Green Mountain expands Starbucks partnership

Starbucks-branded K-Cups for Green Mountain's popular Keurig machines. The companies announced their partnership would continue.

NEW YORK (CNNMoney)

Green Mountain Coffee Roasters announced Wednesday that it will continue its partnership with Starbucks for at least another five years. The two companies have been partners since 2011, when they inked a deal for Starbucks and Tazo-branded single-serve packs to be made and sold for Keurig brewing machines.

Shares for Vermont-based Green Mountain (GMCR) rose more than 10% after hours on the news.

Financial terms of the expanded deal were not disclosed, but it puts an end to investor concerns that Starbucks (SBUX, Fortune 500) would nix the partnership after introducing its own single serve machine, the Verismo, last year.

Since the original deal, Starbucks has shipped more than 850 million of the Starbucks coffee K-Cup packs, according to a press release. As a part of the new contract, Starbucks will add new brands, including its Seattle's Best Coffee and Teavana teas, to the product lines.

The companies also said they hope to expand global marketing of the products.

"This agreement further strengthens our North American partnership with Starbucks and expands our relationship to explore global single-serve opportunities," Green Mountain President and CEO Brian P. Kelley said in the statement.

Green Mountain also posted strong quarterly earnings after the bell Wednesday, beating analyst estimates.

The company's single serve business, which includes Keurig brewers, accessories and single serve packs, grew by 16%, according to the company's release.

Shares of Starbucks were up slightly after hours.

First Published: May 8, 2013: 5:27 PM ET

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Make your vacation pals cough up their fair share

(CNNMoney)

"Resentment over money is one of the biggest issues that ruin vacations," says Nadine Davidson, author of Travel With Others Without Wishing They'd Stayed Home.

So before you book this summer's big trip, air your expectations about who will pay for what and how luxuriously (or not) you'll travel. That way, your time together can be all about having fun.

The Ground Rules

Keep it light. Work the topic into a larger discussion about the good times you're going to have, says Patricia Rossi, author of Everyday Etiquette.

Put it in writing. Outline the costs in black and white after your discussion, or have the whole conversation via e-mail if that feels easier.

Prepay separately when you can. Can you each send in half the condo deposit? Buy your own plane tickets? Doing so will prevent headaches later. Or opt for an all-inclusive resort -- you'll have fewer bills to square up.

When You're Face to Face...

1. Opening gambit: "We're so excited to be going to Disney with you. We love the Mickey Mouse theme restaurant. Are there any places you want to try?"

Why it works: Talking about specific activities -- and even eateries -- offers insight into how your pal or relative intends to divvy up his vacation dollars. "Even if someone's in your tax bracket, it doesn't mean they like to spend their travel money the same way," says Davidson.

2. Suggest a split. "Unless you hit the lottery next month, I assume we'll be dividing everything fifty-fifty."

Why it works: Stating upfront how you expect to share costs sets the tone for the whole trip. Be sure to discuss when the money is needed, the deadline for refunds, and what happens if one party has to cancel. Infuse this with humor to make people feel at ease, says Rossi.

3. Take on the burden. "I know the hotel prices in Chicago are outrageous. Why don't I research some cost-effective options?"

Related: How to ask a pal or relative to pay you back

Why it works: Taking the reins can help you avoid the awkwardness that might ensue when, say, your spendy pals suggest the Ritz or your cheap friends pick the Fleabag Inn. Your travel mates are likely to be more receptive to different options if they know it won't create a hassle for them, says Marblehead, Mass., etiquette consultant Jodi R.R. Smith.

4. Propose a practical plan. "Since we're eating lunches at the condo, how about each family sets aside $100 for grocery store runs?"

Why it works: Putting a system in place ensures that no one winds up footing the whole bill, says Lynn O'Rourke Hayes, editor of FamilyTravel.com. Create a communal account or put receipts in a specific place to be tallied up later. Also address how you'll pay for booze, since differences in consumption can cause tension.

5. Ask for alone time. "Seafood isn't really our thing. When you guys go to the surf-and-turf place, we'll head to our favorite taco stand."

Why it works: Making some separate plans allows each party to look forward to things that cater to its budget and tastes. After all, says Smith, "part of the fun of a vacation is the anticipation."

First Published: May 8, 2013: 6:51 PM ET

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Current deficit plunges 32%

NEW YORK (CNNMoney)

A major reason: A big jump in tax revenue.

Tax collections rose by $220 billion -- or 16% -- between the start of the fiscal year on Oct. 1 through April 30. Individual and payroll taxes accounted for $184 billion of that increase.

The tax haul rose sharply primarily because wages and salaries were higher, the payroll tax cut of the past two years expired on Jan. 1 and the fiscal cliff deal brokered over New Year's raised tax rates on high earners.

Spending, meanwhile, fell 1.9% year over year, the CBO estimated.

The biggest percentage drop occurred in the payment of unemployment benefits, which were down nearly 25%, or $15 billion. Defense spending fell 5.3%, or $20 billion, and "other activities" -- primarily spending on nondefense programs -- fell 8.6%, or $58 billion.

Related: Deficits are falling. For now.

Less was spent, for instance, on housing assistance, energy programs and international assistance, along with the TARP bank bailout and on mortgage giants Fannie Mae and Freddie Mac.

Spending in some categories, however, was higher. Medicare, Medicaid and Social Security outlays combined rose by $50 billion, or between 6% and 7%.

While the country has still racked up an estimated $489 billion deficit in the first seven months of this year, that's about a third less than the $720 billion recorded for the same period last year.

Higher than expected revenue and lower spending has pushed back the real deadline for when Congress must raise the debt ceiling until as late as October.

And it's easing pressure on Congress to cut a big debt deal anytime soon.

Later this month, the CBO is expected to publish its revised estimates for spending, taxes and deficits over the next 10 years. Earlier this year, it estimated an annual deficit for 2013 of $845 billion, but some budget observers have said they expect the deficit for this year will come in lower than that.

First Published: May 7, 2013: 5:55 PM ET

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How much does your money manager cost you?

Charley Ellis, founder of Greenwich Associates, worries about the challenges aging boomers face from low bond yields to uncertain stock returns, and dubious financial come-ons.

(Money Magazine)

He shook up Wall Street in 1975 with a landmark article in a financial trade journal that attacked the notion that professional money managers consistently beat the market.

Nonprofessionals stand even less chance of outperforming the benchmarks, argued Ellis, so individuals need to rethink their approach to building wealth. That influential piece was the basis for Ellis's classic investing book, Winning the Loser's Game, the sixth edition of which is due in July.

Founder of the financial consulting firm Greenwich Associates, Ellis has also served as a director of Vanguard. Today he still worries about investing costs, as well as the challenges that aging boomers face from low bond yields, uncertain stock returns, and dubious financial come-ons.

Ellis, 75, spoke recently with MONEY editor-at-large Penelope Wang. Their conversation has been edited.

Despite recent highs, bear markets and crises have made our readers nervous about stocks. What's your advice for them?

Ben Graham said that people pay too much attention to what the market is doing currently. And he wrote his wonderful book Security Analysis in 1934. If people look backward, they will have one set of views. As they look forward, they'll have another.

What kind of returns should people expect?

Seven percent annual average returns for stocks over the next decade is the consensus among the investing pros I talk to. Minus inflation and expenses. So you're looking at a real return of 5% or less, which is not a lot. But over time you can still do pretty well.

So they should be buying stocks?

They should absolutely invest in a low-cost index fund. But nonprofessionals should forget about stock picking.

For an individual investor, it's like my saying, "I'd like to play football with the NFL." You've got to be kidding.

You don't recommend giving money to pros to manage either.

Most active managers underperform because of fees. Some 80% of them would slightly beat the market, but after fees, their returns end up being below the market.

You've said that people should think differently about fund costs.

