The secret to taking a real vacation

NEW YORK (CNNMoney)

According to a survey from American Express OPEN, just 49% of entrepreneurs planned to take vacations this summer, down from 54% last summer and 67% in 2006.

But it doesn't have to be that hard. Josh Golden, founder and CEO of Table XI Partners, found the secret to going off the grid: Delegation.

"Delegating takes practice," says Golden. "But every time I delegate something new to someone else in the firm, I wish I had done it sooner."

Letting go of the day-to-day details -- and trusting that employees can handle whatever pops up -- is one of those things business owners know they ought to do, but find incredibly difficult in practice.

Golden launched his Chicago web-development firm in 2002 with just a part-time assistant. Like many entrepreneurs, at first he did everything from strategic planning to emptying the wastebaskets -- but he quickly learned that wouldn't work for long.

"As you grow, you just can't do everything anymore," said Golden, whose firm now has more than 30 employees.

Related: 10 hardest working countries

The first step is analyzing your own strengths and weaknesses.

"It takes some honest introspection to identify the one or two things you truly are the best at," Golden said. "The goal is to spend 90% of your time on those things, while you hand over to others the tasks where you aren't really adding value."

Learning to delegate also means shushing your inner perfectionist.

"It took me a while to come to terms with the fact that other people can do perfectly acceptable work without being as passionate about the business as I am," Golden said. "And there are plenty of tasks in any company where 'good enough' really is just fine."

Related: How startups can get cheap office space

Carving out time for a vacation also means more than just delegating while you're gone -- you've also got to make it part of your business plan. Golden, whose strongest skill is marketing, was still running Table XI's accounting and finance until last fall, when he finally handed over the number-crunching to a newly-hired finance director.

To get her up to speed, he used a collaborative method, common in software development, called pairing. "It's like an apprenticeship. You train someone over time, sharing knowledge until that person is independent in that role," he said. "The main thing is to resist the impulse to helicopter in and do everything yourself."

Golden's work paid off. In June, he and his wife spent nine days in Waikiki, Kauai and Honolulu. Was he worried about the company? Not quite. "I could have stayed away for another week or even two," he said.

First Published: July 29, 2013: 6:32 AM ET

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Will your congressman retire richer than you?

NEW YORK (CNNMoney)

Members of Congress receive retirement benefits that are far more generous than those earned by the average worker, according to a recent Bankrate analysis.

Not only do congressional representatives and senators earn the guarantee of a monthly pension check -- a benefit that has become increasingly rare for most U.S. workers -- they also receive Social Security payments and can opt to pay into the federal Thrift Savings Plan, a 401(k) style-plan with fees that are far lower than most retirement plans.

As a result, longtime members of Congress can easily retire with six-figure annual incomes for life.

"If you can get elected to Congress and stay there, you can retire pretty well," said Chris Kahn, a Bankrate analyst, who conducted the research.

Related: Are you worried your public or private pension will be cut? Share your story

Few workers enjoy such generous benefits. While most public workers still receive pension benefits, payments for retired state, county and city workers average around $26,000 a year, according to the U.S. Census Bureau.

Based on current salaries, members of Congress who serve just five years are guaranteed annual pensions of more than $14,000 at age 62, according to current pension formulas. And those who serve 20 years or more can qualify for a pension of at least $59,000 as early as age 50.

Related: Just how generous are Detroit's pensions?

In 2011, 280 former lawmakers who retired under a former government pension system received average annual pensions of $70,620, according to a Congressional Research Service report. They averaged around 20 years of service. At the same time, another 215 retirees (elected in 1984 or later with an average of 15 years of service) received average annual checks of roughly $40,000 a year.

But lawmakers who serve for decades can secure much more lavish checks. For example, a 30-year congressman retiring next year would be eligible for more than $75,000 a year. Nearly two dozen current senators and representatives have served 30 years or more.

Helped by his annual salary of $223,500 as Speaker of the House, John Boehner would be eligible for an estimated annual pension of nearly $85,000 at the end of his current term in 2014 (after 24 years on the job). If he serves future terms, he would be eligible for even bigger checks. A spokesman for Boehner declined to comment.

Related: Seniors in 48 states face serious income shortage

Those elected after 2012 will receive less generous benefits than their predecessors under reforms passed last year. But if they stay in office for 30 years or more, they will still be able to qualify for annual pension checks of at least $50,000, according to calculations using the new formula.

If that's not enough, you could try running for the country's highest office. President Obama will retire with an annual presidential pension of nearly $200,000 a year, in addition to other benefits such as Social Security, according to the Congressional Research Service.

While the average Social Security recipient receives around $15,000 per year, lawmakers and top White House officials can expect around $30,000 a year from Social Security due to their high salaries.

And that's not all. If lawmakers opt to invest into the Federal Thrift Savings Plan, a 401(k)-style plan for federal employees, they receive an employer match and enjoy fees of less than 0.03%.

Related: Your employer may cost you $100k in retirement savings

That means a Congressional saver would pay only 27 cents in annual fees on an $1,000 investment, while the average 401(k) investor would pay more than $5. Over decades of saving, the difference in fees could add up to tens of thousands in savings, according to Bankrate.

With many Americans struggling to afford retirement, some argue that Congress should get rid of the taxpayer-funded pension plan entirely.

"It makes no sense for Congress to continue to reward itself, using taxpayer dollars," U.S. Rep. Mike Coffman, a Republican congressman from Colorado, said in a statement earlier this year. "We need to end this perk."

First Published: July 29, 2013: 6:15 AM ET

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Hottest trade on Wall Street: Detroit bonds

Detroit has roughly $8.3 billion in tradeable bonds.

NEW YORK (CNNMoney)

Detroit's bonds have become the hottest trade on Wall Street, since the Motor City filed for the largest municipal bankruptcy two week ago.

Prior to the bankruptcy filing, Detroit's emergency manager, Kevyn Orr, offered to pay bondholders roughly 10 cents on the dollar to help keep the city going.

That would result in huge losses for the city's original creditors. But hedge funds, particularly those that invest in troubled or bankrupt companies, think these bonds will turn out to be lucrative in the long run.

The problem is there aren't that many available. Few have traded, and the waiting lists are long.

Related: Detroit: After bankruptcy, then what?

"The biggest problem we have is how to allocate bonds," said a trader on a major bank's municipal desk. "Only major customers are getting the opportunity to buy."

Detroit has $18 billion of liabilities, but only about $8.2 billion in bonds you can trade. The rest of the city's liabilities are tied to unfunded pensions and retirees' healthcare costs.

Of the bonds, there are $1.4 billion that have funded some of Detroit's pension costs, and those are among the most coveted by hedge funds.

These taxable bonds, known as pension obligation certificates, were issued and sold to European banks in 2005 to help fund the city's pensions. It was an unusual move by Detroit, because cities typically use local revenue to fund these obligations.

Now, hedge funds are just waiting for the banks to sell. Given Detroit's financial mess, that could happen in the next month or so as banks get skittish about keeping that debt on their books, several market experts say.

Many funds are willing to buy small amounts just to get their foot in the door.

Shortly after Detroit filed for bankruptcy, several hedge funds managed to buy $5 million of pension bonds for 41 cents on the dollar. Those were some of the only pension obligation bonds available.

Related: Michigan court clears way for Detroit bankruptcy to proceed

Hedge funds are also eyeing about $1 billion in general obligation bonds backed by Detroit. More of these have changed hands, but also in small increments. One hedge fund manager said he was able to procure $30,000 of general obligation bonds at 75 cents on the dollar from a dentist in Milwaukee. The fund was hoping to buy several millions of dollars' worth, but so far, that's all they can get their hands on.

Most of Detroit's general obligation bonds are owned by retail investors. Since the bankruptcy, these bonds have been selling at between 69 cents and 92 cents on the dollar.

While Detroit's full faith and credit seems questionable right now, the city's bonds are backed by insurance firms, including Ambac (AMBC), Assured Guaranty (AGO) and the national finance arm of MBIA (MBI). Some investors are betting that these insurers will continue to pay Detroit's bondholders for now.

Other bondholders think Orr's initial projection for what they could recover was overly pessimistic. There's some speculation that he overstated the unfunded pension liabilities. Some hedge fund managers also think a portion of healthcare costs for Detroit's city workers will be able to be deferred under Obamacare.

Betting on Detroit's bonds is still a big gamble. There have been few municipal bankruptcies in the United States, and most have been small.

Still, Jim Spiotto, a partner at law firm Chapman and Cutler and a veteran of several municipal bankruptcies, said that overall, bondholders have recovered more in municipal bankruptcies than corporate ones.

