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Nightmare on Wall Street: Is it over?

Written By limadu on Senin, 20 Oktober 2014 | 14.44

trick or treat stocks

NEW YORK (CNNMoney)

Frightening plot twists like plunging oil prices and the Ebola outbreak teamed up with ghosts from the past (Greece, deflation jitters in Europe) to create a toxic mix of market scares.

Last week even featured a few quasi-heroes like strong quarterly report cards from corporate giants like General Electric (GE) and Morgan Stanley (MS) and the Federal Reserve official who calmed the panic by suggesting additional stimulus could be possible if the economy deteriorates.

When the dust finally settled, the Dow was left in a 1% hole for the year. The S&P 500 is up about 2% in 2014, but well off its all-time high.

So what's going to determine whether this week is another scary ride or something far more tame?

Sure, investors will continue paying attention to what's kept them awake at night like Ebola and Europe. But they'll also get the chance to hear from a massive parade of companies expected to reveal decent quarterly numbers, including Amazon.com (AMZN, Tech30), Apple (AAPL, Tech30), Coca-Cola (KO), General Motors (GM) and McDonald's (MCD).

Related: Time to shop 'til you drop for cheap stocks

"Focusing on fundamentals is the best way for investors to avoid fear and to stay positioned for long-run growth," James Liu and David Lebovitz, global market strategists at JPMorgan Funds, wrote in a recent note to clients.

iPhone to the rescue? Apple could give Wall Street 21 million reasons to feel better this week. That's roughly the number of iPhones analysts expect Apple to say it sold last quarter (thanks in part to the iPhone 6), helping to drive a whopping $40 billion in total sales.

As the world's largest company, Apple always plays an outsize role in impacting stock prices and market sentiment. Positive numbers from the tech behemoth on Monday evening could reinforce cautious optimism about the U.S. economy and ease jitters about growth overseas.

Related: Apple unveils new iPads

A big earnings beat could also help breathe new life into Apple's shares, which have retreated 5% from all-time highs amid the recent market slump. It could also boost shares of AT&T (T, Tech30) and Verizon (VZ, Tech30), two wireless companies that carry the iPhone and are also due to report results this week.

Are consumers still spending? But it's not just about Apple. A number of other consumer-facing tech companies are also on the earnings docket this week like Amazon.com, Microsoft (MSFT, Tech30) and Pandora (P). Don't forget about Yahoo (YHOO, Tech30) and its efforts to lure more eyeballs to its growing family of sites.

There are also a long line of non-tech consumer companies slated to release results this week like Chipotle (CMG), Coca-Cola, Hasbro (HAS), McDonald's and Six Flags (SIX). An update on the pivotal auto market is also on tap in the form of earnings reports from both Ford (F) and General Motors.

If the recent economic data are any sign, these companies will have positive things to say about the health of spending. Consumer sentiment in October has ticked up to the highest level since 2007, according to the University of Michigan sentiment survey.

Concerns about the spread of Ebola added to the negative market sentiment last week, helping drive down travel stocks amid fears consumers would stop traveling. But they bounced off their recent lows as Delta Air Lines (DAL) said concerns about the outbreak haven't impacted travel.

Investors are hoping to hear more soothing words about the Ebola fallout from American Airlines (AAL), JetBlue (JBLU), Royal Caribbean (RCL) and Southwest Airlines (LUV).

Related: Can you protect yourself from a market crash?

Ebola, global growth: Wall Street will be searching for clues about how Corporate America is grappling with slowing overseas growth and the stronger U.S. dollar, which hurts exports.

General Electric (GE) and Honeywell (HON) offered positive news on this front last week, and this week it's 3M (MMM), Boeing (BA) and Dow Chemical's (DOW) turn to hit the earnings stage.

A gut check on the economy will also be available from a number of economic gauges, highlighted by a pair of housing reports on existing and new home sales.

First Published: October 19, 2014: 9:19 AM ET


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One property insurance claim can hike your premiums by hundreds

homeowners insurance claims

NEW YORK (CNNMoney)

On average, filing a single claim -- for anything ranging from a stolen bicycle to tornado damage -- will result in your monthly premium being raised by 9%, according to a report released by InsuranceQuotes.com. File a second claim and premiums climb by an average of 20%.