We've been describing fees in a way that really is nonsense. We ought to look at fees not in terms of assets, but as a percentage of the incremental returns of a fund -- how much extra return you can expect over a comparable index fund.

Related: What you need to know about investing in mutual funds

Think of the 7% expected long-term returns of stocks. A 1.5% fund expense ratio is a big fraction of that 7%.

Now compare that with an index's expected returns. How much more can you expect from an actively managed fund? Your fee wipes out any advantage -- assuming you get those extra returns. Fees as a percentage of incremental returns are unbelievable.

Let's turn to bonds. What's your take on them, given ultra low rates?

The best piece of advice I could give long-term investors today is don't own bonds. And if you do own them, you probably ought to move out of them.

Right now the Federal Reserve is set on keeping rates down. The yield on a 10-year Treasury bond is under 2%. When yields go back to their historical average of 5.5%, an intermediate bond fund could go down 25% in value. People who are putting their retirement money into safe -- quote, unquote safe -- bonds can get hurt badly.

So someone with half of his or her money in bonds should move it into cash?

Moving entirely out of bonds into money funds or bank CDs may be too extreme for some people. But you can diversify more. You could look at foreign bonds or dividend-paying stocks, though you will be taking on more market risk than you would with CDs. Or you could perhaps stick with a short-term bond fund, which would fall less if rates were to rise. There's no simple answer.

How and when might bond investors get hurt?

The Fed has enormous information about the economy, and two smart people heading it: vice chair Janet Yellen and chairman Ben Bernanke. They will just likely judge that the time has come to stop pushing rates down. They'll look for signals like lower unemployment and higher inflation. I would expect to see rising rates in the next three, five, 10 years.

So what should pre-retirees do if they don't know how to be invested for retirement?

One thing they should beware of: Bad guys are tracking who's getting close to retirement. And they're targeting people with pitches -- mail, email, phone calls.

Related: Money 70 - Best mutual funds

You get a lot of very sexy propositions: "Now is the time for you to break free" and "You're entitled to control of your investments." "This is, after all, your money. You should get it done your way."

All this "you, you, you" stuff. The truth is, in all too many cases, people will get stuck with something that costs way too much and won't deliver on promises.

How can you avoid getting stuck?

Anyone rolling over an IRA needs to be super-careful. If you hear from someone that you don't know or someone from a firm you've never heard of, check them out. There are a lot of tough players out there who are selling all types of products and who don't really worry about what happens to you.

So if you're being offered something, ask the salesperson to put the numbers in writing and ask him, "Would it be a good idea if I run this by my accountant or my lawyer?" If he doesn't like that idea, that tells you something.

Related: Avoid the slow bond market meltdown

It's not just about a particular product, but also about how you buy it. Low-cost annuities are a good idea, but sales commissions often make them not that good a deal when you purchase them.

You should check fees rigorously. There are usually several ways to buy anything.

You also think that people should adjust their timetable for investing.

For someone around the age of 60, a 30-year time horizon for investments is perfectly sensible. If you have a younger spouse, it could be even longer than that.

You can change your behavior by thinking really long term. You can stop being flustered so much about daily market moves or even what the market does this year.

The longer your time horizon, the more you will surely invest in equities, which will help you build financial security. With a long time horizon, you will also focus more on protecting your family -- your spouse and your kids -- even after you're gone. I'd like to help my grandchildren get to college.

Active management: The high price of trying to beat the market

As a percentage of assets, the fees of an actively managed fund may not seem high. Compared with a fund's returns, though, they're considerably more substantial -- especially since active funds usually don't outperform their benchmark indexes.

Expenses as a percentage of assets
Index stock mutual fund	0.2%
Actively managed stock fund	1.4%
Expenses as a percentage of a 7% return
Index stock mutual fund	3%
Actively managed stock fund	20%
Expenses of active funds as a percentage of returns over an index
Case No.1: Active fund beats benchmark index by 3 percentage points	47%
Case No. 2: Active fund outperforms index by 1 percentage point	140%

Notes: Expense ratios are typical for stock funds. Examples of returns are before fees.
Sources: Morningstar, MONEY calculations

First Published: May 7, 2013: 5:45 PM ET

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Whole Foods shares surge as growth continues

NEW YORK (CNNMoney)

Shares of the grocery chain surged 8% in after-hours trading Tuesday after the firm posted quarterly earnings that beat expectations and increased its earnings guidance.

Revenue this past quarter increased 13% versus a year prior, while same-store sales increased 6.6%. The company also announced a two-for-one stock split that will increase the total shares of common stock outstanding from roughly 185 million to 370 million.

Whole Foods (WFM, Fortune 500) focuses on healthy and upscale products, competing with chains like Trader Joe's and Fairway.

The company has booked sales growth of better than 10% in the past few years, and expects sales to increase 13.6% in the 2013 fiscal year. It currently has 349 locations and is in the process of expanding, with plans to open three more stores this quarter and 12 in the upcoming quarter.

Whole Foods co-founder and co-CEO John Mackey said in a statement that the company believes it will "continue to gain market share as we accelerate our new store openings."

Whole Foods says that over the long term, it sees the possibility of 1,000 stores in the United States, as "consumer demand for natural and organic products continues to increase." The chain said it also sees "great promise" in Canada and the U.K.

First Published: May 7, 2013: 6:24 PM ET

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Jamie Dimon is under fire

Shareholders will vote on whether JPMorgan should appoint an independent chairman at its annual meeting on May 21.

NEW YORK (CNNMoney)

JPMorgan Chase's (JPM, Fortune 500) larger-than-life CEO appeared to survive the London Whale -- the bank's big bet on derivatives that resulted in nearly $6 billion in losses -- with his power undiminished.

But one year later, he is under fire from a wide swath of shareholders who are pushing the board to strip him of his role of chairman.

On top of that, one of the most influential shareholder advisory firms, ISS Proxy Advisory Services, also recommended that shareholders vote against three of the bank's long-serving board members. The three directors, Honeywell's (HON, Fortune 500) CEO David Cote, private investment adviser Henry Crown, and the American Museum of National History's CEO Ellen Futtter, all served on the bank's risk oversight committee, and were most responsible for overseeing the trading operations that led to the London Whale losses.

If ISS ultimately holds sway, Jamie Dimon could be faced with a new, less agreeable board.

ISS also criticized JPMorgan's entire board for a lack of independence. In the face of the massive London Whale trading losses, "the board appears to have been largely reactive, making changes only when it was clear that it could no longer maintain the status quo," ISS said.

Related: JPMorgan Chase fails to impress Wall Street

David Larcker, a professor of corporate governance at Stanford Graduate School of Business, said ISS typically succeeds at influencing the votes of between 25% to 30% of shareholders.

Last year, 40% of the company's shareholders voted to replace Dimon with an independent chairman. But shareholders were more willing to keep the same board in place. Of JPMorgan's 11 directors, 10 received more than 95% of a vote to keep them. Ellen Futter received the least support, and she was still backed by 86% of shareholders.

Shareholder votes don't necessarily dictate a board's actions. Corporate boards are only meant to use these votes to inform their decisions. Even if a majority of shareholders ask for an independent chairman, the board doesn't have to comply.

That said, a vote against the status quo can become a public relations nightmare for the bank.

"Once you start getting this push from outside shareholders, it becomes a long, time consuming thing for the board and the bank," said Stanford's Larcker.

ISS isn't the only shareholder who has been actively pushing for Dimon to exit his chairmanship.

The nation's largest public pension system Calpers has pushed for an independent chairman at the bank for several years. But this year, Joe Dear, Calper's chief investment officer, said pension funds holding JPMorgan shares have been more proactive in coordinating their votes.

Related: What could cause the next financial crisis

To be fair, Dimon is still revered for his work leading the bank through the financial crisis and even past the London Whale debacle. But some of the largest shareholders that praise his work also think the bank would fare better if his power was diminished.

