Current Events in October 2012

The Hyundai Santa Fe has had a somewhat spotty safety record and now regulators say they're looking into a steering problem in the popular SUV.

The National Highway Traffic Safety Administration says a fastener can come loose, causing the steering shaft to come part and drivers to lose control of the vehicle.

No accidents have been reported but NHTSA says it received a complaint from a driver about a complete loss of steering. Hyundai reports receiving a separate complaint about a similar problem, which it traced to a loose bolt.

The investigation covers about 70,000 Santa Fes from the 2011 model year and could lead to a recall. 

In July, Hyundai recalled more than 200,000 Santa Fe and Sonata models to fix a problem with the airbags. Safety regulators said the front passenger airbags of the Santa Fe models appeared to have improper occupant classification system, putting small-bodied people at risk. 

The airbag recall followed a class-action lawsuit filed in 2009 that alleged Hyundai's airbag sensors don't accurately distinguish between children and adults, increasing the chances that an airbag won't properly deploy in the event of an accident.

In 2008, NHTSA investigated reports of suspension failures in the Santa Fe, some at high rates of speed. Two consumers said their vehicle "nearly rolled over" following the suspension failure.

If you think the bottom fell out of the real estate market, just think what happened to the timeshare market. Hundreds of thousands of consumers have found themselves stuck with timeshares they would like to sell, if only there were a market for them.

This has created fertile ground for companies promising quick and lucrative solutions that usually turn out to be little more than shams.

In one such case, Vacation Property Services, Inc., has been permanently banned from the timeshare resale and rental business, and from all telemarketing, under a settlement with the Federal Trade Commission.  The settlement followed a court ruling that the company violated the FTC Act and Telemarketing Sales Rule (TSR).  

Ivette of New City, NY, described her experience with the company in a ConsumerAffairs posting: "The gentlemen promised that my time share will be sold within 90 days. It has been several years and I am still waiting."

The FTC charged that Vacation Property Services made tens of thousands of unsolicited telemarketing calls to timeshare owners falsely claiming that they already had, or could quickly find, buyers for the owners’ timeshares. The defendants demanded that consumers pay a large up-front fee to facilitate the sale.

The FTC’s complaint charged that the company and its manager and owner, Albert M. Wilson, misrepresented the company’s refund policy and the existence of potential buyers. The complaint also charged the defendants with calling hundreds of thousands of consumers whose phone numbers are on the FTC’s Do Not Call Registry.

In May, the United States District Court for the Middle District of Florida entered a summary judgment order against Vacation Property Services, Inc. and Wilson.  The court held that the company deceived consumers into paying large up-front fees by claiming that it had buyers lined up or would find buyers to purchase consumers’ timeshare properties, and that it had violated the TSR by calling telephone numbers listed on the National Do Not Call Registry.

The settlement order announced today resolves the FTC’s remaining claims against Wilson. The order permanently bans him from all telemarketing and from participating in the timeshare resale and rental business.  It also prohibits him from misrepresenting material facts about any goods or services, and from selling or otherwise benefitting from consumers’ personal information.

The order imposes a judgment of more than $4.2 million, which will be suspended when Wilson has surrendered $120,000, a 2002 Porsche 911, a Spectre Sportfish boat, and his interest in Vacation Property Services.

Has an old boyfriend been Googling your name? MyLife.com is a site that says it can tell you if he has. But over the years the company has produced a number of consumer complaints.

"Be very careful if you have signed up for anything with MyLife.com," Michael, of Lorton, VA, wrote in a ConsumerAffairs post. "They send out misleading email solicitations and if you click to accept one of them, you are automatically and immediately charged for a one year membership - no chance to review and no confirmation. When I called to complain, they reduced it to a three-month membership. They refused to cancel the charge."

State investigation

Washington Attorney General Rob McKenna has a different complaint. He says the company's TV commercials suggest it offers a free service, when it does not.

“MyLife.com’s commercials were misleading because, in order to reveal who was looking for you, a monthly subscription costing $12 to $20 per month was due,” said Washington Assistant Attorney General Jake Bernstein. “MyLife.com’s misleading advertisements for their ‘Who’s Searching for You’ service did not reveal the person’s name. It only revealed their age and location.”

Bernstein said consumers were also surprised to learn that after subscribing, they were immediately charged the full amount of their subscription rather than paying on a monthly basis.

