How Detroit's breakdown will hit you

(Money Magazine)

Indeed, among localities still coping with fallout from the recession and housing bust, the Motor City stands alone in awfulness: 78,000 blighted structures, 18% unemployment, a $327 million operating deficit last year. Yet with the city looking to cut pensions and restructure debt, Detroit's comeback bid could have ramifications beyond Michigan's borders.

Your town may feel freer to slice retiree benefits. With so many state and local pensions facing funding shortfalls, cutting back retirement benefits -- or trying to -- is nothing new. What worker advocates fear is that bankruptcy-court approval of pension changes for Detroit, where pension protection is part of the state constitution, would embolden government leaders elsewhere to seek deeper cuts.

Related: Just how generous are Detroit's pensions?

In Detroit, pension changes are most likely to follow the national trend: eliminate cost-of-living adjustments and convert current workers to defined-contribution plans, says area financial planner Leon LaBrecque, rather than reduce payments.

The muni market could take a hit. Detroit has proposed treating certain general obligation bonds as "unsecured," instead of backed by city taxing power, and offering investors just 10 cents on the dollar.

The odds are long, but if Detroit succeeds, the precedent would shake up the bond market.

Also at risk: retiree health care, which lacks the same protections as pensions. Detroit would shift retirees to new federal exchanges or Medicare, a move other governments are studying.

Related: Detroit's stealth business boom

Still, for most of the country, "credit quality remains quite strong," says John Bonnell, a fixed-income manager for USAA. The five-year default rate in the $3.7 trillion muni bond market is less than one-half of 1%, reports Moody's; 93% of municipal issuers are rated single A or higher.

Michigan muni funds already have. Funds that specialize in the state's bonds are down as much as 17% this year, but at this point you shouldn't rush to sell, says Chris Ryon of Thornburg Funds. Even funds with big stakes in Detroit primarily hold the water and sewer bonds that Detroit is still fully backing, not the unsecured debt the city is defaulting on.

But the real story on bonds is ... Munis are less liquid than the Treasury market, and thus have taken a bigger hit as interest rates have risen of late. But David Kotok, chairman of money manager Cumberland Advisors, thinks the fear has been overplayed.

"High-grade munis are remarkable bargains," says Kotok. Still, stick with a short-term fund, such as Fidelity Short-Intermediate Muni Income (FSTFX) (recent yield: 1.77%), to cushion any losses as rates rise.

First Published: August 19, 2013: 5:57 AM ET

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The IRS is cracking down on small businesses

NEW YORK (CNNMoney)

The Internal Revenue Service has sent out letters to 20,000 small businesses since fall 2012, notifying them of "possible income under-reporting."

The IRS says it is trying to identify businesses that get "an unusually high portion" of their reported sales through credit card transactions. The thinking is that a lot of cash transactions might be going unreported.

To decide who gets letters, the IRS compares a business's credit card and cash receipts with industry averages.

One recipient was the owner of a baking equipment supply company (who preferred to remain anonymous). The IRS sent her a letter on May 28 saying that 80% of her $549,955 in annual revenue came from credit card swipes.

"A larger amount of noncard revenue would be expected," the IRS letter warned.

Related: Defunding Obamacare won't stop it entirely

The business owner was given 30 days to review her records and respond in writing with an explanation. Her accountant, Steve Schneider, wrote back to the IRS this month explaining that the numbers were accurate, but the agency's assumptions were wrong.

"Over the years, the business model has switched to more online sales," Schneider told CNNMoney. "These types of customers tend to pay with credit cards."

Schneider takes issue with the IRS's tactics. He said the agency, by relying on industry averages, doesn't account for how a particular business operates.

"I just don't think that the data they have is sufficient for them to send these letters out," Schneider said.

In the case of an Italian restaurant in Harrisburg, Penn., accountant Steve Gift had to explain to the IRS that his client's credit card data had been reported incorrectly by the payment processor.

Since 2011, the IRS has required payment processors to file 1099-K forms, a record of all credit card transactions on their systems.

The numbers were off, Gift said, because the business owner had changed his federal identification number mid-year. Plus, Gift doesn't think the IRS is looking at restaurants the right way.

"This client was targeted because he has a restaurant and the IRS believes he's getting substantial cash payments," he said. "But everybody nowadays charges on their credit card."

Cracking down on small businesses could make sense. The IRS found that some $450 billion is owed in taxes that goes uncollected. Under-reporting by small businesses accounts for about $140 billion of that tax gap.

In a written statement, the IRS said the aim is to "ensure that people who are non-compliant don't get an unfair advantage over those that play by the rules and follow the law."

The IRS also said its approach is "measured and equitable in several ways, including giving taxpayers the opportunity to explain and fix errors."

Some accountants say the IRS is just doing its job, and that not many business are affected. There are 6 million small employers and 20,000 makes up less than half of one percent.

"This is nothing new," said Van Ballantyne, a small business accountant in Greenland, New Hampshire. "I think it's another attempt to try to get us all to sit a little straighter in our chairs and be more honest in our reporting. It is fairly innocuous."

First Published: August 19, 2013: 6:02 AM ET

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Is renters insurance worth it for college students?

Students who live on campus typically don't have to worry about renters insurance: Their parents homeowner's policy should cover the loss or damage of most items.

NEW YORK (CNNMoney)

Students who live on campus typically don't have to worry about renters insurance: Their parents homeowner's policy should cover the loss or damage of most items as long as the policy includes so-called 'off-premise coverage.' (Just be sure you understand the limits to this coverage and the deductibles that apply.)

However, once you move off-campus and start paying rent, you are no longer covered by mom and dad's policy if there is a fire or someone breaks into the place, said Laura Adams, senior insurance analyst at InsuranceQuotes.com, a Bankrate company.

And you shouldn't expect the landlord to cover anything either. "Landlords typically cover the building and not the tenant's belongings," said Adams. "They will not replace any damaged or stolen items."

Related: Cutting the accelerating cost of car insurance

Also, if one roommate has a renters insurance policy, don't expect it to cover all of your stuff, too. Most rental insurance policies only cover the belongings of the policyholder. Although roommates can purchase a policy together if they'd like, said Adams.

So what does renter's insurance cover? There are three basic types of protection: personal possessions, liability and additional living expenses.

Personal possession protection covers your belongings if they are lost or damaged due to a fire, vandalism or theft among other things.

Related: The average cost to raise a kid: $241,080

Liability protection kicks in if, say, your dog bites the neighbor, or someone slips and gets hurt while at a party at your place. It not only helps cover any medical expenses but, in some cases, can pay for your legal fees if you get sued.

In addition, if you are displaced by a storm or a fire, the policy will typically cover the cost of a hotel, or a temporary rental until you can move back home.