But he cautioned investors should be wary of Detroit, because it might not follow suit. "Detroit has a long history of disappointing people. Detroit could very well be an aberration from other municipal bankruptcies."

First Published: July 29, 2013: 6:24 AM ET

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Apple launches probe over China labor problems

The non-profit watchdog China Labor Watch is accusing Pegatron of terrible working conditions in its Chinese factories.

LONDON (CNNMoney)

Apple (AAPL, Fortune 500) said it is sending audit teams to three Chinese factories that are being accused of having extremely poor working and living conditions.

China Labor Watch, a non-profit organization, issued a report Monday saying that one off Apple's major suppliers -- Pegatron -- violated a wide range of labor rules and industry standards as it worked to pump out iPhones and Mac computers.

A key concern centered around Pegatron's low wages, which led to many workers clocking excessive overtime hours.

China Labor Watch estimated in its report that employees in three key Pegatron factories in Shanghai and Suzhou worked an average of 66 to 69 hours per week. This is well above Apple's 60-hour workweek rule, the organization said. According to Apple's Supplier Code of Conduct, workers are not allowed to work more than 60 hours a week "except in unusual circumstances." The company also said that "all overtime must be voluntary."

But the China Labor Watch report also detailed various management abuses, health and safety concerns, pollution issues and problems with underage workers.

Related: Big business fights human trafficking

A spokesperson for Apple in Beijing said the company "is committed to providing safe and fair working conditions throughout our supply chain."

"[This] report contains claims that are new to us and we will investigate them immediately ... If our audits find that workers have been underpaid or denied compensation for any time they've worked, we will require that Pegatron reimburse them in full," the Apple spokesperson added.

Apple said it has conducted 15 comprehensive audits at various Pegatron factories since 2007.

China Labour Watch said Apple has increased orders at Pegatron factories since the start of 2013 as it works to produce a cheaper version of its popular iPhone. There are rumors that an official launch of a lower-priced iPhone will take place sometime in the next few months.

The group said these factories "benefited from and relied upon labor violations to increase their competitive edge."

Foxconn, another major supplier for Apple in China, has also been in the spotlight amid growing public concern about labor conditions in its factories.

A spate of suicides at Foxconn factories in 2010 garnered media coverage of allegedly harsh working conditions, including unsafe facilities and illegal amounts of overtime.

In January 2012, Apple joined the independent labor-rights organization Fair Labor Association, which promptly began inspections of the working conditions at Foxconn's many factories.

First Published: July 29, 2013: 8:20 AM ET

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Uh-oh: Americans favor cash over stocks for long-term investments

Even when it comes to money they won't need for more than a decade, 26% of Americans prefer cash for long-term investments, edging out stocks, bonds, gold and real estate.

NEW YORK (CNNMoney)

Even when it comes to money they won't need for more than a decade, 26% of Americans prefer cash for their long-term investments, edging out stocks, bonds, gold and real estate, according to a new Bankrate survey of more than 1,000 U.S. adults.

"What people are perceiving as a safe investment strategy is actually quite risky for a time horizon of 10 years or more," said Greg McBride, Bankrate's senior financial analyst. "Considering that Americans don't save enough to begin with, it has the potential to leave millions of them well short of the money they'll need for retirement or education funds for their children."

Whether it's in a savings account or a money-market fund, sheltering cash would barely yield any growth given the current low interest rates. A $10,000 investment in a money-market fund today would just gain $110 over a decade, according to Bankrate.

That's why it is particularly alarming that respondents would rather conserve their money in cash instead of growing it in stocks, said McBride, adding that over a long period of time, being more aggressive with investments is wiser.

Related: What does it take to be wealthy? $5 million

While holding cash eliminates the risk of losing that money, it also means that after a long period of time, you get less bang for your buck, as inflation makes those dollars worth less.

Meanwhile, the S&P 500 has historically returned almost 9% a year including dividends. Yet only 14% of those surveyed favor stocks for long-term investments.

The preference for cash over stocks is likely a byproduct of the financial crisis and the burst of the dotcom bubble, said McBride.

"A lot of people felt burned not once but twice from stocks within a span of a few years," he said. "As a result, a lot of investors swore off stocks and even five years later, a majority of them are feeling the same way."

Related: Short-term savings, super low rates: Where to stash it?

But McBride emphasized that stocks have rallied significantly after the dramatic plunge in 2008 and early 2009, with the Dow and S&P both trading at their highest all-time levels.

"The ride down wasn't fun for anyone, but those who hung in there and had fortitude to buy more stocks along the way are in a much better financial position today," said McBride. "But those who have been hunkered down in cash are no better off."

Even those nearing retirement age should be investing in stocks, said McBride, as they've got to keep their nest eggs growing for at least 30 years.

Real estate was the second most popular long-term investment, but McBride said that's also problematic as it's "not only very cash-intensive, but often illiquid."

"The bottom line is that the burden for retirement savings is increasingly upon us as individuals," McBride emphasized. "And we won't be where we need to be with the meager rate of savings and stashing that money in very conservative investments."

First Published: July 29, 2013: 10:16 AM ET

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Stocks fall despite flurry of deals

Click for more market data.

NEW YORK (CNNMoney)

But that wasn't enough to get investors buying stocks, as several events later this week could set the tone for the rest of the summer. The Dow Jones industrial average, the S&P 500 and the Nasdaq all sank about 0.5%.

Top officials at the Federal Reserve, European Central Bank and Bank of England all meet this week.

The Fed is unlikely to make any changes to its quantitative easing policies of buying $85 billion in bonds and mortgage-backed securities a month.

See what global markets did today

There is also a ton of U.S. economic data on tap, with a report on second-quarter gross domestic product and the government's monthly jobs report Friday. GDP is expected to be tepid, while the latest data on hiring and unemployment should show continued modest improvement.

But several well-known stocks were on the move.

Merger Monday. Canadian retailer Hudson's Bay bought iconic retailer Saks (SKS) in a deal worth $2.9 billion. Hudson's Bay owns rival luxury retailer Lord & Taylor.

Omnicom Group (OMC, Fortune 500) and Publicis Groupe (PGPEF) announced a $35.1 billion deal to form the world's largest advertising agency. Shares of both companies were higher. The news also lifted shares of rival advertising agency, Interpublic Group of Companies (INPGP).

U.S. over-the-counter drugmaker Perrigo (PRGO) announced an $8.6 billion deal for Irish drugmaker Elan (ELN), a cash and stock deal that pays about a 26% premium for Elan shareholders. The Irish company was at the center of an insider trading scandal involving a former employee of embattled hedge fund SAC Capital.

Deluge of earnings. Mall operator Simon Property (SPG) and casino owner Wynn Resorts (WYNN, Fortune 500) both reported improved quarterly earnings, although Wynn fell short of forecasts while Simon beat estimates.

Rental car company Hertz (HTZ, Fortune 500) reported results that met analysts' expectations, but shares were down nearly 3%.

Hartford Financial (HGH) and Express Scripts (ESRX, Fortune 500) are on tap to report after the close. Also after the bell, Herbalife (HLF), the multi-level marketing company that hedge fund manager Bill Ackman has attacked as a pyramid scheme, will release its second-quarter earnings.

Shares of Intuitive Surgical Inc. (ISRG) gained after the medical robotics company boosted its share repurchase program.

Related: Fear & Greed Index

Best of StockTwits. On any given day, there are always high-profile stocks on the move that traders on StockTwits are talking about. Here's a look at some of them.

SodaStream (SODA) shares were up 3% as investors looked ahead to the company's latest earnings report Wednesday. The stock has had a strong pop this year, rising from about $45 a share to above $75 a share in May. But some traders on say the stock is too frothy.

investinthebest: $SODA nothing but a bubble if you ask me. want to see 20-30

Facebook (FB) shares have been on a tear since the social network reported strong quarterly results last week. The stock rose above $35 a share Monday and is closing in on its IPO price of $38.

jincman: $FB it's getting comfortable over 35 ... look out!

Caterpillar (CAT, Fortune 500) announced plans to repurchase $1 billion worth of its own stock from French bank Société Générale, accelerating a $2 billion transaction announced in April. The move comes a few weeks after hedge fund manager Jim Chanos said he's betting against Caterpillar as the global boom in commodities draws to a close.

For some, the buyback is a sign of weakness, while others say Caterpillar is still a good long-term bet.

timboutillier: $CAT You smell that? Smells like desperation if you ask me.

leopardtrader: Those betting against $CAT at the current levels will be thoroughly whipped in months ahead lol

First Published: July 29, 2013: 9:45 AM ET

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Fast food workers protest in 7 cities

Workers protested outside of a New York City Wendy's in April for higher pay and the right to form a union.