"I thought that I was signing up for a monthly chargeable fee," Laura. of Tuscon, AZ, wrote at ConsumerAffairs. "They placed the monthly amount in bold type, but they charged me for an entire year. They ended up sneaking in another service, again placing the monthly fee in bold while charging my account almost $143."

Auto renewal

The Washington Attorney General's Office is also concerned because it said consumers’ memberships were automatically renewed without the consumers’ permission.

Concerned that MyLife.com’s advertisements violated Washington state’s Consumer Protection Act prohibiting unfair and deceptive practices, the Washington State Attorney General’s Office began an investigation in 2011. State officials say MyLife.com chose to resolve the investigation by agreeing to enter into an “assurance of discontinuance” -- an agreement that obligates the company to abide by certain practices or face legal consequences.

Under the agreement MyLife.com must:

• Clearly and conspicuously disclose the amount that consumers will be charged or billed before collecting a method of payment -- and disclose that subscription services will automatically renew.
• Obtain consumers’ consent for a payment that renews automatically before accepting the first payment.
• Stop stating that the service is free -- instead acknowledging that a purchase is required to access the promised information.
• Create a clear Website disclosure about how the service works.

Violations of the terms above are a violation of the Consumer Protection Act, exposing MyLife.com to further litigation. The company also agrees to pay $28,000 in attorneys’ costs and fees.

The massive price hikes in California have stopped but gasoline prices are still rising in much of the rest of the country, though not nearly as fast.

The national average price of self-serve regular today is $3.810 per gallon, compared with $3.789 last Friday, according to AAA's Fuel Gauge Survey. That's nearly five cents lower than a month ago but almost 39 cents higher than the price a year ago.

The average price of diesel fuel today is $4.127 per gallon, versus $4.083 a week ago.

Settling down in California

The price situation in California settled down a bit with prices at the pump rising only a penny or two a day rather than the 20 to 30 cents a day drivers experienced last week. At $4.645 a gallon, California's average price is easily the highest in the nation. It's more nearly 22 cents higher than Hawaii, habitually the most expensive state for gasoline.

Elsewhere, the states with the most expensive fuel saw their average price retreat by two or three cents a gallon this week. The states where gas is the cheapest experienced price increases by roughly the same amount -- keeping the national average stable.

Record highs

Gasoline prices have remained near record highs for this time of year, despite the fact that oil prices have retreated in recent weeks. The sharp hikes in California were blamed on problems at a major oil refinery and some unrelated pipeline issues. The shortages and resulting price escalation at the pump stopped last week after California Gov. Jerry Brown signed an emergency order allowing the early use of winter blends of gasoline.

The states with the most expensive gas prices this week are:

• California ($4.645)
• Hawaii ($4.428)
• Alaska ($4.200)
• Connecticut ($4.118)
• New York ($4.117)
• Washington ($4.113)
• Oregon ($4.086)
• Rhode Island ($3.961)
• Nevada ($3.941)
• Vermont ($3.938)

The states with the lowest gas prices this week are:

• South Carolina ($3.516)
• Texas ($3.551)
• Mississippi ($3.561)
• Tennessee ($3.561)
• Alabama ($3.573)
• Missouri ($3.565)
• Louisiana ($3.600)
• Oklahoma ($3.602)
• Virginia ($3.606)
• Arkansas ($3.621)

This month may be a good time to shop for a new car. Not only are there some attractive bargains out there, interest costs are next to nothing. In fact, they are nothing.

Kelly Blue Book (KBB) pulled together some examples of what it considers the best new car deals and all of them happen to come with zero-percent financing. If you can qualify for that rate -- and most buyers, unfortunately, cannot -- the savings are even greater.

"The end of the year usually means a plethora of great deals available for car shoppers, and this fall is no exception," said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book's KBB.com. "With the annual model-year change-over now in full swing at dealerships across the nation, these deals may not last. Consumers interested in snagging zero-percent financing should act quickly while there are still 2012 models available."

In selecting what it considers the month's best deal, the automotive website focused on vehicles costing $25,000 or less. Of the models that fit that criteria, here are the top five:

2012 Toyota Camry LE

Totally redesigned for 2012, the Toyota Camry is the newest car on this month's list and remains the best-selling car in the country. Zero-percent financing isn't so common on newer models with such proven appeal, and that's why Camry takes the top spot this month.