The cost of renters insurance is typically pretty affordable -- on average, it costs $184 a year -- but the amount will vary depending on the location and size of the rental unit and how much coverage you need, according to the National Association of Insurance Commissioners.

Related: Boomerang kids: Nothing wrong with living at home

Students should shop around and make sure they get enough coverage. To determine how much you need, take inventory. Create a spreadsheet, take pictures or create a video inventory of all your belongings -- including clothing, electronics, jewelry and furniture, among other things -- and keep it in a safe place. Even if students only have a few possessions, ensuring they can be replaced if stolen or damaged is one less thing to worry about.

"If you can't afford to replace everything," said Adams. "You are really rolling the dice if you don't have renters insurance."

First Published: August 19, 2013: 6:38 AM ET

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India edges toward crisis as rupee plunges

Efforts by Indian authorities to restore investor confidence appear to have backfired.

HONG KONG (CNNMoney)

The slide that has rocked Indian markets accelerated Monday, with the rupee hitting a new record low against the dollar. The Mumbai Sensex, the country's benchmark index, dropped 1.6% on Monday and has now lost 10% of its value in the past month.

Investors are worried about India's large current account deficit, which reflects the nation's tendency to import many more goods than it exports and leaves it heavily reliant on foreign capital.

Talk of tighter U.S. monetary policy has seen some investors pull out of emerging markets in recent months.

Prime Minister Manmohan Singh has tried to calm nerves, saying the government has enough foreign reserves to defend the rupee for months.

"There is no question of going back to the 1991 [balance of payment crisis]," Singh told the Press Times of India, referring to an episode that nearly resulted in India defaulting on its debt payments.

But with elevated inflation, a sky-high government deficit and the economy slowing, some are worried that recent government attempts to shore up confidence may have had the opposite effect.

Related story: BRIC markets left in the dust

Policymakers last week unveiled a series of measures designed to support the rupee, including limits on the import of gold, oil and other key commodities.

The government also made a controversial move to restrict the amount of money Indian citizens can take out of the country, and similar restraints were placed on outgoing corporate investment.

The question now is whether the changes will be enough to bolster the rupee and stabilize the economy.

Related story: Dream companies for Asia's grads

Many observers think the government must do more -- and markets seem to agree. The reaction was most violent on Friday, when investors returned from a one-day holiday to push the Sensex down by 4%.

"Authorities are taking a really piecemeal approach, and these measures are having exactly the opposite effect of what was intended," said Anjalika Bardalai, a senior analyst at the Eurasia Group. "The government has given the impression they are in panic mode."

Economists have long argued that India needs to implement structural economic reforms to bring about meaningful progress. Last year, parliament lifted restrictions on foreign direct investment after much debate -- a key step.

But investment dollars have not materialized as international companies seek more details about the new policy and remain wary of a change in the political winds that could reverse the decision.

And with national elections due before May 2014, India's fractious political parties may not be in a mood to cooperate.

"The problem now is that the government is running out of time and running out of options," Bardalai said. "A lot of what happens now with the rupee is beyond the government's control."

First Published: August 19, 2013: 7:30 AM ET

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Credit score killers

Here are 7 common mistakes people make that can ravage your credit score.

NEW YORK (CNNMoney)

Not only is it used to determine whether you're creditworthy enough to open a credit card, land a mortgage, rent an apartment or get an auto loan, but it also plays a big factor in the interest rate you qualify for.

There are multiple credit scores out there, but the most common is your FICO score, which ranges from 300 to 850. A score of 780 or above is considered excellent and will land you the top deals available, while a 720 to 780 is strong but may not qualify you for the best rates, says John Ulzheimer, president of consumer education at SmartCredit.com.

A 680 to 720 means you're likely to get approved for credit but not likely to qualify for the most favorable rates, while having a 680 or lower will make it hard to get approved for credit at all, and any credit you do get will come with sky-high interest rates.

Related: Bad credit - A deal breaker for many singles

To avoid this bottom rung, steer clear of these common credit mistakes:

Carrying big balances: Running up piles of debt is never a good idea. Keeping a big balance on a credit card can increase your credit utilization ratio, which is the percentage of your credit limit that you use. Together with other measurements of your overall debt, this ratio accounts for about 30% of your credit score.

The ratio is calculated using the end-of-month balance that appears on your bill, meaning that your score can suffer even if you pay off your balance every month. To keep your debt utilization ratio in check, Bill Hardekopf, president of LowCards.com, recommends using less than a third of your credit limit.

Closing credit cards: It may seem like the responsible thing to do, but closing a credit card account can actually hurt your credit.

That's because it lowers the amount of credit you have available to you -- which can then hurt your debt utilization ratio (unless you don't carry any balance on your credit card).

The length of your credit history is also factored into your credit score, so keeping a credit card open also helps with that.

Related: Sneaky credit card charges can cost you hundreds

"Keep it open and charge a sandwich once a month just to have activity, and then pay it off each month," said Hardekopf.

But if it's just too tempting to have so many credit cards in your wallet, get rid of the one with the lowest credit limit, Ulzheimer recommends.

Paying late: Your payment history is one of the biggest factors lenders look at and makes up approximately 35% of your FICO score -- so late payments on credit cards, student loans, mortgages or even doctor's bills can all bring down your score if the company reports it to the credit bureaus.

"One or two isn't going to be significant but if it's habitual it's going to hurt you," said Richard Barrington, senior financial analyst at MoneyRates.

Defaulting: The most obvious credit no-no is defaulting on a loan or credit card, which means you fail to pay back the amount owed to a lender. The biggest hits come from declaring bankruptcy or foreclosing on a home, which can easily slice 100 points or more from a credit score.

"Anything that can be classified as defaults on obligations are the bombshells that are going to leave a giant smoking crater on your credit," said Barrington.

Opening too many credit lines: While having some credit is good for your score, there is such a thing as too much.

Each time you apply for a loan or credit card, the lender makes an inquiry into your credit history, which usually knocks off several points from your credit score.

Related: Fix costly credit report errors

Applying for multiple credit cards or loans or increasing your overall available credit can also be a red flag.

"If you're continually adding to your potential credit, credit companies are going to look at that as a risk that you could become overextended at some point," said Barrington. "So if you're one of those people who can't say no when a credit card offer arrives in the mail, this could drag down your credit [score]."

Not having a credit card: A growing number of Americans are ditching credit cards as they turn to debit and prepaid cards instead. But while this may keep you safe from debt, it's not going to help your credit score.

Without any credit history, you're typically considered unscoreable, meaning there isn't enough activity on your credit file to calculate a score. This leads many lenders to deem you too risky to take a chance on, said Ulzheimer.