NEW YORK (CNNMoney)

Dozens of workers asking to be paid a minimum of $15 an hour and the right to organize without retaliation are expected to protest outside of McDonald's (MCD, Fortune 500) and Wendy's (WEN) locations across New York City on Monday. The rallies will move to Chicago, St. Louis, Detroit, Milwaukee, Kansas City and Flint, Michigan the rest of the week.

The campaign, organized by a coalition of labor, community and clergy groups called Fast Food Forward, has been building momentum since last fall, when the protests first came into the national spotlight.

Related: The real budgets of McDonald's workers

Recently, even Washington has caught on.

The White House mentioned the "low-wage worker" protests in a blog written last week by the the National Economic Council director Gene Sperling and Alan Krueger, chairman of the Council of Economic Advisers. They said that raising the minimum wage was part of President Obama's economic vision.

"Marking four years since the last increase, Americans across the country are making the case for why raising the minimum wage is good for workers and the economy," the post said.

Currently, the median pay for the nearly 50,000 fast food workers in New York City is $9 an hour, or $18,500 a year, according to the New York Labor Department. That's about $4,500 lower than Census Bureau's poverty income threshold level of $23,000 for a family of four. While minimum wage in New York is $7.25 an hour, food service workers may earn $4.65 an hour because their total compensation includes expected tips.

Related: Obama's jobs record: Where are we now?

In May, the New York State attorney general's office said it was investigating whether fast food restaurant owners have cheated their workers out of wages by paying them less than minimum wage, not paying overtime and not reimbursing for work-related expenses like uniforms or gas for deliveries.

The investigation came on the heels of a study released by Fast Food Forward based on 500 interviews with New York fast food workers from McDonald's, Burger King (BKW), Wendy's and Papa John's (PZZA). Nearly 85% of those surveyed said their employer had committed at least one form of wage theft.

Labor experts say there have been scattered attempts to organize over the last several decades, but very little in the fast food industry has stuck. Many say that's because there is a high turnover rate of labor in the industry.

First Published: July 29, 2013: 11:26 AM ET

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Canadian retailer taking over Saks

Saks is being bought out by the Canadian retailer, Hudson's Bay Company, in a deal worth nearly $3 billion.

LONDON (CNNMoney)

The Canadian Hudson's Bay Company (HBC) is buying the high-end American retailer Saks (SKS) in a deal worth nearly $3 billion, including debt.

The Toronto-traded Hudson's Bay Company already owns Lord & Taylor and a network of Hudson's Bay department stores across Canada. This latest acquisition will see the group managing 320 stores in the U.S. and Canada.

"This exciting portfolio of three iconic brands creates one of North America's premier fashion retailers," said HBC's chairman and CEO Richard Baker in a written statement. "With the addition of Saks, HBC will offer consumers an unprecedented range of retailing categories and shopping experiences."

Related: A guide to great bargains on clothes

There had been rumors for the last few years that Saks would be bought out, and the buyout chatter intensified in May. Reports had surfaced saying Saks might be taken over for as much as $18 per share.

In the end, HBC agreed to pay $16 for each Saks share.

"We believe this transaction delivers compelling value to our shareholders," said Saks chairman and CEO Steve Sadove, in a written statement. "The $16 per share price represents an approximate 30% premium to the May 20 closing price, the day before media speculation [of a takeover] began."

The all-cash deal has been approved by the board of directors at both companies. The takeover is expected to be finalized before the end of the year, however, Saks was given a 40-day "go-shop period" when it is allowed to consider other takeover options.

"There can be no assurance that this process will result in a superior proposal," Saks said in a press release.

HBC, which was founded in 1670, will be slashing its dividend after it closes the deal.

First Published: July 29, 2013: 11:12 AM ET

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Why we're working less than our parents did

NEW YORK (CNNMoney)

But as a whole, Americans are working far less now than they did a generation ago, and have more leisure time than ever.

The average work week has gone from over 38 hours in 1964 to under 34 hours in 2013 -- a drop of nearly 12%, according to the Bureau of Labor Statistics.

A big reason for the decline is the growth in part-time jobs, which have surged as more women entered the workforce and the number of restaurants, shopping malls, and other establishments that employ part-time workers have exploded.

Another explanation is that people tend to stay in school longer and retire earlier, clocking fewer hours over their lifetime. Men in their 50s, for example, have been retiring or entering semi-retirement earlier and in greater numbers than those in previous generations, according to John Robinson, a sociology professor at the University of Maryland, and are partly responsible for driving down overall work hours per week.

Share your story: Are you working less but maintaining the same lifestyle?

And we're working a lot less than our grandparents, great grandparents and earlier generations. The average work week for a manufacturing employee in the 1860s was 62 hours, according to a paper from Robert Whaples, an economist at Wake Forest University.

In the 1600s, there were actually laws requiring a minimum work day, wrote Whaples. In parts of the country, most people had to work sun up to sundown -- part of the Puritanical "idle-hands-are-the-devil's-workshop" ethos.

Related: 10 hardest working countries

It wasn't easy to change that culture. Political battles that led to less religious influence over the nation's laws almost sparked a civil war. A century later, labor activists fought for decades to get the 40 hour work week.

Coinciding with the shorter work week is a rise in leisure time. Americans reported having just under 35 hours a week of "free time" in 1965 -- that's time not spent at work, doing housework, eating, sleeping or doing other activities necessary for day-to-day survival, according to research by Robinson, who directs the American's Use of Time Project at the University of Maryland.

By 2012, it had reached 42, according to the Bureau of Labor Statistics.

"People feel less rushed than they did even a decade ago," said Robinson.

And thanks to modern technology, the time we spend on housework and cooking is declining.

Just what are we doing with all these extra hours? Watching more TV, mostly.

Related: World's shortest work weeks

But technology certainly hasn't made all our lives easier.

Some people, especially those at the higher end of the earnings spectrum, report working more hours than they want to. This is particularly true for professionals who are now tied to their work by smartphones and email.

Also, many Americans are working part time not because they want to, but because their jobs have been replaced by automation, outsourced, or otherwise eliminated.

"The promise of technology is that we'd all get to work less," said Linda Barrington, head of the Institute for Compensation Studies at Cornell University's school of Industrial and Labor Relations. "But it's playing out differently for different people at different income levels."

Share your story: Are you working part time, but would rather work full time?

Barrington believes the Affordable Care Act - a.k.a. Obamacare -- is the first real law intended to deal with some of the disruption of a changing workplace, as more Americans enter freelance or part-time positions that don't provide health insurance.

As happened during the industrial revolution, she feels other measures will need to take shape to make the technological revolution more beneficial to all workers.

"How are we going to change the rules again?" she asked.

First Published: July 29, 2013: 6:28 AM ET

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Amazon hiring 7,000 workers

Amazon is hiring 5,000 more workers for its fulfillment centers.

NEW YORK (CNNMoney)

Amazon did not give specific pay scales for the positions, but said the 5,000 warehouse jobs will pay 30% more than jobs in traditional retail stores.

The jobs are full-time permanent positions and also include stock grants that, over the last five years, have averaged 9% of pay for Amazon's full-time workers. And the company said many workers would also be eligible for 95% tuition reimbursement for those attending college, whether or not their field of study is related to their job.

In addition, Amazon is looking for 2,000 workers for its customer service department, with those jobs being a mix of full-time, part-time and seasonal positions.

Related: World's shortest work weeks

The 5,000 fulfillment center jobs represent a 25% increase in current staffing in that department.

Amazon has been increasing its network of fulfillment centers and warehouses in order to offer quicker shipping to more of its customers. Many Amazon customers now have the option of next-day delivery, and the company is looking to offer same-day delivery on some items.

Last week, Amazon (AMZN, Fortune 500) reported a surprise loss in its most recent quarter due to bigger investments in digital products than Wall Street had been expecting. But its revenue rose 22% compared to a year earlier.

Amazon's growing sales have hurt many brick-and-mortar retailers, including book retailer Barnes & Noble (BKS, Fortune 500), electronics retailer Best Buy (BBY, Fortune 500) and housewares retailer Bed Bath & Beyond (BBBY, Fortune 500). Two years ago, book seller Borders went out of business, resulting in a loss of nearly 11,000 jobs at that time.