"Jamie Dimon is one of the most talented CEOs in the world," said Dear. "With [his] outsize personality, it's important to split the jobs of chairman and CEO. It's a bedrock principal of corporate governance."

The board has said it will back Dimon as both its CEO and chairman.In the runup to the May 21 meeting, the bank is actively talking to shareholders to help convince them that Dimon is needed in both roles and why their board members should be re-elected.

In an SEC filing, the company's board said Dimon as CEO and chairman is "the most effective leadership model for the Firm."

Still, some shareholders, such as revered Berkshire Hathaway chief Warren Buffett, still think Dimon is the right man for both jobs.

At his annual shareholder meeting in Omaha, Neb., Buffett told Bloomberg Television: "I couldn't think of a better chairman."

First Published: May 6, 2013: 4:30 PM ET

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Term life insurance prices rising amid low interest rates

Premiums for term life insurance can vary widely. Search online for comparison pricing.

(Money Magazine)

Following a decade in which prices fell to all-time lows, premiums for new term policies last year rose an average of 3%, says online agency IntelliQuote, which forecasts more increases this year.

The culprit? Sickly yields on bonds, in which insurers invest most of customers' premiums.

Hit hardest are policies longer than the standard 20-year term; top firms Genworth and ING have stopped selling 30-year term, and rates are up about 5% among remaining carriers, says Byron Udell of term life agency AccuQuote.

Related: Strategies for buying life insurance

Despite the general increase, premiums can vary widely. To nab a low-priced policy, start your search online with either IntelliQuote or AccuQuote.

Stick with insurers rated A or better for financial strength by A.M. Best. And should you want coverage beyond your guaranteed term, screen for policies giving you until age 60 to convert to permanent insurance without a physical -- a big plus if health changes make you uninsurable.

Highs and lows

Prices for term insurance range widely.

Annual premium for a $500,000 policy for 40-year-old healthy male
Low	$355
Median	415
High	565

Note: Based on March 2013 quotes for a 20-year level term policy from 11 insurers with an A.M. Best rating of A or better. Source: AccuQuote

First Published: May 6, 2013: 4:45 PM ET

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Senate approves Internet sales tax proposal

NEW YORK (CNNMoney)

The so-called Marketplace Fairness Act would allow the 45 states (and the District of Columbia) that currently charge sales taxes to require large online retailers to collect tax on purchases made by their residents. The law would only apply to online sellers that have sales of at least $1 million in states where they don't have physical operations, like a store or a warehouse.

The Senate voted 69 to 27 to approve the bill, which enjoyed bipartisan support. But before it can become law, it must be approved by the House, where Republicans are split on the issue.

Some House Republicans have already expressed support for the bill, arguing that it would level the playing field for small brick-and-mortar retailers. They say it would not create a new tax, but rather enforce the collection of taxes already charged at traditional retailers. But other House Republicans still view that as a tax increase on consumers or say it would overburden Internet businesses in their states.

The Obama administration has endorsed the bill, so if it can gain approval in the House, it is likely to become law.

Related: What an Internet sales tax would cost you

If the bill is enacted, academic studies estimate more than $12 billion in additional sales taxes will be collected from online purchases each year.

Big brick-and-mortar retailers with an online presence, such as Wal-Mart (WMT, Fortune 500), already charge sales tax for web purchases. But in many states, you can still shop tax-free at Internet-only retailers like Amazon or Overstock (OSTK).

That's because under current law, online sellers are only required to collect tax in states where they have a physical presence. And while most states require shoppers to pay a so-called "use tax" when a sales tax wasn't collected at online checkout, few people actually follow through.

CNN Radio: Is it fair to tax Internet purchases?

"This collection disparity has tilted the competitive landscape against local stores, creating a crisis for brick-and-mortar retailers around the country and in your state," David French, senior vice president of the National Retail Federation, one of the bill's loudest supporters, said in a letter to Senate members.

Close to 30% of online shoppers surveyed by advisory firm AlixPartners recently said they would shop more at brick-and-mortar retailers if the tax became reality. Nearly half, though, said that an Internet sales tax would have no effect on their online shopping habits, according to the survey of about 2,500 consumers.

Related: Internet Sales Tax: What you need to know

After years of battling individual state efforts, Internet giant Amazon (AMZN, Fortune 500) is supporting the bill, in part because the company is already collecting sales tax in nine states where it has warehouses.

Many other online retailers remain opposed to the legislation, saying that the sales tax would hurt business and create an administrative nightmare because they would have to determine tax rates for different states and localities at checkout.

Anti-tax group Americans for Tax Reform has also come out strongly against the legislation, which it says "can only be viewed as a tax increase." It did not respond to a request for comment.

Meanwhile, eBay (EBAY, Fortune 500) is lobbying for a $10 million exemption for small businesses.

First Published: May 6, 2013: 7:06 PM ET

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Buffett's Berkshire blows past estimates

NEW YORK (CNNMoney)

Buffett's Berkshire Hathaway (BRKA, Fortune 500) handily beat analyst estimates with its first-quarter earnings on Friday, booking strong gains in its investments and insurance business.

Excluding certain investment gains, Berkshire reported earnings of $3.8 billion, or $2,302 per Class A share, blowing past the prediction of $1,995.50 per share from analysts surveyed by Thomson Reuters.

Including investment gains, Berkshire's earnings hit $4.89 billion, rising more than 50% versus a year prior.

Berkshire is a broad-based investment conglomerate whose holdings include everything from Geico insurance to Burlington Northern Santa Fe railroad to Dairy Queen. It also has stakes in a variety of other large firms.

Earlier this year, Berkshire was part of a consortium along with private equity firm 3G Capital that purchased ketchup maker H.J. Heinz Co for $28 billion.

Berkshire earned $901 million in the first quarter from its insurance underwriting business, up from just $54 million in the first quarter of 2012. The company said its gains came from the lack of significant catastrophe losses in the first three months of the year.

Related: Buffett is worried about Fed policy

On the investment side, Berkshire has substantial holdings in derivatives that serve as bets on the value of global stock indexes like the S&P 500. Berkshire's position improves when these index values rally.

Berkshire earned more than $1.1 billion from investment and derivative gains in the first quarter, up from $580 million a year ago.

With stakes in several large banks and homebuilders, Berkshire also has significant exposure to the housing market, which appears in the midst of a solid recovery. Earlier this week, the S&P Case-Shiller index of home prices showed a 9.3% rise over the past 12 months, the biggest gain since near the height of the housing bubble.

The aging Buffett has not publicly revealed a succession plan, but says he has informed Berkshire's board about his preferred candidates. He underwent radiation treatment last year for prostate cancer, though he said the illness was "not remotely life-threatening."

Investors will descend on Buffett's hometown of Omaha this weekend for Berkshire's annual meeting, where he and business partner Charlie Munger typically hold forth on their business and the state of the U.S. economy.

You don't have to be in Nebraska to get real-time updates on Buffett's thinking, however; the 82-year-old joined Twitter this week.

First Published: May 3, 2013: 6:00 PM ET

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Stock market momentum continues

Click the chart for more stock market data.

NEW YORK (CNNMoney)

Small investors, who missed the stock market rally of the past few years, are being drawn in by the record highs and returning in droves. The new money could stoke more stock buying and send indexes higher again.

This week, investors will have to digest economic reports on the U.S. consumer and manufacturing.

The consumer credit report due out on Tuesday will give investors a sense of how keen Americans are to reach into their pocket books.

Last week's jobs report gave an indication that consumers are feeling fine. Retail and food services experienced some of the strongest job growth in April's jobs report, adding 29,000 and 38,000 positions respectively.

Experts say this shows that households are more willing and able to go out and spend, which drives job growth.