Related: Millions without credit scores not so risky after all

"It's like walking into a job interview with an empty resume," said Ulzheimer. "[A lender] would have to roll the dice on you to give you credit -- and that's not a good position for you to be in."

It also hurts the diversity of your credit file, which accounts for 10% of your score and rewards you for having experience managing different kinds of credit -- like credit cards, mortgages and auto loans.

Co-signing: It's tempting to help out a friend or relative by co-signing a loan when they can't qualify on their own. But it's a huge risk to take, and it can often result in ravaged credit.

Related: Young Americans are ditching credit cards

By becoming a co-signer, you're assuming equal responsibility for the amount owed, meaning any late payments or defaults will show up on your credit report and your score will suffer accordingly. You could also end up facing collection action or even lawsuits.

"Co-signing is a disaster waiting to happen," said Ulzheimer. "You're basically saying, 'yeah, I realize no bank wants to do business with you but I'm willing to do business with you anyway.'"

First Published: August 19, 2013: 5:54 AM ET

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Deadline to challenge Detroit's bankruptcy filing looms

Monday night marks the last time people can challenge the city on whether its municipal bankruptcy should be allowed to proceed.

NEW YORK (CNNMoney)

The deadline, set at 11:59 pm Eastern time on Monday night, marks the last time people will be able to formally challenge the city on whether the largest municipal bankruptcy in the nation's history should be allowed to proceed.

Detroit filed for bankruptcy last month when the state-appointed emergency manager Kevyn Orr and Michigan Gov. Rick Snyder said the city could not pay its $11.5 billion in liabilities associated with pension benefits, retiree health care costs and unsecured debt held by investors.

But the question of whether Detroit can qualify for municipal bankruptcy, known as Chapter 9, remains.

Related: Retired Detroit firefighter: "My pension is what I was promised"

Judge Steven Rhodes, who's overseeing the case in U.S. Bankcruptcy Court, now must to decide whether the city has proven that it's insolvent, and that it has negotiated in good faith with creditors.

Only a handful of creditors have filed objections so far, all arguing that the city does not qualify for Chapter 9. More are expected to roll in as the day goes on.

Some of the arguments contend that the bankruptcy violates a provision of the Michigan constitution that prohibits cutting pension and retirement benefits.

In addition to arguing that it's unconstitutional, public employee unions have charged that the city did not negotiate in good faith, and should not be allowed to walk away from obligations made to employees and retirees.

While the deadline to object to Detroit's filing is fast approaching, the question of whether Detroit can qualify for Chapter 9 won't be taken up in court until October.

First Published: August 19, 2013: 9:39 AM ET

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Bond bubble finally bursting? Rates creep up

Click the chart for more market data.

NEW YORK (CNNMoney)

Worries that the central bank could taper its $85 billion a month in bond purchases, or quantitative easing, as early as September has spurred a huge sell-off in bonds.

Investors have yanked nearly $20 billion from bond mutual funds and exchange traded funds so far in August. That's the fourth highest pullback ever, according to TrimTabs data. In June, investors took out $69.1 billion -- the highest on record.

The heavy selling has pushed long-term bond rates to two-year highs, with the benchmark 10-year Treasury yield nearing 3%.

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

"As much as bond professionals say they've never really liked QE, they're trading as though they miss it already," said Jim Vogel, interest rate strategist at FTN Financial.

The Fed will remain in focus this week as investors look ahead to Wednesday. That's when the Fed releases minutes from its last monetary policy meeting. The Kansas City Fed also hosts its annual conference in Jackson Hole, Wyo. later this week.

Concerns about the Fed tapering have hit stocks as well. The Dow Jones industrial average, the S&P 500 and the Nasdaq have dropped for two consecutive weeks.

But with no economic data or significant earnings reports on tap Monday, the three major market indexes were mostly unchanged.

Related: Fear & Greed Index

What's moving: Shares of Chesapeake Energy (CHK, Fortune 500)advanced following news that Carl Icahn boosted his stake in the natural gas company to almost 10%.

Apple, (AAPL, Fortune 500) which Icahn announced a "large" position in last week, also continued to climb, hitting the highest level in seven months. And the stock was the hottest topic among traders on StockTwits.

FUNERALMAN21: $AAPL shorts and profit takers get your hats, get your coats, and go home I'm 100% sure this stock will be bigger then anyone has predicted.

daytradingshrink: $AAPL todays theme song has gotta be stairway to heaven. really thought it would break this intraday uptrend and move sideways. strong!

Of course not everyone was so bullish.

rmbagadiya: $AAPL Running too much too fast I am concerned

There was also plenty of chatter about Intel (INTC, Fortune 500), which was upgraded to "neutral" by analysts at Piper Jaffray.

alexsimonelis: $INTC Those are not dinosaurs in the least. What do you think the cloud runs on? Answer: Intel chips.

Shares of several Chinese companies were flying high and generating buzz on StockTwits as well. AutoNavi Holdings (AMAP), in which Chinese e-commerce leader Alibaba recently purchased a stake, was rising. Search engine Qihoo 360 Technology (QIHU), Chinese real estate website SouFun Holdings (SFUN) and social network YY (YY) were also sharply higher.

ivanhoff: Momo money has gone on vacation in China: $AMAP $QIHU $SFUN $YY etc.

UltraGwenn: $QIHU on the weekly, this is the most overbought stock i've ever seen in my life. rivals Google and Apple back in 2012. Bearish.

Related: J.C. Penny still in a world of trouble

The earnings calendar was light Monday, but results are due from J.C. Penney (JCP, Fortune 500), Target (TGT, Fortune 500) and Hewlett-Packard (HPQ, Fortune 500) later in the week.

World markets: European markets closed slightly lower, while Asian markets ended mixed results. Both the Shanghai Composite index and Japan's Nikkei rose nearly 1%. Stocks in Hong Kong declined by 0.3%. And investors are also nervously watching India, where stocks have plunged lately as the country's rupee currency hit an all-time low.

First Published: August 19, 2013: 9:51 AM ET

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J.C. Penney still in a world of trouble

Shares of J.C. Penney have plunged since the start of 2012. Click the chart to track J.C. Penney's stock.

NEW YORK (CNNMoney)

J.C. Penney (JCP, Fortune 500) is slated to report its second-quarter results Tuesday morning, and it's unlikely that the retailer will have much good news to share with investors.

In fact, analysts are expecting a ninth straight quarterly drop in sales and another large loss, even as returning CEO Mike Ullman aggressively tries to clean up the mess left by ousted CEO Ron Johnson.

"The bottom line is that the second quarter is going to be really bad for J.C. Penney," said Brian Sozzi, chief equities strategist at Belus Capital Advisors. "It's still fighting with the ghost of Ron Johnson when it comes to the merchandise, so customers still haven't regained their trust in J.C. Penney."