Kelley Blue Book Fair Purchase Price: $21,802

60-month APR: 0%
Monthly payment: $363

Expiration date: 11/5/2012

2012 Ford Focus SE Sedan

In addition to styling, the new-for-2012 Ford Focus offers the kind of engaging, European-inspired driving dynamics American enthusiasts have long envied, according to KBB.

Kelley Blue Book Fair Purchase Price: $17,239

60-month APR: 0%
Expiration date: 1/2/2013

Monthly payment: $287

2012 Mazda MAZDA3 i Sport Sedan

Not the newest car in its class, the Mazda3 may still be the most fun to drive. New for 2012 is an optional "Skyactiv" powertrain that bumps up highway fuel economy to 40 mpg.

Kelley Blue Book Fair Purchase Price: $16,658

60-month APR: 0%
Expiration date: 10/31/2012

Monthly payment: $278

2012 FIAT 500 Pop

Smaller and less powerful than a Mini Cooper but with more personality than a Toyota Yaris, KBB says the Fiat 500 offers a unique combination of European heritage and subcompact practicality.

Kelley Blue Book Fair Purchase Price: $15,353

60-month APR: 0%

Expiration date: N/A
Monthly payment: $256

2012 Mitsubishi Outlander Sport ES

According to KBB, the 2012 Mitsubishi Outlander Sport features style and a 5-year/60,000-mile warranty and 7-year/100,000-mile powertrain warranty.

Kelley Blue Book Fair Purchase Price: $19,303

60-month APR: 0%
Expiration date: 10/31/2012

Monthly payment: $322

A recent J.D. Power and Associates study found that offers of zero percent financing are strong motivators to get consumers into new car showrooms. But be aware that you might not qualify unless you have a very good credit score.

The U.S. Department of Transportation (DOT) has assessed a civil penalty of $100,000 against Australian carrier Qantas for violating the DOT rule requiring carriers and ticket agents to tell consumers that they may have to pay baggage fees, and directed Qantas to cease and desist from further violations.

“Airline passengers deserve to have complete and accurate information about how much their flight will cost, including baggage fees, when they first search for flights,” U.S. Transportation Secretary Ray LaHood said. “DOT will continue to take enforcement action against carriers and ticket agents when they fail to comply with our aviation consumer rules.”

Afoul of the rule

Under the Jan. 24, 2012, rule, carriers must clearly and prominently disclose on the first screen that offers a fare for a consumer’s specific itinerary that additional fees for baggage may apply, as well as show consumers where they can view the baggage fees. The rule applies to all airlines selling air transportation in the United States, including foreign carriers.

For a period of time after the new requirement took effect, a search of flights on Qantas’ website found that the airline failed to disclose on the first Webpage in which it offered fare quotations for specific itineraries that additional fees for baggage may apply and where consumers could see those fees.

In recent years traffic safety officials have figured something out. When young drivers have a car full of other teenagers, the risks of an accident go up.

That's why in some states now a newly licensed driver may not drive with other teens in the vehicle for the first few months. Triple-A recently completed a survey that confirms the logic of these laws.

The new research shows the number of teen passengers in a vehicle resulted in an increase of risky behaviors for 16 and 17-year-old drivers. Among 16 and 17-year-old drivers involved in fatal crashes speeding increased when there were other teen passengers in the car.

Late-night driving also increased, as did the use of alcohol.

Deadly consequences

"Teens driving teens can have deadly consequences," said Jack Peet, AAA Michigan Traffic Safety manager. "AAA urges parents to clearly communicate and limit the frequency that newly licensed teens drive with young passengers."

To reach its findings the AAA Foundation for Traffic Safety analyzed data on fatal crashes that occurred in the United States from 2005 through 2010. The report shows the prevalence of passengers ages 13-19 in fatal crashes involving drivers age 16 and 17, and examines the characteristics of those crashes according to age, sex and number of teen passengers present.

Researchers found that 9,578 drivers age 16 and 17 were involved in fatal crashes, and that 3,994 of these included at least one teen passenger.

"Teen crashes remain a huge problem nationwide," said AAA Foundation President and CEO Peter Kissinger. "Our past research clearly shows how young passengers substantially increase a novice driver's risk of being in a fatal crash, and these new findings underscore the need to refocus our efforts, to address the problem, from state legislatures to parents."

