "only" a bit over $300 million since he turned pro, according to published reports. So he'll need investments to get him to the land of 10-figure net worth. And he might well do just that.

Back in 2007, before he was a free agent for the first time, the then 22-year old James was already aiming for his lofty goal. He befriended Warren Buffett for his investment advice and set up a firm, LRMR Marketing, to start to handle his low profile investments in business start-ups, real estate and other companies.

Those investments included a reported 10% stake in bike-maker Cannondale and a stake in high-end headphone maker Beats by Dre that ESPN reported paid him an estimated $30 million when the company was purchased by Apple (AAPL, Tech30) for $3 billion earlier this year.

Maverick Carter, a high school friend of James who is his partner in LRMR, told CNNMoney back in 2007 that James' billion-dollar goal was centered around the investments more than his playing income or endorsement deals.

"It's impossible to get to a billion dollars by endorsement deals," said Carter. "The biggest deals only take you so far. It's how you make money when you're asleep that's going to get you there."

Among his investments is a minority ownership in the Liverpool Football Club, the British soccer team that he bought into as part of a deal with the Fenway Sports Group. The Fenway Sports Group is the majority owner of not just the Liverpool team, but also the Boston Red Sox and Roush Fenway Racing, a NASCAR team.

If he gets to be a billionaire, it's not clear if James would be the first athlete to cross that threshold.

Forbes estimated in 2009 that Tiger Woods' winnings and endorsement income crossed the billion dollar mark that year. But his earnings and endorsements have plunged since then, due to a combination of on-course problems and an off-course sex scandal. The latter resulted in a divorce that also likely reduced his net worth.

First Published: July 10, 2014: 10:57 AM ET

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Mind control app lets you snap photos with Google Glass just by focusing

You can now control Google Glass with pure brain power, using the new MindRDR app.

NEW YORK (CNNMoney)

A new app called MindRDR allows users to snap photos and post them to Facebook (FB, Tech30) and Twitter (TWTR, Tech30) without so much as lifting a finger or uttering a word.

Pronounced "mind reader," the app doesn't actually read your mind. It connects two wearable devices: Google (GOOG) Glass and NeuroSky's MindWave brainwave reader.

Wearing the two headpieces together (if you're into the bionic man look), your brain activity is measured using electroencephalography (EEG), the same neurotechnology used to diagnose epilepsy and sleep disorders.

Your mental focus is then translated into two actions. As TechCrunch first reported, your initial burst of concentration triggers the app to take a photo of what you're looking at through Google Glass. Focusing your mind again shares that photo on your social media account.

Related: Google Glass wearers can steal your password

Created by This Place, a London-based design and digital innovation studio, the combination of technologies behind the MindRDR app is not just limited to social networking. Really, the simple act of taking and sharing a photo is a proof of concept for This Place's technology.

This Place released the app's source code so other developers can put their own spin on the interaction between human brain power and digital devices. The caveat is that both the $1,500 Google Glass and the $80 NeuroSky MindWave are required purchases for experimentation.

The app maker says the technology could be used to help people with physical limitations and speech impediments. This Place developed the Google Glass App after the team noticed the amount of hand and voice activated controls on the wearable device.

Google touts Android TV, smartwatches and cars

"It became very clear to us that those with disabilities have difficulty interacting with digital devices," said Ben Aldred, company director of This Place.

"We're really excited about releasing this to the world," said Aldred. "To purely use the power of your mind to control an interface -- it's the interface of the future."

First Published: July 10, 2014: 12:24 PM ET

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Why state and local reporting is suffering

Only 4 full-time reporters cover Connecticut's statehouse

NEW YORK (CNNMoney)

Does that match up with reality? Essentially yes, says the Pew Research Center.

In a new study released Thursday, Pew shows that the relatively small pool of reporters covering state governments has been drying up over the past decade.

Currently, there are 1,592 journalists assigned to statehouses in all 50 states, according to Pew. About half of them are on the beat full-time. And roughly 14% of the total are students who cover the legislatures and state officials for short periods of time. Local television reporters account for another 17% of the total.

Most of the rest work for newspapers, but their numbers have been dwindling.

"An analysis of comparable newspaper data over time reveals a 35 percent drop in full-time statehouse staffing from 2003 to 2014," Pew says.

"In numerous conversations with journalists, legislative leaders and industry observers, one sentiment was expressed again and again: concern about the impact of what they see as a broad decline in mainstream media coverage."