Related: CNNMoney's Fear & Greed Index

The manufacturing sector will also be in play, with a report on wholesale inventories on tap for Thursday.

On the corporate front, several companies will report financial results this week, including Toyota (TM), News Corp. (NWS), Macy's (M, Fortune 500), Nissan (NSANF) and BAE Systems.

Stocks rallied last week, sending the Dow Jones Industrial Average briefly above 15,000 for the first time on Friday. For the week, the Dow rose 1.8%; the S&P 500 gained 2% and the Nasdaq added 3%.

April was a strong month, with the S&P 500 advancing for the sixth consecutive month.

First Published: May 5, 2013: 12:24 PM ET

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Senate to vote on proposed Internet sales tax law

NEW YORK (CNNMoney)

The legislation would allow the 45 states (and the District of Columbia) that currently charge sales taxes to require large online retailers to collect tax on purchases made by their residents. The law would only apply to online sellers that have sales of at least $1 million in states where they don't have physical operations, like a store or a warehouse.

The bill has a good chance of becoming law. It already received broad support in the Senate during earlier procedural votes, and now must pass Senate muster a final time. After that, however, it will need to be approved by the Republican-controlled House. Proponents argue that the proposal would not create a new tax, but rather enforce the collection of taxes already charged at brick-and-mortar retailers. Some House Republicans may view that as a tax increase.

If the bill is enacted, academic studies estimate that more than $12 billion in additional sales taxes will be collected from online purchases each year.

Related: What an Internet sales tax would cost you

Under current law, online sellers are only required to collect tax in states where they have a physical presence. Otherwise, consumers who shop online and don't pay a sales tax at the time of purchase are supposed to pay the tax to their home state. But estimates are that only about 1% of buyers comply with those widely unenforced laws.

"We think this will help level the playing field," said Stephen Schatz, a spokesman for the National Retail Federation, one of the bill's largest supporters.

Close to 30% of online shoppers surveyed by advisory firm AlixPartners recently said they would shop more at brick-and-mortar retailers if the tax became reality. Nearly half, though, said that an Internet sales tax would have no effect on their online shopping habits, according to the survey of about 2,500 consumers.

Related: Internet Sales Tax: What you need to know

After years of opposition, Internet giant Amazon.com (AMZN, Fortune 500) is also supporting the bill, in part because the company is already collecting sales tax in nine of the states where it has warehouses.

Many other online retailers remain opposed to the legislation, saying that the sales tax would hurt business and create an administrative nightmare because they would have to determine tax rates for different states and localities at checkout. Anti-tax group, Americans for Tax Reform, has also come out strongly against the legislation, which it says "can only be viewed as a tax increase."

Meanwhile, eBay (EBAY, Fortune 500), which has loudly opposed the tax, is lobbying for a broader exemption for small businesses.

"The solution is simple," CEO John Donahoe said in a letter to eBay users. "If Congress passes online sales tax legislation, we believe small businesses with less than 50 employees or less than $10 million in annual out-of-state sales should be exempt from the burden of collecting sales taxes nationwide."

First Published: May 5, 2013: 3:55 PM ET

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How construction can lose jobs in middle of home building rebound

Cuts in government spending on construction projects led to the drop in April's construction employment.

NEW YORK (CNNMoney)

The sector lost about 6,000 jobs overall, according to the Labor Department's jobs report. This was largely due to a decline in hiring for non-residential buildings or public works projects like roads or sewer plants. Combined, these two areas lost 19,700 jobs.

Meanwhile, home builders and their subcontractors added 13,300 workers, even more than in March.

A big part of the sector's pullback is due to a drop in government-funded construction projects, a trend that has been going on for about two years.

Federal construction spending is down 28% since peaking in August 2011, when stimulus spending was still going strong, according to Ken Simonson, chief economist of the Associated General Contractors of America, an industry trade group. Local governments, particularly school districts, have also been pulling back on construction spending after building a rush of new ones during the housing boom.

"You don't need to open a new school every month if people aren't coming," he said.

Related: April jobs report - Hiring picks up

Additionally, many builders are having a hard time finding skilled construction workers.

David Crowe, chief economist with the National Association of Home Builders, said residential construction hiring likely would have been even higher in April if not for the shortage of skilled workers in some markets. He said a survey of his trade group's members found about half couldn't find workers with the necessary skills.

Simonson and other experts say the cutback in federal spending -- known as the sequester -- that went into effect March 1 hasn't halted work on any construction projects already underway. But they said federal agencies knew the sequester was looming and did scale back new construction contracts earlier this year.

Record low mortgage rates, a rebound in home prices and strong new home sales prompted the fastest pace of home building in nearly five years in March, according to a separate government report.

First Published: May 3, 2013: 12:54 PM ET

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My First Rifle: The business of selling guns for kids

Chipmunk, a subsidiary of Keystone, sells guns designed for children, along with its sibling subsidiary, Crickett.

NEW YORK (CNNMoney)

The gun used in the recent shooting in Kentucky was a Crickett .22-caliber rifle, marketed with the slogan "My First Rifle," from Keystone Sporting Arms in Milton, Pa. The single-shot rifle uses the smallest caliber available and is sold by major retailers, including Wal-Mart (WMT, Fortune 500), Cabela's (CAB) and Gander Mountain.

The Crickett website was down Friday due to "difficulties," according to John Renzulli, an attorney representing Keystone . But the site for Chipmunk, another Keystone brand, exhibited "quality firearms for America's youth" on its site, including .22-caliber rifles and pistols, with photos of children shooting them. The site includes a "kids corner" section.

Renzulli insisted that the company is not marketing firearms to children.

"No one's marketing to children," he said. "They're marketing to parents who would buy guns for children."

On its website, Wal-Mart markets the Crickett as a "youth rifle," while Gander Mountain's site describes it as a "great beginner's gun."

"All are lightweight and easy for youngsters to carry at the range and in the woods," reads the Crickett description on Cabela's site, which describes it as "a fun firearm to get your young shooter started with."

Wal-Mart did not immediately comment on whether their policy on sales of guns for children would change. Gander Mountain said it would not comment on potential policy changes, but added that it has launched a responsibility campaign aimed at keeping firearms away from "the underaged, untrained and unauthorized." Cabela's did not return a request for comment.

Related: Remington jobs rule the Rust Belt

Lawrence Keane, vice president and spokesman for the National Shooting Sports Foundation, the firearms industry group, described the youth firearm market as a relatively small slice of the gun industry, though large enough to have plenty of participants.

"A number of manufacturers make youth models of firearms for parents to purchase to introduce their children to adult-supervised target shooting," said Keane. "Millions of families all across America participate in the shooting sports as a family recreational activity. Children cannot purchase firearms from licensed dealers, of course."

Keane said safety has improved in recent years, saying data show that accidental fatalities involving firearms and children younger than 14 dropped by more than half over two decades to about 600 in 2009, the most recent year for available data.

Related: Gun and ammo sales fuel jobs boom

Brian Rafn, gun industry analyst and director of research at Morgan Dempsey Capital Management, described the youth gun segment as a small enough portion of the $4 billion industry to call it a "ghost market." He added that most states won't issue a hunting license to children younger than 10.

"I don't know of any state, and I've been hunting for 30 years, that would allow an armed five-year-old out in the woods during hunting season," he said. "In Wisconsin where I go hunting, if you were found out in the woods with a five-year-old with a gun, the game warden would have you in cuffs."

First Published: May 3, 2013: 2:44 PM ET

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Buffett's Berkshire blows past estimates

NEW YORK (CNNMoney)

Buffett's Berkshire Hathaway (BRKA, Fortune 500) handily beat analyst estimates with its first-quarter earnings on Friday, booking strong gains in its investments and insurance business.

Excluding certain investment gains, Berkshire reported earnings of $3.8 billion, or $2,302 per Class A share, blowing past the prediction of $1,995.50 per share from analysts surveyed by Thomson Reuters.

