Bulgaria tries to contain bank run

The small European Union nation has been experiencing a bank run over the last few days.

LONDON (CNNMoney)

Officials blamed the rush to withdraw deposits on a coordinated attempt by individuals to destabilize the banking system by spreading unfounded rumors via social media, emails and text messages.

"There is no cause or reason to give way to panic. There is no banking crisis, there is a crisis of trust and there is a criminal attack," said Bulgaria's President Rosen Plevneliev in a public address on Sunday after the arrests were made.

It all started roughly 10 days ago when messages began circulating warning people that the country's financial system was unstable. Bulgaria's Corporate Commercial Bank ran out of money and was placed under state control.

The collapse revived memories of a previous Bulgarian banking crash in the 1990s, and as the rumors kept coming another Bulgarian bank -- First Investment Bank -- was overwhelmed by people rushing to withdraw their savings.

That bank was forced to close temporarily on Friday after its branches and ATMs were drained.

In response, the central bank said over the weekend it would provide a credit line worth 3.3 billion Bulgarian lev ($2.3 billion) to the country's banks to reassure people about the safety of their savings.

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It also lashed out at the Bulgarians suspected of fueling the bank run.

"We insist that the competent authorities ... apply the full force of the law against the disseminators of false and malicious rumors and speculation."

According to the country's national security agency, one of the messages sent around said: "Corporate Commercial Bank IS NOT THE ONLY bank in [a] liquidity crisis ... Deposits of citizens will be lost or sacrificed [to save] the Bulgarian economy."

Bulgaria is one of the poorest countries in the European Union. Its economy barely grew in 2013 and it has struggled with high unemployment, corruption and an aging population. However, the International Monetary Fund and EU view its banking system as relatively stable.

"The banking system in Bulgaria is well capitalized and liquid. No spillovers to the rest of the region are expected," said an IMF spokesperson.

The country of 7.6 million people is readying itself for snap parliamentary elections on October 5 after facing weeks of political uncertainty. Some parts of the country have also experienced fatal flash flooding and mudslides this month.

--CNN's Radina Gigova contributed to this report

First Published: June 30, 2014: 11:31 AM ET

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Why you don't need to buy extra car rental insurance

NEW YORK (CNNMoney)

Often times, people end up buying supplemental insurance protection that they really don't need, said Odysseas Papadimitriou, CEO of credit card comparison site, CardHub.com. That can add anywhere from $15 to $30 a day to the cost of a rental.

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"The majority of consumers are covered by their own auto insurance, but they may not know it," he said. "They may be spending extra money when they don't have to."

And those who aren't covered by their own insurance, are likely covered by their credit card, he said. All four major credit card issuers, Visa (V), American Express (AXP), MasterCard (MA) and Discover (DFS), provide some form of rental car insurance coverage. Although, MasterCard issues a few cards that don't offer coverage.

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CardHub rated the card issuers based on the extent and length of the coverage they provide, how clearly they state what's covered and how easy it is to get claims paid. American Express (AXP) received the highest rating of 90% for its car rental insurance; Discover (DFS) was second at 88%; MasterCard (MA) third at 79%; and Visa (V) ranked last at 74%.

To make sure you get covered, you must charge your entire car rental on your credit card and decline the supplemental collision damage coverage offered by the rental company. If you sign up for that insurance, you won't be covered by the credit card company.

Coverage from your credit card comes with restrictions, though, said Papadimitriou. Several types of vehicles aren't covered, including trucks with open beds and off-road vehicles, as well as exotic or expensive cars like Ferraris or Jaguars. And American Express doesn't cover certain popular SUVs, such as Chevy Suburbans, Ford Expeditions and Range Rovers.

Related: The riskiest spots for natural disasters in the U.S.

Visa and MasterCard may not cover damages that occur on dirt or gravel roads and other cards don't cover wheels and rims. Some card issuers cap rental periods at 15 days, after which the insurance lapses. None of the card issuers will insure a rental car for more than 30 days straight.

Rental cars in some countries are not eligible for credit card insurance. The ones most often named include Ireland, Israel, Italy, Jamaica and Australia.