"Winning a small claim could actually cost you money in the long run," said Laura Adams, InsuranceQuotes.com's senior analyst. "Homeowners need to be really careful. Even a denied claim can cause your premium to go up."

Related: Which natural disaster will likely destroy your home?

And the size of the claim has little impact. Filing a small claim increases your rates by just about as much as filing a catastrophic one. "The insurers have found that people who make a claim are more likely to make another," said Adams. "You've become a riskier customer."

Yet, the type of claim does matter. Liability claims, such as from personal injuries, are the most expensive type of claim, with insurers raising premiums by an average of 14%, InsuranceQuotes.com found.

Other claims that lead to big premium increases are theft and vandalism, which often indicate that the home is in a neighborhood that is unstable or falling prey to blight. In bad neighborhoods, these crimes can recur, and the high premiums reflect that.

The premium increases also vary greatly by state. Homeowners in Wyoming saw the biggest increase in their premiums -- an average of 32% -- after a claim was filed. While the hikes are high, the state tends to charge fairly low premiums of about $770 a year, considerably lower than the $978 national average.

Policyholders in Connecticut, Arizona, New Mexico and California also saw large hikes of 18% or more.

Meanwhile, homeowners in Texas, where insurers are not allowed to raise premiums on the basis of a single claim, saw no increase. And homeowners in New York and Massachusetts paid very little more after filing claims.

Average premiums range from a low of $513 a year in Idaho to $1,933 in Florida, where frequent hurricanes drive insurance costs up.

Once your premiums are raised, it can be difficult to get them reduced.

Insurers keep a database called the Comprehensive Loss Underwriting Exchange, or CLUE, which tracks seven years' worth of your auto and property insurance claims, as well as any inquiries you may have made about a claim. The database then compiles a report based on your claims history that is then used to determine whether to cover you and how much to charge.

The information is available to all insurers so even if you switch providers, your rate with the new carrier may be just as high.

Related: Damaged home? How to get an insurer to pay up

"You can't escape your claim history," said Adams.

But you are not completely without hope. Here are some ways to try and keep your homeowner's insurance costs down:

Raise your deductible. But not so high that you can't afford to pay out-of-pocket costs if damage occurs.

Don't make small claims. Getting a few hundred dollars back if a tree limb falls on your shed may feel good but you could be paying that back to your insurer over the next few years -- and then some.

Don't use homeowners insurance as a maintenance tool. Don't file a claim to pay for small repairs, such as when wind blows some old shingles off your roof. Use it for catastrophic repairs only.

Shop around often. Look for quotes once a year. There's lots of competition in the industry and you may be able to buy equal coverage and service for a lower price.

First Published: October 19, 2014: 10:12 AM ET


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Debt-laden 'zombie' firms threaten China's economy

china zombie bank

HONG KONG (CNNMoney)

After expanding at a lightning-fast rate, China's corporate debt market is now the world's largest at $14.2 trillion, according to Standard and Poor's.

Experts worry that too many of the loans have gone to underperforming firms that will never be able to repay -- especially in a slowing economy.

Economists surveyed by CNNMoney often cite concerns over runaway credit growth, but many now single out corporate debt as a major threat to China's economy.

"The risk is that the high debt burden will eventually result in unproductive zombie banks and zombie firms, which are a drag on the economy," said Julian Evans-Pritchard of Capital Economics.

Related: The Chinese like capitalism more than Americans

As China's economy slows, companies are seeing a lower rate of return on their investments, according to analysts at JPMorgan. Firms also face higher interest rates -- making it harder to pay what they owe.

Already, the system is showing stress. China suffered its first corporate default earlier this year, when a solar firm failed to make a payment to bondholders. A few other small companies have followed suit.

So far, central government initiatives to restrain credit growth have largely flopped, especially since many firms have in the past been encouraged to spend their way out of a hole.

Chinese companies are even turning to unconventional financing options -- increasing their debt in the process.

Some firms, for example, have been using copper as collateral to secure loans. Experts are concerned that some companies are using the same copper stockpiles to take out multiple loans, borrowing far more than they can afford.