Related: J.C. Penney: A buy or a sell?

Investors will be looking for a possible glimmer of hope though. According to a report in The New York Post last week, J.C. Penney's same store sales, a key measure of health for retailers, began to improve in August.

"We need to know whether or not J.C. Penney has achieved stabilization in sales and whether it has any momentum going into the end of the year," said Sozzi. The second half of the year is typically much stronger for retailers. Back-to-school shopping kicks in during August while the fourth quarter includes the holiday shopping season.

With that in mind, analysts are eager to see if J.C. Penney is able to provide any upbeat guidance about the third and fourth quarter. But It doesn't help that many other retailers in a stronger position than J.C. Penney all issued relatively weak outlooks last week. Wal-Mart (WMT, Fortune 500), Macy's (M, Fortune 500) and Nordstrom (JWN, Fortune 500) all disappointed investors.

"The holiday quarter is critical for any retailer, and they'll need to show they're on the road to making some serious improvements because their future is dependent on it," said Paul Swinand, Morningstar analyst.

"A lot of J.C. Penney's wounds are self-inflicted," Swinand added. He argued that J.C. Penney does have a chance to fix itself with the "right merchandise and pricing." The company isn't necessarily struggling from online competition in the way that Blockbuster, Borders, Circuit City did. Those three retailers all went bankrupt. Borders and Circuit City were forced to shut their doors for good.

Related: Bill Ackman rides the crazy train

Nobody is really talking about the possibility of a Chapter 11 filing for J.C. Penney just yet. But its balance sheet will be in the spotlight amid ongoing liquidity concerns.

The retailer shot down reports earlier this month that commercial lender CIT stopped providing financial support to small suppliers that sell merchandise to it. Despite the denials, analysts remain worried that CIT (CIT, Fortune 500) could eventually halt lending to suppliers. If that happens, J.C. Penney would either need to pay its suppliers in cash or cut back on its inventory.

Still, J.C. Penney should be helped by the fact that Ackman will be less of a distraction. With the backing of the rest of the board, Ullman should be able to focus on executing his turnaround strategy.

But Ackman could still crate some trouble. Just a few days after Ackman left the J.C. Penney board, he reached an agreement with the company that allows him to register to sell shares of J.C. Penney in up to four separate blocks.

Ackman owns a 18% stake in the company. So once he does start selling, that could create more problems for a stock that is already down more than 30% this year, and more than 60% since the start of 2012.

"The fact that Ackman will be creating fewer headlines will be important for Ullman and overall confidence among vendors and investors," said Sozzi. "But I worry about that signal to the market when Ackman begins dumping his stock. He has been privy to all sorts of information for a long time, and if begins selling sooner than later, he'll be showing that he's willing to take a loss for fear of losing more money."

First Published: August 19, 2013: 9:02 AM ET

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The income gap

(Fortune)

Let's start with the first question. Both liberal and conservative economists agree that, yes, income inequality has increased since the 1970s. The Congressional Budget Office October 2011 report "Trends in the Distribution of Household Income Between 1979 and 2007" shows that during that 28-year period overall real average (after-tax) household income grew 62%. But for the top 1% of earners, income grew 275%, and for the bottom 20% of earners, household income grew only 18%. Pretty bald, I'd say.

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Drones can change the fight against wildfires

As wildfires grow in number and size, drones could drastically change the nature of the fight.

NEW YORK (CNNMoney)

Wildfires have grown in number and size, but fighting them has remained an old-school game that sometimes relies on paper maps and gut feelings.

Accessing new technology in rural areas where forest fires rage has been a challenge, but the use of new unmanned drones could drastically change the nature of the fight.

"We can get more information for less cost, and it doesn't put anyone in harm's way," said Sher Schranz, a project manager at National Oceanic and Atmospheric Administration who researches fire weather modeling.

Fighting wildfires is a tricky game, since the direction and intensity of the massive blazes can change in seconds. Drones can help in two ways: They can safely gather more information about fire conditions than is currently available, and they can send that information to firefighters on the ground quickly.

Related story: Cheap drones could save your life

Today, firefighters are often sent out with tablets and smartphones so they can be updated about conditions, but those devices don't help if Internet service is weak or non-existent -- which is likely, as wildfires typically rage in rural areas where rough terrain keeps firefighters out of signal range.

Drones can hover over dead zones, providing an Internet signal. That's something researchers are making a priority, said Tim Sexton, the program manager at the Wildland Fire Management Research Development and Applications Program.

Where Internet connections are available, great information about fires can be disseminated to firefighters. Internet-based tools can help calculate the risk of a fire reaching homes or other structures, and they can determine how fires may move, depending on the weather. Currently, firefighters hike up to a ridge where they can get an Internet connection, or they'll work with the local telecom company to set up portable cell towers.

But when those Web-based modeling systems aren't available, firefighters rely on "gut feelings" from those who knew the area well, Sexton said. Without an Internet connection, they have to rely on data they received that morning, which was likely gathered late the night before.

Information available to firefighters is often so out-of-date, because manned airplanes and helicopter flights that take pictures and infrared images to map the fire perimeter are costly and risky, so they only fly over a fire once or twice a day.

Drones, on the other hand, are comparatively cheaper, and more than one can be launched at once. Schranz estimates that a drone can cost as little as $2,000 for an eight-hour flight -- the same price for just one hour of a manned flight.

"Drones can sit up there all day long, or for days," said Sexton.

Drones aren't quite ready to assist in fire suppression, since the fire community is still in the early stages of making sure the technology is applied effectively and safely, said Erin Darboven from the Department of Interior. Unmanned aerial systems are strictly regulated by the Federal Aviation Administration.

Fifty years ago, photos taken from a plane above would have to be dropped in a tube to firefighters below, said Sexton. The process is a lot more advanced today, but drones could be a tool that gives firefighters an edge up in the battle against wildfires.

First Published: August 19, 2013: 11:45 AM ET

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Twitter U.K. cracks down after threats against women

Twitter will get tougher on cyber abuse in the United Kingdom.

NEW YORK (CNNMoney)

There has been a lot of pressure on the social networking site to increase these measures after several female members of parliament and female journalists were the targets of misogynistic, bomb and rape threats.

Twitter's U.K. arm announced Saturday that it updated its rules section to clarify that abusive behavior is not tolerated.

Related: Why I'm quitting social media

In a blog post, Twitter reiterated that an in-tweet report button is available on Apple (AAPL, Fortune 500) devices, so that users can report abusive behavior directly from a tweet rather than going through the help center. This button will be available for Androids and on Twitter.com next month.

Twitter also said that it is adding more staff to handle abuse reports, and will use promoted tweets to bring more attention to the issue.

