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Why Netflix will have a tough time in China

Written By limadu on Kamis, 16 April 2015 | 23.54

The incentive is obvious: China is the world's third largest market for entertainment and media, according to Pricewaterhouse Coopers, and could be worth as much as $214 billion by 2018.

But many global firms have had a tough time getting their foot in the door: Google (GOOG), YouTube and Facebook (FB, Tech30) have been shut out of the country.

Here are three reasons why entering China is going to be a huge headache for Netflix (NFLX, Tech30).

1. It's not free

Chinese consumers aren't used to shelling out cash for content. Most streaming services in China rely on advertising, so Netflix's subscription service could meet with resistance.

"Consumers have historically paid little or nothing for traditional content, and have easy access to pirated digital content," according to Ernst & Young. "This environment has limited opportunities to generate multiple sources of income."

2. Censorship

The government keeps a tight grip on the number of foreign movies allowed into China each year, and screens them for content deemed controversial. It's likely that all Netflix content would have to be vetted before it could be made available in China.

Netflix content could be banned or censored, and the company could face tricky decisions over whether to bow to government censors or risk being blocked.

Related: China crackdown makes it harder to get around the Great Firewall

3. Competition

The market is already crowded with international and homegrown rivals.

Last December, Tencent (TCEHY) struck an exclusive deal to distribute Sony's (SNE) music library, including artists such as Beyonce and Yo-Yo Ma, online in China. Alibaba (BABA, Tech30) took control of film production company ChinaVision Media last year, and has invested $1.2 billion in Internet television company Youku Tudou (YOKU).

Alibaba has also invested in Xiami.com, one of the biggest local music service providers.

Other foreign firms are also trying to get in the game through distribution agreements. They include Warner Music, HBO -- owned by Time Warner, (TWX) parent of CNN and this website -- National Geographic, and YG Entertainment, the Korean pop label that backs singer Psy of "Gangnam Style" fame.

Related: Why Tencent wants to own Beyonce online

CNNMoney (Hong Kong) April 16, 2015: 9:45 AM ET


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Bill O'Reilly 'surprised' by attack on his credibility

"I was caught by surprise on it," O'Reilly told the Los Angeles Times.

"I was an idiot for not being prepared for it before a presidential election," he told the paper.

O'Reilly said the firestorm involving "NBC Nightly News" anchor Brian Williams should have given him a clue that he'd soon be embroiled in a similar dispute.

Related: How Brian Williams' Iraq story changed

Williams was suspended for six months without pay in February after he owned up to repeatedly telling an exaggerated story about his time covering the Iraq War in 2003. Williams has admitted "misremembering" the Iraq incident in which he was in a helicopter that got shot down. NBC is currently conducting an internal investigation into other Williams stories. His future at the network remains in doubt.

Days after the Williams scandal bubbled to the surface, the liberal magazine Mother Jones published a report indicating that O'Reilly had told his own exaggerated story about his time in Argentina covering the 1982 Falklands War. O'Reilly has repeatedly claimed to have covered the conflict in a "war zone," despite the fact that he reported from Buenos Aires -- far from the fighting in and around the Falkland Islands.

O'Reilly mounted a furious defense, disparaging the Mother Jones authors and insisting that his accounts were accurate.

More questions surfaced about some of his other claims, and eventually he was forced to clarify that he hadn't actually witnessed atrocities while covering the civil war in El Salvador and "The Troubles" in Northern Ireland. Instead, he saw photos depicting violence from each conflict. And O'Reilly still hasn't offered an explanation about evidence that contradicts his claim to have been at the scene when an associate of Lee Harvey Oswald committed suicide in the late 1970s.

Related: Phone recordings contradict O'Reilly's claims

O'Reilly told the Los Angeles Times that Williams is "definitely going to come back" to NBC, even if he doesn't return to the "Nightly News" anchor chair.

He made a nearly identical point in his interview with the Los Angeles Times.

"I put out what we had and said, 'Hey, what ever happens, happens,' " he said. "And luckily, the folks rallied."

CNNMoney (New York) April 16, 2015: 11:14 AM ET


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Gap between richest universities and the rest got wider

That's thanks to strong investment returns and a tremendous fundraising advantage, according to credit rating agency Moodys.

Eighteen of the wealthiest schools have Aaa credit ratings -- that's a rare achievement for any businesses or government.

The top 40 include seven of eight Ivy League schools - all but Brown University - along with prestigious institutions such as Stanford, MIT and Duke. But half of the wealthiest schools were state schools, led by the universities of Texas, California and Michigan.

Related: How I got into an Ivy League school

The 40 richest schools have median cash and investments of $6.3 billion, versus only $273 million for the 500 other schools tracked by Moody's. Harvard is the richest school with $42.8 billion assets, followed by the University of Texas at $36.7 billion. The University System of Maryland is at the bottom of the list with assets of $3.4 billion.

The richest schools had average investment returns of 50% between 2009 and 2014. Returns for other schools were between 22% and 38% over the same period.

The top 40 also collected 59% of all donations made to the 500 schools during fiscal year 2014.

Related: Stanford offers free tuition to families making less than $125,000

The result: About one third of the assets held by all colleges belong to the top 10 schools, and nearly two-thirds of the assets are held by the top 40 schools.

"This growing gap will pose increasing competitive challenges for institutions that do not have the resources to invest in facilities, financial aid, and other strategic initiatives at the same level as their wealthier counterparts," said the report.

Related: 10 most expensive colleges

CNNMoney (New York) April 16, 2015: 11:50 AM ET


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Kansas gov to sign sweeping welfare crackdown

cruise ship

The measure - believed to be the strictest in the country - concerns the Temporary Assistance for Needy Families program in Kansas, which is designed to help families struggling with short-term financial hardships.

The TANF program provides families with benefits cards that can be used like a debit card to purchase groceries and gas or pay for things like rent and day care.

Under the new law, recipients will be unable to use the card to purchase alcohol, tobacco and lottery tickets. They will also be barred from using the card in nail salons, in swimming pools and for fortunetellers. (See full list below).

It is difficult to track how much cash assistance is spent on items that will be banned, but a federal report last year found that less than one percent of total aid was used at liquor stores, casinos or strips clubs, according to the Associated Press.

The federal government has required states to restrict TANF recipients from using their cards in liquor stores, gaming or gambling establishments or adult entertainment venues.

At least 23 other states have passed laws restricting how benefits cards can be used, according to the National Conference of State Legislatures.

In Alabama, for example, the cards cannot be used to pay for psychics or for body piercings. Indiana prohibits the cards on riverboats and other gambling facilities, as well as in gun stores.

TANF recipients in Kansas will still be able to use their cards in gun stores.

Related: Student loans forgiven for daughter of fallen vets

The legislation, called the HOPE Act, enshrines in law various changes the Brownback administration has made to the program over the past few years. Supporters said putting those changes into law will make the harder to repeal down the road.

Brownback's office says the changes have helped 6,100 recipients find jobs and transition out of the program last year.

In one of its more controversial aspects, the bill limits the amount of money TANF recipients can withdraw from the ATM to $25 per day. Previously, there was no limit on how much cash could be taken out. On average, TANF families receive about $400 per month.

TANF recipients will still be able to obtain money orders using their TANF dollars, which can be used to pay for rent or other bills that cannot be paid by card.

Related: Will Hillary Clinton support a $15 minimum wage?

Supporters of the bill have acknowledged that policing how recipients spend their $25 will be difficult, if not impossible. But the goal, they say, is to prevent people from gaming the system, rather than punishing families that have fallen on hard times.

Still, critics say the legislation mischaracterizes the majority of TANF recipients, who are largely single parents who don't earn enough to pay all their bills.

Kansas Action for Children, a local advocacy group, said in a statement that the law will make it harder for poor families to access other support programs, including the Supplemental Nutrition Assistance Program, or food stamps.

"By signing this bill into law, Gov. Brownback has added to the burden that the poorest Kansans already carry," the KAC statement said. "It's always been hard to be poor in Kansas. Now, it's going to be a lot harder."

In Kansas, here's a list of what would be off limits:

Alcoholic beverages

Casinos

Gaming establishments

Jewelry stores

Tattoo parlors

Massage parlors

Body piercing parlors

Spas

Nail salons

Lingerie shops

Tobacco paraphernalia stores

Vapor cigarette stores

Psychic or fortune telling businesses

Bail bond companies

Video arcades

Movie theaters

Swimming pools

Cruise ships

Theme parks

Dog or horse racing facilities

Parimutuel facilities (off-track betting)

Cigarettes and tobacco products

Lottery tickets

Concert tickets

Tickets for professional or collegiate sporting events

Tickets for other entertainment events intended for the general public

Sexually-oriented businesses

Strip clubs

Any business or retail establishment where minors under age 18 are not permitted.

Related: Women nearly twice as likely to retire in poverty

Related: How your tax dollars are spent

CNNMoney (New York) April 16, 2015: 12:34 PM ET


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Russia bans 'Child 44' serial killer movie

child 44 russia Gary Oldman and Tom Hardy star in the Lionsgate thriller "Child 44."

The ministry of culture in Moscow has blocked distribution of Hollywood thriller "Child 44" for being "historically inaccurate."