One other important note: Unless your personal auto insurance also covers business use, your personal policy won't cover damage caused when you're renting a car for a business trip.

Drivers who aren't sure about their coverage should call their credit card company before they leave for their trip.

First Published: June 30, 2014: 6:04 AM ET

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Consumer Reports rates some Graco strollers "don't buy"

Consumer Reports says that some Graco strollers, including the Ready2Grow Classic Connect LX, can't handle the tilt test.

NEW YORK (CNNMoney)

"We've tested more than 160 strollers, single and double, that are listed in our ratings, and this is the only one where the brake gave way," said John Galeotafiore, head of stroller testing for Consumer Reports, in a video on the nonprofit organization's web site.

Models including the Ready2Grow Classic Connect LX, and the Classic Connect, Click Connect LX and Click Connect have all been rated "don't buy."

The strollers were tested on a tilt table, and the brake gave way when the angle was raised to 18 degrees.

The organization suggested that consumers who have already purchased these strollers should request a refund from Graco.

Graco called Consumer Reports' testing methods "unreasonably excessive."

"While we share a common commitment to the safety of families that use our products, we strongly disagree with Consumer Reports' assertion that our Ready2Grow Classic Connect stroller is unsafe," a spokeswoman told CNNMoney.

She said the test "far surpasses" current federal guidelines, and she said Graco was upgrading the brake system to conform with more rigorous federal safety standards that will go into effect in September 2015.

Consumer Reports rates another Graco stroller, the FastAction Fold Duo Click Connect, as a "best buy."

Related: How New York's 1% get their kids into pre-school

First Published: June 30, 2014: 9:37 AM ET

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Adrenaline rush! GoPro surges again

NEW YORK (CNNMoney)

Shares of GoPro (GPRO) were up nearly 8% in late morning trading Monday. The stock has gone up dramatically in its first three days as a public company, surging more than 60% from its offering price.

GoPro went public to much fanfare on Thursday. But is buying the stock at these levels now more dangerous than jumping out of an airplane with a GoPro Hero camera on your head?

The only Wall Street analyst who currently covers the company says he's a little worried about the stock's meteoric rise. But he adds it might be a mistake for long-term investors to get too caught up in valuation concerns.

Charlie Anderson, an analyst with Dougherty & Co. who initiated coverage on GoPro just before its initial public offering last week, said he's still a fan of the stock -- even though it's now well above his target price of $28 a share. GoPro priced its IPO at $24 and is now trading around $39.

He conceded that the stock is "obviously trading on euphoria," but he thinks that the reason for this is because there is such a small supply of shares available.

The company sold about 18 million of its 123 million shares outstanding during the offering. Anderson said that because that was a mere sliver of the company's stock, investors that didn't get a piece of the offering before the IPO were forced to buy it once it started trading. That has driven the price higher.

Anderson thinks that many big hedge funds and mutual funds do not want to miss out on GoPro because it should be able to report strong results for the next few quarters. He's predicting sales growth of nearly 20% this year. And GoPro, unlike many other hot tech IPOs, is profitable.

Still, isn't GoPro a bit frothy at this point?

Shares are trading at about 50 times his earnings forecasts for this year. And with a market value of about $4.8 billion, GoPro is worth more than several well-known companies in the S&P 500, including Cablevision (CVC), GameStop (GME) and Urban Outfitters (URBN).

There are obvious risks for GoPro besides valuation too. What happens if Apple (AAPL, Tech30) and Samsung start building more durable smartphones with even better cameras? Won't that hurt GoPro?

Remember the Flip Video camera that was all the rage a few years ago? Cisco (CSCO, Tech30) bought the company ... only to watch the camera quickly lose relevance once it became easy to shoot and upload videos on the iPhone and other smartphones.

There's also the tale of Garmin (GRMN). The GPS maker's shares are worth only about half of their peak price from 2007. Like Flip Video, Garmin no longer was a must-buy for consumers once free navigation apps like MapQuest, Waze and Google Maps became available.

Anderson isn't expecting GoPro to suffer the same fate though.

"Why did Flip go away and Garmin decline? Both of those devices were subsumed by the smartphone," he said. "GoPro does not have the same risk. Nobody is strapping their iPhone to their helmet while riding a surfboard."