Related: 10 hardest working countries

Amazon's fulfillment center jobs are located in Breinigsville, Pa., Middletown, Del., Chattanooga and Murfreesboro, Tenn., Charleston and Spartanburg, S.C., Patterson, San Bernadino and Tracy, Calif., Chester, Va., Coppell, Haslet and San Antonio, Texas, Hebron, Ky., Indianapolis and Jeffersonville, Ind. and Phoenix. The customer service jobs are in Grand Forks, N.D., Kennewick, Wash., Huntington, W.V., and Winchester, Ky.

According to its SEC filings, Amazon had about 88,400 full- and part-time employees companywide as of Dec. 31, up from only 17,000 workers five years earlier. Those figures are affected by seasonal workers brought on for the holiday period.

More information on the jobs is available at www.workatamazonfulfillment.com.

First Published: July 29, 2013: 7:42 AM ET

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GlaxoSmithKline says China execs may have broken law

Chinese authorities are investigating suspected bribery at the China arm of GlaxoSmithKline.

HONG KONG (CNNMoney)

The U.K. drugmaker has been accused by China of using a network of more than 700 travel agencies and other firms to channel bribes to hospitals, doctors and government officials since 2007.

The admission was made by Abbas Hussain, an executive GSK dispatched to China last week in an effort to contain fallout from the investigation. In a statement issued after a meeting with Chinese officials, Hussain said the company was taking the situation "extremely seriously."

"Certain senior executives of GSK China who know our systems well, appear to have acted outside of our processes and controls which breaches Chinese law," Hussain said. "We have zero tolerance for any behavior of this nature."

Chinese officials said that Hussain apologized during the meeting, according to a statement posted on the Ministry of Public Security's website.

Four senior Chinese executives of GSK (GSK) have been detained in China, and state central television has aired the apparent confession of one of the four.

The CCTV report featured GSK executive Liang Hong explaining how the bribery scheme worked, including the use of fake conferences and travel agencies to create receipts for services that were never performed. The surplus funds were then used to pay bribes.

The circumstances of the interview are difficult to discern and it wasn't clear whether the confession was coerced.

In addition, Steve Nechelput, finance director for GSK China, has been prevented from traveling outside China since the end of June.

How much damage the scandal will do to GlaxoSmithKline's reputation or bottom line remains unclear. But the episode underscores the challenges of doing business in China -- an enormous, rapidly developing market in which bribes and corruption are often deeply ingrained.

Related story: Could China scandal derail Glaxo?

Medical workers are thought to be particularly susceptible to bribery in China because their salaries often lag other fields, even though extensive education is required to enter the profession.

The pharmaceutical industry is also a place where the interests of the government clash with private enterprise.

The state finances medical care for many Chinese, making the government one of the drug companies' biggest customers. As a consequence, regulators often work to keep costs low through the implementation of price ceilings.

Related story: China turns up heat on GlaxoSmithKline

Lower pharmaceutical prices also help keep inflation under control, leaving consumers with a little extra purchasing power -- a key factor as China works to encourage more domestic consumption.

Hussain, the GSK executive, indicated Monday that the company would likely be charging less for its products in the future.

"Savings made as a result of proposed changes to our operational model will be passed on in the form of price reductions, ensuring our medicines are more affordable to Chinese patients," he said.

China's investigation could expose the company to legal action in the U.K., and possibly the United States, under laws relating to the bribery of foreign public officials.

GlaxoSmithKline said last week it had informed the U.K.'s Serious Fraud Office about the allegations but had not yet been asked to provide any further information. The agency, which investigates and prosecutes corruption cases, said it could neither confirm nor deny an interest in the claims against GSK at this stage.

--CNN's Dayu Zhang and CNNMoney's Mark Thompson contributed to this report.

First Published: July 22, 2013: 5:51 AM ET

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Sandy-ravaged regions will never get landlines back

Much of Verizon's landline infrastructure on New York's Fire Island was destroyed during Superstorm Sandy and the telecom will not be repairing the old technology.

NEW YORK (CNNMoney)

Verizon (VZ, Fortune 500) is still in the process of repairing the telephone infrastructure that was damaged by the massive storm in late October. But in many cases, the telecom giant is replacing the old copper-based systems with new technologies -- including wireless.

Those changes are coming for the industry as a whole, whether or not telecom giants like Verizon and AT&T (T, Fortune 500) want them to. And they were coming long before Sandy struck. The parts needed to repair the old landline technology are hard to find, sending companies to some odd places to purchase equipment, such as eBay (EBAY, Fortune 500).

"It can't be that our critical infrastructure is relying on eBay for replacement parts," said Bob Quinn, head of AT&T's regulatory affairs.

Manufacturers that once made the required components, such as Nortel and Lucent, have gone out of business or been bought out, noted Danielle Coffey, a vice president at the Telecommunications Industry Association.

"It's not only eBay, there's a whole secondary market for these parts," she said.

Related story: are landlines doomed?

That's because landlines are a dying business. Many customers have switched to cell phones or VoIP services like Microsoft's (MSFT, Fortune 500) Skype to make calls. More than 36% of Americans use cell phones as their only telephone service, about ten times the rate from a decade ago, according to a Centers for Disease Control study.

Still, many telephone customers in Sandy-ravaged areas are displeased about the prospect of losing their landlines.

On Fire Island, N.Y., off the southern coast of Long Island, Verizon is replacing its copper landlines with a wireless telephone system called Voice Link. The new system consists of a small modem-sized device that plugs into an electrical outlet and a standard telephone jack in your wall at home. That device connects to Verizon's wireless cellular network, which brings phone service and a dial tone to the existing cord or cordless phones in the home. Customers can use it to make calls, and it and offers services like call waiting, caller ID and voice mail.

But, at least for now, Voice Link can't connect customers to the Internet. That means medical alert services often used by senior citizens will not work. Those kinds of systems allow a customer to press a medical alert button immediately contacting a monitoring center. Alarm services, fax machines, and DSL Internet won't work either.

Related story: AT&T isn't nearly as bad as you think

Hundreds of Fire Island residents have filed complaints with the New York Public Service Commission about the service.

"It's not quite ready for prime time," said Harold Feld, the senior vice president of Public Knowledge, an advocacy group that opposes the all-wireless Voice Link system. "If we do switch to wireless as an alternative, then we want this wireless alternative to be as good or better than what we have now."

Verizon offers the only telephone service on the island, so the hundreds of residents of the popular vacation spot have little choice but to accept Verizon's Voice Link plan. Verizon said it intends to improve the system as time goes on.

Fire Island is a "unique situation," said Tom Maguire, the senior vice president for national operations at Verizon. Wireless is not the only path forward for swapping out copper lines for new technology. AT&T and Verizon in many cases are replacing copper with fiberoptic cable and upgrading their networks from a series of routers and switches to a modern digital network.

Related story: Femtocell hack reveals mobile phones' calls, texts and photos

But Fire Island isn't the only place where Verizon is installing Voice Link. The company began working on the Voice Link system well before the storm, testing it in places like Florida and Virginia as a way to connect customers without having to repair existing copper lines.

In areas other than Sandy-ravaged communities, Maguire said, the Voice Link system will be available as an option -- and not every customer is a suitable candidate. It is for people who do not want DSL Internet service and do not have services like alarm and life support systems. And if a Verizon technician goes to a home to install Voice Link and there is weak cellular network signal, Verizon would in that case repair the copper wire instead of installing the wireless system.

Verizon has deployed Voice Link in Mantoloking, N.J., which was also heavily damaged by Hurricane Sandy, and the company has plans to deploy it in areas like the Catskills where the copper infrastructure is badly damaged.

First Published: July 22, 2013: 6:06 AM ET

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Tax breaks: Washington budget voodoo hides true cost

Manufacturers of rum from Puerto Rico and the U.S. Virgin Islands have enjoyed a "temporary" increase in a key tax break for the better part of 20 years.

NEW YORK (CNNMoney)

Unless, that is, you're Congress. Lawmakers routinely enact "temporary" tax breaks that they then renew again and again, in some cases for decades.

It's a neat trick that hides the true cost of tax breaks to the government's bottom line.

And it suits lobbyists just fine since they get to come back to lobby for renewal.

"It's an annuity for them," said Howard Gleckman, editor of the blog TaxVox. Plus, he said, lawmakers get to keep campaign donations rolling in from those eager for yet another extension.

Indeed, Congress has made more parts of the tax code "temporary" over the years. The number of annual expiring tax provisions has more than tripled since 1998.

The research and development credit, intended to spur business investment, is a perfect example of the perma-temporary break. First enacted in 1981, it has been extended 15 times.

Another one is the renewable energy production tax credit, for wind-produced electricity. It was initially created 21 years ago and has since been re-upped many times.

The "temporary" tax deduction teachers get for buying classroom supplies was first enacted in 2002 and has been extended every year or two since.