The calls for Twitter to take action grew particularly loud in the wake of hateful tweets from Twitter "trolls" against British activist Caroline Criado-Perez, who had successfully campaigned to get a woman on British bank notes. The Bank of England announced that novelist Jane Austen's face will appear on £10 notes in its next design update.

British Member of Parliament Stella Creasy was also threatened after she voiced support for Criado-Perez. Some female journalists also received bomb threats via Twitter messages.

After the Twitter attacks, more than 126,000 people signed a Change.Org petition calling on the site to take a zero tolerance policy on abuse and make it easier for users to report incidents.

"We need Twitter to recognize that it's current reporting system is below required standards," the petition said. "Women standing up to abuse should not fear having their accounts canceled because Twitter fails to see the issue at hand."

Twitter responded by saying it has been listening to the feedback over the last week on how it can make rules clear and make reporting abuse easier.

First Published: August 4, 2013: 11:28 AM ET

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BRIC markets left in the dust

Political unrest and slowing economies have sent investors fleeing the BRICS.

HONG KONG (CNNMoney)

Brazil's Bovespa index has been among the world's worst, losing a fifth of its value since January.

The Shanghai Composite is down 12%, Russia's Micex is 7% lower and Mumbai's Sensex has declined by 1%.

"I would say the BRICs are going through a period of indigestion or perhaps a bit of a hangover," said Sean Darby, chief global equity strategist at Jefferies. "Sometimes the quality of growth produced by rapid development means that subsequent periods aren't all that great."

At the same time, markets in the United States, Japan and Europe have gone gangbusters, with many rebounding to levels not seen since before the 2008 financial crisis.

Related story: Emerging markets lose a step

Ex-Goldman economic guru Jim O'Neill coined the BRIC acronym in 2001 as a handy way of referring to what he figured were the world's top four emerging economies. Keying off the prediction, asset managers crafted investment strategies based on on the idea that rapid economic growth would translate into robust equity returns.

O'Neill was right -- the BRICs have delivered sustained growth, and now account for about 20% of world economic output. And for awhile, BRIC equity funds did extremely well. But pity the investor who thought it would last.

The iShares MSCI BRIC ETF (BKF), which includes top companies in all four markets, is down 14% this year, and 27% over the past five. Outflows from BRIC markets in recent months suggest many investors have given up and taken their money elsewhere.

There aren't many reasons to be optimistic, considering the significant challenges facing BRIC economies. At the moment, it looks like other emerging markets are in a better position to expand more rapidly.

"All of the BRIC economies have structural problems which are likely to prevent significant rebounds in the next couple of years," analysts at Capital Economics recently wrote. "Instead, the turnaround in growth that we expect to see in the emerging world will be driven by the smaller [non-BRIC] economies."

Related: China launches audit as debt worries grow

In China, GDP growth could drop below 7.5% this year as the government seeks to implement structural reforms. Brazil, meanwhile, has been hit hard by political unrest, and the real has come under pressure. Russia's economy had a bad second quarter as investment slowed and export demand dried up.

Despite a tough political environment and stagnant growth, India's economy might have the best prospects of the bunch.

The U.S. Federal Reserve has also thrown a wrench into emerging market investment strategies.

The Fed has bought some $3 trillion worth of assets since it launched quantitative easing in 2008. Much of that money found its way into stocks in developing economies as investors ventured into riskier assets.

When Fed chief Ben Bernanke suggested in May that the bank could soon pull back on those purchases, investors freaked. According to data from HSBC, stocks around the world fell 9% over the next four weeks, while emerging markets lost 16%.

The central bank punted in its latest meeting, and did not provide any hints about plans to wind down its stimulus efforts.

"I would say that this has to play itself out," Darby said. "It was a seismic shock, but we haven't seen any of the tectonic plates actually move yet. A lot of these markets will have difficulty."

First Published: August 4, 2013: 6:24 PM ET

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Chinese producers benefit amid New Zealand milk scare

China has suspended imports of some whey protein and milk-based powder sourced from Fonterra.

HONG KONG (CNNMoney)

Over the weekend, the world's largest dairy exporter, Fonterra, revealed that some of its products were contaminated with a bacteria that could cause botulism. The bacteria was found in whey protein, produced by the New Zealand company, for sale to other companies for use in consumer products.

Now, China has suspended imports of some whey protein and milk-based powder sourced from Fonterra.

This isn't great news for New Zealand, as China is its top trading partner. But it's turning out to be a bit of a boon for some Chinese dairy and infant formula companies.

Guangzhou-based infant formula maker Biostime and China Modern Dairy both surged by 9.8% in Hong Kong trading. Yashili International closed up 2.5%. China Mengniu Dairy closed down 1.4%, erasing earlier gains.

At the same time, Want Want China, a company that sources most of its raw milk from Fonterra, tumbled 3.2%.

China has pledged to boost food safety measures after tainted baby formula killed at least six infants and sickened another 300,000 in 2008. Nearly all major Chinese makers of milk powder were found to be contaminated with the toxic chemical melamine. The additive caused the formula to appear to have a higher protein content.

Related story: China probes baby milk price fixing

Chinese families, fearful of tainted formula, have been scouring the globe for milk they perceive to be safer. The rush has created shortages as far afield as the U.K. As a result, foreign baby formula brands such as Nestle (NSRGF) and Mead Johnson (MJN) have surged in popularity.

Not all foreign-sourced baby formula have continued to benefit from Chinese consumer preferences for non-domestic brands. Infant formula products from New Zealand have received additional scrutiny lately as Chinese companies have been buying up dairy farms in the country.

"People are saying they don't trust it any more than a Chinese source," said China Market Research analyst Ben Cavender. Consumers are becoming more concerned, Cavender said, that there's greater risk of "cutting corners, cutting costs" as Chinese businesses become more involved.

Last year, the New Zealand government approved the sale of 16 farms, including dairy farms, to Chinese developer Shanghai Pengxin Group.

First Published: August 5, 2013: 1:50 AM ET

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Mysterious smartwatch maker Kreyos raises $1 million on Indiegogo

Kreyos smartwatch makers won't reveal their identities, but the company still raised $1 million through crowdfunding site Indiegogo.

NEW YORK (CNNMoney)

The company, which says it's making a pioneering new smartwatch, doesn't have a finished product or even a website. Kreyos doesn't have a store you can visit, and until one of its founders held a Reddit exchange last week, its executives were largely anonymous.

But it has raised more than $1.1 million through a crowdfunding campaign on Indiegogo. Thousands of people have contributed $100 or more, and in exchange Kreyos says it will provide its "Meteor" smartwatch.

Just about all we know about Kreyos' smartwatch comes from the company's Indiegogo page, which details some very impressive features. The company says the watch includes voice and gesture control and compatibility with the Apple (AAPL, Fortune 500) iPhone, Google (GOOG, Fortune 500) Android devices and Microsoft (MSFT, Fortune 500) Windows. It can monitor your heart and your golf swing. It connects to social networks like Facebook (FB), and it's waterproof.