Including investment gains, Berkshire's earnings hit $4.89 billion, rising more than 50% versus a year prior.

Berkshire is a broad-based investment conglomerate whose holdings include everything from Geico insurance to Burlington Northern Santa Fe railroad to Dairy Queen. It also has stakes in a variety of other large firms.

Earlier this year, Berkshire was part of a consortium along with private equity firm 3G Capital that purchased ketchup maker H.J. Heinz Co for $28 billion.

Berkshire earned $901 million in the first quarter from its insurance underwriting business, up from just $54 million in the first quarter of 2012. The company said its gains came from the lack of significant catastrophe losses in the first three months of the year.

Related: Buffett is worried about Fed policy

On the investment side, Berkshire has substantial holdings in derivatives that serve as bets on the value of global stock indexes like the S&P 500. Berkshire's position improves when these index values rally.

Berkshire earned more than $1.1 billion from investment and derivative gains in the first quarter, up from $580 million a year ago.

With stakes in several large banks and homebuilders, Berkshire also has significant exposure to the housing market, which appears in the midst of a solid recovery. Earlier this week, the S&P Case-Shiller index of home prices showed a 9.3% rise over the past 12 months, the biggest gain since near the height of the housing bubble.

The aging Buffett has not publicly revealed a succession plan, but says he has informed Berkshire's board about his preferred candidates. He underwent radiation treatment last year for prostate cancer, though he said the illness was "not remotely life-threatening."

Investors will descend on Buffett's hometown of Omaha this weekend for Berkshire's annual meeting, where he and business partner Charlie Munger typically hold forth on their business and the state of the U.S. economy.

You don't have to be in Nebraska to get real-time updates on Buffett's thinking, however; the 82-year-old joined Twitter this week.

First Published: May 3, 2013: 6:00 PM ET

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How construction can lose jobs in middle of home building rebound

Cuts in government spending on construction projects led to the drop in April's construction employment.

NEW YORK (CNNMoney)

The sector lost about 6,000 jobs overall, according to the Labor Department's jobs report. This was largely due to a decline in hiring for non-residential buildings or public works projects like roads or sewer plants. Combined, these two areas lost 19,700 jobs.

Meanwhile, home builders and their subcontractors added 13,300 workers, even more than in March.

A big part of the sector's pullback is due to a drop in government-funded construction projects, a trend that has been going on for about two years.

Federal construction spending is down 28% since peaking in August 2011, when stimulus spending was still going strong, according to Ken Simonson, chief economist of the Associated General Contractors of America, an industry trade group. Local governments, particularly school districts, have also been pulling back on construction spending after building a rush of new ones during the housing boom.

"You don't need to open a new school every month if people aren't coming," he said.

Related: April jobs report - Hiring picks up

Additionally, many builders are having a hard time finding skilled construction workers.

David Crowe, chief economist with the National Association of Home Builders, said residential construction hiring likely would have been even higher in April if not for the shortage of skilled workers in some markets. He said a survey of his trade group's members found about half couldn't find workers with the necessary skills.

Simonson and other experts say the cutback in federal spending -- known as the sequester -- that went into effect March 1 hasn't halted work on any construction projects already underway. But they said federal agencies knew the sequester was looming and did scale back new construction contracts earlier this year.

Record low mortgage rates, a rebound in home prices and strong new home sales prompted the fastest pace of home building in nearly five years in March, according to a separate government report.

First Published: May 3, 2013: 12:54 PM ET

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My First Rifle: The business of selling guns for kids

Chipmunk, a subsidiary of Keystone, sells guns designed for children, along with its sibling subsidiary, Crickett.

NEW YORK (CNNMoney)

The gun used in the recent shooting in Kentucky was a Crickett .22-caliber rifle, marketed with the slogan "My First Rifle," from Keystone Sporting Arms in Milton, Pa. The single-shot rifle uses the smallest caliber available and is sold by major retailers, including Wal-Mart (WMT, Fortune 500), Cabela's (CAB) and Gander Mountain.

The Crickett website was down Friday due to "difficulties," according to John Renzulli, an attorney representing Keystone . But the site for Chipmunk, another Keystone brand, exhibited "quality firearms for America's youth" on its site, including .22-caliber rifles and pistols, with photos of children shooting them. The site includes a "kids corner" section.

Renzulli insisted that the company is not marketing firearms to children.

"No one's marketing to children," he said. "They're marketing to parents who would buy guns for children."

On its website, Wal-Mart markets the Crickett as a "youth rifle," while Gander Mountain's site describes it as a "great beginner's gun."

"All are lightweight and easy for youngsters to carry at the range and in the woods," reads the Crickett description on Cabela's site, which describes it as "a fun firearm to get your young shooter started with."

Wal-Mart did not immediately comment on whether their policy on sales of guns for children would change. Gander Mountain said it would not comment on potential policy changes, but added that it has launched a responsibility campaign aimed at keeping firearms away from "the underaged, untrained and unauthorized." Cabela's did not return a request for comment.

Related: Remington jobs rule the Rust Belt

Lawrence Keane, vice president and spokesman for the National Shooting Sports Foundation, the firearms industry group, described the youth firearm market as a relatively small slice of the gun industry, though large enough to have plenty of participants.

"A number of manufacturers make youth models of firearms for parents to purchase to introduce their children to adult-supervised target shooting," said Keane. "Millions of families all across America participate in the shooting sports as a family recreational activity. Children cannot purchase firearms from licensed dealers, of course."

Keane said safety has improved in recent years, saying data show that accidental fatalities involving firearms and children younger than 14 dropped by more than half over two decades to about 600 in 2009, the most recent year for available data.

Related: Gun and ammo sales fuel jobs boom

Brian Rafn, gun industry analyst and director of research at Morgan Dempsey Capital Management, described the youth gun segment as a small enough portion of the $4 billion industry to call it a "ghost market." He added that most states won't issue a hunting license to children younger than 10.

"I don't know of any state, and I've been hunting for 30 years, that would allow an armed five-year-old out in the woods during hunting season," he said. "In Wisconsin where I go hunting, if you were found out in the woods with a five-year-old with a gun, the game warden would have you in cuffs."

First Published: May 3, 2013: 2:44 PM ET

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Buffett's Berkshire blows past estimates

NEW YORK (CNNMoney)

Buffett's Berkshire Hathaway (BRKA, Fortune 500) handily beat analyst estimates with its first-quarter earnings on Friday, booking strong gains in its investments and insurance business.

Excluding certain investment gains, Berkshire reported earnings of $3.8 billion, or $2,302 per Class A share, blowing past the prediction of $1,995.50 per share from analysts surveyed by Thomson Reuters.

Including investment gains, Berkshire's earnings hit $4.89 billion, rising more than 50% versus a year prior.

Berkshire is a broad-based investment conglomerate whose holdings include everything from Geico insurance to Burlington Northern Santa Fe railroad to Dairy Queen. It also has stakes in a variety of other large firms.

Earlier this year, Berkshire was part of a consortium along with private equity firm 3G Capital that purchased ketchup maker H.J. Heinz Co for $28 billion.

Berkshire earned $901 million in the first quarter from its insurance underwriting business, up from just $54 million in the first quarter of 2012. The company said its gains came from the lack of significant catastrophe losses in the first three months of the year.

Related: Buffett is worried about Fed policy

On the investment side, Berkshire has substantial holdings in derivatives that serve as bets on the value of global stock indexes like the S&P 500. Berkshire's position improves when these index values rally.

Berkshire earned more than $1.1 billion from investment and derivative gains in the first quarter, up from $580 million a year ago.

With stakes in several large banks and homebuilders, Berkshire also has significant exposure to the housing market, which appears in the midst of a solid recovery. Earlier this week, the S&P Case-Shiller index of home prices showed a 9.3% rise over the past 12 months, the biggest gain since near the height of the housing bubble.