Sometimes, even when a tax provision itself is permanent, a modification of the break is characterized as temporary.

Such is the case with the rum excise tax "cover over," which has been around since 1917.

Related: Tax breaks: Where the big money is

Manufacturers of rum made in Puerto Rico and the U.S. Virgin Islands pay the tax to the U.S. Treasury Department. But almost all of that money is rebated to the governments of those territories. They, in turn, often spend it in ways that benefit the rum manufacturers.

In 1993, lawmakers approved a "temporary" increase in the tax. With a brief exception, an increase has been renewed ever since and with it the rebate.

Occasionally there's good reason to deem a tax break temporary -- for example, after a natural disaster or during a recession.

But since tax breaks mean less revenue to the government, lawmakers often characterize other breaks as temporary to make them look less costly.

"The budget thing looms very large," said Donald Marron, a former director of the Congressional Budget Office.

Here's another way to look at it: Extending all the expiring tax provisions in the code might cost up to $100 billion a year. Extending them over the decade, it's more like $938 billion, according to estimates from the Congressional Budget Office and Joint Committee on Taxation.

Making tax breaks temporary and renewing them at the 11th hour not only further complicates the code, it makes it hard for taxpayers to plan and increases the cost of administering the provisions.

"[T]he frequent ritual of being on tax code death watch only to be saved by last- minute clemency ... creates tremendous volatility," tax expert Rosanne Altshuler told the Senate Finance Committee last year.

The fiscal cliff deal brokered by lawmakers over New Year's made some longstanding "temporary" provisions -- like the majority of the Bush tax cuts -- permanent. And it eliminated others, such as the portion of the Bush tax cuts solely affecting high-income households.

Now, as Congress debates tax reform,"extenders" will be on the table, especially if lawmakers stick with what has been called a "blank slate approach" proposed by top Senate tax writers.

The idea is to assume the tax code will have no breaks and to add back only those that lawmakers can justify and "pay for," meaning the revenue loss from a given break won't add to the country's deficits.

Reform won't necessarily stamp out temporary provisions entirely, but it's likely to reduce them greatly, Marron said.

At least temporarily.

First Published: July 22, 2013: 6:14 AM ET

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UBS settles mortgage case for $745 million

Swiss bank UBS reveals latest in a series of penalties to settle charges of misconduct.

LONDON (CNNMoney)

UBS (UBS) announced the settlement Monday, noting that it's one of 18 financial institutions named in similar cases.

The U.S. Federal Housing Finance Agency brought the case against UBS in 2011, saying the bank made misleading statements and didn't conduct full due diligence when it sold $4.5 billion in these securities to the government-backed mortgage financiers.

The settlement relates to assets sold by UBS between 2004 to 2007, as the U.S. housing bubble was growing. When it burst, Fannie Mae and Freddie Mac had to be rescued by the U.S. government in 2008 as they discovered they held billions of dollars in non-performing assets that were backed by bad residential mortgages.

Related: Bank fines top $10 billion in 2012

The settlement announced Monday still needs approval by both sides before it is finalized.

UBS said it had already made financial provisions for the case.

This UBS deal with the Federal Housing Finance Agency is the latest in a string of legal settlements. In late 2012, the bank announced $1.5 billion in penalties after admitting to fraud in its role in the Libor scandal.

In 2009, the bank paid $780 million after admitting to helping U.S. taxpayers hide money from the IRS.

Related: Bank of America in $10 billion settlement with Fannie Mae

The Swiss bank also announced Monday that it expected to report second quarter pre-tax operating profit of roughly 1 billion Swiss francs ($1.1 billion) at the end of the month. Net profit would be about 690 million Swiss francs.

The bank, which is set to report full quarterly results on July 30, detailed how its wealth management division was seeing billions in inflows and was boosting its cash cushion to protect it from future financial shocks.

However, the firm's global asset management division is showing some weakness, reporting two billion Swiss francs in net outflows.

Shares in the bank jumped roughly 5% in premarket trading after the numbers were released.

First Published: July 22, 2013: 6:57 AM ET

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Apple's developer's site shut down by hack attack

Apple had to shut down its developer's site due to a hacker attack last Thursday.

NEW YORK (CNNMoney)

A notice on the site said an intruder had "attempted to secure personal information of our registered developers" last Thursday, and that Apple had shut down the site.

While the site has been shuttered since the attack, the original notice said it was down for maintenance.

"Sensitive personal information was encrypted and cannot be accessed, however, we have not been able to rule out the possibility that some developers' names, mailing addresses, and/or email addresses may have been accessed," Apple said Monday. The tech firm said it had been working around the clock to fix the problem, updating its server software and rebuilding its entire database. It said it expects the site to be up and running soon.

The site is used by third-party developers who are creating software and apps for use on Apple operating systems. It has everything from chat forums to technical manuals.

Related: This is what a bad quarter for Apple looks like

In June, Apple unveiled a beta version of iOS 7, its new operating system for iPhones and iPads, as well as a new operating system for Mac laptops and desktops, OS X 10.9, also known as "Mavericks."

Developers have been busy readying their software and apps to work with the new operating systems, expected to launch this fall, making this a particularly bad time for the developer's site to have an extended outage.

Shares of Apple (AAPL, Fortune 500) edged higher in premarket trading, despite the problem. Apple reports earnings Tuesday.

First Published: July 22, 2013: 8:16 AM ET

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Home sales dip in June

Sales of existing homes stumbled in June after hitting a 42-month high in May.

NEW YORK (CNNMoney)

The number of sales dipped 1.2% to an annual rate of 5.08 million in June from a downwardly revised 5.14 million in May, according to the National Association of Realtors. However, sales were up 15.2% compared to June, 2012.

Related: Prepare for a slowdown in home prices

Rising mortgage rates may have taken some of the steam out of the market, according to NAR's chief economist, Lawrence Yun.

"We're still dealing with a large pent-up demand," he said. "However, higher mortgage interest rates will bite into high-cost regions of California, Hawaii and the New York City metro area market."

A lack of inventory is also holding sales back. In some places, buyers simply could not find suitable homes. In June there was a 5.2-month supply at the current sales pace, up from 5.0 months in May. That's 7.6 percent below a year ago, when there was a 6.4-month supply. "Inventory conditions will continue to broadly favor sellers and contribute to above-normal price growth," said Yun.

Related: The home bidding wars are back

Indeed, the median home price jumped 13.5% from June 2012, to $214,200, posting the 16th consecutive month of gains.

The ongoing drop in foreclosures and short sales as the foreclosure crisis has eased has helped contribute to home price gains. Distressed sales accounted for just 15% of all existing home sales in June, compared with 18% a month earlier. That's the lowest market share for distressed properties NAR has reported since it begantracking them in October 2008.

Related: New homes sales hit five-year high

Distressed properties generally sell at substantial discounts to conventional homes, so having fewer in the mix helps boosts the median home price.

First Published: July 22, 2013: 10:43 AM ET

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Stocks: Bracing for earnings deluge

Click chart for more market data

NEW YORK (CNNMoney)

The Dow Jones industrial average was down a handful of points. McDonald's (MCD, Fortune 500) was the main drag, falling 2.5% after the restaurant operator reported disappointing earnings and sales.

The S&P 500 was little changed. The Nasdaq edged up 0.1%.

Nearly 160 companies in the S&P 500 are slated to report quarterly results this week. Among the Dow components set to report this week are AT&T (T, Fortune 500), Boeing (BA, Fortune 500), and 3M (MMM, Fortune 500).

While investors were hitting the pause button Monday, stocks have had quite a year. All three indexes are up roughly 19%, and both the Dow and S&P 500 hit new record highs last week.

Click here for more on stocks, bonds, currencies and commodities

Broad boost from earnings: While it's still early, the second-quarter earnings have come in better than many had feared.

The results so far "have provided support to stock prices and given a boost to investor sentiment," said John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, adding that expectations had been cut in the run-up to the reports.

Of the 104 companies that reported results through Friday, 66% have beat analysts' expectations, according to S&P Capital IQ.

Much of that performance was driven by the financial services sector, which benefited from robust capital market activity in the second quarter.

Kimberly-Clark (KMB, Fortune 500), producer of Kleenex, Huggies, Kotex, Depends and Scott products, reported an increase in quarterly profit but sales were flat.

Six Flags (SIX) shares fell after the amusement park operator said earnings slumped 26% in the second quarter. The company is also struggling with the fallout from a fatal roller coaster accident over the weekend.