If it accomplishes all that the promotional material says it will, it could disrupt the burgeoning wearable tech field that includes devices like Google Glass, Pebble and a host of other smart devices.

But for such a promising gizmo, the company is acting strangely secretive.

Related story: Kickstarter pulls plug on scam minutes before $120,000 heist

Kreyos says on its Indiegogo profile page that it is an international team founded in the United States, and its team members have worked for companies including Hewlett-Packard (HPQ, Fortune 500), Microsoft, Acer, Lenovo, Hitachi, Toshiba, Amazon and others.

When I met with Kreyos spokeswoman Patricia Roché on July 24, she would not tell me the name of the company's CEO, or any other team member, on the record. (Some hunting turns up one press release with a quote from co-founder Steve Tan.)

"We don't think, in the end, you buy it because so-and-so created it; you buy it because it does what you want it to do," Roché said.

The founders, she said, want to focus on shipping the smartwatch to backers on time, so they only wish to communicate with the public through her.

Unlike other crowdfunding campaigns, Kreyos does not post photos or bios of team members -- or even name them. Finally, after the campaign had been raising money for more than a month, Tan came briefly into the spotlight last week to hold a public forum on Reddit where he answered questions about the smartwatch.

Roché did have a few prototypes to show me in July. She said they were fully operational, but that's just about where the demonstration ended -- she had not yet figured out how to sync it with her new phone.

Indiegogo advises those running campaigns on its site to "be thorough, communicative, and transparent" and "introduce yourself and your team," and other campaigns post pictures and bios of their founders.

Yet experts in the industry say it is not all that uncommon for a crowdfunding campaign to post little about the company.

"Too many of them are like that," said Sara Hanks, the CEO of CrowdCheck, which advises investors and entrepreneurs on crowdfunding. "Failure to identify the person is really omitting the one thing you're supposed to be able to see on the crowdfunding sites."

For Kreyos, shipping the Meteor on time is likely to be a tall order: it has promised to ship smartwatches to its Indiegogo backers in November. But the company claims the gadget is still being tweaked and hasn't been manufactured yet.

Crowdfunding campaigns do not have a stellar track record of shipping on time. In fact, a CNNMoney survey of 50 projects on the cowdfunding site Kickstarter found that 84% miss their target delivery dates.

Related story: Why 84% of Kickstarter's top projects shipped late

Yet crowdfunding sites like Indigogo provide no clear, legal obligation for companies to ultimately deliver the product they raise money for. The transaction is more like making an investment and less like buying a good in a store.

Even with loose rules, there is very little outright fraud in crowdfunding, according to Ethan Mollick, a researcher at the University of Pennsylvania.

"The lack in regulation means there's a funding source accessible to a lot more people," Mollick said. "There's something risky about that, but there's something very nice about it, too."

Almost 10,000 people have faith in the Kreyos smartwatch. Time will tell whether or not it was misplaced.

First Published: August 5, 2013: 6:07 AM ET

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Stocks: Terror threat could have impact

Click on chart to track premarkets

NEW YORK (CNNMoney)

U.S. stock futures were little changed.

"After the market posting record highs last week, we'll probably move sideways as investors take a look at the terror warnings abroad," said Peter Cardillo, chief market economist at Rockwell Global Capital. "That might be an excuse for investors to take a break."

Investors are waiting for the Institute for Supply Management to release its monthly service-sector index at 10 a.m. ET.

On the corporate side, Tyson Foods (TSN, Fortune 500) is set to release quarterly results before the opening bell.

Fear & Greed Index, still greedy

HSBC (HBC) shares dropped 3.5% in London trading after the company reported results for the first half of the year that disappointed investors. The company announced an increase in revenue and profit before tax over the previous year as it sold assets.

U.S. stocks finished higher Friday after a worse-than-expected monthly jobs report. Investors initially hit the sell button after the report came out, but sentiment soon recovered. The Dow Jones industrial average and S&P 500 both closed at record highs.

Related: Will stock momentum continue?

European markets edged higher in morning trading. London's FTSE 100 index was up by as much as 0.5%, taking a lead over the other European exchanges.

Asian markets ended with mixed results after investors got a chance to react to the Friday U.S. jobs report.

Japan's benchmark Nikkei index fell by 1.4% as the yen strengthened. But the Shanghai Composite index rose by 1% and Hong Kong's Hang Seng index edged up by 0.1%.

First Published: August 5, 2013: 5:11 AM ET

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Washington's budget brawl: 8 things you need to know

NEW YORK (CNNMoney)

The stars seem aligned for an ugly fight over the federal budget, automatic spending cuts and the debt ceiling.

At the heart of the issue: The two parties can't agree on a level of spending going forward, and there is disagreement even among Republicans as well.

Experts expect deals will be struck by key deadlines, but that's hardly guaranteed.

What's the first thing lawmakers must do? Fund the government past Sept. 30, which marks the last day of fiscal year 2013.

Given the serious differences between the House and Senate on spending, there's no chance they will pass a real budget for fiscal year 2014.

So lawmakers will at least have to pass a temporary funding bill known as a "continuing resolution," or CR, by Oct. 1.

And if it's very short term, Congress will have to pass another one -- or several -- before Dec. 31.

Are they likely to pass a funding bill? Probably, but a lot could complicate the effort.

Normally when Congress passes a CR, it does so at current spending levels. Think of it like this: We can't agree on what to do, so let's keep on keepin' on until we can.

But that would be risky this time around because the law calls for lower spending caps to take effect in fiscal year 2014.

Related: Debt ceiling awaits Congress after summer break

So approving temporary funding at this year's higher level means federal agencies would need to make abrupt cuts later to stay under the caps. By law, those cuts would need to occur 15 days after Congress adjourns for 2013 in a process known as sequestration.

Right now, Democrats and Republicans can't even agree on whether to keep those spending caps in place. And some conservative Republicans have threatened to vote against any funding bill that includes money for Obamacare.

What happens if Congress doesn't pass funding by Oct. 1? Much of the federal government will shut down.

What does a government shutdown mean? Hundreds of thousands of federal workers would be furloughed without pay. And most federal government offices, programs, museums and parks would be shuttered.

There would be exceptions, however.

Essential services that protect human life and property would continue to operate. That includes air traffic control, national security, the handling of hazardous waste, food inspections and disaster assistance.

Federal employees needed to preserve "essential" elements of the money and banking systems would not be furloughed. Mail would still be delivered.

And President Obama and Congress would keep coming to work.

What's more, an analysis by the Congressional Research Service concludes that the implementation of Obamacare is also likely to continue in the event of a shutdown.