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It's a good point. Anderson also noted that his estimates for the stock are likely to be lower than many other Wall Street analysts. Anderson does not work for one of the investment banks that was involved in helping to take GoPro public. That's why he's allowed to launch coverage now. Analysts at the underwriters have to wait 25 days before they can issue their first reports.

Analysts at firms that are involved in IPO underwriting tend to be a little more bullish than those who don't have the proverbial skin in the game.

"I would not be shocked if the bankers have higher estimates," he said. "This stock is going to be so volatile but it is set up for a great quarter. I would hate for people to worry about valuation with great numbers ahead of it."

He said that investors who didn't buy momentum stocks like Chipotle (CMG) and Google (GOOGL, Tech30) when they went pubic now realize with hindsight that worrying about their valuations back then was silly.

Comparing GoPro to Google and Chipotle is high praise. So if you enjoy a good adrenaline rush, GoPro may be the right stock for you. But it's still not for the faint of heart.

First Published: June 30, 2014: 12:07 PM ET

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BNP Paribas braces for $9 billion fine: reports

BNP Paribas CEO Jean-Laurent Bonnafe.

LONDON (CNNMoney)

The punishment for helping clients dodge sanctions on Iran, Sudan and Cuba will also include a temporary ban on BNP Paribas (BNPQF) clearing payments in dollars, starting in January, the Financial Times reported Monday.

"I want to say it clearly here: we will receive a heavy penalty," BNP Chief Executive Officer Jean-Laurent Bonnafe was quoted as saying by Reuters in an internal email to staff.

BNP Paribas declined to comment.

U.S. authorities are expected to reveal details of the settlement later Monday, concluding a long-running criminal investigation.

The settlement between the bank and prosecutors had been expected for months. Shares in the bank edged about 0.5% higher in Paris, having fallen more than 12% so far this year in anticipation.

BNP Paribas had previously set aside $1.1 billion to cover the costs of any penalties arising from the U.S. investigation, but warned in late April that the fines could far exceed that amount.

The Wall Street Journal said the bank would have to slash its dividend and raise billions of euros by issuing bonds.

The fine dwarfs HSBC (HSBC)'s $1.9 billion penalty in 2012 for similar offenses, and the $2.6 billion Credit Suisse (CS) paid in May to settle tax evasion claims.

The settlement comes at a sensitive time for European banks, which are under pressure to increase lending to get the economy moving, while shoring up their finances ahead of region-wide stress tests due later this year.

Earlier this month, Jean Claude Trichet, former president of the European Central Bank, told CNN that a penalty in the range of $10 billion could carry risks for the global banking system. He said this kind of fine was neither fair, just, nor proportionate.

Standard and Poor's has warned it could cut the bank's long term credit rating once it reviewed the size of the fine and the nature of any additional penalties.

First Published: June 30, 2014: 5:58 AM ET

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Hong Kong's 'Occupy' takes on Beijing

Black-clad lawyers gather at Hong Kong's Court of Final Appeal to protest Beijing's influence.

HONG KONG (CNNMoney)

The pro-democracy protests, which recall the Occupy Wall Street movement in New York, have divided the powerful business community. Some worry that they could deter investors.

Tuesday's march to the city's business district takes place on the 17th anniversary of Hong Kong's handover from British to Chinese rule, and could attract hundreds of thousands of protesters.

Political and economic tensions in the territory have been rising recently, fanned by Beijing's release of a controversial white paper asserting its control.

City activists accuse China of reneging on its "one country, two systems" pledge that was a condition of Hong Kong's return in 1997.

Hong Kong enjoys a high level of economic autonomy, but Beijing's critics say it is encroaching on judicial and political freedoms. On Friday, 1,800 of the city's lawyers, dressed in black, marched in protest.

Bigger flash points are likely over the next few months before a decision over how Hong Kong will elect its next chief executive, the city's highest office.

Pro-democracy activists want Hong Kong residents to elect the chief executive directly. Beijing is said to favor a process that would allow it to screen candidates.