Tech results in focus: This week, a number of big technology companies are slated to report, including Apple (AAPL, Fortune 500), Facebook (FB) and Amazon (AMZN, Fortune 500).

Following disappointing results from Google (GOOG, Fortune 500) and Microsoft (MSFT, Fortune 500)last week, investors are eager to see how other tech companies have fared. Apple, which can have an out-sized impact on the broader market, is expected to report a sharp drop in profits.

Netflix's (NFLX) report is due after the close.

Despite the positive tone to last week's earnings reports, many investors remain concerned about the tepid pace of revenue growth, said Dan Greenhaus, chief market strategist at BTIG.

"Revenue growth concerns are paramount, with some wondering about the future path of earnings if revenue growth doesn't accelerate," Greenhaus wrote in a note to clients.

He said about half of the companies that have reported so far have beat revenue expectations, which is below average.

Related: Fear & Greed Index, still greedy

In other corporate news, Yahoo! (YHOO, Fortune 500)announced that it will repurchase 40 million Yahoo shares from long-time backer Third Point Capital. The hedge fund, run by activist investor Dan Loeb, will retain a small stake.

UBS (UBS) agreed to pay about $745 million to settle a case with the U.S. Federal Housing Finance Agency over improperly selling mortgage-backed securities to Fannie Mae and Freddie Mac in the United States.

Gold boost: Shares of mining companies were higher as the price of gold rose more than 2% to trade above $1,300 an ounce.

Barrick Gold (ABX), Newmont Mining (NEM, Fortune 500), Kinross Gold (KGC) all gained about 4%.

In economic news, the National Association of Realtors said new home sales fell 1.2% in June. The group blamed higher mortgage rates in certain high-end markets .

World markets: In Europe, the major indexes were mixed in midday trading.

Asian markets ended with mixed results. Japan's Nikkei advanced by 0.5% after voters rewarded the architects of Abenomics with a sweeping electoral victory.

"Japan now has no election planned for the next three years, suggesting Abenomics will be here to stay for some time," wrote Reid. "Politics aside, the next test for Abe's economic agenda is Japanese corporate profitability, with the domestic earnings season kicking off this week."

First Published: July 22, 2013: 9:43 AM ET

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This is what a bad quarter for Apple looks like

Apple's financials appear to be heading in the wrong direction.

NEW YORK (CNNMoney)

Apple (AAPL, Fortune 500) didn't unveil any major products over the last three months. High-end smartphone sales are plateauing, and Apple has no real low-cost solution for prepaid customers and developing global markets. Apple customers are increasingly opting for iPad minis and older iPhone models, which carry lower profit margins than newer and bigger devices.

All of those factors will contribute to flat sales and a 22% drop in profit in Apple's fiscal third quarter, analysts predict.

That's a nasty development for a company that was regularly posting startup-like profit and sales growth as recently as a year ago. Between October 2009 and March 2012, Apple doubled its quarterly earnings in eight out of 10 quarters. Apple's sales grew by more than 50% in nine of those quarters.

There's no question Apple's financials are heading in the wrong direction. Gross margin has fallen in five straight quarters, and Apple announced in April that earnings fell year-over-year for the first time since late 2003. If this past quarter's sales come in below what Apple reported a year ago -- which about half of Wall Street analysts expect to happen -- it will mark the first time that occurred in more than 10 years.

All of Apple's recent problems have been stated -- and restated -- time and time again. Apple's precipitous 40% decline in its stock price over the past 10 months has been well documented.

But there's another side to the story.

Related story: Game over or room to grow for Apple?

Just because it's not growing doesn't mean Apple is unsuccessful. The company is still expected to post $35 billion in sales and $6.9 billion in profit. Apple is currently the sixth largest U.S. company measured by revenue, and its sales are expected to grow by 9% in 2013.

Verizon (VZ, Fortune 500) last week reported that iPhone sales grew 44% last quarter, and half of the smartphones it sold were made by Apple -- despite the fact that the newer, more feature-rich and better-marketed Samsung Galaxy S4 sits right next to the iPhone 5 on the shelf.

Apple's brand still has a lot of cachet, and it remains a big draw for consumers. If the company can develop new, innovative product categories -- perhaps the long-rumored iWatch or iTV would fit the bill -- then Apple has a chance at turning the ship around.

Consider what the company's groundbreaking products did for Apple's financials over the past decade.

The iPod mini, the first blockbuster product for Apple in years, kicked off seven consecutive quarters of triple-digit profit growth after it debuted in January 2004. Apple's sales tripled between the time the iPod mini first went on sale and the iPhone launched in the summer of 2007. Profit grew 20-fold.

The iPhone tripled sales and profit again during its first three years on store shelves, but it was the iPad that launched Apple into the stratosphere. The debut of the iPad in 2010, partnered with the completely redesigned iPhone 4 later that year, helped the company enter that remarkable stretch between the fall of 2009 and the spring of 2012. During that two-and-a-half year period, Apple became the stock market's most valuable company, and Apple posted the second-most profitable quarter in U.S. corporate history.

It has been just three years since the iPad, the last major new Apple product, went on sale. If Apple has another revolution or two left in it, the company could return to glory.

If not, then the story of this ugly past quarter is going to become a familiar one.

First Published: July 22, 2013: 6:11 AM ET

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High speed trader fined $3 million for commodity manipulation

Panther Energy 'spoofed' oil and commodity markets traded on CME exchanges

LONDON (CNNMoney)

New Jersey-based Panther Energy Trading and its principal, Michael Coscia, were fined a total of $3.1 million, and also ordered to hand over at least $1.4 million in trading profits, for "spoofing" markets in crude oil, natural gas and other commodities, such as wheat, soybean and corn.

Coscia was accused of using an algorithm to illegally place and quickly cancel orders to buy and sell futures contracts traded on CME Group (CME)exchanges and London's ICE during a two-month period, the regulators said.

Regulators said Coscia and his firm would place small sell orders they wanted to execute, followed by several large buy orders at successively higher prices that they intended to cancel, with the aim of artificially inflating the price at which they could sell by creating an impression of strong demand.

Related: Favorite stocks of high speed traders

Once the sell order was filled by another market participant, Coscia would cancel the buy orders and then reverse the process, racking up a profit from the executions of small orders many times over between August and October 2011.

"While forms of algorithmic trading are of course lawful, using a computer program that is written to spoof the market is illegal and will not be tolerated," said David Meister, enforcement director at the U.S. Commodity Futures Trading Commission.

Panther and Coscia have been banned from trading on any CTFC-registered entity for a year, and from CME markets for six months.

The CFTC said this was the first case pursued under Dodd-Frank rules that explicitly prohibit placing buy or sell orders with the intent to cancel before executing the trade.

The total financial penalty includes a CFTC penalty of $1.4 million, a CME fine of $800,000, along with a fine of about $900,000 imposed by the U.K. Financial Conduct Authority for Coscia's deliberate manipulation of Brent crude, gas oil and West Texas Intermediate futures contracts on the ICE.

Related: High speed trading: Paying for an edge

The FCA fine was cut by 30% because Coscia chose to settle.

The FCA said Coscia made a profit of nearly $280,000 over a 6-week period, mainly at the expense of other high speed traders.

"High frequency trading and the use of algorithms are an important and commonplace part of the markets nowadays but in this case these techniques were deliberately designed to abuse the market," said Tracey McDermott, director of enforcement and financial crime at the FCA.

First Published: July 22, 2013: 11:35 AM ET

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Loeb exits Yahoo board

Yahoo buys back 40 million shares held by Third Point, leading the hedge fund's founder Daniel Loeb to step down from the tech giant's board of directors.

NEW YORK (CNNMoney)

The decision was spurred by Yahoo's decision to buy back 40 million shares owned by Loeb's hedge fund Third Point. The move reduces Third Point's stake in Yahoo (YHOO, Fortune 500) to 2% from about 6%, leading Loeb to resign from the board, along with two other directors nominated by Third Point -- Harry Wilson and Michael Wolf.

Loeb was instrumental in restructuring Yahoo and hiring its current CEO Marissa Mayer. After buying up a big stake in Yahoo last year, he successfully orchestrated a move to oust then-CEO Scott Thompson, by drawing attention to his padded résumé.

"Since our Board's rigorous search led us to hire Marissa Mayer as CEO, Yahoo's stock price has nearly doubled, delivering significant value for shareholders," Loeb said in a prepared statement.

Also read: Bad quarter for Apple?

Yahoo CEO Mayer thanked Loeb's contribution in a statement: "Daniel Loeb had the vision to see Yahoo for its immense potential - the potential to return to greatness as a company and the potential to deliver significant shareholder value."