Three-step licensing

AAA is recommending that all states adopt and enforce a comprehensive three-stage graduated license system that would start with a learner's permit, move to an intermediate/probationary license, and then graduate to a full unrestricted license for novice drivers.

In addition, AAA would like to limit driving at night and with young passengers.

"Statistics show that graduated driver licensing programs are a concrete way of reducing the risk of motor vehicle crashes for novice drivers," said Peet. "Parental involvement is key in the learning to drive process and steps parents can take, such as setting and enforcing a parent-teen driving agreement, improve safety by gradually easing teens into driving."

Lest teens think AAA is picking on them, the auto club says the numbers don't lie.

Teenage drivers are involved in more crashes per mile than drivers of any other age group. Drivers aged 16 to 17 are involved in about seven times as many crashes per mile driven compared to drivers in their forties, fifties or sixties.

With all of its dominance in social media, it’s surprising that Facebook hasn’t dived into the e-commerce thing full steam yet. Of course there was Facebook Beacon which disclosed the information of users' online purchases on others' profile pages.

Facebook Beacon shut down under a slew of lawsuits associated with privacy complaints fairly quickly after it started in 2007. Since then, the social media company settled a suit for $9.5 million and other suits are still pending.

Mark Zuckerberg & Co. have now released what they call “Connections,” where ads from popular retailers like Neiman Marcus, Pottery Barn, and Victoria’s Secret will be able to be clicked upon, “liked,” and users can purchase items directly from the ad.

“We’ve seen that businesses often use pages to share information about their products through photo albums,” Facebook said in a statement. “Today, we are beginning a small test in which a few select businesses will be able to share information about their products through a feature called Collections.”

“Collections can be discovered in News Feed and people will be able to engage with these collections and share things they are interested in with their friends. People can click through and buy these items off of Facebook,” the statement reads.

Currently the new feature is in the testing phase, but will be fully rolled out within a day or so, and ultimately users will not only be able to select “like” when purchasing an item, they can also select “want” indicating a current or future interest in buying a particular product.

Big bold pictures

Taking a page from Pinterest, Collections will go the big-bold-picture route, as presenting anything less in order to advertise something these days is counterproductive.

Let's face it, we consumers like our huge bold colorful images when it comes to surfing in online retail stores. It’s almost as if we welcome the enticement that these kinds of Internet images provide, and we use that enticing feeling to help us make the final decision to buy something. We can all thank Pinterest for that.

Facebook also hopes its new feature will become a seamless part of the site's sharing experience, to the point where it’s commonplace to exchange fashion or home decorating ideas on the site.

“People will be able to engage with these collections and share things they are interested in with their friends," the company says. “People can click through and buy these items off of Facebook.”

Other retailers have joined Collections too, including Wayfair, Michael Kors, Smith Optics, and Fab.com, and it’s likely that other prominent retailers will also sign on in the near future, as interactive shopping is currently the new wave among many consumers, and a lot of retailers want in.

A "Collect" button

The feature will also have a “Collect” button, which will allow items to be placed in the user’s timeline, and Facebook believes that unlike its failed Beacon feature, Collections could be the new way people shop, purchase and discuss new products.

Once the user clicks Connect or Like, the item goes into the timeline of their friends, and the way retailers see it, the feature is a free way to have around-the-clock advertising, because once a user shows interest in a product it automatically has the potential to circulate to millions of users.

Currently, the Connections feature is free for both the user and retailer.

Facebook also says that if you’re not following a particular company, you won’t see pictures of products -- which if you were able to, would turn the colorful photos from inviting eye candy to annoying pop-up ads.

Although the social site is introducing the feature with seven retailers already on-board, it says in time all retailers that have a Facebook page could become part of the service.

Last week Facebook said it reached 1 billion users, and with its new Collection feature, it looks as if the company will continually try to link itself to areas of life that it hasn’t attached itself to yet.

Kind of scary

One never knows -- we could be seeing a Facebook movie feature, a supermarket or food lovers component, Facebook dating, it could go on and on, which is actually a bit scary.

But if the social site is successful at adding e-commerce to its already widely used list of features, it could laugh off the naysayers who have been almost happy that Facebook has suffered a few hardships lately, namely with the disappointing response to the company’s public offering.

Netflix, which helped seal the doom of your neighborhood video store just a few years ago, now has Amazon nipping at its heels. Will it go the way of Hollywood Video?