Related: Future of media

The study says that nontraditional news outlets "have tried to fill the gaps left by the lost jobs." These include digital news start-ups, niche publications and bloggers with a political point of view.

"Nontraditional outlets employ 126 full-time statehouse reporters," Pew says, which is "fewer than the 164 jobs lost from the newspapers studied from 2003 to 2014."

The Texas Tribune, for example, operates the largest single statehouse bureau out of Austin, Texas. It has 15 full-time reporters and 10 students. "The Connecticut Mirror is next with four full-time reporters," the study says.

Some state officials have even said that they find themselves producing more of their own media -- through press releases, videos and other formats -- to compensate for the decline in coverage from traditional outlets.

The study ends with this comment from Bobby Harrison, the capitol bureau chief for the Northeast Mississippi Daily Journal: "I think in a way, because of the Internet, there's more information being put out, but the information a lot of times is partisan. As far as analysis and in-depth reporting, I think there's definitely less than there was 10 years ago."

First Published: July 10, 2014: 10:00 AM ET

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Chinese hackers broke into U.S. federal employee network

Hackers from China sought information on government employees, including which personnel have security clearances.

NEW YORK (CNNMoney)

The attack occurred in mid-March, U.S. government officials told CNNMoney on Thursday. A New York Times report attributed the operation to China -- although it was unclear whether hackers were independent or government spies.

President Obama's cybersecurity advisers would not say whether the attack came from China or elsewhere.

The hackers managed to break into the computer network at the Office of Personnel Management, which stores data about federal employees. The agency conducts background checks for anyone working with the federal government, and it keeps information about employee hiring, wages, pensions and security clearances.

All of this is valuable information for foreign governments and corporations. If you know who has top-secret access, you know who to bribe -- or kidnap -- to get information.

Related story: What were China's hacker spies after last time?

The hackers managed to break into the agency's network, according to several federal agencies involved. But U.S. investigators haven't yet spotted "any loss of personally identifiable information," according to an official at the Department of Homeland Security who spoke to CNNMoney on condition of anonymity.

DHS and the personnel agency constantly monitor computer systems, so the break-in set off alarms and allowed them to act quickly, according to Office of Personnel Management press secretary Nathaly Arriola.

The U.S. Computer Emergency Readiness Team is now conducting forensic analysis to determine how deep the hackers got -- and what they know.

Related story: Russian hackers attack U.S. oil and gas companies

This news comes at a pivotal moment: just U.S. Secretary of State John Kerry wraps up the United States' annual in-person meeting with Chinese officials. On Thursday, America's top diplomat released a joint statement with Chinese State Councilor Yang Jiechi discussing cybersecurity -- but not this latest episode.

They called cybersecurity "a common threat" and said China hopes to "strengthen cooperation on the basis of mutual respect and trust."

However, today's revelations put that in context. The reality is, there's an ongoing cyberwar. On one side, there are the all-seeing American and British cyber spies. On the other are intellectual-property-stealing hackers in China and Russia.

And there's no end in sight.

First Published: July 10, 2014: 11:10 AM ET

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New Internet speed record blows past Google Fiber

Bell Labs set a new broadband Internet speed record that could change the need for Internet providers to bring fiber to the home.

NEW YORK (CNNMoney)

It is eight times faster than the previous record -- and it was done over copper landlines.

With speeds of 10 gigabits per second, Bell Labs' technology proved to be 1,000 times faster than traditional broadband speeds. It is even 10 times faster than Google (GOOGL, Tech30) Fiber, which offers the fastest broadband available to consumers.

Alcatel-Lucent (ALU), Bell Labs' parent company, dubbed the new technology "XG-FAST." The company called it a "major breakthrough," giving broadband companies the ability to provide fiber-optic-like speeds over the existing copper landline infrastructure that blankets most of America.

Verizon (VZ, Tech30) FiOS, Google Fiber and others have sought to bring ultra-fast fiber connections directly to people's homes. But the process is extremely expensive, and often involves digging up homeowners' yards. Providing fiber to the majority of American households could cost hundreds of billions -- or even trillions -- of dollars, depending on various estimates.

But Netflix (NFLX, Tech30) and other bandwidth-hungry applications are forcing broadband providers' hands. Video over the Internet is cramping networks and slowing connection speeds.

Realizing they need a bigger pipe to carry all the data that customers demand, companies like Comcast (CMCSA) and AT&T (T, Tech30) have increased the amount of fiber they use in their networks -- but they still use old-fashioned telephone lines and copper wires to bring Internet, TV and phone service to their customers' homes and offices.