The most visible pro-democracy group -- Occupy Central With Love and Peace -- conducted an unofficial election of its own this month, drawing nearly 790,000 voters, or almost a quarter of the electorate.

The group is also planning a demonstration and other acts of civil disobedience designed to snarl traffic and disrupt operations in the central business district.

Related: Why Occupy Wall Street fizzled

Although they share a moniker, Hong Kong's "Occupy" supporters are not affiliated with the protest movement that got its start in Manhattan's Zuccotti Park. The groups share concerns over rising income inequality, but the Hong Kong group's immediate goal is to secure full voting rights.

"Hong Kong people really want to show to China, to the whole world, that we are determined to have full democracy," organizer Benny Tai told CNN on Monday.

The group's plan to "occupy Central" has set many in the city's establishment on edge.

Hong Kong affiliates of the big four accounting firms -- Deloitte, Ernst & Young, PricewaterhouseCoopers and KPMG -- placed an advertisement in local newspapers last week, trumpeting their opposition to the movement.

"We are concerned that Occupy Central will have a negative effect on the rule of law, social order and the economy of Hong Kong," they said in the ad. "We worry that this would cause international and local investors to relocate their Hong Kong's headquarters or even relocate their businesses."

The highly unusual public intervention by multinational companies in local politics drew widespread criticism. The Financial Times reported that the firms' head offices were not made aware of the plan prior to publication.

Paul Gillis, a professor at Peking University's Guanghua School of Management, wrote on his blog that the "arrogance of the firms is stunning" and the decision would diminish their brand value.

Some employees of the accounting firms shot back Monday -- taking out an ad of their own in support of Occupy Central.

First Published: June 30, 2014: 7:02 AM ET

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Should happiness, more than GDP, define a nation's success?

The tiny nation of Bhutan started measuring "gross national happiness" in the 1970s. More recently, public experts have started to tout the importance of measuring citizens' well-being in addition to GDP.

NEW YORK (CNNMoney)

But in recent years, there's been a quest to define and measure it, especially in the context of a prosperous economy.

That's because economic growth as measured by gross domestic product doesn't really tell us much about citizens' general well-being.

"For example, traffic jams may increase GDP as a result of the increased use of gasoline, but obviously not the quality of life," according to a report by an international commission chaired by Nobel Prize-winning economist Joseph Stiglitz.

The assumption is that the more economic growth the better. Legislators are forever debating the merits of a measure on the basis of whether it would create jobs and boost GDP.

But rarely do you hear lawmakers debate whether a measure will boost or detract from citizens' well-being, of which income is just one part.

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Take North Dakota. Its economy has doubled in the past 25 years thanks to a massive oil boom. Incomes have soared, but so have prices, traffic, crime, and housing shortages.

Well-being, of course, relies on many factors -- from health and education, to environment and culture, to the quality of governance, your community and how you use your time.

There's a growing international chorus that thinks this kind of well-being should be measured and used as a guide when formulating policy and tracking social progress.

The tiny nation of Bhutan pioneered the effort, adopting a "gross national happiness index" decades ago.

The rest of the world has been slow to catch on. But there have been nascent efforts in recent years to address the issue.

In 2011, the U.N. General Assembly passed a resolution encouraging countries to measure their citizens' happiness and use that measure to help guide public policies.

More recently, the Organization for Economic Cooperation and Development (OECD) has created guidelines for nations that want to measure well-being.

In the United States, four states -- Maryland, Vermont, Oregon and Colorado -- have developed a "genuine progress indicator," according to Demos, a left-leaning think tank.

The GPI seeks to quantify in a consistent way the cost and value of factors not measured by GDP.

For instance, Maryland -- which was the first state to adopt a GPI -- is seeking to assess, among other things, the "environmental and social costs of what we buy, [and] the quality-of-life impacts of how we live."

Some cities and towns, meanwhile, have started their own "happiness initiatives," distributing gross happiness surveys to residents to give local policymakers a sense of the level of their constituents satisfaction in different areas.

It doesn't appear that there will be any kind of universal agreement to measure citizens' happiness and well-being anytime soon.

But proponents -- such as the Sustainable Development Solutions Network (SDSN) -- are trying to make the economic case to governments as to why they should.