The aging Buffett has not publicly revealed a succession plan, but says he has informed Berkshire's board about his preferred candidates. He underwent radiation treatment last year for prostate cancer, though he said the illness was "not remotely life-threatening."

Investors will descend on Buffett's hometown of Omaha this weekend for Berkshire's annual meeting, where he and business partner Charlie Munger typically hold forth on their business and the state of the U.S. economy.

You don't have to be in Nebraska to get real-time updates on Buffett's thinking, however; the 82-year-old joined Twitter this week.

First Published: May 3, 2013: 6:00 PM ET

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Disney pulls out of Bangladesh factories

The Walt Disney Company told licensees and vendors to halt production in "highest-risk countries" like Bangladesh and Pakistan.

NEW YORK (CNNMoney)

The company sent a letter in March to vendors and licensees to transition production out of the "highest-risk countries," like Bangladesh, in order to bolster safety standards in its supply chain.

Disney will also halt production in four other countries: Ecuador, Venezuela, Belarus and Pakistan, by April 2014.

The decision was made before last week's devastating collapse of a factory building in Bangladesh that left more than 400 people dead. It was prompted by the November fire at the Tazreen Fashions Factory in Bangladesh's capital Dhaka that killed 112 people, and another fire in Pakistan that killed 262 garment workers last September.

"After much thought and discussion we felt this was the most responsible way to manage the challenges associated with our supply chain," said Bob Chapek, president of Disney Consumer Products.

Related: Shoppers face tough choices over Bangladesh

While Disney (DIS, Fortune 500) is the first brand to completely halt production in Bangladesh after the tragedies, it's a small chunk of what the company sources. Less than 1% of the factories that Disney sources from are located in Bangladesh. Even less are made in the four other counties, according to Disney spokeswoman Tasia Filippatos.

The company said its decision was based on a report from the World Bank that assesses how countries are governed, using metrics like accountability, corruption and violence, among others. The five countries from which Disney pulled production had the lowest scores on those measures.

Disney said it will continue to source from some countries, like Haiti and Cambodia, that didn't get high marks in the World Bank report, but only with factories that partner with the Better Work program run by the International Labor Organization and the International Finance Corporation. The group works to control health and safety conditions.

The company will consider permitting production in Bangladesh in the future if factories agree to partner with the Better Work program, according to Disney's Filippatos.

Disney isn't the only company snapping into action after the latest tragedy.

Earlier this week, a group of retailers, including H&M, Wal-Mart (WMT, Fortune 500) and Gap (GPS, Fortune 500), met with nongovernmental organizations and labor rights advocates in Frankfurt to discuss health and safety issues in the 4,500 garment factories in Bangladesh.

Related: "Shame on you," customers tell retailers

On Monday, a trade association representing stores, the Retail Council of Canada, called an urgent meeting to discuss how to address the situation. Joe Fresh and Wal-Mart confirmed that they were participating in the meeting. The companies haven't said if they are taking any concrete action.

The British retailer Primark on Monday said it will compensate victims who worked for its supplier, by providing long-term aid for children who lost parents, financial aid for those injured and payments to families of the deceased. A spokesman for the company said it has also partnered with a local aid group to dole out emergency food to families.

Other companies like J.C. Penney (JCP, Fortune 500), Benetton, and Sears (SHLD, Fortune 500) -- all of which source clothes from Bangladesh -- have reaffirmed their support for worker safety and monitoring conditions in the country.

The corporate reactions come as people are expressing outrage on companies' Facebook (FB) pages over the working conditions that retailers are willing to tolerate in order to sell clothes at cut rate prices.

"Until companies like yours control the working situation and pay decent wages, it will happen again. And again," Linda Bowser Fallis posted on Joe Fresh's Facebook page.

First Published: May 2, 2013: 1:14 PM ET

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LinkedIn slumps on disappointing outlook

NEW YORK (CNNMoney)

LinkedIn again beat expectations in its first-quarter earnings report late Thursday, but the company's guidance for the second quarter came in lower than analysts were expecting.

Shares fell a whopping 12% in after-hours trading, after reaching an all-time intraday high above $202 in regular trading on Thursday.

The record high comes after an incredible 73% run-up so far in 2013. When a stock is that hot, any spot of bad news tends to pop the bubble of excitement.

For LinkedIn (LNKD), it was the company's outlook. The business networking site expects revenue for the current quarter to come in between $342 million and $347 million. Analysts polled by Thomson Reuters were predicting revenue of around $359 million.

Investors clearly chose to focus on that outlook, rather than LinkedIn's first-quarter earnings. The company earned $52.4 million during the quarter, excluding one-time items, on sales of nearly $325 million. Both figures beat Thomson Reuters estimates.

Facebook (FB), with its 1 billion-plus user base, tends to get most of the social-tech-stock press. But Facebook is heavily reliant on advertising, which made up 85% of its sales last quarter. LinkedIn has three distinct revenue streams, a diversified mixed that appeals to investors.

Related story: Facebook sales jump 38%, with mobile boost

All of those revenue streams were up significantly last quarter, but how important they are to LinkedIn's overall sales shuffled a bit.

Revenue from "talent solutions," which lets companies post jobs and helps recruiters contact potential candidates, totaled $184 million. That's 57% of LinkedIn's total revenue for the quarter, up from 54% from the same period in 2012.

Talent solutions stole a few percentage points from the marketing sector. Revenue from marketing products came in at nearly $75 million, which represents 23% of LinkedIn's total revenue. That's a slight slip from 25% a year ago. Some analysts have expressed concern about how the shift to mobile will affect sites like LinkedIn and Facebook -- smaller screens mean less space on which to put ads.

LinkedIn's third product, paid subscriptions, came in around $67 million. Those "premium subscriptions" represented 20% of total sales last quarter, consistent with the first quarter of 2012.

First Published: May 2, 2013: 5:04 PM ET

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How porn links and Ben Bernanke snuck into Bitcoin's code

The code on the left records a bitcoin transaction from July 2011. Converted into text, it generates a portrait of Federal Reserve Chairman Ben Bernanke.

NEW YORK (CNNMoney)

Bitcoin, a four-year-old digital currency developed by a hacker who still remains anonymous, is a favorite plaything of libertarians and cryptography geeks. It burst into the mainstream this year when investors took note of its wild price swings. One bitcoin is now worth around $112, down from a record high of $266 last month, but up from $5 a year ago.

At the core of the bitcoin network is a database recording every single transaction.

Bitcoin enthusiasts have long known about a technical loophole that allows people to inject coded messages into the database. The trick is typically used for pranks or harmless notes, but Bitcoin discussion boards lit up on Monday with the news that someone took advantage of it for a nastier purpose: adding encoded links that claim to lead to porn sites, some featuring children. (CNNMoney verified that the links exist in Bitcoin's database, but did not check to see if they actually went to child porn sites.)

A technical analysis posted on BitcoinTalk.org delves into the details. There doesn't seem to be much danger for the casual bitcoin user. The porn links are concealed in hexadecimal code, and a decoder is needed to translate them into English. In other words, you'd really have to be looking for it.

But once a message makes it into the Bitcoin ledger, it can't be removed.

"There are very large ramifications to filtering out transactions, even ones that are obviously data spam," Jeff Garzik, a developer who works on Bitcoin's core software, wrote in a blog post responding to the porn discovery.

People have been sneaking messages into the ledger for years. Bitcoin's creator put a coded note into the very first recorded transaction, and in 2011, a crafty hacker embedded a tribute to a recently deceased friend, along with a rather accurate, pixelated image of Federal Reserve Chairman Ben Bernanke. Religious tracts, spam and random pronouncements like "I LIKE TURTLES" are some of the notes that turned up in 2012 file showing some of the encoded text. Last month, someone dropped in a large stash of Wikileaks cables.