Related: Much faster Wi-Fi coming soon

XG-FAST could potentially make it unnecessary to bring expensive fiber for ultra-high-speed Internet.

Bell Labs says that XG-FAST can provide up to 10 gigabits per second over a distance of up to 30 meters. So if there is a fiber connection on the street, it would be sufficient to deliver lightning-fast Internet over a home's existing landline wires. For big buildings, fiber could be brought into the basement without needing to route it to individual apartments or offices.

"The Bell Labs speed record is an amazing achievement," said Federico Guillén, president of Alcatel-Lucent's fixed networks business. "Bell Labs is offering the telecommunications industry a new way to ensure no customer is left behind when it comes to ultra-broadband access."

Related: Cisco plans to double the speed of the Internet

Though the research is exciting, don't expect your cable provider to start offering 10 Gbps speeds anytime soon.

Bell Labs' test was done in -- you guessed it -- a lab. In the real world, there are plenty of factors that can reduce Internet speeds traveling over copper lines, including the thickness of the cable, signals picked up by other nearby cables and the length of the wire. The technology also has yet to be approved by the standards-setting International Telecommunication Union.

Still, the promising new technology could help America achieve much faster broadband speeds that many other developed countries are already enjoying today.

First Published: July 10, 2014: 11:22 AM ET

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6.5 million homes at risk from storm surges

NEW YORK (CNNMoney)

Given that oceanfront homes are among the most valuable properties along the coasts and also in the front line of incoming storms, the costs related to such flooding are also high.

Flooding's potential costs

5 States with highest potential reconstruction costs

Florida	$491 billion
New York	$182 billion
Louisiana	$161 billion
New Jersey	$92 billion
Texas	$77 billion

Source: CoreLogic's 2014 storm surge analysis

Floods from storm surges represent a collective $1.5 trillion in potential reconstruction costs, CoreLogic said.

Related: For sale -- dream beach homes

When tropical storms strengthen, their winds and low pressure causes water to gather. The mass of water can strike the shore and surge over low-lying lands.

Even when hurricanes are not in the highest category, storm surges can occur, warns Thomas Jeffrey, a senior hazard scientist for CoreLogic.

Related: Wilder weather, smaller losses in 2013

The forecast for this season is for slightly less storm activity than normal.

"But the early arrival of Hurricane Arthur on July 3 is an important reminder that even a low-category hurricane or a strong tropical storm can create powerful riptides, modest flooding and cause significant destruction of property," he said.

Superstorm Sandy is a prime example. By the time it hit the Atlantic Coast in 2012, it did not even meet the strict definition of a hurricane but still managed to do an estimated $68 billion in damage from the water surge it caused along the coast line. Only Katrina, the costliest natural disaster in U.S. history, cost more.

Related: Which natural disaster is likely to destroy your home?

There are 19 states in the paths of the Atlantic and Gulf storms.

Densely populated Florida, with its shallow elevation, is most at risk. There are 2.5 million homes that could get hit with a potential damage cost of nearly $500 billion.

Other vulnerable states are Louisiana, where 750,000 homes are at risk, New York had 466,919 homes, New Jersey 445,928 and Texas 434,421.

First Published: July 10, 2014: 10:47 AM ET

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Dish Network wants the government to stop the Comcast-Time Warner Cable merger

NEW YORK (CNNMoney)

Dish (DISH), the No. 2 satellite-TV provider, has called on regulators to block the pending merger between Comcast (CMCSA) and Time Warner Cable (TWC), according to a filing this week with the Federal Communications Commission.

That $45 billion deal, if approved by the government, would create the country's dominant provider of television channels and Internet connections, reaching roughly one in three American homes.

Dish said the new company could harm competing video services thanks to its control of broadband infrastructure, and it could use its massive scale to extract lower fees for television content that programmers would be forced to make up for in deals with other TV providers.

The proposed merger "presents serious competitive concerns for the broadband and video marketplaces and therefore should be denied," Dish said.

Dish also raised concern about AT&T's proposed $49 billion takeover of No. 1 satellite provider DirecTV (DTV), though it stopped short of calling for regulators to block the deal. That new company, too, could use its size to acquire TV content at a discount and disadvantage competitors, Dish said.

Related: New Internet speed record blows past Google Fiber

This latter concern is ironic given that Dish itself has been perhaps the country's most aggressive TV provider in its attempts to extract lower fees from programmers. The company's disputes with content producers have led to blackouts of channels from companies like Fox, AMC and Viacom for Dish subscribers.