"Happy people live longer, are more productive, earn more, and are also better citizens. Well-being should be developed both for its own sake and for its side-effects," SDSN noted in its 2013 World Happiness Report.

First Published: June 30, 2014: 7:06 AM ET

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Enough with Millennials. Here's what Gen X thinks

Gen X is the forgotten generation.

NEW YORK (CNNMoney)

They are called Gen X, but they are often overlooked by pollsters, the media and just about everyone else.

Born between 1964 and 1980, Gen X got its name from a 1991 book Generation X: Tales for an Accelerated Culture, by Canadian author Douglas Coupland.

When they were coming of age in the 1990s, they were considered slackers and aimless. But then, they were just forgotten.

The Pew Research Center recently shed some light on what it termed "America's neglected middle child." Turns out they are less likely to be married than the Baby Boomers, but more religious than Millennials.

When it comes to social and political views, the liberal Millennials didn't spring from nowhere. Gen Xers were already leaning that way, breaking from the more button-down Baby Boomers.

But even Gen Xers aren't sure what their cohort stands for, according to Paul Taylor, Pew's executive vice president for special projects. They are less likely than Millennials and Baby Boomers to think their generation is unique, and they don't have as firm a view on what makes them special.

There's are reasons why Gen X is so often ignored, said Taylor. There are fewer of them: Just 65 million, compared to 77 million Boomers and roughly 83 million Millennials. And they span just 16 years, whereas most generations encompass two decades.

Then again, they may not care either.

"From everything we know about them, they're savvy, skeptical and self-reliant. They're not into preening or pampering, and they just might not give much of a hoot what others think of them. Or whether others think of them at all," Taylor wrote.

First Published: June 30, 2014: 9:40 AM ET

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GM offers victims more than $1 million

NEW YORK (CNNMoney)

The automaker will give another $300,000 for each surviving spouse and dependent, in addition to a sum of money that will be determined by the victims' earning potential.

The automaker also said that it will not cap the total amount of money it will pay to the compensation fund.

At least 13 people died, and many more were injured as result of a faulty ignition switch installed in 2.6 million GM cars.

The automaker is also offering money to those injured in crashes that were caused by the defect in the cars.

Attorney Kenneth Feinberg, who devised compensation plans for victims after 9/11 and the BP oil spill, issued the details at a press conference Monday, about four months after GM recalled the affected vehicles. He was hired by GM (GM) in April as a consultant.

The 13 people that GM says were killed as a result of the ignition switch flaw died when the front airbags failed to deploy.

But Feinberg said for the first time today that any passengers killed or hurt are also eligible for compensation.

Additionally, the passengers and drivers in any other cars involved in a crash are all eligible, as are any pedestrians involved.

Victims may file a claim even if their own negligence, such as speeding or driving drunk, contributed to the crash.

GM employees first knew that the ignition switches were malfunctioning back in 2004. But the automaker didn't issue a recall until a decade later. Some deaths and injuries could have been avoided had the recall been issued sooner.

Payouts to those who suffered serious, life-altering injuries will be determined on a case-by-case basis. Those with less serious injuries will be paid depending on the number of nights they spent at the hospital. Someone who spent one night in the hospital will receive $20,000, while someone hospitalized 32 nights or more will be paid $500,000.

The compensation plan does with a caveat: Any victim who accepts the money waives their right to sue GM. The program is voluntary, and victims can bypass the whole program and take GM straight to court instead.

But taking the automaker to court could be an uphill battle since a bankruptcy court gave the company a liability shield for incidents that happened prior to its filing in 2009.

Anyone who lost a loved one or was seriously injured in a crash related to the recall can file a claim with GM between Aug. 1 and Dec. 31, 2014.

Feinberg also said he will hold a private meeting with any claimant that wishes to do so.

First Published: June 30, 2014: 10:20 AM ET

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Stock market flirts with new records

NEW YORK (CNNMoney)

After starting in the red, a bullish report on home sales helped lift stocks slightly.

Here's what to keep an eye on Monday:

1. Halftime report: The S&P 500 is up modestly, erasing earlier losses after strong real estate news. The Dow Jones Industrial Average is hovering around flat, and the Nasdaq extended its early gains and is up about 0.2%.