Probably not, but industry insiders say the next few months will be very interesting. Wall Street doesn't know which way to turn, as Netflix stock has become volatile of late.

Netflix, which suffered a public relations disaster in 2011 when it split off its streaming and DVD rental services, is still the leader. It has some 27 million customers and has made some nimble moves when encountering adversity.

Shifting strategy

When Starz Entertainment refused to renew its contract with Netflix, the company found itself without access to some of the blockbuster movies its members expected. While there was some initial grumbling Netflix has loaded up on popular television and cable series, such as "Mad Men," "Louie," and "Breaking Bad."

Instead of just watching a movie, viewers found they could sit down and in one very long night watch an entire season of a TV series, commercial-free.

But while Netflix is expanding its movie library with a deal with Paramount's Epix, its emerging rival, Amazon.com, has also secured a deal with Epix for its Amazon Prime service.

What Prime offers

Amazon Prime may eventually prove a major threat to Netflix as it adds content. While Netflix is all about video content, an Amazon Prime membership gives consumers more.

First, members get free two-day shipping when they order products from Amazon -- well, most of the time anyway. They also get instant access to streaming video content from Amazon's video library Third, they can download a large amount of content to their Kindles at no charge.

Where Netflix costs $8 a month, Amazon Prime is $79 a year. Broken down to a monthly rate, however, it's $6.58.

Advantage, Netflix

So why not switch to Amazon Prime? There are still a few issues to consider. Amazon does not have as large a library as Netflix, through recent history has shown things like that can charge very quickly.

You can watch content from both services in a variety of places but Netflix currently has more places where you can watch, including TiVo, Apple TV, iPhone, Nintendo Wii, Android phones and tablets, Nook color tablets, and Windows phones.

Most movies on Netflix now have subtitles while Amazon has yet to take that step. Still, Forbes recently called Amazon Netflix's worst nightmare. It notes that with Netflix losing exclusivity for much of its content, the video streaming landscape could change in a hurry.

Despite the chaos in the business world that may cause, the result for consumers is likely to be more choices and lower prices.

Barely a week after T-Mobile and MetroPCS announced plans to merge, it's reported that Japanese mobile carrier Softbank is in advanced talks to buy Sprint, the No. 3 U.S. wireless company.

The Wall Street Journal quotes people close to the negotiations as saying the deal would be valued at about $13 billion. 

Sprint has been struggling to merge its operations with Nextel, which it acquired a few years ago. The Softbank deal would, presumably, strengthen its financial position and enable it to more effectively compete against Verizon Wireless and AT&T, the No. 1 and 2 carriers.

Everyone keeps writing Sprint off but it's still here and its persistence could finally pay off if the Softbank deal goes through and Sprint gets a firmer foundation to support its growth efforts in the U.S.

AT&T tried to buy T-Mobile about 18 months ago, you'll recall, and Sprint was one of the most outspoken opponents, saying it would be hard-pressed to compete against a strengthened AT&T. Although it has since gained some ground, Sprint remains about half the size of Verizon.

The Justice Department blocked that deal and the competitive situation has been in flux since then.

Both Sprint and Softbank, Japan's No. 3 carrier, have been working to expand their high-speed LTE networks, so a merger between the two could bring economies of scale to the build-out effort.  

An angry consumer charges that eBay sells insurance that excludes from coverage the exact items it ships, rendering the policy useless. In a federal  class action, lead plaintiff Luke Knowles claims eBay knows its ShipCover insurance excludes entire categories of products from coverage, but doesn't  disclose that to sellers when they buy the insurance.

Knowles said he regularly sells coins on eBay and buys  ShipCover insurance to cover them, according to Courthouse News Service.

When a buyer notified him that a package he sent arrived open, with the coin missing, Knowles says, he refunded the buyer the purchase price and then filed a claim under the ShipCover insurance, but the claim was denied by eBay's insurer, which claimed that the "'item insured is on the list of items that are ineligible for coverage,'" according to the complaint.

"The ShipCover policy excludes from coverage 'coins, bullions, loose diamonds or stones, stocks, bonds, currency, deeds, evidences of debt, travelers checks, money orders, gift certificates, calling cards, lottery tickets, admission tickets, or any other negotiable documents,'" the complaint states.
But Knowles says: "These exclusions are not evident on the checkout page, even though that page offers the insurance sets the insured value, and that determines the price of insurance."