Related: $547,000 for a parking space in Hong Kong

For Beijing, the question is how to contain debt growth, without hurting the economy.

Analysts say it is a positive sign that the government is allowing some firms to default. The defaults show the government's commitment to reforms that will encourage consumption-driven growth, instead of expansion fueled by easy credit.

At the same time, the central government still wields enormous power over the economy -- a fact that will help Beijing limit damage to the financial system.

"China is somewhat of a unique case given the degree of state control over the system, and so we don't think a financial crisis is likely," Evans-Pritchard said.

First Published: October 19, 2014: 10:07 PM ET


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For $65 million, you can buy Miami's most expensive home

Written By limadu on Minggu, 19 Oktober 2014 | 14.45

miami house exterior Miami's most expensive home for sale has a graceful, Mediterranean style.

NEW YORK (CNNMoney)

Called La Brisa (The Breeze), the Coconut Grove compound sits on 6.9 acres, with more than 200 feet of waterfront property along Biscayne Bay.

The nine-bedroom Mediterranean-style home, which was first built in the 1920s, has undergone a major facelift. It last sold in an estate sale six years ago for $11.5 million.

Related: Mansions for under $1 million

"The [current] seller, an architect, did everything he could to restore it to its original state," said Coldwell Banker agent William Pierce.

The result? Nearly 17,000 square feet of completely renovated and restored living and outdoor space that includes original woodwork, restored windows and natural woods like Brazilian, teak and pine.

miami house interior The seller tried to keep as much original detail as possible.

There's also Spanish tile roofs, balconies, walkways and patios galore, with almost every interior space opening up to the outside or providing views of the water.

A 500-foot canal borders the north end of the property and includes a docking slip that can accommodate a 70 foot yacht. The manicured grounds are filled with 100-year-old trees, tropical vines and a large lawn. There's also a shaded, spring fed pond.

miami house spring The Munroe spring is named for an early owner.

A large, coral stone patio with a fire pit and sitting areas shaded by tall palm trees surrounds a large pool. There's enough room to entertain a couple hundred guests for outdoor parties.

miami house pool The cool pool catches Bay breezes.

Where the seller didn't attempt to return the house to an earlier time were the kitchen and baths, both of which are modern and sleek.

miami house kitchen Walk through the arched kitchen doorways right onto the patio.

As for the rest of the property?

"It's like traveling back in time," said Pierce.

First Published: October 17, 2014: 5:21 PM ET


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Moody's downgrades Russia's debt

NEW YORK (CNNMoney)

Moody's downgraded the country's debt by one notch Friday, citing the ongoing conflict in Ukraine, capital flight and falling oil prices. The debt rating is now Baa2, just two notches above "junk" status.

Ongoing tensions with Ukraine led to international sanctions against Russia earlier this year. That has reduced foreign investment and further slowed economic growth, spurring inflation and higher interest rates.

Related: Ruble's headlong plunge shows Russia hurting

"The longer the conflict in Ukraine and sanctions against Russia last, the more significant will be the damage to investors' confidence in Russia as a source of profitable investment opportunities," the agency said in a statement.

A recent slide in oil prices isn't helping things, either. The commodity is down nearly 12.5% in the last month.

The country relies heavily on oil to bankroll its budget -- over half of the government's 2012 revenues came from oil and gas, according to the latest data from the U.S. Energy Information Administration.

Related: Crashing oil prices could crush Vladimir Putin

The ratings agency said the debt's outlook would remain negative, and it is also considering a separate downgrade of Russia's sovereign credit rating if its economy continues to slow.

Standard & Poor's issued its own sovereign downgrade in April, to just a single step above junk.

The World Bank forecasts anemic Russian economic growth of just 0.5% in 2014 and 0.3% in 2015. A more pessimistic scenario foresees the Russian economy slipping into recession this year and contracting further in 2015 and 2016.

First Published: October 17, 2014: 6:47 PM ET


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Audi driverless car to hit 150 mph

NEW YORK (CNNMoney)

The RS7 Piloted Driving Concept will attempt to lap the Hockenheimring racetrack in Germany at high speeds on Sunday using only computers and sensors to guide it.