If both the AT&T-DirecTV and Comcast-Time Warner Cable deals go through, the new companies would together control close to two-thirds of the U.S. pay-TV market, which can't be a heartening prospect for Dish. Of course, the Colorado-based company isn't exactly a crusader against monopoly power itself.

Regulators blocked a 2002 merger proposal that would have united Dish and DirecTV. Dish reportedly considered renewing that merger effort earlier this year. Although it's currently in the TV business, Dish owns valuable rights to wireless spectrum, and it's also looked into partnering with Sprint (S) and T-Mobile (TMUS).

Sprint and T-Mobile, for their part, are reportedly close to announcing their own merger proposal, a deal that would create a wireless company with a subscriber total to rival that of dominant U.S. carriers AT&T (T, Tech30) and Verizon (VZ, Tech30).

Comcast dismissed Dish's concerns about industry consolidation as self-interested.

"Dish not wanting stronger competitors isn't surprising and it isn't new," spokeswoman Sena Fitzmaurice said.

Time Warner Cable declined to comment, while AT&T and DirecTV did not immediately respond to requests for comment.

First Published: July 10, 2014: 11:49 AM ET

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They're back! Euro jitters slam U.S. stocks

NEW YORK (CNNMoney)

Here's the bad news: U.S. stocks are down sharply Thursday as jitters about a Portuguese bank and ugly economic data raise more doubts about whether Europe is recovering.

Here's the good news: Stocks are bouncing back...a little. The losses aren't as bad as they were earlier in the day.

"This has been a horrible day in Europe by recent standards, with peripheral credit concerns once again rearing their head just as core Europe struggles with a decelerating economy," analysts at Bespoke Investment Group wrote in a note to clients.

Here's what you need to know about today's market sell-off:

1. By the numbers: Investors drove the Dow Jones Industrial Average as much as 180 points lower in morning trading. The index was recently off about 100 points, while the S&P 500 and Nasdaq shed around 0.5% each.

Now the question is: Is this European-fueled slide a blip or indicative of a longer-lasting slump?

"A 5% or 10% correction is a healthy component of any bull market, and that should be considered the worst case scenario," Bespoke analysts said. "It will take a lot more than a soft patch in global economic data and a bad turn for European equities to break the back of this market in the long run."

2. Blame Europe! The ugly day began in Europe, where a little known Portuguese bank brought back concerns about the health of the continent's financial system.

Trading of Espirito Santo Financial Group -- the leading shareholder in Portugal's biggest bank -- was suspended. Shares of Banco Espirito Santo (BKESF) plummeted 17% before they were also halted.

The euro banking woes trickled down to U.S. financial firms, with shares of Bank of America (BAC), Morgan Stanley (MS) and JPMorgan Chase (JPM) all down about 1%.

But that's not all that caused European markets to tumble. New reports show industrial production fell sharply in France and Italy, signaling the European economic recovery could be in trouble.

The concerns about Europe mark a sharp reversal from recent months when the continent had been seen as a mild positive to global growth following its sovereign debt crisis.

3. Earnings season is here: After Alcoa (AA) kicked off earnings season earlier this week with a home run, a number of retailers reported mixed results on Thursday.

Family Dollar (FDO) started in the red but was recently trading slightly higher after the struggling retailer reported a drop in same-store sales and profits. The discounter also dimmed its forecast slightly. But Family Dollar has a plan to lure in shoppers: booze. The company said it will follow Wal-Mart (WMT)by selling beer and wine in the coming years.

Related: Is there a 'retail funk'?

Shares of Tractor Supply Co. (TSCO) slumped 2% after the company posted disappointing earnings on Wednesday.

4. Stock movers: Lumber Liquidator, T. Rowe, Zumiez: Investors took a big axe to shares of Lumber Liquidators (LL). The flooring retailer plummeted 22% after disclosing a traffic tumble and projecting profits that would badly miss expectations.

The somber news sparked selling in home improvement stocks like Ethan Allen Interiors (ETH), Lowe's (LOW) and Home Depot (HD).

Potbelly, (PBPB) which went public in October, plummeted 23% after the sandwich chain cut its outlook for the year and said it will try new marketing moves.

"$PBPB Calling a restaurant 'potbelly' in a nation where everyone is trying to lose weight might be a clue?" StockTwits user BlackBerril wrote.

While Family Dollar is stuck in the red, shares of Zumiez (ZUMZ) popped 8% after the company boosted its profit outlook for the rest of the year thanks to soaring June sales.