Knowles said he would not have bought insurance to protect coins if he had known that it did not, in fact, cover coins and asserts that no one else would buy such insurance either.

His suit names eBay, eBay Insurances Services, Brown & Brown of Missouri, and Fireman's Fund Insurance Co.

Can babies dance to recorded music? Yes, but only so long as no one posts a video of it to YouTube. That's the position Universal Music Corp. has taken in a case that highlights the extremes to which copyright holders will go to protect their turf.

The case -- widely regarded as absurd -- began back in 2007 when Stephanie Lenz's toddler son began dancing in the family's kitchen while Prince's rendition of "Let's Go Crazy" played in the background.

Lenz thought it was cute, an assertion most of the parties to the case do not dispute, and recorded a 29-second video which she then posted to YouTube so her family and friends could see it.

Not amused

But over at Universal, the legal staff was not amused and fired off a takedown demand to YouTube. Copyright law permits copyright holders to file such demands when their material is wrongfully displayed on Internet sites. It's intended to stop wholesale pilfering of software, music, books, articles and photos.

But there is also something called the Fair Use Doctrine, under which brief snippets of copyrighted material can be used -- quotes from a book or newspaper article, for example.

This cuts no ice, however, with the music and movie industries, known for being inflexible, even outrageous, in their demand that their customers toe the line.

Most consumers will bow to legal actions by giant corporations but Lenz fought back. With the help of the Electronic Frontier Foundation, she filed a lawsuit asking the court to hold Universal accountable for its actions.

A district court ruled in her favor, holding that content owners must consider fair use before sending copyright takedown notices.

Next Tuesday, Oct. 16, the case goes back to U.S. District Court in San Jose, Calif., where EFF Intellectual Property Director Corynne McSherry will ask the court to grant Lenz's motion for summary judgment in this case and rule that Universal's takedown was improper and an abuse of the Digital Millennium Copyright Act (DMCA).

"Parents are allowed to document and share moments of their children's lives on a forum like YouTube, and they shouldn't have to worry if those moments happen to include some background music," said McSherry. "Content companies need to be held accountable when their heavy-handed tactics squash fair use rights. We hope the judge gives Ms. Lenz the closure she deserves, and shows content owners they can't trample over users' rights."

For yet another month, there were fewer than expected foreclosure filings, adding to the optimism that the housing market is beginning to recover. But activity spiked in a number of states, leading some to warn that a shadow inventory of distressed properties has yet to hit the market.

First, the encouraging data. In September, foreclosure filings, which include everything from default notices to bank repossessions, fell seven percent from August and were down 16 percent from September 2011, according to RealtyTrac, a foreclosure marketing company.

Third quarter numbers also fall

The decrease in September helped drop the third quarter foreclosure numbers to the lowest level since the fourth quarter of 2007. Foreclosure filings were reported on 531,576 U.S. properties during the quarter, a decrease of five percent from the second quarter and a decrease of 13 percent from the third quarter of 2011. It's also the ninth consecutive quarter with an annual decrease in foreclosure activity. The report also shows one in every 248 U.S. housing units with a foreclosure filing during the quarter.

“We’ve been waiting for the other foreclosure shoe to drop since late 2010, when questionable foreclosure practices slowed activity to a crawl in many areas, but that other shoe is instead being carefully lowered to the floor and therefore making little noise in the housing market — at least at a national level,” said Daren Blomquist, vice president at RealtyTrac. “Make no mistake, however, the other shoe is dropping quite loudly in certain states, primarily those where foreclosure activity was held back the most last year.

Pace picks up in some states

Those are so-called "judicial foreclosure" states, where the law requires a foreclosure to go through the court system. In these states mortgage servicers got into trouble when it was discovered they were cutting corners with documents. Many foreclosures were placed on hold until a settlement was signed last spring.

As a result several judicial foreclosure states -- including Florida, Illinois, Ohio, New Jersey and New York -- continued to buck the national trend, registering substantial year-over-year increases in foreclosure activity in September and the third quarter.

"Several states where the foreclosure flow was not so dammed up last year could see a roller-coaster pattern in foreclosure activity going forward because of recent legislation or court rulings that substantively change the rules to properly foreclose,” Blomquist said. “A backlog of delayed foreclosures will likely build up in those states as lenders adjust to the new rules, with many of those delayed foreclosures eventually hitting down the road.”