The Lionsgate (LGF) movie is about a Soviet-era serial killer. Oldman plays General Mikhail Nesterov, an officer who tries to hunt down the killer.

It was due for worldwide release Friday but now won't be seen in Russian theaters.

The ministry said the film, which also stars Tom Hardy and Noomi Rapace, distorts historical facts and events before, during and after World War II.

Russia is preparing to celebrate the anniversary of victory over Nazi Germany next month.

"The distribution of such films on the eve of the 70th anniversary of the Great Victory is unacceptable," the ministry said.

Culture minister Vladimir Medinsky accused the filmmakers of depicting Russia as a "Mordor" -- the evil realm of Tolkein's "Lord of the Rings" -- with "physically and mentally inferior subhumans."

Related: Putin wants Russian films to be about Crimea and military glory

The film was due in hundreds of cinemas across Russia after premiering in London on Friday. Central Partnership, the Russian distributor, said the decision to withdraw the film was made jointly with the ministry of culture.

Based on a 2008 bestseller by Tom Rob Smith, the movie transposes a series of murders committed in the 1980s to famine-stricken Stalinist Russia. It shows the authorities trying to cover up the crimes to maintain the image of a perfect society.

Related: Even bribes are more expensive in Russia

CNNMoney (London) April 16, 2015: 9:24 AM ET


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Elizabeth Warren: Tax the banks

The Massachusetts Senator is calling for changes in tax law designed to hit banks where it hurts: executive compensation, leverage and high-frequency trading.

In a speech Wednesday in Washington, Warren, a Democrat, charged that Republicans are hindering the implementation of reforms put in place after the 2008 financial crisis. But she was equally hard on government regulators, including the Securities and Exchange Commission, Department of Justice and Federal Reserve.

"The bottom line is that the culture of cheating on Wall Street didn't stop with the 2008 crash," she said. "When cops don't do their job, cheaters prosper and honest businesses lose out."

Related: 'Wealth trickles up,' says Warren

Warren reiterated that banks deemed too big to fail need to be broken up. She wants to force financial firms that have federal deposit insurance to be limited to "boring banking." Banks that want to take risks are free to do so, she said, but taxpayers should not be on the hook for their mistakes.

Warren also called on Congress to limit the Federal Reserve's ability to provide emergency loans to banks that get into trouble, saying Wall Street sees the Fed as its "personal piggy bank."

In addition, she wants the Department of Justice to stop offering "deferred prosecution" agreements to banks that break the law, which she compared to a "slap on the wrist," and a request to "please don't do it again."

But making the financial system safe and fair will also require changes to the tax code, Warren said.

Related: Elizabeth Warren is worth millions

Under the 2010 Dodd-Frank financial reforms, the SEC has the power to regulate executive compensation, but the commission has yet to finish writing those rules.

"The SEC needs to get its act together," said Warren. "But we can't sit on our hands on this issue any longer."

Warren said corporations are taxed for any executive compensation over $1 million, unless it is in the form a "performance-based bonus," which makes up the bulk of most CEO pay. Closing this loophole, she said, would "stop pushing companies to reward short-term thinking."

Warren also wants to change tax laws that she says give financial firms an incentive to take on debt, rather than raising capital in the stock market.

Related: Elizabeth Warren has 8 ways to restore the middle class

"Financial firms can write off every dollar of interest they pay on their debts, but financing themselves thorough equity requires them to pay taxes on dividends," she said.

Warren called for a transaction tax on firms that use computer-based trading systems to make rapid-fire transactions. She said taxing so-called high-frequency trading would make the market less volatile and give smaller investors a fighting chance.

"Together, changes like these can make a real difference," Warren concluded. "They can help protect hard-working families from cheats and liars. They can help rein in the lawless practices that are still too common on Wall Street."

Related: Elizabeth Warren brings new fight for middle class

Related: Elizabeth Warren says the market is broken

CNNMoney (New York) April 16, 2015: 9:27 AM ET


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Netflix stock tops $500 for first time ever. Next stop = $900?

The company is on fire. One analyst now predicts Netflix (NFLX, Tech30) could hit $900 a share by next year. The reason? Millennials (and a lot of other age groups) talk about watching Netflix, not TV.

"Netflix subscribers -- nearly 40% of TV households in the U.S. -- love the service more than TV," Barton Crockett, an analyst at FBR Capital Markets, wrote in a note.

That shift is helping the bottom line. Netflix crushed its earnings Wednesday. It added 4.9 million subscribers in the first quarter this year, well above the 4 million it added in the same quarter a year ago. The stock shot up 15% Thursday morning and is the best performer by far this year in the S&P 500.

Related: Netflix wows Wall Street with strong subscriber growth

netflix fire

The Netflix migration: FBR and ClearVoice Research conducted a survey to ask Netflix users what they thought of it. Half said they spend more time on Netflix than traditional TV, and 57% said they like Netflix more than TV. Not bad for a company that opened for business in 1998.

The survey results were one of the main drivers for Crockett to update his projection that the stock could shoot to $900.

Investors and analysts aren't just giddy about Netflix's potential among Americans -- its user base abroad is expected to grow by a lot too.

While Netflix gained 5.8 million users in the U.S. over the past year, it got 8.2 million new subscribers abroad over the same time. Netflix is also one of the first American companies to operate in Cuba, which it reported during the quarter.

Other analysts raised their one-year price estimate for Netflix, but not nearly as much. Earlier this week, Cantor Fitzgerald raised its estimate on Netflix to $500 -- which Netflix quickly surpassed Thursday.

Related: Why Netflix will have a tough time in China

netflix stock 2015

Headwinds: The only drag for Netflix these days is the strong dollar. All the foreign growth for the streaming service means Netflix must exchange those profits abroad into U.S. dollars. That's been problematic lately as the dollar keeps going up in value. Netflix actually missed earnings estimates, but investors are shrugging it off since it was mostly caused by the dollar's surge. That should dissipate over time.

The bigger concern long-term for Netflix is the rise of other streaming services. You can now sign up for HBO, for example, without needing a cable subscription. But Netflix is starting from a huge position of strength.

Related: How to invest $1,000

Related: Goldman Sachs employees made nearly $130K in 1st quarter

Related: Star Wars,' Marvel, and 'Game of Thrones' have cut the cord

CNNMoney (New York) April 16, 2015: 10:47 AM ET


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Finally! Saudi Arabia opening stock market to foreigners on June 15

Saudi Arabia stock market tadawul

The oil-rich nation is opening its stock market -- the largest in the Middle East -- to foreign investors on June 15, the government announced Thursday.

The Saudi market -- worth an estimated $530 billion -- is more than double the size of the Tel Aviv stock exchange in Israel.

Previously, only Saudi-based investors could buy stocks there. By mid-June, international firms will be able to buy stocks in the country's exchange, the Tadawul All Share Index. This will likely encourage mutual funds and ETFs to add some Saudi stocks to their holdings, especially in emerging market funds.

Related: Saudi Arabia: The next big emerging market?

The move could put Saudi Arabia in the same breath as major emerging market countries like Brazil and India, although it's still classified as a "frontier market" currently.

The Saudi market is largely dominated by energy-related companies and financial firms. The index is up 11% so far this year.

Saudi Arabia's international market opening comes on the heels of China making it easier for foreign investors to buy Chinese stocks in November.

Related: Investors send billions to Shanghai as market opens to foreigners

CNNMoney (New York) April 16, 2015: 11:51 AM ET


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Jorge Ramos breaks through, making the cover of Time 100

time jorge ramos The Fusion and Univision anchor made one of the covers of Time's 100 most influential people.

The veteran newsman may be somewhat unknown to English language audiences, but his respected stature in the media world and in the Hispanic community helped him make Time's cover. Time printed five covers; the other names were Supreme Court Justice Ruth Bader Ginsburg, musician Kanye West, dancer Misty Copeland, and actor Bradley Cooper.

Ramos, who was born in Mexico City, appears on Spanish-speaking news shows like Univision's "Notciero Univision" and "Al Punto," two of most widely watched Spanish language news shows. In addition, he hosts the English-language Fusion news show "America with Jorge Ramos."

The anchor has turned heads in the past year for his intense interview with President Obama regarding Immigration reform along with showing the hardships of immigrants by swimming across the Rio Grande with his camera crew.

Ramos, 57, has been often called the "Walter Cronkite of Latino America," according to the New York Times. Yet, making the cover of Time 100 is a breakout moment for the anchor and his young Fusion network.

Fusion, Disney (DIS) and Univision's cable network looking to serve Millennials across differing platforms, was launched two years ago and, like Ramos, is fairly undiscovered.

Regardless of its current impact, Ramos has spoken highly of Fusion telling CNN's Brian Stelter in September that the media company was "a bridge to the future."

"In 2016, no one is going to be able to make it to the White House without Fusion or Univision," Ramos said speaking to the network's reach to Latino audiences.

In the Time 100 piece on Ramos, the anchor received glowing words from fellow journalist CNN's Christiane Amanpour . "He says he asks every question as if it's his last, determined to get an answer or go down trying," wrote Amanpour. "He knows he has a voice and is not afraid to use it."

Ramos has won multiple awards for his work and is considered by many in the media landscape to be one of the most influential journalists heading into the 2016 election, and Fusion and Univision have worked hard to promote Ramos as a news anchor for the future. His inclusion in the Time 100 is a boost for Fusion's standing.