How long would a shutdown last? As long as it takes Congress to agree on spending levels and pass appropriations bills that fund agencies at those levels. The longest shutdown lasted 21 days starting at the end of 1995.

Is a shutdown the worst that can happen? Sadly, no. The ramifications of not raising the country's debt ceiling in time would be much worse.

The country's legal borrowing limit is currently set at $16.699 trillion.

That level was reached in mid-May. And the Treasury Department began its official juggling act, employing "extraordinary measures" to keep the country from breaching the ceiling. But those measures aren't expected to last much longer.

Budget wonks expect the debt ceiling will need to be raised sometime between mid-October and mid-November. Treasury, the real arbiter in this matter, is still only saying it will need to be raised sometime after Labor Day.

Why does it need to be raised at all? Both parties in Congress have approved permanent tax cuts and spending increases over the years, knowing full well they will add to deficits.

By doing so, they increase the country's future borrowing needs.

What's more, the aging population means there will be more spending on Medicare and Social Security with each passing year.

That's why raising the debt ceiling is not a "license to spend more," as some Republicans assert. And it's why the debt ceiling always needs to be raised periodically. Over the past two decades, it's been raised about 15 times.

Raising the ceiling simply lets Treasury continue to pay all the country's obligations that Congress has already approved -- whether it's a payment to a federal contractor, a Social Security check to a senior, or interest on the debt to a bond investor.

What happens if the debt ceiling isn't raised? Uncle Sam still has revenue coming in to pay for government services and agencies. Just not enough to pay for everything. And the longer the debt ceiling crisis lasts, the harder it would be to keep government operations running.

"After two weeks you'd have absolute paralysis," said Steve Bell, economic policy director at the Bipartisan Policy Center.

More problematic: The country could no longer pay all of its bills in full and on time. Treasury then would have to make legally murky decisions about who to pay and who to stiff.

Even if bond investors continue to be paid on time, the country could still be perceived as in default if it fails to pay its other legal obligations.

And if the full faith and credit of the United States is called into question, that could be disastrous for markets and interest rates -- which would harm the U.S. economy and Americans' financial well being.

First Published: August 5, 2013: 6:03 AM ET

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Stocks hit by gravity

Click chart for more markets data.

NEW YORK (CNNMoney)

The Dow Jones industrial average, the S&P 500 and the Nasdaq were all relatively unchanged. Yet all three indexes are up between 19% and 22% this year.

On a quiet week for economic and earnings data, Monday's dip seems more related to gravity (what goes up must come down) than anything specific.

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

The one piece of data out Monday didn't move markets: The Institute for Supply Management's monthly service-sector index came in above expectations.

Looking at stocks on the move, Tyson Foods (TSN, Fortune 500) was one of the biggest gainers in the S&P 500 after the meat processor reported better-than-expected earnings.

HSBC (HBC) shares dropped after the company reported results for the first half of the year that disappointed investors. The company announced an increase in revenue and profit before tax over the previous year as it sold assets.

Click here for more on world markets

Tech stocks stay in focus: Apple's (AAPL, Fortune 500) stock rose modestly, after the Obama Administration vetoed an International Trade Commission import ban on some of its products.

Traders on StockTwits found other reasons to buy the stock Monday:

SkepticalBull: As I said 30 points lower, buy $AAPL now b4 the new products. That is what Cook is doing with the buyback- a massive public insider trade!

Morpheus: $AAPL announcing a China Mobile deal today tomorrow or this week would be a nice wake up call to the 'what have u done for me lately' crowd.

Facebook (FB) continues to rise. Shares of the social network finished above their $38 IPO price last week for the first time since it went public.

Related: Something to Yelp about for investors

Shares of Yelp (YELP), the business review website, took a step back Monday, dipping 1%. Yelp has soared more than 35% since reporting earnings last week.

Blackberry (BBRY) shares rose more than 6% without an obvious catalyst. Some traders on StockTwits pointed to a leak of the image of a new Blackberry as a possible reason for the jump.

NBohrQM: $BBRY BlackBerry rallying, possibly due to image leaks http://stks.co/gfuK

NVTino: $BBRY today is not based on any rumors other than it is dirt cheap at these prices and going much higher

First Published: August 5, 2013: 9:46 AM ET

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Female economists: Pick Janet, but leave gender out of it!

Only 17 of 177 central bank heads around the world are women. Female economists surveyed by CNNMoney would like to see Janet Yellen become number 18 . (Scroll to bottom of story for all 17 names)

NEW YORK (CNNMoney)

Last week, we sent a questionnaire to 100 female economists in academia and the private sector, several who have worked with Larry Summers and Yellen in the past. We asked them to choose: Which of these two top contenders is their preferred candidate for Federal Reserve chair?

Also, will gender have anything to do with the decision? A woman has never led the Federal Reserve, and worldwide, only 17 of 177 central bank leaders are women, according to the Central Bank Directory.

In order to encourage candid responses, we also gave the economists the option to remain anonymous.

Of the 45 economists who responded to our survey, 38 said Yellen should get the job, and one wrote-in that she would like former Fed chair Paul Volcker to return to the post. The remaining six participants declined to make a recommendation, with some noting they felt both Yellen and Summers were qualified for the job.

However, not one economist threw their full support behind Summers alone.

"Yellen is the most qualified candidate. If she doesn't become Fed chair it will be, in part, because she is a woman," said one respondent. "I don't think it would be because of overt discrimination. Rather, there is more subtle bias -- she is not a friend of the decision makers; a woman who is not aggressive is perceived as weak, whereas a man who is not aggressive is perceived as a thoughtful consensus builder."

Yellen, 66, currently serves as vice-chair of the Federal Reserve Board, and previously served as president of the San Francisco Fed. She has a Ph.D in economics from Yale and vast academic experience at the University of California, Berkeley. Plus, she served a two-year stint as the chairwoman of President Clinton's Council of Economic Advisers,

But she is not as well connected to the White House as Summers, who was Treasury Secretary under President Clinton and also the head of President Obama's National Economic Council. Several economists we surveyed perceived this as a big hurdle for Yellen.

Related: Fed's Yellen wants return to 'prudent risk-taking'

Summers, 58, has his Ph.D. from Harvard. In addition to having Treasury Secretary on his resume, he is also well-known for being president of Harvard University (did you see "The Social Network?") and as one of the architects behind President Obama's 2009 stimulus package.

Of the 38 economists who said Yellen should get the job, 10 said they thought President Obama would nominate Summers.

"The old boys will make the call, and I think they will pick their insider," one survey participant said.

But many of the economists we surveyed stressed that Yellen is the better candidate because she has more relevant monetary policy experience.