TRW Automotive Holdings (TRW) raced 7% higher amid M&A buzz. The car safety equipment supplier has received a buyout bid from Germany's ZF Friedrichshafen, Bloomberg News reported.

T. Rowe Price (TROW)was among the worst financial performers after the asset manager was reportedly downgraded by Evercore. The worry is that T. Rowe could be hurt by in the coming months by investors yanking cash from U.S. equity funds.

5. Return of U.S. jobs: Americans received another glimmer of hope about the jobs market on Thursday. The Labor Department said initial claims for jobless benefits fell by 11,000 last week to 304,000. That was slightly better than many on Wall Street expected.

The weekly claims report comes on the heels of the June jobs report, which revealed the U.S. added an impressive 288,000 jobs.

Related: CNNMoney's Tech30

6. International markets overview: While Europe is washed in red, Asian markets ended mixed. Markets in Shanghai and Tokyo closed lower, while Hong Kong's Hang Seng defied the broader trend to finish in positive territory.

Mumbai's Sensex posted early gains on the release of the first national budget from Prime Minister Narendra Modi and its promise of sharply higher growth. But the index turned negative later.

First Published: July 10, 2014: 9:55 AM ET

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Portugal bank crisis: 4 reason to keep calm

LONDON (CNNMoney)

Stocks fell across the region, most heavily in southern Europe, where government bonds also took a knock. Shares in Banco Espirito Santo were suspended but not before they slumped 17%, taking losses for the year to 46%. Shares in parent company Espirito Santo Financial Group were also suspended.

So what's going on and why does it matter? Here are four reasons to stay calm:

1. It's a local problem: Banco Espirito Santo (BES) may be a big player in Portugal, but it accounts for less than a fifth of the country's total banking assets and only 0.25% of the eurozone banking sector.

France's Credit Agricole (CRARF), a much bigger international bank, stands to lose heavily on its 15% stake, but BES does little international business. Analysts at Commerzbank reckon 72% of the bank's loans are domestic, with Angola (12%) and Spain (6%) its only significant foreign markets.

2. Regulators are on the case: Portuguese authorities have already forced the bank to raise €1 billion to strengthen its finances, and are in the process of overseeing the appointment of new management. That will end the control of the Espirito Santo family and improve corporate governance at the bank.

Those measures should provide insulation against further problems in the wider Espirito Santo group, which has been rocked by revelations of financial irregularities and the possibility of default.

Still, investors will want clarification quickly from the bank on the extent of its exposure to those risks.

Related: Europe steps up fight against deflation risk

3. Europe is getting its act together: Eurozone banks are still far from perfect but they've come a long way in the last two years. EU leaders have given themselves the tools to calm market panic by creating a permanent bailout fund -- the European Stability Mechanism -- and putting in place the essential elements of a banking union.

The European Central Bank is reviewing the assets and resilience of the region's most important banks, and eurozone states have agreed to rules on how to rescue -- or wind down -- banks that get into trouble.

Related: It's official: Austerity drives down Europe's deficits

4. Portugal is in better shape: It's just two months since Portugal staged a clean exit from a painful bailout led by the EU and International Monetary Fund. Painful and deeply unpopular reforms have restored its competitiveness -- its economy is now growing faster than the eurozone by some margin, and unemployment is falling faster than elsewhere.

That track record should mean it can count on the support of its European partners if the BES crisis turns into a wider problem for Portuguese banking.

"In the very unlikely case that Portugal needed outside support to deal with a banking issue, its reform record would probably allow it to draw on ESM funds for its banks in the way that Spain did without onerous new conditionality," wrote Berenberg economists in a note.

First Published: July 10, 2014: 12:34 PM ET

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Time for fireworks: Dow tops 17,000!

NEW YORK (CNNMoney)

Many see it as just a psychological threshold, but it's a level U.S. stocks have never seen before, and it comes a mere six months after the Dow crossed 16,000.

All three major indexes are up in Thursday trading, with the Dow Jones Industrial Average at an all-time high of around 17,040 (up 0.4%). The S&P 500 is also at a record level, hitting 1,982 for the first time. The tech-heavy Nasdaq Composite is up about 0.4% as well.

U.S. markets will close early today at 1p.m. ET ahead of the July 4th holiday weekend. So far Hurricane Arthur does not seem to be impacting stocks.