"With another presidential election coming up, if anyone can move this needle, Jorge Ramos can—and he must," Amanpour added.

CNNMoney (New York) April 16, 2015: 12:11 PM ET


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Let's get this party started: Party City goes public

party city exterior

Wall Street seems to think good times are rolling for Party City (PRTY), which is the largest party goods retailer in North America.

It debuted on Thursday morning at $20.50 a share. That's more than 20% above its initial public offering price of $17 on Wednesday night.

The coming out party was held at the New York Stock Exchange, where Party City is now trading under the ticker symbol "PRTY." The IPO values the retail chain, which sells everything from balloons and pinatas to costumes, at nearly $2 billion.

Etsy (ETSY), the online marketplace for vintage and handmade goods, also began trading Thursday, making it the largest certified socially-responsible company, or B Corporation, to go public in the U.S.

Rounding out the IPO party Thursday was Virtu Financial (VIRT), a high-frequency trading firm that had its public debut delayed by a year due to the controversy sparked by the Michael Lewis book "Flash Boys," which argues that U.S. markets are rigged by high-frequency traders.

Related: Etsy crafts a $267 million IPO

Too much debt? The Party City deal raised $372 million, but the company doesn't plan to do anything wild and crazy with the proceeds.

The cash will be used to help pay down its heavy debt burden, much of which was incurred when Thomas H. Lee Partners took a majority stake in the company in 2012. The private-equity firm now owns a smaller stake in Party City, though it remains a majority shareholder.

While some investors may be alarmed by Party City's more than $3 billion in debt, management isn't concerned.

"It is a lot of debt, but we've operated in a highly-leveraged environment for a long time," Party City CEO Gerald Rittenberg told CNNMoney, noting the chain's first leveraged buyout took place in 1997.

Rittenberg said Party City's business is "very, very stable" and features "great cash flow characteristics." He pointed to how even in 2009 during the Great Recession same-store sales only fell 2.9% and the company still posted a profit before interest, taxes and other expenses.

Related: Netflix stock tops $500 for first time ever. Next stop = $900?

The party is growing: Party City offers a way for investors to capitalize on the $10 billion retail party goods industry, which lures lots of customers during special occasions like Halloween, Fourth of July and the Super Bowl.

Get ready to see more Party City stores. The chain already has 900 locations, but it sees an opportunity to open another 350 stores in North America and ramp up expansion overseas as well.

If the banks underwriting the Party City IPO exercise their options, the total value of the IPO will rise to $428 million.

Related: GoDaddy races onto Wall Street with IPO

Related: How to invest $1,000

CNNMoney (New York) April 16, 2015: 12:43 PM ET


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Racial differences in teen online habits

Written By limadu on Kamis, 09 April 2015 | 23.53

teens on phones

But a new report by the Pew Research Center reveals that black and Hispanic teens are more active internet users than white teens.

The study found that 34% of African-American teens and 32% of Hispanic teens report going online "almost constantly." By contrast, 19% of white teens say they go online that often.

Overall, the vast majority of teens (92%) report they go on line every day and more than half (56%) do it multiple times a day. The report defines teens as those between the ages of 13 and 17 years old.

Most teens are using mobile devices to get online. The report says about three-quarters of teens have their own smartphone or have access to one. Another 30% have a "basic phone," while only 12% of teens have no cell phone at all.

Related: Facebook Messenger is now a standalone web app

In terms of race, black teens are the most likely to have a smartphone. A full 85% of black teens report having access to a smartphone, while 71% of Hispanic and white teens have one.

The report also confirms what many already know about teens. They like to send text messages. A typical teen sends and receives 30 texts per day, according to Pew.

It's also no secret that teens are big fans of social media. But the report says girls are by far the biggest users of social media, particularly "visually-oriented" networks such as Instagram, Snapchat, Pinterest and Tumblr.

Facebook (FB, Tech30) is the social network of choice for teen boys. Likewise, boys are much more likely to play video games. A full 91% of boys have access to a video game console, compared with just 70% of teen girls.

Pew questioned 1,060 teens across the country in English and Spanish for the survey - which, it was also noted, was done online as opposed to the usual phone interviews.

Related: New Facebook app Riff lets you make viral videos with friends

Related: Facebook Scrapbook lets you tag kids, pets

CNNMoney (New York) April 9, 2015: 9:29 AM ET


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Shockingly small 'crimes' that can land you in jail

Because such minor infractions are considered misdemeanor criminal offenses in some cities and states, failing to pay a ticket for these crimes can trigger a warrant for your arrest.

Here's how it happens:

Let's say you get a speeding ticket. Typically, you're given a certain amount of time to pay the fine or challenge it in court.

But if you don't show up to the hearing or pay the fine, some courts will issue a warrant for your arrest -- placing you on the same list as alleged rapists, thieves and escaped prisoners.

Some local governments say the warrants are a last-ditch effort to get people to settle their debts. But critics say arresting people over unpaid fines for such minor violations unfairly impacts low-income and minority residents.

Related: Dogs killed over unpaid fines

In Ferguson, Missouri, for example, a Department of Justice report found that the city has almost as many active arrest warrants as it has residents -- and that many of these warrants stem from small, traffic-related tickets given to low income African-Americans.

But traffic tickets are just one of the many minor offenses that can escalate to time behind bars.

Cursing in public. Playing music too loud. Rollerblading. Parking too far from the curb. Leaving old appliances in the yard. These are just some of the surprising "crimes" that CNNMoney found in databases of arrest warrants from cities and counties across the country.

Here are the stories of four people who actually got locked up.

Catching an out-of-season fish

Unemployed and strapped for cash, Ionia, Michigan resident Kyle Dewitt was out fishing for dinner for his family in 2011 when he got slapped with a ticket. The offense: the then-19-year-old caught a type of bass that was off-limits during that time of year.

Dewitt disputed the citation with the officer to no avail and says he was later told that he would get information in the mail telling him how to pay the $115 fine. A few months went by and he still hadn't received anything, so he called to ask about it -- only to find out a warrant had been issued for his arrest.

kyle dewitt Kyle DeWitt with his family.

Confused and scared, he drove to the local jail and was put behind bars. He then borrowed $175 and paid a bail bondsman to help get him out. At a court hearing a week later, he was ordered to pay an even bigger bill -- $215 -- by the end of the day.

DeWitt, who was unemployed with a baby at home, said his fiance's mother offered to give him $100 of her Social Security benefits to help settle the debt.

He told the judge he could pay $100 the next day, and he could get the rest together by the following month. But the judge wouldn't give in.

"It needs to be paid -- all [of it]. Or you need to do jail [time] instead," the judge said, according to a court transcript. "Do you have a credit card?"

When he couldn't get the money, he was put back in jail. Originally ordered to serve three days, Dewitt was released early after the American Civil Liberties Union of Michigan intervened, arguing "it was unconstitutional for Kyle to be sentenced to jail for being poor."

The Ionia District court did not respond to a request for comment.

Skipping school

Frank Ward, from Baytown, Texas, says his grandsons were threatened with arrest after missing too many days of high school.

In Texas, missing 10 or more days of classes over a six-month period, or three days in four weeks, can result in adult criminal proceedings. While this offense is typically resolved by paying a fine of up to $500 (plus court costs), arrest warrants can be issued for those who fail to pay.

Related: The secret world of government debt collection

Ward says his grandsons couldn't get to school because of a bad family situation that resulted in more than a dozen moves in two years. That ultimately left the boys 20 miles from school, making options like the bus often unavailable, he claimed.

Ward didn't find out about the citations until his 17-year-old grandson ended up in jail for failing to pay fines that had ballooned to $950. The other grandson owed $360, but had not been arrested. Ward has since used more than $1,300 of his Social Security benefits to clear both boys' warrants, and is still angry that they ended up in criminal court in the first place.

In a recent report, nonprofit Texas Appleseed found that 80% of Texas students sent to court for missing school were low-income and, as a result, the "least able to pay the fines imposed by the court."

us map arrest warrant texas

Dogs that get loose

An 82-year-old widow, Mary Root never thought her beloved Chihuahuas could land her in jail.

But after the dogs got out of her yard a few times, she was hit with a $525 fine that she couldn't afford and a court hearing that she couldn't attend due to medical reasons.

The result? Two days behind bars and an even bigger $7,000 bill.

mary root Mary Root went to jail after her dogs got out of the yard.

While she was in jail, locals rallied in support of the great grandmother.

But Root isn't the only pet owner to face jail time. And it's not just a loose dog that can get people in trouble. Pets without licenses or microchips, or dogs that bark too much, are just a few of the pet-related offenses that can trigger an arrest warrant if a ticket isn't resolved.

Expired car registration

Tuscaloosa, Alabama college student Crissy Brown was driving to her job as a waitress on July 4, 2013 when a police officer pulled her over for expired car registration tags.

The officer looked her up in the system and found that there was a warrant out for her arrest. He then promptly put her in handcuffs and took her to jail. It turned out that the warrant stemmed from a prior unpaid ticket, also for her expired registration.

Already struggling to support herself and pay tuition, Brown said she would have had to work four shifts at her waitressing job to afford the $60 to renew her registration and the fines for the earlier $160 ticket.