Audi and other automakers have previously shown off automated driving technologies, but those systems have operated at normal road speeds. Operating at high speeds presents a different set of challenges.

There will be no other cars on the track at the time, but the car will be operating close to the limits of its own performance capabilities. It will have to round corners as quickly as possible without skidding or driving off the track, and it will have to find the best possible path through each curve.

To do that, the car will use an ultra-precise positioning system that will allow it to know its own exact location on the track moment by moment.

Photos - Best cars for billionaires

The ability to turn in the best possible lap time on a track is more than just a fun trick, according to Audi. It has important implications for safety.

"We have to be able to manage extreme situations and that's what we are demonstrating here," said Ulrich Hackenberg, board member for technical development at Audi.

When operating without a driver on real roads, a car may have to respond to emergencies in ways that require high-speed maneuvering. That will require precise sensors, fast computers and complex, flexible programming.

Audi was the first automaker to receive a license for autonomous driving from the state of California. The Audi RS7 has a 560-horsepower engine and a top speed of nearly 190 miles per hour.

First Published: October 17, 2014: 8:27 PM ET


14.44 | 0 komentar | Read More

For $65 million, you can buy Miami's most expensive home

Written By limadu on Sabtu, 18 Oktober 2014 | 14.44

miami house exterior Miami's most expensive home for sale has a graceful, Mediterranean style.

NEW YORK (CNNMoney)

Called La Brisa (The Breeze), the Coconut Grove compound sits on 6.9 acres, with more than 200 feet of waterfront property along Biscayne Bay.

The nine-bedroom Mediterranean-style home, which was first built in the 1920s, has undergone a major facelift. It last sold in an estate sale six years ago for $11.5 million.

Related: Mansions for under $1 million

"The [current] seller, an architect, did everything he could to restore it to its original state," said Coldwell Banker agent William Pierce.

The result? Nearly 17,000 square feet of completely renovated and restored living and outdoor space that includes original woodwork, restored windows and natural woods like Brazilian, teak and pine.

miami house interior The seller tried to keep as much original detail as possible.

There's also Spanish tile roofs, balconies, walkways and patios galore, with almost every interior space opening up to the outside or providing views of the water.

A 500-foot canal borders the north end of the property and includes a docking slip that can accommodate a 70 foot yacht. The manicured grounds are filled with 100-year-old trees, tropical vines and a large lawn. There's also a shaded, spring fed pond.

miami house spring The Munroe spring is named for an early owner.

A large, coral stone patio with a fire pit and sitting areas shaded by tall palm trees surrounds a large pool. There's enough room to entertain a couple hundred guests for outdoor parties.

miami house pool The cool pool catches Bay breezes.

Where the seller didn't attempt to return the house to an earlier time were the kitchen and baths, both of which are modern and sleek.

miami house kitchen Walk through the arched kitchen doorways right onto the patio.

As for the rest of the property?

"It's like traveling back in time," said Pierce.

First Published: October 17, 2014: 5:21 PM ET


14.44 | 0 komentar | Read More

Moody's downgrades Russia's debt

NEW YORK (CNNMoney)

Moody's downgraded the country's debt by one notch Friday, citing the ongoing conflict in Ukraine, capital flight and falling oil prices. The debt rating is now Baa2, just two notches above "junk" status.

Ongoing tensions with Ukraine led to international sanctions against Russia earlier this year. That has reduced foreign investment and further slowed economic growth, spurring inflation and higher interest rates.

Related: Ruble's headlong plunge shows Russia hurting

"The longer the conflict in Ukraine and sanctions against Russia last, the more significant will be the damage to investors' confidence in Russia as a source of profitable investment opportunities," the agency said in a statement.

A recent slide in oil prices isn't helping things, either. The commodity is down nearly 12.5% in the last month.

The country relies heavily on oil to bankroll its budget -- over half of the government's 2012 revenues came from oil and gas, according to the latest data from the U.S. Energy Information Administration.