Loeb, Wilson and Wolf's resignations are effective July 31.

Yahoo will buy the shares at $29.11 a share, for a total of $1.2 billion. The repurchase is part of Yahoo's larger $5 billion buyback plan announced last year.

Yahoo shares were down about 4% on the news.

First Published: July 22, 2013: 11:19 AM ET

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Scamming Obamacare harder than you think

A temporary rule change won't make it easier for people to get more health subsidies than they qualify for, experts say. And in the event they do, the IRS will serve as the ultimate backstop.

NEW YORK (CNNMoney)

Officials announced on July 5 that insurance exchanges could relax how they verify the income of people who apply for federal financial help in the first year.

But experts say the temporary change won't necessarily make it easier to scam the system.

The subsidies at issue are meant to help people who can't afford to pay full freight for health insurance. Generally speaking, the less you make, the bigger the subsidy you get.

The purpose of the change is to ease the initial administrative burden on the exchanges, which roll out in October.

The new rule doesn't fully excuse exchanges from having to verify income, said Judy Solomon, vice president for health policy at the Center on Budget and Policy Priorities.

Exchanges must still check the applicant's income against a federal database, which will include information from his federal tax returns and a record of Social Security benefits.

The exchanges will be looking for disparities between what the applicant says and what's in the database.

If it looks like someone is understating his income by more than 10%, and the exchange doesn't have other sources to quickly check against, the exchange may choose to rely on what the applicant says.

But in those cases, the exchange must also conduct a random sample of similar applicants to make sure the verification process is working.

In the end, if someone slips through the cracks -- and gets more of a subsidy than he is entitled to -- he still could be found out.

That's because the exchanges are only approving estimated tax credits that a person can use to help pay their insurance, said Larry Levitt, a senior vice president of the Kaiser Family Foundation.

Related: Form to apply for Obamacare coverage

The final calculation of a subsidy's size will be done after the fact by the IRS.

"Your actual tax credit will be calculated based on your actual income that next April [when you file your federal tax return]," Levitt explained.

Bottom line: Anyone who might get a bigger subsidy than they're eligible for will have to pay back the difference to the IRS.

And they may owe a penalty, too, since they must attest when applying for subsidies that they are not filing false information.

"If you report your income incorrectly, it will catch up with you because there's a reconciliation of these tax subsidies on your tax return. Come tax time you could see an enormous bill," said Linda Blumberg, a senior fellow at the Urban Institute's Health Policy Center.

Of course, it's also possible to unintentionally understate your income when applying for credits.

Changing jobs, losing one, getting a raise or simply increasing or decreasing work hours means your year-end income could be very different than what you initially reported.

That's why, Blumberg said, it will be important for consumers to alert the exchange within a month of their income changing so their subsidy can be adjusted accordingly for the rest of that year.

Efforts to educate the public about how the exchanges will work is getting under way, with less than 80 days to go before the exchanges open for enrollment on Oct. 1.

First Published: July 15, 2013: 5:33 AM ET

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Twinkies are back, but most jobs are not

Twinkies are now produced by a joint venture between Apollo Global and C. Dean Metropolous.

NEW YORK (CNNMoney)

There were 18,500 people working for Hostess Brands when the company went bankrupt in November, making Twinkies, Wonder Bread and a variety of other brands.

But only about 20% to 25% of those jobs will end up returning when all the brands are up and running again, according to estimates by Natalie Everett, a bread and snack industry analyst with IBISWorld.

Typically, companies that buy iconic brands like those produced by Hostess invest in equipment and machinery to replace laborers -- which is why the jobs aren't coming back, Everett said.

Hostess had two main unions when it went under: About 6,600 employees were members of a bakers' union and worked at 33 bakeries nationwide, and 7,500 were drivers who belonged to the Teamsters union.

Hostess announced plans to liquidate in November after offering workers a new contract with reduced wages and benefits. The Teamsters accepted the deal, but the bakers' union rejected it. Hostess management blamed the bakers for forcing the company to shut down.

Related: New Twinkies will double their shelf life

Twinkies and a number of other Hostess snack brands were purchased by a joint venture of Apollo Global Management and Metropoulos & Co. The new company bought five bakeries but will only operate four.

Hannah Arnold, a spokeswoman for the Apollo-Metropoulos venture, said the company plans to use 1,800 workers to produce a full line of Hostess snacks, including Twinkies.

The old Hostess had roughly 2,500 workers producing snacks. Arnold cautioned that it's "nearly impossible" to compare the two, because the new company did not buy rights to all of the brands that the old Hostess produced.

Some of the reduction in jobs is also due to the new owners' different business model.

Instead of using truck drivers as salesmen to deliver the product and stock the shelves of about 50,000 stores, the new company will hire outside trucking firms to deliver trailers full of the product to retail distribution centers.

The company says it will be able to reach even more stores that way -- an estimated 110,000 nationwide by the end of the year.

Some jobs won't be coming back due to the permanent shutting of nearly 600 outlet stores the old Hostess Brands operated to sell products directly to consumers.

Related: First batch goes on sale at Wal-Mart

Flowers Foods agreed to buy Wonder Bread and most of Hostess' other bread brands -- as well as 20 bakeries and about three dozen depots -- for $360 million. A Flowers spokesman declined to comment on staffing at these facilities because the deal hasn't yet been finalized.

A former Hostess sales representative in New York told CNNMoney that he was in the process of applying for a job with Flowers, as were a number of other ex-colleagues.

"It's a shame what happened -- we've got families to feed and we lost our benefits," the man said, requesting anonymity to avoid harming his job prospects.

One challenge for Hostess is that the entire sector has been seeing weak sales for several years.

"The general health trend is people avoiding bread products, avoiding carbs, avoiding glutens now," said Everett, the industry analyst. "The sweet treats that Hostess sold, they also have a bad rep. That said, they wouldn't be coming back if people didn't love them."

First Published: July 15, 2013: 6:49 AM ET

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Stocks: Investors cheer China data

Click for more market data.

NEW YORK (CNNMoney)

U.S. stock futures were modestly higher ahead of the open.

There had been concerns that the Chinese economic slowdown was intensifying.

While the latest data show China's economy grew at a slower pace in the second quarter -- with gross domestic product expanding by 7.5% over the previous year -- the performance matched the government's target and the consensus estimate from private forecasters.

"While confirming the inevitable slowing of the emerging market's expansion, [there's] a collective sigh of relief that it wasn't any weaker," noted Mike van Dulken, head of research at Accendo Markets

China has averaged growth of around 10% a year in the past three decades.

Related: China's GDP growth slows to 7.5%

In company news, the stock price for Leap Wireless International (LEAP) jumped 115% in premarket trading Monday, after AT&T (T, Fortune 500) said on Friday that it plans to acquire the prepaid wireless provider for about $1.2 billion.

Bank earnings remain in focus Monday. Citigroup (C, Fortune 500)'s share price rose 2% in premarket trading after the bank reported quarterly net income of $4.2 billion, or $1.34 per diluted share, and revenue of $20.5 billion, driven by lower loan losses.

On the economic front, U.S. retail sales grew 0.4% in June, according to the Commerce Department. Economists surveyed by Briefing.com had forecast a 0.7% rise.

U.S. stocks inched higher Friday, and the slim gains were enough to send the Dow and S&P 500 to new record closing highs, and the Nasdaq to the highest level in over a decade.

Related: Fear & Greed Index gets greedy

Boeing's (BA, Fortune 500) stock edged up 1% after British investigators said that a Dreamliner fire at London Heathrow Airport last Friday was not linked to its batteries, which have created problems in the past.

Major European markets gained less than 0.5% in morning trading, while the main Chinese markets ended with gains. The Shanghai Composite index and the Hang Seng index popped up by 1% and 0.1%, respectively.

In Japan, the Tokyo Stock Exchange was closed for a holiday.

First Published: July 15, 2013: 5:05 AM ET

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Retail sales rise slightly, but show consumer weakness

NEW YORK (CNNMoney)

Retail sales rose 0.4% in June, the Census Bureau said Monday. That's a slowdown from a 0.6% rise a month earlier, and weaker than expected.

A 2.1% gain in car sales was an important driver of the increase. Excluding auto sales, the June number came in flat.

The number was also boosted by a 2.4% increase in furniture shopping and a 2.1% rise at "nonstore" retailers, which mainly reflects online shopping.

Spending on summer clothes and gasoline also increased.

Related: Drivers, get ready for a gas price spike

Spending declined for many other retail sectors. Sales of building supplies and garden equipment fell 2.2%, even as home prices have continued to climb this year and new home sales hit a five-year high in May.