Crissy brown Crissy Brown never thought she would land in jail.

After she had received that initial ticket, Brown had spoken with a judge and was given a second hearing. But when that hearing came around, she still didn't have the money and feared that if she showed up to court again she would be thrown in jail. So she didn't go.

"The rational thing to do seemed to be to keep a low profile until I could dig myself out of the financial hole I was buried in," she said.

But this only made matters worse. Because she didn't attend the hearing or pay the fine, her initial ticket turned into an arrest warrant.

Related: Debt collection nightmares

The Tuscaloosa Police Department said that she could have requested a payment plan had she shown up to that second hearing, but Brown said she was never informed of that option.

She spent eight hours in jail before her parents bailed her out. But when she was finally free, she had a whole other set of problems. Her car was impounded, costing her another $150 in fees. She lost her job for missing her shift because she was in jail. And she had another upcoming court date to worry about.

Nearly two years later, Brown has a full-time job and up-to-date car registration. But she's still bitter about the experience. "It only took 8 hours of incarceration to make me feel like I was criminal," she said.

CNNMoney (New York) April 9, 2015: 12:38 PM ET


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How startups are redesigning cities

shaun stonly Shaun Abrahamson, left, and Stonly Baptiste, cofounders of VC firm Urban.Us.

In the past, city planners, policymakers and real estate developers could safely assume that energy was cheap, water abundant and garbage could simply be moved away. There was no downside to burning more fossil fuels and we could keep adding everything from air-conditioning to more roads (and cars). Now we know this reasoning is not just wrong, but it threatens our future.

Today, cities are home to a little over 50% of the world population and account for 75% of greenhouse gas emissions. In the coming decades, people will look to cities to dramatically reduce their emissions, even as the urban population is expected to reach 6 billion by 2050 (up from 4 billion today).

These two macro trends inspired my partner Stonly and I to start Urban.Us. We fund and serve startups that make cities better in areas ranging from water and waste to personal mobility and energy-efficient buildings. Beyond capital, we're building an advisory network of experts, investors, customers and partners.

Why focus on startups?

While we see some progress in areas of technology and policy, we expect some of the greatest impact to come from startups. New technology companies are some of the few organizations capable of very rapid, efficient growth. They are able to attract talent and capital, and within half a decade they can reach 100 or more cities.

We think the biggest impact is going to come from personal mobility and energy-saving solutions. We've been exploring early-stage companies and mapped them according to their focus areas and end customers.

urban.us radar

If you look at the Urban Tech Radar, one of the most noticeable areas impacted by startups is mobility, specifically consumer-facing services. Changes in mobility were first led by firms like Zipcar and Car2go and then Waze, Tesla, Uber and Lyft. We're already glimpsing the next generation of solutions from private bus services like Bridj, Chariot, Leap, Skybus and Rallybus, and we're seeing an explosion of personal electric vehicles from electric bikes, boards and new devices like the Onewheel.

But what about really big infrastructure? How can startups take on problems of supplying cities with water? Or what about reducing energy consumption in buildings? These all require massive amounts of capital and have traditionally been the domain of municipal bonds (luckily there is a startup working to change municipal bond issues, Neighborly.com). But today, in each of these specific cases, we're seeing promising startups.

Here are three startups Urban.Us has invested in that we think have the potential to dramatically reduce the carbon footprint of our cities.

Rachio was founded just three years ago and is a already a top selling product on Amazon (AMZN, Tech30). It helps people reduce water consumption by as much as 30%, simply by removing their old irrigation controller and installing the Rachio Iro. Rachio will automatically adjust for changes in weather and seasonality and syncs to your smart device or laptop.

The EPA estimates that as much as 50% of water used outdoors is wasted, and Rachio has already saved over 31 million gallons of water. While it's easy to focus on building more infrastructure to support growing populations, Rachio focused instead on reducing demand. They're not alone in their aim to shrink demand and reduce waste.

Radiator Labs helps reduce energy use in inefficient heating systems, which are primarily found in pre-war buildings of the Northeast and Canada and account for 40% of heating systems. Since residents are unable to control the temperature, if it's too warm, they simply open windows. These antiquated heating systems are much too costly to replace, so a retrofit solution is the most cost effective.

Radiator Labs solves this problem by installing covers over existing radiators that allow you to control the temperatures. If it's cold, fans push the heat out; when the room gets warm, the heat is trapped inside.

The real innovation comes when an entire building is using these "cozies." Data from the connected network triggers an automatic shutdown of the boiler, vice versa when the temperature is too cold, resulting in a 40% reduction of energy use.

Blocpower matches energy retrofit projects with investors. Schools, churches and small businesses aren't always desirable loan candidates -- especially for expensive retrofit projects, even if they'd save on energy costs down the road. So Blocpower created a marketplace for those who want to invest in energy-saving products in financially underserved communities.

The "Bloc" of four or more buildings lowers the cost of retrofitting and spreads out the risk of default, making it economically viable to install solar and energy-efficient technology.

How we redesign our cities will have a significant impact on the world we leave to future generations. Their redesign must support a growing global population and curb climate change. Startups offer a path to quickly and efficiently test many promising ideas instead of debating them. We think we're just beginning to see the impact of startups on cities. They're approaching decades-old problems with new reasoning. And it's not a moment too soon.

Shaun Abrahamson is a co-founder of Urban.Us, a venture capital fund that invests in startups focused on urban issues like mobility, sustainable building, governance, service delivery and resilience.

Related: The most innovative cities in America

Related: These startups thrive on being unreasonable

Related: This cooler runs on water and sunlight

CNNMoney (Miami) April 9, 2015: 9:37 AM ET


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Boston Globe's calls to spare Marathon Bomber sparks outcry

tsarnaev death penalty The Boston Globe is calling for Dzhokhar Tsarnaev to not get the death penalty.

"Get sparky ready," wrote Sunday@1 after the Globe's editorial was published Wednesday. It was one of more than 100 comments in response to the Globe's editorial.

Tzarnaev, 21, was convicted on Wednesday of 30 counts for the 2013 bombing that killed four people, maimed others and both traumatized and infuriated Bostonians. The jury will soon begin the second phase of the trial to determine whether Tsarnaev should be executed.

Massachusetts abolished the death penalty in 1984. However, with this being a federal case the death penalty is an option.

The editorial board for the major Boston newspaper wrote that Tsarnaev should spend the rest of his life in prison rather than receive the death penalty.

"Even supporters of the death penalty should have some qualms about putting Dzhokhar Tsarnaev to death," the newspaper wrote. "Sentencing Tsarnaev to death would ensure endless appeals, substitute vengeance for justice, and risk letting him become a martyr."

Related: Tsarnaev guilty of all 30 counts in Boston bombing

"Tsarnaev was 19 at the time of the bombing; he was apparently a heavy drug user; he had no prior criminal record," the paper wrote. "By themselves, none of these would seem like a particularly good reason to spare him, but taken as a whole... they should plant seeds of doubt."

Skipper2115 wrote that he had been opposed to the death penalty "my entire life," but wants Tsarnaev executed.

"He placed the bomb on the ground next to a 8 year old boy and his family...He walked away with a smug look and bought milk!" Skipper2115 wrote.

Suprdav dismissed the argument that execution would make Tsarnaev a martyr. "Remember Timothy McVeigh? Me neither," he wrote, citing the Oklahoma City bomber who was executed for the 1995 blast that killed 168. McVeigh was killed by lethal injection in 2001.

Others, however, supported the Globe's argument that Tsarnaev should instead spend the rest of his life in prison.

"Execution is just too merciful, and too much publicity with all the appeals year after year," argued macsmart.

"He will be forgotten in prison. When was the last time anyone paid attention to Sirhan Sirhan?" wrote nj27, referring to Robert F. Kennedy's assassin.

The Globe also pointed out that the defense team for Tsarnaev argued that his brother, Tamerlan Tsarnaev, was the one who played the dominant role in the bombing.

"Tsarnaev obviously should spend the rest of his life in prison," the Globe wrote. "His defense has already made a good case that he does not meet the exceptionally high standards for a federal execution."

CNNMoney (New York) April 9, 2015: 11:25 AM ET


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Oops. Apple's diverse emoji turn into aliens

alien emojis

Apple (AAPL, Tech30) has launched the latest version of its operating system this week, making their emoticons available in six skin tones.

Tapping and holding on an emoji person brings up the new skin-tone variations, so users can chose the one they like the most.

But for those without the iOS 8.3. version, the new emoticon faces display as pictures of aliens instead.

Related: Siri speaks with a new voice in Apple's iOS 8.3 update

Pictures of male and female faces, thumbs ups/thumbs down, as well as other emoticons such as princesses and flamenco dancers are all affected by the bug.

Apple didn't respond to CNNMoney's request for comment on the glitch.

IOS 8.3 is currently available as a free download for the iPhone, iPad and iPod Touch. Other platforms, devices and apps will be updated to display the new and improved emoji.

Until then, sit back and enjoy the alien invasion in your Twitter (TWTR, Tech30) feed.

Related: Is emoji biased towards hamburger and pizza lovers?