The broad index needs to only end above 1,962.87 to log its 23rd record close of the year (it's currently right around that point). The Dow needs to land above 16,947.08 for its 12th record close.

Monday marks the end of the month, quarter and first half of 2014. The year started ominously due to emerging market concerns and severe winter weather, but things have turned around on Wall Street along with the warmer temperatures.

Related: The 2014 half-time report

The S&P 500 is up 6% during the first six months of 2014, even after losing some ground last week. Of course, the first-half rally pales in comparison with 2013 when the S&P 500 soared 12.6% by this point.

Volatility has all but vanished on Wall Street. The VIX, or so-called "fear gauge," recently plunged to seven-year lows and remains at just over 11 -- which is far lower than its historical average of about 20.

Related: Fear & Greed Index still extremely greedy

2. More housing hopes: Wall Street cheered new signs of progress in the very important housing market. The National Association of Realtors said U.S. pending home sales jumped 6.1% in May, representing the biggest monthly increase since April 2010. Economists had been anticipating a more modest increase.

The bullish housing news lifted shares of home builders like Lennar (LEN), KB Home (KBH) and PulteGroup (PHM).

3. Stock movers -- Yahoo, American Apparel, Mannkind: Yahoo (YHOO, Tech30) enjoyed a 2% bump after the Internet company was upgraded to "overweight" by Piper Jaffray.

While Yahoo's core business remains "challenged," analyst Gene Munster said his bullish call is based on the belief that the company's stake in Alibaba is "undervalued." Last week, the Chinese e-commerce giant revealed plans to list its highly anticipated initial public offering on the New York Stock Exchange.

American Apparel (APP) tumbled 15% after the company announced plans to adopt a shareholder rights plan in an effort to prevented ousted chairman Dov Charney from seizing control.

Related: Founders in hot water at American Apparel, Lululemon

Shares of MannKind (MNKD) soared 10% after the company said the Food and Drug Administration approved a powder form of insulin that is inhaled.

U.S. Steel (X) shed 1% as investors react to the company being kicked out of the S&P 500. The steel maker, an original member of the S&P 500, is being replaced by Martin Marietta Materials (MLM), which traded about 2% higher on Monday.

PPG Industries (PPG) logged a 3% gain after unveiling plans to acquire a Mexican coatings company for about $2.3 billion.

Bank of New York Mellon (BK) advanced nearly 3% as activist investor Nelson Peltz and his Trian Partners revealed a $1.05 billion stake in the financial company.

4. Investors yawn at Facebook, BNP headlines: Facebook (FB, Tech30) is in hot water after it was revealed the social network conducted a 'mood' experiment on users without their knowledge or explicit consent. Facebook's terms of service give the company permission to conduct this kind of research, but many users have reacted with anger.

Wall Street, however, was unmoved by the drama. Facebook's stock is flat.

The U.S. Department of Justice is expected to announce a multi-billion dollar settlement with French banking giant BNP Paribas (BNPQY) on Monday. The bank has been subject to a long running criminal investigation over accusations that it breached U.S. sanctions on Iran, Sudan and other countries. Shares of BNP rose slightly in Paris.

5. Dubai crumbles, Bulgaria booms: Investors continue to give Dubai's stock market a big thumbs down.

The DFM General Index plunged 4.4% on Monday due to worries about property stocks, especially contracting giant Arabtec Holdings. Dubai plummeted 22% in June, its worst month since 2008.

On the other hand, Bulgaria's stock market raced almost 5% higher after the European Union gave the green light to the country providing $2.3 billion in state aid for banks. The move follows a series of arrests of men accused of fueling bank runs.

Other European markets were mixed in midday trading. Asian markets closed mixed. The main loser of the day was Australia's ASX All Ordinaries index, which dropped by 0.9%.

It's also worth keeping an eye on Argentina's markets. The country faces a Monday deadline to pay two groups of bondholders. The way things unfold from here will determine Argentina's ability to move past its 2001 default and regain access to foreign funds.

First Published: June 30, 2014: 9:50 AM ET

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