Jobs Bonanza: A strong June job reports drove the optimism in the stock market. The U.S. economy added 288,000 jobs last month, and the unemployment rate fell to 6.1%, down from 6.3% in May. That was much better than economists or Wall Street expected.

Related: What you need to know about the jobs numbers

Treasuries react to jobs report: The bond market is moving to sell after the jobs report and Federal Reserve chair Janet Yellen's comments yesterday that the central bank will not use interest rates to pop any potential bubbles in the markets. Bond yields are up to 2.65%, a sign of the improving economy.

Gold investors are similarly skittish, with the precious metal's price dropping nearly 1% to around $1,320 an ounce.

Bow Wow -- PetSmart stock spikes: PetSmart (PETM) shares are howling at the moon, up more than 12% after hedge fund Jana Partners announced a 9.9% stake with intentions of exploring a sale of the company.

In other moves, embattled clothing retailers American Apparel (APP) and Lululemon (LULU) are trading higher. Shares in the two are up 5% and almost 2.5%, respectively. There's a lot of news around American Apparel, where Reuters reports that former CEO Dov Charney has handed off his stake to hedge fund Standard General. The Wall Street Journal is reporting that former Lululemon chair and founder Chip Wilson is trying to take the company private.

Intel (INTC, Tech30) shares are up 20% so far this year, making it the second best performing stock in the Dow.

Independence Dog: It's also fun to note that Nathan's Famous (NATH)hot dogs, sponsor of Coney Island's annual July 4 hot dog-eating contest, is a publicly traded company. The stock is down slightly in trading today, but it's up over 7% so far this year and has truly been a "top dog" in recent years.

Related: Nathan's stock performance illustrated with mustard

Overseas Markets: European markets are were higher in afternoon trading, with the FTSE 100 up more than 0.6%. Asian markets were mixed, and Australia's stock market jumped a nice 0.7%.

First Published: July 3, 2014: 10:01 AM ET

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Mortgage rates drop to near 4%

NEW YORK (CNNMoney)

The last time the 30-year rate was lower was in October, 2013 when it stood at 4.10%. The rate on 15-year loans remained at 3.22%.

Related: Priced out! I can't afford a home in my town

The fact that borrowing remains so affordable has surprised experts, who expected rates to start rising once the Federal Reserve began to cut back on its purchases of Treasury bonds and mortgage backed securities.

The Fed began to pull back its bond buying last December, but mortgage rates fell for much of the first half of the year anyway.

"This is more remarkable with the economy coming back up to speed and a bit more inflation pressure than we've seen for a while," said Keith Gumbinger, vice president of HSH.com, a mortgage information company.

Related: Buy vs. rent -- What you'll pay in 10 biggest cities

Low rates mean lower monthly payments for homebuyers. Payments on a $200,000 loan at 4% come to just $955 a month, while the same loan at 5% would cost $1,073 a month and $1,200 at a rate of 6%.

And indeed, recent housing market data has improved. In May, existing home sales climbed nearly 5% in May and new home sales jumped 19%.

Nobody knows when rates will start to climb, said Gumbinger, so homebuyers are seizing their chance to lock in near-record low rates as fast as they can.

First Published: July 3, 2014: 10:32 AM ET

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Subaru recalls 660,238 vehicles over brake lines

Subaru is recalling more than 660,000 vehicles for potential corrosion of the brake lines.

NEW YORK (CNNMoney)

The Japanese automaker said brake lines in some vehicles run the risk of corrosion and may affect the driver's ability to stop.

The recall covers vehicles that are currently, or have ever been registered, in what Subaru calls the "20 salt belt states" - where salt is used to melt ice and snow in the winter months.

The models affected are 2005 through 2009 Legacys and Outbacks, 2008 through 2011 Imprezas, 2008 through 2014 Impreza WRX/STIs, and 2009 through 2013 Foresters.

Related: General Motors recalls 8.4 million vehicles

Subaru says that parts of the brake system in some models can potentially corrode from road salt, increasing the risk of a crash.

Subaru says it discovered the potential problems in its own testing. Brake lines could perforate after exposure to seven or more winter driving seasons. In a letter to the National Highway Traffic Safety Administration, the automaker says the perforations could cause brake fluid to leak and that in turn could cause the "driver to misjudge the amount of brake pedal travel required to achieve the desired stopping distance."

Related: Chrysler recalls 696,000 minivans and SUVs

Subaru of America spokesman Michael McHale told CNNMoney, "No accidents or injuries have resulted due to the operation of the vehicles."

First Published: July 3, 2014: 12:15 PM ET

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