But all this monkeying with the ledger is posing a problem for the pioneering currency, just as it's beginning to gain wider attention. Bitcoin advocates have worried for years about what would happen if someone tried to store illegal content in the ledger -- like, say, child porn, which is a U.S. federal crime to possess. That once-hypothetical threat is now real.

The porn: Every bitcoin user interacts with a portion of the currency's database, and many power users run software that stores the entire thing. Legally, bitcoin users who have the part of the ledger with the porn links seem to be in the clear. They are, after all, just words and text links -- not actual child porn images.

The U.S. Justice Department wouldn't comment on this specific case, but an agency spokesman pointed CNNMoney to the exact wording of the law, which states that the issue becomes a crime when a person "knowingly possesses, or knowingly accesses with intent to view" child porn. It doesn't appear that an unsuspecting user with these coded links sitting on their hard drive has much to worry about.

So is this a big deal or not? The Bitcoin community is divided.

Some think the links are being blown way out of proportion. They liken the coded messages in Bitcoin's ledger to graffiti, and say it's inevitable that someone would eventually inject something unsavory.

"All tech can be abused for weird stuff," Dan Kaminsky, the hacker who pulled off the Bernanke stunt in 2011, told CNNMoney.

Others would like Bitcoin's core developers to take action. "This is actually a big issue," one commenter wrote in a discussion thread on Hacker News. "I don't think we should avoid it."

Related story: 'I lost $50,000 in Bitcoin crash'

Bitcoin's backers appear to be taking this seriously.

"It is an awful situation," the developer Garzik told CNNMoney. "The problem goes to the core of digital currency storage."

Because bitcoin transactions are anonymous, it's difficult to trace a malicious transaction back to its source. Theories about why someone would put the porn links in run the gamut. Perhaps it's anti-child porn activists who want the authorities to take more action. Perhaps it's people trying to shut down Bitcoin, or a group hoping to make money off a crash in the currency. It might just be pranksters looking for trouble.

Most of Bitcoin's users don't think it's actual pedophiles trying to distribute their contraband. There are better, more secure ways to store information, and injecting the porn links cost the perpetrator $50 or $60 in transaction fees.

Already, new versions of Bitcoin's core software are being developed that allow historical transactions to eventually be deleted.

"Once people get the idea that it's not a way to force lots of people to store your data forever, interest in it will go away," said Mike Hearn, a Bitcoin developer. "There might be occasional graffitis here or there, but we can tolerate that."

Another way to head off problems like this would be to increase the fees charged by bitcoin transaction processors, since these "data spam" interludes generally require dozens or hundreds of small transactions to complete. Or Bitcoin's network could start weeding out people who are making a rapid series of tiny transactions.

But both these options diminish some of Bitcoin's biggest selling points to begin with: its low transaction fees and lack of central authority.

"The answer is very complex," Garzik wrote in his blog post, "with implications that travel to the heart of Bitcoin's value."

First Published: May 2, 2013: 6:31 PM ET

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Chevy pulls ad offensive to Chinese

GM has pulled this ad that used a song with offensive lyrics.

NEW YORK (CNNMoney)

The ad, which began running on Canadian television on March 4, was originally reworked with a different sound track a week ago. But Wednesday -- after the ad's offensive content was reported in the English language South China Morning Post -- GM (GM, Fortune 500) decided to pull the ad completely. The ad had also appeared on websites for GM's European operations.

The ad used the 1938 song "Oriental Swing" includes the lyrics "Now, in the land of Fu Manchu, The girls all now do the Suzie-Q, Clap their hands in the center of the floor, Saying, 'Ching, ching, chop-suey, swing some more!'"

The song also includes lyrics about Japanese geisha girls and Arab sheiks that could be considered offensive. GM apologized for the use of the song Wednesday.

"GM has stopped airing a commercial for the Chevrolet Trax due to the objectionable lyrics of a song used in the spot's soundtrack," said the company's statement. "We apologize for the use of inappropriate content. We are conducting a full review of our advertising approval process to ensure this does not happen again in the future."

There have been a rash of offensive car ads recently requiring apologies by various automakers.

Just last week, Hyundai pulled an ad that made a joke about a man's suicide attempt using exhaust fumes but being unable to do so because the car he was using emits only water vapor.

In March, GM rival Ford Motor (F, Fortune 500) apologized for ad depicting tied up women in the back of one of its cars, even though the ad itself never ran. The ad agency employees who created the artwork were fired as a result of the publicity.

Related: The chunkiest cars on the road

The Trax is a small SUV that GM is selling in many markets around the world, but not in either China or the United States. The car is built on the same platform as the Buick Encore, which was introduced to the U.S. market earlier this year.

China has become one of the most important markets for GM in recent years. It sells more cars in China than it does in the United States.

First Published: May 1, 2013: 3:09 PM ET

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Facebook sales jump 38%, with mobile boost

Click to check out Facebook's important Q1 stats.

NEW YORK (CNNMoney)

Investors are laser-focused on mobile, which Facebook has said is the key to its future success. Mobile ad sales accounted for 30% of Facebook's total ad revenue in the first quarter of the year -- up sharply from the previous two quarters and from essentially zero just a year ago.

Facebook began working ads into its mobile products only several quarters ago, most notably when it released a new Apple (AAPL, Fortune 500) iOS app in August.

That mobile ad boost has helped increase revenue, but the growth in monthly active users on Facebook's mobile site and apps is slowing. It jumped 54% over the year to 751 million, which is slightly below the fourth quarter's 57% year-over-year jump, and the 61% annual increase in the third quarter.

That growth rate will likely continue to shrink as mobile users come into parity with total users. Facebook reported that overall monthly active users jumped to 1.11 billion in the first quarter, 751 million of whom accessed Facebook on their phones and tablets.

Facebook (FB) shares were essentially flat in after-hours trading following the report.

Facebook founder and CEO Mark Zuckerberg spent a lot of time on the post-earnings conference call talking about advertising, and how the company plans to continue integrating ads without alienating users.

"Over the long term, the thing that's going to drive the business is the ads that are very high quality ... things people are interested in," Zuckerberg said.

Starting with ads in users news feeds last year "was a valuable step," he added. "Anywhere someone is getting content from Facebook, the business model is following naturally." Facebook plans to continue that philosophy as it rolls out new ad products.

COO Sheryl Sandberg said she feels "pretty good" about Facebook's ad formats, but she thinks "there's a lot of room to improve our ads" in terms of quality.

Ad sales helped propel the social network's overall revenue to $1.5 billion in the quarter -- a solid performance in what's generally a soft quarter for ad revenue at most companies. Brands typically spend heavily to market to holiday shoppers in the fourth quarter and ease off at the beginning of the year.

Earnings rose 7% over the year to $219 million, despite being crunched by massive expenses.

Costs jumped 60% over the year to $1.08 billion. Facebook executives had warned during last quarter's earnings call that the company expects expenses to rise by about half this year. Facebook is spending cash on both infrastructure and headcount, and it's putting that money to work: In 2013 so far, the company has already released four major new products.

Graph Search and a News Feed revamp came in the first quarter, while the third and fourth products came too late to be included in Wednesday's results.

Earlier this month brought Facebook Home, a custom startup screen for Android smartphones that will eventually include ads. A week later, Facebook announced "Partner Categories," which lets advertisers target specific users based on their past buying history -- even if the purchases happened offline.

Facebook also revealed that photo-sharing app Instagram reached 100 million monthly active users in the first quarter.

Rival social network LinkedIn (LNKD) is set to report its quarterly finances Thursday after the market closes.

First Published: May 1, 2013: 4:48 PM ET

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Shoppers lash out at stores over Bangladesh

NEW YORK (CNNMoney)

Dozens of consumers took to social networks after more than 400 workers were killed when a garment factory building in Bangladesh collapsed last Wednesday.