CNNMoney (London) April 9, 2015: 11:27 AM ET


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A historic Summit of the Americas - Opinion

Isabel de Saint Malo de Alvarado Isabel Saint Malo de Alvarado (right) is Vice President and Foreign Minister of Panama

This week, Panama will host the Summit of the Americas, an important gathering of heads of state from throughout the hemisphere, first launched by U.S. President Bill Clinton in 1992. The first-ever presence of both Cuba and the United States, along with every other nation in the region, makes this Summit an historic occasion before it even begins. But beyond the breathtaking diplomatic opportunity the thaw between Cuba and the U.S. presents, there is much else on our agenda that deserves attention.

The overarching theme of the Summit is "Prosperity with Equity: The Challenge of Cooperation in the Americas." This could well be the rallying call of all nations in our region. How do we develop fairly and justly? How do we close the income gap? How do we give everyone a voice?

There is no doubt that Latin America is on the rise, economically. By 2020, Latin American GDP is expected to reach $10 trillion—double that of 2010—with 640 million active consumers. However, this prosperity has not been sufficiently and broadly shared by our people. That is where the demand for equality begins.

Equality is a necessity and a condition for the sustainable growth of our countries and for our peace and stability. While our countries are enjoying a state of economic growth, we know that stability can be jeopardized if we, as a region, do not attend the most pressing challenges our people face today.

Related: Everyone wants to go to Cuba now

Democracy in our region, for example, is limited by inequality, and therefore, to fight against these challenges is also to fight to strengthen democracy. It is the same for education, health, energy, environment, security, immigration, democratic governance and civil participation. These in fact comprise the key subthemes of the agenda.

Indeed, the presence of all nations at the table during the Summit means that we can put all the issues on the table, including human rights, democracy, and civil liberties. We are a diverse hemisphere, with lots of ideas and many voices on these questions. In fact, there will be a dedicated platform for civil society organizations at the Summit of the Americas in which citizens from all countries can freely discuss their ideas and concerns. This means everyone is at the table and everything is on the table.

The United States has much at stake in the discussions at the Summit, which will range from climate change to commerce. Indeed, the U.S. integration in the hemisphere is growing stronger by the day through our broad economic, security, and political cooperation. Panama, for example, is the fastest growing economy in the region and the expansion of the Panama Canal will enhance the importance of U.S. trade with Panama and throughout Latin America.

It is truly fitting that this historic Summit be hosted in Panama. The first meeting of Heads of State from the Americas was held in Panama back in 1956, in what is now the headquarters of the Panamanian Foreign Ministry. And just a year ago, we celebrated the 100th anniversary of the Panama Canal. This was, of course, an important historical event that transformed global commerce, but it also symbolically inaugurated what has become our traditional role in promoting dialogue between nations. This is precisely the role we wish to play at the Summit by bringing together a group of nations with far more in common than we are separated by. The participation of Cuba and the U.S. is the most powerful symbol of our need and ability to transcend differences and work towards a positive outcome.

It is undeniable that the time for the Americas has come. Prosperity is on the rise. By breaking down barriers and the old dividing lines, we can at last unlock the potential of our people. We can help lift them up. We can give them a stake in the stability of their countries and their neighbors. The precondition is equality. Our progress towards prosperity, equality and cooperation in the upcoming Summit will be the ultimate measure of its success.

Related: How Colombia went from murder capital to tech powerhouse

Related: Five reasons why Venezuela may be the world's worst economy

Related: The big picture behind Brazil's protests

CNNMoney (New York) April 9, 2015: 12:25 PM ET


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Clorox apologizes, deletes tweet after racial uproar

The tweet, which Clorox (CLX) since deleted, showed a Clorox bottle made up of the new emojis released by Apple (AAPL, Tech30) as part of this week's iOS 8.3 update. Clorox tweeted, "New emojis are alright but where's the bleach."

Apple's new iOS 8.3 release consists of 300 new emojis, including kissing lips, googly eyes and a smiling poop (we wish we were making that up). But they also include racially diverse emojis, including cartoon faces with brown and black skin.

In its tweet, Clorox seemed to be commenting on why bleach wasn't included among the hundreds of other household items that Apple had added to its list of emojis. But on social media, offense was taken.

"You need to clean up your PR person. Put some bleach on your distasteful marketing ideas," tweeted @DriNicole. "Black emojis were added today. Saying this implies you'd rather the emojis be only white, by adding bleach."

After taking down the tweet, Clorox followed up with an apology: "Wish we could bleach away our last tweet. Didn't mean to offend - it was meant to be about all the [toilet, bathtub and red wine] emojis that could use a clean up."

clorox tweet emoji

"We apologize to the many people who thought our tweet about the new emojis was insensitive," said Molly Steinkrauss, a spokeswoman for Clorox. "It was never our intention to offend. We did not mean for this to be taken as a specific reference to the diversity emojis -- but we should have been more aware of the news around this. The tweet was meant to be light-hearted but it fell flat."

Taco Bell launched a similar -- but far less controversial -- campaign earlier this year in an attempt to rally support for a taco emoji.

In a looming update to the emoji system (for non-Apple devices), a non-profit organization called the Unicode Consortium that regulates emojis among other computer text, is considering 37 candidates for new emoticons could be added as part of a code update scheduled for June.

The finalists include racially diverse emoji faces, a zipper-mouth face, prayer beads, a cricket bat and a taco.

But no bleach.

Related: Siri speaks with a new voice in Apple's iOS 8.3 update

Related: Apple's new diverse emoji characters

CNNMoney (New York) April 9, 2015: 12:25 PM ET


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Apple expects Apple Watch to sell out Friday

"We expect that strong customer demand will exceed our supply at launch," Angela Ahrendts, Apple (AAPL, Tech30) senior vice president of Retail and Online Stores, said in a statement Thursday morning.

Friday also marks the first day the smartwatches will be available for customers to try on at Apple retail stores across the U.S., and eight international regions: Australia, Canada, China, France, Germany, Hong Kong, Japan, and the UK.

Shoppers at the Galeries Lafayette in Paris, Isetan in Tokyo, Selfridges in London, and select authorized resellers in Japan and China will also be able to get a glance at the watches.

The Apple Watch is the company's first new consumer product in five years -- and its first since Steve Jobs died.

Apple relies heavily on a single product -- the iPhone -- for most of its revenue. Its latest device, the iPad, has had a slump in sales given the success of smartphones with larger screens, sometimes called phablets.

The question now is whether or not consumers think the Apple Watch is as revolutionary as the iPod or iPhone.

CNNMoney's Heather Kelly had a chance to try it. Kelly found the technology "fresh and exciting" but confusing at the same time. For example, the communications tools were "oddly fragmented."

In general, for the past few months, interest in Apple's first wearable device is abundant, especially in China, where knockoff versions are already being sold. But sales receipts for the real thing will tell the final tale.

Related: Hands on with the Apple Watch

The Apple Watch will come in three models. The cheapest -- the Apple Watch Sport -- costs $349.

The stainless steel model will start at $549 (38mm version) and $599 (42mm size). Prices will then go up to $1,049 and $1,099.

The high-end version, called the Apple Watch Edition and made from 18-karat solid gold, will range in price from $10,000 to $17,000.

CNNMoney will cover the unveiling on Friday from Apple stores in London and New York.

Follow CNNTech on the Periscope app for live shots and a discussion.

Related: 13 things to know about the Apple Watch

CNNMoney (New York) April 9, 2015: 12:30 PM ET


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These federal building janitors say they're owed back pay

sonia chavez good jobs nation Janitor Sonia Chavez (red bandana) and her husband, Anibal (center) with their three children. Both of them clean the office of the Secretary of Education and are fighting to get back pay they were entitled to receive.

That's according to a formal complaint filed Thursday with the Labor Department by a group called Good Jobs Nation, which represents low-wage workers employed by federal contractors.

The janitors are among dozens of workers -- including grounds keepers and bus drivers -- who say they are routinely denied the pay and time off they are entitled to under federal law. They work for businesses under contract with federal agencies such as the Department of Education, the National Zoo and the Park Service.

One janitor, Sonia Chavez, said she and her husband clean Duncan's office every week night.

"The secretary likes to talk about a race to the top in education, but what about a race to the top in wages," Chavez told reporters, speaking through a translator.

Chavez said her family struggles to make ends meet and regularly receives eviction notices.

"If we were getting paid what we should be, we could give our kids the supplies they need for school and perhaps save enough to send them to college," she said.

At issue is the 1965 Service Contract Act, which requires federal contractors to pay their employees a certain minimum wage depending on their occupation and location.

More recently, President Obama signed an executive order last year requiring businesses with new or renewed federal contracts to pay their minimum wage workers $10.10 an hour starting this year.

Related: Home health care workers sue employers for back pay

The advocay group Good Jobs Nation says violations of these rules are "rife both in Washington DC and throughout the country." It calls on federal agencies "to take meaningful responsibility for enforcing the letter and the spirit" of the act and other rules Congress has passed to protect low-wage workers.

George Faraday, policy director for Good Jobs Nation, said the laws designed to protect people who work at federal contractors are "routinely flouted right under the noses of those charged with policing them."

In total, the D.C. workers say they are owed more than $1.5 million in unpaid wages.

The group says pay stubs of nine janitors working nights at the Education Department headquarters in Washington, D.C., shows they were paid between $9.10 and $9.65 per hour and received no paid vacations days.