Market could take a hit

Meaning more distressed properties could soon be headed for the market. While that may be good news for buyers in search of a bargain, it's not so good for the housing market as a whole, which needs to see some price appreciation, especially in cases where mortgage-holders are under water.

Meanwhile, September's overall decline in foreclosure can be traced to sizable drops in non-judicial states where the problem had been most pronounced. California, Georgia, Texas, Arizona and Michigan all showed marked improvement in their foreclosure numbers.

Of the 24 non-judicial states, 20 reported year-over-year decreases in foreclosure activity.

Arguments about climate change often seem abstract and far removed from day-to-day life. But in Florida, bordered by water on three sides, rising sea levels are becoming a source of everyday concern.

In a letter to President Obama and former Gov. Mitt Romney, more than 120 city and county officials and scientists in Florida note that the sea level has already risen about 8 inches along Florida’s coast and is having profound effects.

“Because Florida is so densely populated,” the letter states, “it is estimated 40 percent of the population and housing units at risk from sea level rise in the nation are here, in the state of Florida.”

The letter asks Obama and Romney to discuss, at campaign stops in Florida and at the October 22 Boca Raton debate, how they will address rising sea levels that threaten the state. 

“Sea level rise is causing the biggest problems in southern Florida, particularly in the southeast where communities are essentially at sea level and porous limestone allows sea water to penetrate inland,” said Len Berry, a professor in Florida Atlantic University’s environmental sciences program. 

Cities and counties in southern Florida are looking at billions of dollars in expenditures to address problems caused or exacerbated by sea level rise, the officials say.

“We just spent $10 million on new wells because salt water seeped into six of our wells that were close to the coast,” said Hallandale Beach City Commissioner Keith London, who also signed the letter. “We’re skimming water off of the top of another two wells because salt water is at the bottom.”

Flooded neighborhoods

Other cities, including Fort Lauderdale, Pompano Beach, Hollywood and Miami Beach, are dealing with sea water backing up into storm water pipes, flooding streets and neighborhoods.

The storm water pipes are intended to funnel water, which accumulates on city streets during heavy rains, into the ocean. But during seasonal high tides, and during extreme high tides -- one of which will occur on October 16 and 17 -- the pipes can become submerged by sea water. The sea water then backs up into the pipes out onto city streets. In Miami Beach, city leaders are considering a $206 million overhaul of their drainage system.

In addition, South Florida’s canal system, designed to help funnel excess inland water out to the ocean, isn’t working as effectively as it used to.  

“The canal system was built on a decline, using about a foot of gravity,” said Berry. “As sea level has risen, more than half of that foot gradient is now gone.  During some high tides the canal gates have to be closed to prevent sea water from flowing into the canals.”

Call for help

The letter calls on the next president to work domestically and internationally to mitigate further sea level rise and help local governments adapt to it.  The federal government currently provides no funding for city and county projects needed to prepare for the impacts of climate change.

“Florida is ground zero when it comes to sea level rise,” said Broward County Commissioner Kristin Jacobs, another signer of the letter. “Residents see this first hand, which is why local governments are leading the way in establishing policies to minimize and adapt to climate change.”

Problems associated with sea level rise extend beyond southeast Florida.  Sanibel Island, west of Fort Meyers Beach, is losing its fresh water marshes -- home to a number of endangered species -- due to salt water intrusion.  And a University of Florida study documented hardwood forests along the west coast north of Tampa Bay turning into saltwater marshes. 

Meanwhile, the Tampa Bay Water Authority, which delivers drinking water to three cities, and the Peace River Water Authority, which provides water for Charlotte and Sarasota counties, are wrestling with salt water moving up rivers that the authorities use as drinking water sources.    

August was a good month for airlines in terms of getting their passengers off the ground in decent fashion.

According to the U.S. Department of Transportation's (DOT) Air Travel Consumer Report, there were no tarmac delays of more than three hours on domestic flights and only one tarmac delay of more than four hours on international flights

The one international tarmac delay -- an Aug. 15 flight by Caribbean Airlines from New York's JFK Airport to Port of Spain, Trinidad and Tobago that was delayed on the tarmac for four hours, 28 minutes prior to takeoff -- is under investigation by DOT.