The message from shoppers like Judy Caulfield had for retailers: Shame on you.

"Do the people running this company sleep at night knowing that they are partly responsible for the deaths of so many people?" she asked on the Joe Fresh page.

While some wondered how retailers could tolerate such conditions at factories they buy from, others threatened that they would stop shopping at stores connected to the collapse.

"I have a Joe Fresh gift card and was going to go shopping there. Now I'm not so sure," Linda Bowser Fallis posted on Joe Fresh's Facebook (FB)page. "Until companies like yours control the working situation and pay decent wages, it will happen again. And again."

The building that collapsed housed a factory that made goods for Joe Fresh, some of which were destined for J.C. Penney (JCP, Fortune 500) stores, since the brand has a partnership with the department store.

The factories in the collapsed building had, at some point or another, made items for The Children's Place (PLCE), Dress Barn, Benetton and British retailer Primark. One factory, Ether Tex, listed Wal-Mart (WMT, Fortune 500) as one of its buyers, though the retailer said it had no authorized production in the building.

Related: Shoppers face tough choices over Bangladesh

People also unleashed their anger at retailers that didn't have any connections to that specific building, but are known to source from factories located in Bangladesh, like H&M.

One H&M shopper posted that he will start shopping there if the retailer stops "using slave labor in [its] clothing production."

Many of the comments pointed out how little people around the world knew about where their clothes come from, and just how much they cared to know.

"Just wanted to ask if you import any of your clothing from Bangladesh...and if so have [you] done anything to fund...safety programs," Jonathan Gottleib posted on the J.C. Penney Facebook page. "I need to know from each corporation before I decide if I want to buy anything from them."

Jackie Lynch, a Benetton shopper posting from Melbourne, asked how many of the retailer's clothing lines come from Bangladesh and if it can reassure customers that its garments are made in safe factories.

The confusion stems from the fact that companies often aren't transparent about how they monitor production overseas.

Many large companies monitor suppliers and have guidelines on health and safety standards, but experts say that the results of these audits aren't made public. That makes it difficult for any consumer who wants to check if a company is actually conducting the audits or terminating relationships with suppliers who don't meet standards.

Joe Fresh, H&M, Benetton and J.C. Penney didn't respond to questions on what they plan to do about their customers speaking out.

First Published: May 1, 2013: 10:20 PM ET

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41% of college grads overqualified for what they do

More than 4 out of 10 recent graduates say they are stuck in jobs that don't required a college degree.

NEW YORK (CNNMoney)

A survey out Tuesday found that 41% of college graduates from the last two years are stuck in jobs that don't require a degree.

Consulting firm Accenture talked to 1,005 students who graduated from college in 2011 and 2012 and haven't returned to graduate school. In addition to those who are underemployed, 11% said they are unemployed, with 7% reporting they haven't had a job since graduating.

The lack of job options in their chosen fields are weighing grads down, as nearly half of the recent graduates believe they would fare better in the job market if they'd pursued a different major.

Related: Earning $221,000 and paying two tuition bills

Nearly two-thirds of those surveyed said they would need additional training in order to start their chosen career, with 42% saying they expect to go to graduate school. That's a sharp change in thinking from those still in school: A separate survey by Accenture found that only 18% of the class of 2013 expects to need graduate school.

It will likely be much higher, as job prospects are grim for the class of 2013. The unemployment rate remains stubbornly high at 7.6%, and recent graduates fare even worse, according to the Labor Department.

Related: Engineering is top-paying college degree

The weak job market will continue to make things difficult for recent graduates, according to Katherine Lavelle, managing director of Accenture's Talent & Organization practice in North America.

"It's logical that if there are more meaningful jobs available, you will have fewer out in the market looking for those jobs," she said.

But she said even when the job market improves, there needs to be better coordination between employers and colleges about what skills new workers need to have.

First Published: April 30, 2013: 3:20 PM ET

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Marissa Mayer extends Yahoo's maternity leave

NEW YORK (CNNMoney)

Both new mothers and fathers at Yahoo can now take eight weeks of paid parental leave, and the mothers can take an additional eight weeks. What's more, new parents will also receive $500 to buy items like groceries and baby clothes.

It's part of a slate of new benefits "to support the happiness and well-being of Yahoos and their families," the company confirmed via email. NBC Bay Area first reported these changes. Other new perks include gifts for new pets, and eight weeks of unpaid leave each time an employee hits a five-year milestone.

Yahoo didn't confirm its previous maternity leave length, but the new policy is more in line with those of other Silicon Valley tech companies. Google (GOOG, Fortune 500), Mayer's former employer, offers seven weeks of paid leave for parents who did not give birth, while new mothers can take off between 18 to 22 weeks. Facebook (FB) offers four paid months for both parents and a whopping $4,000 in "baby cash."

Yahoo's parental leave extensions come just two months after Mayer banned telecommuting at Yahoo, setting off a debate about the merits of working from home. Mayer later said the change "was wrongly perceived as an industry narrative," when she felt it was simply the right thing to do for Yahoo (YHOO, Fortune 500) right now.

But as a female CEO and new mother trying to turn around an aging former tech titan, Mayer faces increased scrutiny on every decision she makes -- especially when it relates to juggling family and career.

Mayer revamped the company culture quickly after she took the reins in July 2012, encouraging Yahoo teams to work more quickly and offering Google-esque (GOOG, Fortune 500) perks like free food. Under her watch, Yahoo announced it will return $3 billion to shareholders after selling back some of its stake in Chinese company Alibaba.

Investors cheered Mayer's business moves, but pundits panned some of her personal decisions.

Related story: Bring your baby to work day - every day

Mayer was pregnant when she accepted the Yahoo job, and she gave birth to baby Macallister on September 30. She worked while she was out of the office, and came back to work just two weeks later.

Outraged critics slammed Mayer for setting a bad example for other mothers, and pointed out she has more resources than do most working moms -- including a reported nursery built next to her office.

Mayer has a lot of turnaround work to do at Yahoo, and she seems to be focusing more on those problems than on gender politics and work-life balance issues. But the new parental leave policy should quell some of her critics.

First Published: April 30, 2013: 1:33 PM ET

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Marissa Mayer's first-year pay: $6 million

NEW YORK (CNNMoney)

In addition to a salary of close to half a million dollars, Mayer received a $1.1 million cash bonus and $4.3 million in stock, according to regulatory documents filed on Tuesday.

Mayer was named Yahoo's CEO in July 2012, so her pay package worked out to about $1 million a month.

If she sticks around the new job for another four years, she will make a whole lot more: Mayer's compensation package is worth at least $71 million through 2017. It could top $120 million if an extra batch of stock grants that she is eligible for comes through -- or even more if Yahoo's share price continues to rise, since most of the package is paid in stock.

In the nine months since Mayer took the reins, Yahoo (YHOO, Fortune 500) shares have soared by more than 50%.

Related: Marissa Mayer extends Yahoo's maternity leave

Yahoo (YHOO, Fortune 500) was willing to shell out such a huge sum of money in hopes that snagging the former Google exec could turn the company around. It paid past CEOs generously as well: Scott Thompson was promised a first-year pay package of as much as $26 million before he ended up leaving without severance due to a resume scandal.

The company has undergone a major cultural sea change under Mayer. She has offered several well-publicized perks, including free food, free iPhones and extended maternity leave. A decision to scale back telecommuting proved less popular.

Mayer also recently unveiled a new homepage, a redesigned Yahoo Mail and a refreshed Flickr service. All were designed to get Internet consumers' thinking about Yahoo again and increase user engagement.

But none of those changes have yet translated into financial success. Two weeks ago, Yahoo reported lousy first-quarter sales and a downbeat outlook.

First Published: April 30, 2013: 7:21 PM ET

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