Under the law, the workers should have been paid $11.83 per hour and they were entitled to benefits such as 10-days of paid holidays, and up to four weeks of paid vacation depending length of service.

The workers are employed by Sabree Inc., which says on its website that has a contract to provide custodial services at the DOE's headquarters, known as the Lyndon B. Johnson Building. (Coincidentally, the Service Contract Act was signed into law as part of President Lyndon Johnson's War on Poverty.)

department of education building

Related: McDonald's gives workers a raise, but is criticized for not going far enough

However, Good Jobs Nation believes that Sabree subcontracted with a shell company, Ace Janitorial Svcs, in order to avoid paying the legally required wages.

Sabree did not immediately respond to a request for comment.

The complaint also says at least four workers who picked up trash and shoveled snow at the National Zoo were paid less than the mandated rate for groundskeepers.

Those workers are employed by Friends of National Zoo, a non-profit group under contract with the Smithsonian Institution.

As many as 35 bus drivers working for a tour company that contracts with the National Park Service and Department of Interior are also entitled to unpaid wages, according to the complaint.

The Department of Education, the Park Service and the Smithsonian did not immediately respond to requests for comment.

Related: Low-wage workers plan major strike

Related: Minimum wage since 1938

Related: 2014 minimum wage, state by state

CNNMoney (New York) April 9, 2015: 12:32 PM ET


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Walgreens shutters 200 U.S. stores

walgreens

The company, now known as Walgreens Boots Alliance (WBA), said the store closings will allow a more aggressive cost-cutting plan, as it aims to reduce expenses by $1.5 billion over three years. It had previously set a $1 billion cost cutting target.

Walgreens is the largest U.S. drugstore chain by locations, with slightly more outlets than rival CVS, although it trails CVS in sales.

The chain has been adding stores more frequently than it has closed them in recent years. It has 8,232 U.S. stores spread across all 50 states. In addition to the overseas move to buy Alliance Boots for $5.3 billion, it also spent $1.1 billion to buy the Duane Reade chain of pharmacies, which it still operates under that separate name, a deal that brought in 257 stores in New York City.

But closings have become a growing trend in the retail sector as brick-and-mortar stores face growing competition from online outlets. Even traditional chains are trying to respond to more sales shifting online.

Beyond the store closings announced as part of the bankruptcies of RadioShack and Wet Seal, other chains that have announced recent closing plans include Staples, Office Depot and Sears.

Walgreens said plans for closings are still being finalized and no time frame has been set for when the closings will occur.

CNNMoney (New York) April 9, 2015: 12:42 PM ET


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McDonald's gives workers a raise, but is criticized for not going far enough

Written By limadu on Kamis, 02 April 2015 | 23.53

What gives?

Critics charge that the vast majority of McDonald's workers will not see the higher wages.

Effective July 1, starting wages at 1,500 McDonald's-owned restaurants will be at least $1 an hour more than the minimum wage set by local law. Employees up to restaurant managers will get a pay bump, and if they have worked at least a year, they will also receive paid time off.

But 90% of McDonald's (MCD) workers are employed by independently-owned franchises and the plan will not apply to those workers. Critics are now calling on McDonald's to offer all its workers better pay and benefits. Fast food workers in New York plan to protests the new pay policies outside a McDonald's location later Thursday.

McDonald's CEO Steve Easterbrook seemed to anticipate the criticism, writing an OpEd in The Chicago Tribune, and releasing a similarly worded full-page ad in several newspapers Thursday.

"I understand that some may believe it doesn't go far enough," writes Easterbrook. "These actions demonstrate meaningful progress, and this is what we can do right now, in our company-owned stores."

Easterbrook, who has been in the job for less than three months, described the plan to raise pay for workers at company stores as an "initial step." He said the company remains committed to "reviewing the total employment experience we offer our people."

Related: Low-wage workers plan major strike

Easterbrook said raising wages is part of a plan to make McDonald's a "modern, progressive burger company."

The company is also changing its menu, offering more healthy options, and revamping its stores.

While franchise workers won't get a raise or paid time off, McDonald's is extending some educational benefits to all 750,000 employees at its network of 14,000 U.S. restaurants. The company will pay for workers to obtain a high school diploma, provide tuition assistance for college courses and language training.

McDonald's and other fast food chains have been under pressure to give workers better pay and benefits for more than two years with low wage workers staging nationwide protests, demanding pay of at least $15 an hour.

Related: 100 students refuse to pay their loans

"The company needs to raise wages for all of its employees to $15 an hour and ensure paid time off for sickness and family needs is accessible to all of their workers," said Ellen Bravo, executive director of Family Values @ Work, a group that has advocated for paid sick days.

Other big companies have responded to the push. Walmart (WMT) announced plans to boost pay for 500,000 full-time and part-time associates and give them more control over their schedule.

McDonald's has claimed that its franchise-based business model means the corporation is not responsible for wages or any workplace violations at independently-owned stores.

But a federal labor watchdog has challenged that argument.

The National Labor Relations Board in December named McDonald's along with several franchise owners in complaints alleging "discriminatory discipline" against workers who took part in protests calling for higher wages.

The NLRB has yet to issue a final ruling. But by naming McDonald's along with its franchise owners as violators, the group could set a precedent that would open McDonald's up to greater responsibility for the conduct of franchise owners.

Related: Minimum wage since 1938

Related: Minimum wage map

CNNMoney (New York) April 2, 2015: 11:58 AM ET


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The next big tech sex bias suits

twitter facebook lawsuits

Ellen Pao sued her former employer, venture capital firm Kleiner Perkins, for sex discrimination and retaliation. After a month of testimony, the jury sided with Kleiner Perkins.

Now there are two other potentially big sex discrimination cases on the horizon: One against Twitter and one against Facebook.

Tina Huang's lawsuit against Twitter (TWTR, Tech30) doesn't single out individuals. She claims the company has a secretive system for promoting employees that is biased against women.

"We are focused primarily with those systemic problems: Twitter's policies and procedures and how those practices adversely affect women, rather than just the specific things that happened to Ms. Huang," said Alec Segarich, of law firm Lohr Ripamonti & Segarich, which is representing Huang.

Chia Hong is suing Facebook (FB, Tech30), as well as her former boss and unnamed Facebook employees. That case has more specifics on individuals' allegedly offensive behavior, but would have narrower implications.

Twitter and Facebook both dispute the claims. Spokespeople from both firms say they believe the facts will show the plaintiffs were "treated fairly."

The next wave of lawsuits is happening in a post-Kleiner world

Before there was even a verdict, Pao may have helped inspire these women to come forward. The firm that represented Pao, Lawless and Lawless, is also representing Hong.

After the jury's verdict, there was an outpouring of support for Pao online using the hashtag, #thankyouellenpao. Some supporters took out a full page "Thanks Ellen" ad that ran in the Palo Alto Daily Post.

However, the Pao case also showed how difficult the process can be for the plaintiff. Pao's personal life was dragged into the spotlight, and her personality and shortcomings were picked apart on the witness stand and online.

Related: Tech's highest paid women

And the verdict for Kleiner Perkins might encourage the plaintiffs to settle.

"It will likely cause the plaintiffs' attorneys to at least pause and question whether they can find jurors who haven't heard anything about the Kleiner Perkins or Ellen Pao case," said Morin Jacob, an employment attorney with Liebert Cassidy Whitmore in San Francisco.

Similarly, the amount of negative press Kleiner Perkins received might influence Twitter and Facebook to avoid trial. (Tinder settled a recent sexual harassment and discrimination case out of court.)

Silicon Valley companies know there's a problem

Many Silicon Valley companies have publicly owned up to their lack of diversity. Only 6% of venture capital partners are women, according to the Diana Project at Babson College. At Kleiner Perkins, that number is around 20%.

Related: 'Things will not change' after Pao verdict without push

Facebook's global staff is 31% female and 69% male, according to the diversity report it released last summer. The number of women shrinks to 15% when you look at just tech employees. Meanwhile, Twitter's diversity report found that 30% of the entire company is female, and just 10% of its technical employees.

Self-awareness isn't a solution to the problem, but it is an important first step. Efforts to hire more women might not matter if the company culture keeps them from moving up or sticking around. These lawsuits, even if they're unsuccessful, can push tech companies to recognize and address any culture issues.

Twitter suit could become a class action

Huang's complaint requests class action status, which means there's a chance more female Twitter engineers could join the lawsuit. This would have an even bigger financial impact on the company.

Fear of class action suits could act as a wake-up call for other tech companies to drastically revamp their culture and promotion processes.

Suits show discrimination is often subtle and hard to prove

These cases are primarily gender discrimination suits. The Facebook suit also alleges sex/gender harassment and race discrimination.

The plaintiffs in these cases claim they were denied opportunities such as promotions because they were women. The Kleiner Perkins and Facebook cases also allege retaliation for complaining about discrimination.

Related: 9 reasons to be hopeful about women in tech

Some of the alleged examples of male-dominated culture are blatant. The Pao case included tales of sexual advances, affairs and inappropriate conversations about porn stars. In the Facebook suit, Hong says her male boss asked her why she wasn't home with her children.

Other instances are smaller, easier to deny and harder to prove, like double standards about personality traits and being excluded from all-male meetings. The plaintiffs have argued that they were equally or more qualified than male employees who were promoted instead or who replaced them after they were terminated.