Related: Crashing oil prices could crush Vladimir Putin

The ratings agency said the debt's outlook would remain negative, and it is also considering a separate downgrade of Russia's sovereign credit rating if its economy continues to slow.

Standard & Poor's issued its own sovereign downgrade in April, to just a single step above junk.

The World Bank forecasts anemic Russian economic growth of just 0.5% in 2014 and 0.3% in 2015. A more pessimistic scenario foresees the Russian economy slipping into recession this year and contracting further in 2015 and 2016.

First Published: October 17, 2014: 6:47 PM ET


14.44 | 0 komentar | Read More

Audi driverless car to hit 150 mph

NEW YORK (CNNMoney)

The RS7 Piloted Driving Concept will attempt to lap the Hockenheimring racetrack in Germany at high speeds on Sunday using only computers and sensors to guide it.

Audi and other automakers have previously shown off automated driving technologies, but those systems have operated at normal road speeds. Operating at high speeds presents a different set of challenges.

There will be no other cars on the track at the time, but the car will be operating close to the limits of its own performance capabilities. It will have to round corners as quickly as possible without skidding or driving off the track, and it will have to find the best possible path through each curve.

To do that, the car will use an ultra-precise positioning system that will allow it to know its own exact location on the track moment by moment.

Photos - Best cars for billionaires

The ability to turn in the best possible lap time on a track is more than just a fun trick, according to Audi. It has important implications for safety.

"We have to be able to manage extreme situations and that's what we are demonstrating here," said Ulrich Hackenberg, board member for technical development at Audi.

When operating without a driver on real roads, a car may have to respond to emergencies in ways that require high-speed maneuvering. That will require precise sensors, fast computers and complex, flexible programming.

Audi was the first automaker to receive a license for autonomous driving from the state of California. The Audi RS7 has a 560-horsepower engine and a top speed of nearly 190 miles per hour.

First Published: October 17, 2014: 8:27 PM ET


14.44 | 0 komentar | Read More

Baby Boomers are overexposed to stocks in this rocky market

Written By limadu on Jumat, 17 Oktober 2014 | 14.44

NEW YORK (CNNMoney)

Among 60-to-65 year olds, 30% have invested almost all of their savings in stocks, while 52% have more than 70% of their nest egg in stocks, according to an analysis of 10,000 users (split among three different age groups) of FeeX, which helps users find lower investment fees.

That's a risky move.

For a well-balanced portfolio, financial planners say that savers in this age group should have no more than 60% of their assets in stocks. The rest should be split among more conservative assets like bonds and money market funds that can cushion the blow of sell-offs like the one we're currently in.

Related: Asset allocation: Fix your mix

Amid fears surrounding Ebola and slowing global growth, both the S&P 500 and Dow Jones Industrial Index are down more than 5% from a month ago, and some experts say it could signal the start of a market correction, when the market drops by at least 10%.

While there's no way to know which direction stocks will go, older investors simply don't have the time to ride out such big market fluctuations.

"If you're a couple of years away from retirement, you're really rolling the dice at the Roulette table," said Erik Laurence, vice president of marketing and business development at FeeX.

Related: What the heck should the Fed do now?

When stocks are plunging, age-appropriate allocations can help shield older investors from such steep losses, said Scott Tiras, a Houston-based Ameriprise financial adviser who works mainly with older clients.

"Diversification is so important...especially for someone who is going to be dependent on that portfolio sooner rather than later," he said.

So what's an overexposed Boomer to do?

Now is the time to check those 401(k) statements closely and make sure you have the appropriate asset mix. To help you figure out what that mix should be, try taking this risk tolerance quiz or using our asset allocation calculator.

If you find that you're too heavily weighted in stocks, let the current market volatility serve as a friendly reminder to put a more conservative strategy in place.

Related: Get your assets in gear! Find the right investment mix

Yes, that may mean selling at a loss compared to a few months ago. But stocks are still relatively flat for the year. And they're leaps and bounds higher than they were in 2008.

Of course, you could also hold tight and see what happens in coming weeks and months. But in that case, "the market might do the re-balancing for you," said Judith Ward, a senior financial planner at T. Rowe Price.

First Published: October 16, 2014: 6:30 PM ET


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