Restaurants, department and grocery stores, along with sales of electronics felt a pinch, as well.

"It was a gain, but it was a weak one at that," said Jennifer Lee, senior economist at BMO Capital Markets. "Despite steady job gains, homes that are worth more, record high stock prices, U.S. consumers are staying cautious when it comes to buying."

The monthly retail sales number is a closely watched one, since consumer spending accounts for more than two-thirds of the nation's overall economy. The June jobs report showed that the retail sector added 37,000 jobs in June, which means that retail sales can be a sign of overall economic growth.

First Published: July 15, 2013: 9:11 AM ET

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China says GlaxoSmithKline ran huge bribery web

Chinese police have detailed allegations of bribery by GlaxoSmithKline, saying the pharma group used a network of more than 700 firms to transfer funds.

LONDON (CNNMoney)

The Xinhua news agency, citing Chinese police, said four senior Chinese executives working for the U.K. pharmaceuticals group had been detained and would be charged once preliminary investigations are complete.

Since 2007, GlaxoSmithKline (GLAXF)used the network to channel hundreds of millions of dollars to government officials, medical associations, hospitals and doctors with the aim of raising drug sales and prices, media reported.

The state news agency said the transfers totaled nearly $5 billion while other media said the figure was a tenth of that.

GlaxoSmithKline declined to comment on the number of employees held by Chinese police but said it was deeply concerned by the "shameful" allegations. It is reviewing its ties with all third-party agencies and will cooperate with the investigation.

"We have put an immediate stop on the use of travel agencies that have been identified so far in this investigation and we are conducting a thorough review of all historic transactions related to travel agency use," a spokesperson said.

China's Ministry of Public Security first accused GlaxoSmithKline last week of orchestrating a campaign of bribery and corruption in some of the country's biggest cities.

International companies operating in China often have a valuable edge over local competitors in terms of public trust, but a recent spate of allegations relating to price-fixing, quality control and consumer rights has forced some of them to defend their reputations.

Related story: Rolls-Royce in China corruption probe

Aircraft engine maker Rolls-Royce (RYCEF) said late last year it may face prosecution in the U.K. over allegations of corruption in China and elsewhere.

China claims that wrongdoing by GlaxoSmithKline executives included the falsification of tax forms in order to facilitate the payment of bribes. In addition, executives are also suspected of taking bribes and kickbacks from business partners. The security ministry said last week that the suspects had admitted to the crimes.

The GlaxoSmithKline spokesperson said the company's head of China -- Mark Reilly -- remained in his post, but declined comment on his whereabouts. Some reports say he left China last week and has not returned.

Corruption is thought to be endemic in wide swaths of Chinese industry and is perceived by many as a cost of doing business in the country.

The ruling Communist Party is sensitive to allegations of bribery after several high-profile members were caught in scandals in recent years. Former President Hu Jintao warned that failure to tackle corruption could be fatal for China.

It's not yet clear whether the GlaxoSmithKline allegations are tied to a probe of price setting practices at 60 pharmaceutical companies announced last month by authorities.

The National Development and Reform Commission is investigating 33 drug companies over pricing and a further 27 over input costs. GlaxoSmithKline is among the companies targeted, along with Astellas (ALPMF) and Sandoz.

Drugmakers are under pressure to reduce costs in China as the country's population grows older, a trend that is straining the country's medical system and care facilities.

First Published: July 15, 2013: 9:42 AM ET

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I risked my life to pay off $108,000 in student loans

Thomas McGregor paid off $108,000 in law school student loans in four years by serving in the Army. He was deployed to Iraq and Afghanistan.

WASHINGTON (CNNMoney)

McGregor graduated in 2008 from the University of St. Thomas law school in Minnesota with $108,000 in student loans.

After several months of job hunting, and with the threat of a deeper recession looming, McGregor decided to enlist in the Army.

"I paid off $108,000 of law school loan debt," said McGregor, 31. "All I had to do was put my life on the line."

McGregor knew what he was getting into. When he joined, he was told there was a "100% chance" he'd be deployed overseas.

"I was just being realistic. I'd be paying those loans off forever and I knew interest compounding would make (the total) go up," McGregor said. "I couldn't think of any better options."

Related: Student loan horror stories

He deployed to Iraq for two months in 2010, and later to Afghanistan from May 2012 to March 2013.

His first convoy in Iraq was attacked by an RKG-3, a Russian anti-tank hand grenade. He and his colleagues were regularly fired upon in Afghanistan. One of his buddies lost his legs to land mines. He also lost friends in Afghanistan.

By all accounts, McGregor did things backwards. Most people join the military first, usually after high school, and then go to school. The GI bill picks up most of the tab for veterans who attend public universities and up to $17,500 for those at private colleges.

McGregor graduated from law school in May 2008, passed the Minnesota state bar and was sworn in as an attorney in late October.

He was convinced he'd get a "good job right away," circulating his resume and taking an unpaid internship at a legal aid clinic. Later that year, he went back to work for his family's roofing distribution business, where he had worked every summer for 13 years.

He was licensed to practice law, but he was driving a forklift and managing roofing material orders for $15 an hour, no benefits.

"I'd load up the pick-up truck or unload returns, it was pretty much manual labor," he said. And his $1,200 a month student loan bills began to pile up.

McGregor decided to enlist after seeing the recruitment incentives.

Related: Senate rejects plan to roll back student loan rate hike

He started training in February 2009 and later went to Officer Candidate School, which allowed him to earn a higher Army salary.

McGregor was able to trim his private loan interest rates to 6% with the help of the Soldier Relief Act, which caps interest rates while soldiers serve. And the Army College Loan Repayment Program paid down $65,000 of his loans. The rest he paid off just using his Army salary. He was free of debt by 2012.

"You don't have any bills when you're deployed," he said.

He was only required to be active in the Army three years, but he liked it so much that he stayed. When he leaves the Army, he'll be subject to be recalled for eight years, if the Army needs him.

He said he has no regrets.

"Joining the Army is something people can only decide for themselves," he said. "It was a great opportunity. . . I don't think any other job would be close to this."

First Published: July 15, 2013: 6:01 AM ET

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Stocks drift in early trading

Click for more market data.

NEW YORK (CNNMoney)

The Dow Jones industrial average added a handful of points, while the S&P 500 and the Nasdaq were flat.

The Chinese government said gross domestic product rose by 7.5% in the second quarter, matching official estimates. While growth was slower than the 7.7% rate in the first quarter, investors were relieved that Chinese GDP was not weaker than expected.

"The overall rate of GDP growth is a tinch disappointing, but the economy seems to be in far-from-desperate shape," said Carl Weinberg, chief economist at High Frequency Economics.

In the United States, retail sales rose 0.4% in June, the Census Bureau said Monday. That's a slowdown from a 0.6% rise a month earlier, and weaker than expected.

Separately, the New York Federal Reserve bank said its index of manufacturing activity in the region rose to 9.5 in July, from 7.8 in June.

Related: China's GDP growth slows to 7.5%

"Investors are keeping a watchful eye on economic data, not only for signs about the direction of the economy, but perhaps more importantly in a search for clues about the Fed's next steps," said Jim Baird, chief investment officer for Plante Moran Financial Advisors.

Federal Reserve chairman Ben Bernanke will be on Capitol Hill this week for his annual testimony on the economy. Bernanke gave the market a boost last week after he said U.S. monetary policy will remain "highly accommodative" for the foreseeable future.

U.S. stocks inched higher Friday. The slim gains were enough to send the Dow and S&P 500 to new record closing highs, and the Nasdaq to the highest level in over a decade.

What's moving? Shares of Leap Wireless International (LEAP) jumped 115% after AT&T (T, Fortune 500) said on Friday that it plans to acquire the prepaid wireless provider for about $1.2 billion.

Bank earnings remain in focus Monday. Citigroup (C, Fortune 500) reported quarterly net income of $4.2 billion, or $1.34 per share, driven by a jump in revenue and lower loan losses.

Shares of jeweler Tiffany & Co. (TIF) were up 3% after analysts at Stifel upgraded the stock.

Related: Fear & Greed Index gets greedy

Boeing's (BA, Fortune 500) stock edged up after British investigators said that a Dreamliner fire at London Heathrow Airport last Friday was not linked to its batteries, which have created problems in the past.

Major European markets gained less than 0.5% in morning trading, while the main Chinese markets ended with gains. The Shanghai Composite index and the Hang Seng index popped up by 1% and 0.1%, respectively.

In Japan, the Tokyo Stock Exchange was closed for a holiday.

First Published: July 15, 2013: 9:41 AM ET

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