"Kleiner Perkins dodged a bullet with a verdict in its favor, but this case should be used as a teaching tool and treated as a wake-up call for employers," said Jacob. "It remains to be seen, but there could very well be different results if trials happen in the Facebook or Twitter cases."

CNNMoney (San Francisco) April 2, 2015: 12:20 PM ET


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Everyone wants to go to Cuba now. Too bad for the rest of the Caribbean

Cuba has been the "forbidden fruit" for U.S. tourism over the last 50 years and Americans are giddy to see their southern neighbor. But should Americans' hunger for Havana concern other Caribbean countries?

Tourism is a key industry for many Caribbean nations, creating jobs and bringing billions of U.S. dollars to a relatively poor region. Now some of those dollars will head to Cuba.

"Cuba will be very stiff competition for them," says Mauro Guillen, a business professor at the University of Pennsylvania's Wharton School. "Cuba could be a paradise for tourism."

Americans can't yet travel to Cuba in the traditional sense for sun, sand and salsa dancing. They need to go for a specific purpose, such as business trip, family visit, religious mission or "support for the Cuban people."

But the surge is expected soon. That's why Airbnb announced Thursday it will begin operating in Cuba. Netflix (NFLX, Tech30), Mastercard (MA) and American Express (AXP) will start doing business there soon too.

cuba skyline The Havana skyline in the afternoon.

Related: Airbnb opens for business in Cuba

Cuba's tourism case: Cuba has a lot to offer. Last year, three million tourists visited Cuba, more than every other Caribbean nation besides the Dominican Republic, according to the Caribbean Tourism Organization. And that's with almost no Americans visiting Cuba last year.

The size of Ohio, Cuba has nine UNESCO world heritage sites -- a major tourism pull. That's more than the Dominican Republic, Bahamas, Jamaica and Puerto Rico combined.

Cuba's mix of an urban experience and sunny getaway give it a dynamic other islands don't have, experts say. Since President Obama's decision to lift some travel restrictions to Cuba, American companies are starting file into Havana too.

The Dominican Republic and Mexico's Yucatan peninsula, where Cancun is, have the most to lose, Guillen says. Others suggest that Jamaica and the nearby Caribbean island nations could get hit hard too.

Related: Netflix is now available in Cuba

Tourism makes up 43% of the Bahamas' economy, almost 30% of Jamaica's activity and 16% of the Dominican Republic's economy. By comparison, only 8% of America's economy is driven by tourism, according to the World Travel & Tourism Council.

"Neighboring countries will be challenged when the hospitality level catches up in Cuba," says Jonathan Blue, managing director of Blue Investments, a private equity firm, and frequent traveler to Cuba.

But others say American tourists going to Cuba is a win for others too.

Related: The promise for American businesses if Cuba sanctions are lifted

All for one and one for all?: The hope is the excitement surrounding Cuba will be an overall positive for the region. It's like the idea of multiple gas stations on one block: the more the better.

Plus, Cuba can't yet offer the luxury hotels and experience that many other islands have. The Dominican Republic had five million tourists visit last year, up 12% from a year before, and it has 5-star hotels.

A flood of US tourists to Cuba could flow over to other countries.

"There's a lot of romanticism around traveling to Cuba right now," says Alana Tummino, policy director at the Council of the Americas. However: "there's still going to be a lot of interest in Puerto Rico, Dominican Republic and all these other destinations."

Whether Cuba helps or hurts the rest of the Caribbean, one thing is certain: Americans -- and their businesses -- are coming.

Related: Cuba poised to join the internet age

CNNMoney (New York) April 2, 2015: 12:10 PM ET


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Atlanta Fed cuts U.S. growth forecast to zero

zero percent

It's looking so rotten that the Federal Reserve Bank of Atlanta just cut its growth projection to zero for the first three months of the year.

That's a big drop from the 1.9% growth forecast they started with in early February.

Of course, this is only an estimate. The official data on first-quarter growth will be released April 29. But it's yet another sign of the cracks appearing in the economy in a year when America was supposed to be the global growth leader.

What went wrong? Blame the weather and the strong U.S. dollar.

Related: This is the U.S. dollar's fastest rise in 40 years

American consumers and businesses haven't been spending much in recent months. There was hope that extremely low gas prices across the country would spur people to head to the shops and buy, buy, buy. But so far, that's not happening.

atlanta fed forecast

People aren't buying big things or small things. Retail sales are down. Home construction and sales came in weaker than expected, and orders for durable goods (think appliances and furniture) have fallen in three of the last fourth months.

On top of that, businesses aren't helping boost growth much either. While hiring has remained strong, there have been pullbacks in manufacturing and industrial production.

But the greatest headwind appears to be the strong U.S. dollar. It makes American goods more expensive to people overseas, and is also problematic for U.S. companies trying to bring their profits from abroad back home. They lose money on the currency exchange.

Related: Thank you strong dollar: these 5 travel spots are cheap

Companies as varied as Caterpillar (CAT), Coke (KO) and Apple (AAPL, Tech30) have all warned that the strong dollar will likely hurt their bottom line this year.

All of this weighs down gross domestic product (GDP), the measure of economic activity. The Atlanta Fed dramatically cut its growth forecast in mid-March after seeing how weak American trade was so far this year.

Bad sign for the rest of the year? While this not the start anyone wanted to see, something very similar happened last year. Growth was actually negative in the first quarter of 2014. But the economy rebounded quickly in the spring and summer, and the U.S. finished last year with healthy 2.4% growth for the year.

Fed and Wall Street economists are still largely optimistic about the rest of the year. In fact, most still predict better growth in 2015 than last year.

All eyes will now turn to the latest jobs report on Friday. Despite the problems so far this year, hiring has remained strong. CNNMoney's Survey of Economists predicts 244,000 jobs were added in March. Anything less than 200,000 will be seen as a miss.

Related: Why we can't ignore the stock market alarm bells

Related: Vacation home sales exploded last year

Related: The U.S. economy is showing cracks

CNNMoney (New York) April 2, 2015: 11:08 AM ET


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Harvard rejects about 95% of applicants

harvard acceptance rate Just 5.3% of those who applied to Harvard this year got in.

It was even tougher to make the cut this year, since the acceptance rate is down from last year's 5.9%.

But that's because a record number of people applied, not because the already discerning school decided to admit fewer students. This year, 37,307 students applied to fill the roughly 2,000-person class. Last year, the number was 34,295.

It's a similar story for Stanford, Princeton, Penn, Brown, Columbia and many of the country's top schools, who saw a higher, if not their highest number of applicants this year. Stanford accepted 5% of applicants, Columbia took in 6.1%, Yale sent acceptance letters to 6.49%, Princeton said yes to 6.9%, Brown accepted 8.5%, 9.9% of applicants got into Penn, Dartmouth took 10.3%, and Cornell offered spots to 14.9%.

Related: Stanford offers free tuition for families making less than $125,000

Harvard said that 52% of its accepted applicants are men, reflecting the fact that more males applied. 21% of the admitted students identified as Asian-American, 13.3% as Latino and 12.1% as African American.

While the acceptance rate dropped because more students applied, that doesn't mean that the pool wasn't insanely competitive. About 3,200 of the applicants were ranked first in their high school classes. More than 43% of those who applied scored a 700 or higher on their SAT math test, and more than 36% scored above 700 on the critical reading section.

At Princeton, 41% of applicants had a 4.0 grade point average. Of those accepted, 49% self-identified as people of color and 61% come from public schools.

For those admitted to Penn, 13% are the first in their families to go to college and 45% identified as minorities.

CNNMoney (New York) April 2, 2015: 11:29 AM ET


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Why Wall Street isn't cheering wage hikes yet

Pay hikes at McDonald's (MCD), Target (TGT), TJX Cos (TJX) and Wal-Mart (WMT) are great news, especially given how anemic wage increases have been since the Great Recession.

While it's a rare win for everyday Americans, don't expect Wall Street to cheer just yet.

If wage hikes don't encourage consumers to spend more -- something that cheap oil has so far failed to do -- they won't help the stock market much. Yet higher labor costs will increase expenses on companies at a time when they may not be able to balance them out by raising prices. That's not good for investors.

"In contrast to what was seen over the past six years, what could be good now for Main Street may not be so for Wall Street," said Peter Boockvar, chief market strategist at The Lindsey Group.

Related: McDonald's is giving 90,000 workers a raise

Finally! Pay raises are coming: American workers haven't had as much to celebrate during the economic recovery as investors. While the stock market has shattered records, wages have barely grown compared with the economy and inflation.

Worker compensation -- including pay, health insurance, pensions and employer-paid benefits -- relative to the U.S. economy is at the lowest level since 1948, according to the Bureau of Economic Analysis.

Yet now the labor market has improved enough that at least some large companies are fighting to keep talent by slowly increasing pay. Earlier this week McDonald's revealed plans to boost hourly wages by more than 10% for roughly 90,000 workers.

"Employees have more leverage and employers are starting to respond," said Boockvar. "The pendulum of wages relative to profits swung way too far in one direction. Now it's slowly beginning to move back the other way."