Whereas Summers spent most of his career focused on fiscal policy, Yellen was number-two in command, as the Fed launched unprecedented policies to stimulate the economy. She has also led the Fed's recent efforts to increase its transparency.

Yellen is largely known as a Fed "dove," meaning she favors keeping interest rates low as a way to stimulate the economy and promote job growth. Fed watchers generally expect that she would continue Bernanke's policies, and therefore, she represents continuity for the Fed.

"Yellen is a qualified monetary economist with significant experience within the Fed system. Her appointment is less likely to rock markets in the transition period," said one survey participant.

Summers' position on monetary policy is not quite as well known, but he has recently made critical comments about the Fed's bond-buying program, known as quantitative easing.

FORTUNE: Investors who love QE should fear Larry Summers

Respondents also said they thought Yellen would be a better consensus-builder within the Fed, whereas a few expressed concerns about Summers' tendency to "put his foot in his mouth" and "poor reputation for not being a team player."

"Summers is likely to be the brightest person in whatever room he finds himself, but that does not mean he would be a good Fed chairman," one said.

We also asked a few questions about gender, since it has been such a hot-button issue.

The responses were strong. Most said the focus on gender wasn't fair to Yellen, whose credentials should stand on their own.

"Gender is not a valid part of the conversation, and it's sort of embarrassing that there is so much focus on it rather than on the substantial differences between Yellen and Summers," said Jodi Beggs, a lecturer at Northeastern University and blogger behind Economists Do It With Models.

Catherine Mann, professor of global finance at Brandeis University, agreed that gender should not play a role in the decision. She thinks Yellen is a better candidate for the job than Summers because of her research-focused background.

Other respondents criticized the media for even mentioning the gender issue.

"Media coverage of this in recent days has substantially raised my blood pressure. Please, write about this responsibly!" one said, adding "when a woman DOES rise to near the top of the profession and is considered for a high-level position, there will be a contingent that immediately begins to claim she is only in the top pool because she is a woman. This is exactly what is happening now to Dr. Yellen."

Related: Fed dissenter Esther George argues for tapering QE3

But the focus on Yellen's gender is part of a bigger issue. Women are greatly outnumbered by men in the field of economics.

Only about a third of new economics Ph.Ds are women, according to the American Economic Association, but the disparity starts even earlier, in undergraduate education. In the top 100 universities, there are 2.5 male economics majors per female econ major, notes Claudia Goldin, Harvard economist and president of the American Economic Association.

"If women are poorly represented in economics in the labor market it is largely because they do not major in the field," she said. "You can't easily make a Shakespeare expert or a gene splicer into an economist."

But if Janet Yellen becomes the most powerful central banker in the world, perhaps more young women will decide to pursue a career in economics?

Earlier this year, I asked Yellen about why more women aren't rising in the field, to which she replied:

"At the highest levels of central banking, there are very few women," she said. "But I am pleased that the representation of women is increasing a lot at other levels... I really think this is something that's going to increase over time, and it's time for that to happen."

First Published: August 4, 2013: 5:08 PM ET

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Russia's Mark Zuckerberg offers Edward Snowden a job

Pavel Durov (left) offered Edward Snowden a job at Vkontakte.

NEW YORK (CNNMoney)

Russia granted temporary asylum on Thursday to the infamous former contractor for the National Security Agency. On the same day, Pavel Durov, CEO of the social network VKontakte, offered Snowden a job as a security software developer. The St. Petersburg-based company is a popular Facebook alternative in Eastern Europe, with 100 million active users.

"I invite Edward to St. Petersburg and will be happy if he decides to join up a stellar team of programmers at VK," Durov wrote on his VKontakte profile page. "I believe Edward would be interested in working on protecting personal data of millions of users."

Durov, 28, is often referred to as Russia's Mark Zuckerberg by the Western media.

CNN: Snowden out of airport, still in Moscow

Snowden has not publicly said whether he is interested in Durov's offer, and his location has been kept secret for security reasons, according to his Russian lawyer, Anatoly Kucherena.

Snowden's high-profile leak led him into a high-stakes global dispute over his freedom for almost two months, during which time he'd been in limbo at Moscow's airport. He also thrust the world into a debate about government surveillance.

Durov expressed pride in Russia's decision to grant Snowden asylum.

"In such moments one feels pride with our country and regret over the course taken by United States -- a country betraying the principles it was once built on," he said.

An opinion survey conducted by Russian news agency RIA Novosti shows 51% of Russians back Snowden's decision to leak the NSA information, and 43% were in favor of Russia granting him asylum, according to the Levada Center poll.

President Obama and Russian President Vladimir Putin are still on track to hold a meeting in Washington this week in preparation for the G-20 summit, according to a U.S. official.

First Published: August 5, 2013: 10:47 AM ET

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Powerball jackpot reaches $400 million

The Powerball jackpot has reached its third-biggest tally: $400 million.

NEW YORK (CNNMoney)

There were no jackpot winners on Saturday, which means the pot rolls over to its next scheduled drawing on Wednesday.

Every time it rolls over, it expands by a minimum of $10 million. And even though no one has hit the jackpot, this particular game has dolled out some smaller prizes.

The $400 million jackpot is equal to $230.3 million in cash, if the winner opts for the cash payout, which most do. They also have the option of receiving the jackpot in annuity payments, which no one has selected in the last several years.

The record Powerball jackpot was $590.5 million, won in May by an octogenarian of modest means in Florida. The second-largest jackpot of $587 million was split by two players -- one from Arizona and one from Missouri -- in November 2012.

Related: Does Powerball really boost the economy?

In order to win the jackpot, the winner has to draw six numbers that match all six numbers randomly selected by the lottery system.

But players can also win second prize by matching certain combinations of five numbers. This prize is $1 million or $10,000, depending on whether the Powerball is included in those five numbers. If players match four numbers, they win $100.

Christy Calicchia, New York spokeswoman for the state-run Powerball system, said eight players have already won $1 million each from the current game.

She said there's also a million dollar winner from last year who hasn't collected.

"We have an outstanding one million dollar Powerball ticket right now that is about to expire," she said.

Related: Winning the jackpot can be a blessing and a curse

The unwitting millionaire bought his or her ticket in Westchester County, N.Y., on Aug. 25, 2012. The ticket expires after one year.

This is a common situation, since many gamblers focus exclusively on the jackpot without paying attention to smaller winnings. As of last year, unclaimed winnings totaled $800 million.

Powerball doubled its ticket price to $2 in January of last year. Calicchia said this was to produce a bigger jackpot, to increase the odds of winning the jackpot (to 1 in 175.2 million from 1 in 195.2 million) and to produce more million dollar winners. Jackpots now start at $40 million, instead of $20 million.

First Published: August 5, 2013: 11:24 AM ET

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