Related: Atlanta Fed cuts U.S. growth forecast to zero

Margin destruction ahead? The shift in the labor market has a negative implication for profit margins, a measure of corporate efficiency that has climbed to high levels thanks in part to stagnant wages. High margins have in turn helped lift stock prices.

Of course, not all companies will feel the margin pressure. Only the ones employing large amounts of low-wage workers.

Also, it's pretty normal at this stage of the economic cycle to see margins take a breather. There are only so many costs companies can squeeze.

Companies will naturally try to offset the higher costs by raising prices on products. Yet it's not clear they will have the pricing power to pass these costs on to consumers.

Just look at consumer spending. It inched up just 0.1% in February following two months of outright declines. Even cheap gasoline hasn'r perked up spending. Many Americans seem to be hoarding the $750 they will save from cheap gas this year rather than spending it.

"This time we may see a heavier deterioration of margins than we normally would at this point in the cycle," said Bruce McCain, who helps oversee more than $20 billion as chief investment strategist at Cleveland's Key Private Bank, a division of KeyCorp.

Related: The wild ride in stocks isn't over

Wage hikes could lead to Fed rate hikes: If companies are able to boost prices that would be good news for the Federal Reserve, which is failing to hit its 2% inflation target. The Fed is in no rush to raise rates until it's confident inflation will improve to healthier levels.

But investors get nervous about anything that speeds up the timetable or the pace of interest rate hikes. That's because extremely low rates make risky assets like stocks look that much more attractive.

Related: Stock market risks may be rising

Consumer spending is the key: Of course, there is a way for both Main Street and Wall Street to come out as winners from the wage hike story. If higher pay triggers a meaningful boost in spending, that would be huge for the stock market as well as the economy, which still takes its cues from consumers.

Wage hikes "are not a positive for corporate earnings in the near term, but they could have the potential of fueling further expansion in terms of consumer spending," said Peter Kenny, chief market strategist at The Clearpool Group.

That could lead to further wage hikes and a stronger job market.

"It's another way of pushing that virtuous cycle to a close," said Kenny.

Related: Chinese investors trade way more often than Americans

CNNMoney (New York) April 2, 2015: 11:51 AM ET


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Looking for a job? Follow the money

Tech consulting and outsourcing firm Cognizant Technology Solutions (CTSH) increased its headcount by more than 40,000 people in 2014.

That made Cognizant the biggest job creator in the S&P 500 according to an analysis of data for the most recent fiscal year compiled by FactSet Research. Another big IT services firm, Accenture (ACN), added 30,000 workers.

Demand for their products and services is up, and they needed more workers to fulfill obligations to clients, the companies said.

Related: Where the jobs are now

Tech is hot: This trend isn't a surprise to anyone who watches the stock market. The tech sector is booming again. The Nasdaq is back near its all-time highs from 2000. And it's not just companies that help businesses manage their tech departments that are hiring.

Companies that cater to consumers' love of gadgets have been adding workers too. Amazon (AMZN, Tech30) boosted its workforce by 36,800 last year while Apple (AAPL, Tech30) added 12,300 positions to its payrolls.

companies added jobs These are some of the blue chip companies that added lots of jobs last year.

Microsoft (MSFT, Tech30) added 29,000 jobs, but it's important to note that many of them came from its acquisition of Nokia's (NOK) device business. Microsoft also announced 18,000 layoffs last year.

Still, it's clear that the tech sector is in expansion mode. Google (GOOGL, Tech30), Corning (GLW), SanDisk (SNDK), Facebook (FB, Tech30) and Salesforce.com (CRM, Tech30) also added thousands of jobs in 2014.

Related: Americans just aren't spending

Good paying jobs: Tech jobs tend to have higher salaries than other industries. So if this trend continues, that could be a good sign for the overall economy considering that sluggish wage growth is the main weakness in the job market right now.

Outside of tech, UPS (UPS) and Whirlpool (WHR) also made the top five for jobs growth.

It will be interesting to see if these companies and others whose fortunes are closely tied to the health of the overall economy will be able to keep adding workers now that there are concerns about a consumer spending slump in the first quarter.

Related: Atlanta Fed cuts U.S. economic growth forecast to zero

Check the stock prices: Many retailers added jobs in 2014. The common theme among the businesses adding jobs? Rising stock prices.

Kroger (KR), Starbucks (SBUX), Costco (COST), Tractor Supply (TSCO) and CVS (CVS) were among the top 20 job creators in the S&P 500. The shares of all five companies are not far from their record highs.

It's true that Wall Street often seems to operate in a different galaxy than Main Street. Bad economic news can cause market rallies and companies get rewarded for handing out pink slips.

But that's really a short-term phenomenon. Over the long haul, the companies with strong fundamentals are the ones that do best.

Related: The U.S. economy is showing cracks

They are the ones with healthy sales and profits. And guess what? These companies have to keep hiring to keep up with demand, especially when they are opening new stores.

Sure, retail jobs may not pay as well as tech, finance or other sectors. But at least these well-known companies were adding jobs.

IBM (IBM, Tech30), McDonald's (MCD), Target (TGT), Bank of America (BAC), Hewlett-Packard (HPQ, Tech30) and Best Buy (BBY) did not.

These blue chips all slashed the size of their workforces last year and were among the 10 biggest job destroyers in the S&P 500.

Related: Cheap gas is saving Americans $750 ... but consumers are hoarding it

Related: Low wage workers plan major strike

CNNMoney (New York) April 2, 2015: 11:57 AM ET


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Buffett: I won't give millions to candidates

Buffett has given $25,000 to Ready for Hillary, a Super PAC that's backing Hillary Clinton's expected run for the White House. He strongly supports her and expects she'll win. But she'll have to do so without a six-figure check from Buffett, even if he can easily afford to write one.

"I support her, but I would not write a huge check," he told CNN. He plans to help raise money for her campaign, but says he doesn't believe in the kind of huge donations that current campaign laws allow.

"I just don't believe that the elections should be decided by the super-rich," he said. Being a billionaire, he has said, shouldn't mean he can "outshout everybody else."

"Obviously it's very tempting to take a very big check from somebody who has a special interest. [But] it's counter to our ideas of democracy to allow unlimited campaign contributions."

Related: Buffett - Discrimination for sexual orientation is 'wrong'

Buffett is the second-richest American, according to Forbes, worth an estimated $67 billion. David and Charles Koch are tied for fourth on the list with $42.9 billion each.

Buffett has made a total of $329,000 in political donations since 2000, according to the Center for Responsive Politics lists donations, including the $25,000 to Ready for Hillary.

The Koch brothers have reportedly told a group of conservative donors that they plan to spend $889 million during the upcoming 2016 campaign alone.

Related: Koch brothers set staggering 2016 spending goals

Buffett said he wasn't aware when he made that contribution that the group qualified as a Super PAC. Buffett is one of nearly 100 donors to give $25,000 to the group.

"I think of Super PACs as these things with donations of hundreds of thousands or millions," he said.

And he said he'll be more careful about contributing to such groups in the future. "I'm not for Super PACs,' he said.

CNNMoney (New York) April 2, 2015: 11:58 AM ET


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Get up to speed with the Greek debt crisis 3.0

After bailouts in 2010 and 2012, Greece is once again edging towards financial collapse.

Here is what you need to know to get up to speed with the third installment of the Greek thriller.

1. Payments due

Greece has some hefty payments to make in April. It has to send about 460 million euros to the International Monetary Fund next Thursday.

The government is reported to be facing a bill of 1.7 billion euros for public sector wages and pensions by the end of the month.

2. Running out of money

Only the Greeks know how much money is really left in their treasury. Tax revenues in January and February came in 1.1 billion euros below forecast.

Reports that the government does not have enough cash to meet its obligations are emerging. Some even say Athens will run out of money next week -- a scenario the government has so far denied.

Related: 7 reasons Grexit wouldn't be a total disaster

greece avoiding default

3. Running out of time

What is clear is that Greece urgently needs the final portion of its 240 billion international bailout.

Athens is pushing for the money to be released as soon as possible, to avoid stumbling out of the eurozone.

But creditors will only release the cash -- 7.2 billion euros -- if Greece commits to a revised program of economic reforms.

Related: Is keeping Greece in euro impossible?

4. Reforms

Athens submitted a new list of reforms Wednesday. The document, published by the Financial Times, details the government's plans to tackle tax evasion and fraud. They include a proposal for a lottery to encourage consumers to ask for sales tax receipts, a new luxury tax, and higher revenues from tourism.

But the list also includes a number of measures that are likely to spark a backlash from the creditors.

The government wants to reverse earlier reforms by reintroducing a 13th month pension payment for low-income Greeks, and by scrapping gradual cuts to state pensions. These proposals would cost the Greek government an extra 1.1 billion euros this year.

5. Markets worried

Markets are getting anxious as the payment deadlines loom. The stocks of the main Greek banks have all taken a beating this year -- Piraeus (BPIRF) has lost 63%, Alpha Bank (ALBKF) 42% and Eurobank (EGFEF) 38%. And Greek bond yields have been soaring, indicating investors are growing more concerned about the ability of the government to repay its debt. Yields on the 10-year bond are at nearly 12%, up from below 11% a week ago.

Opinion: Greece needs to behave like a startup

CNNMoney (London) April 2, 2015: 12:11 PM ET


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