The larger U.S. airlines have been required to file complete reports on their long tarmac delays for domestic flights since October 2008. Under a new rule that took effect Aug. 23, 2011, all U.S. and foreign airlines operating at least one aircraft with 30 or more passenger seats must report lengthy tarmac delays at U.S. airports.

Also beginning Aug. 23, 2011, carriers operating international flights may not allow tarmac delays at U.S. airports to last longer than four hours. There is a separate three-hour limit on tarmac delays involving domestic flights, which went into effect in April 2010. Exceptions to the time limits for both domestic and international flights are allowed only for safety, security, or air traffic control-related reasons. Severe weather could cause or worsen such situations.

Other areas covered by the report include:

On-time performance

• The reporting carriers posted an on-time arrival rate of 79.1 percent in August, versus August 2011's 79.3 percent mark and July 2012's 76.0 percent.

Cancellations

• The reporting carriers canceled 1.3 percent of their scheduled domestic flights in August. The cancellation rate was 2.5 percent in August 2011 and 1.4 percent in July 2012.

Chronically delayed flights

• At the end of August, there were 56 flights that were chronically delayed -- more than 30 minutes late more than 50 percent of the time -- for two consecutive months. There were no chronically delayed flights for three consecutive months or more.

Causes of flight delays

• In August, the carriers filing on-time performance data reported that 5.26 percent of their flights were delayed by aviation system delays, compared with 6.07 percent in July; 7.68 percent by late-arriving aircraft, versus 9.03 percent in July; 5.79 percent by factors within the airline's control -- such as maintenance or crew problems -- compared with 6.32 percent in July; 0.53 percent by extreme weather, compared with 0.82 percent in July; and 0.04 percent for security reasons -- the same as in July. Weather is a factor in both the extreme-weather category and the aviation-system category. This includes delays due to the re-routing of flights by the Federal Aviation Administration in consultation with the carriers involved. Weather is also a factor in delays attributed to late-arriving aircraft, although airlines do not report specific causes in that category.
• Data collected by the Bureau of Transportation Statistics also shows the percentage of late flights delayed by weather, including those reported in either the category of extreme weather or included in National Aviation System delays. In August, 32.95 percent of late flights were delayed by weather, down 16.52 percent from August 2011, when 39.47 percent of late flights were delayed by weather, and down 19.06 percent from July when 40.71 percent of late flights were delayed by weather.

Mishandled baggage

• The U.S. carriers reporting flight delays and mishandled baggage data posted a mishandled baggage rate of 3.38 reports per 1,000 passengers in August, compared with August 2011's rate of 3.45  and July 2012's rate of 3.52 .

Incidents involving pets

• In August, carriers reported five incidents involving the loss, death, or injury of pets while traveling by air, equal to the the five reports filed in August 2011, but up from the three reports filed in July 2012. August's incidents involved three pet deaths and two pet injuries.

Complaints about airline service

• In August, the DOT received 1,886 complaints about airline service from consumers, up 33.2 percent from the 1,416 complaints filed in August 2011, but down 23.5 percent from the 2,466 received in July 2012.

Complaints about treatment of disabled passengers

• The report also contains a tabulation of complaints filed with DOT in August against airlines regarding the treatment of passengers with disabilities. The Department received a total of 73 disability-related complaints in August, up from the total of 48 complaints filed in August 2011, but down from the total of 97 complaints received in July 2012.

Complaints about discrimination

• In August, the Department received nine complaints alleging discrimination by airlines due to factors other than disability -- such as race, religion, national origin or sex. There were 12 in August 2011 and 16 in July 2012.

Consumers may file their complaints in writing with the Aviation Consumer Protection Division, U.S. Department of Transportation, C-75, W96-432, 1200 New Jersey Ave. SE, Washington, DC 20590; by voice mail at (202) 366-2220 or by TTY at (202) 366-0511; or on the Web.

The Federal Reserve has served notice it plans to keep buying mortgage-backed securities to keep interest rates at record lows. Rates have, indeed, fallen to new historic lows since the launch of the latest round of Quantitative Easing (QE) but rates have climbed in two weekly surveys.

In its weekly report Freddie Mac says the 30-year fixed rate mortgage (FRM) averaged 3.39 percent with an average 0.7 point for the week ending October 11, 2012; last week it averaged 3.36 percent. Last year at this time, the 30-year FRM averaged 4.12 percent.

The average 15-year FRM also climbed in the last week, rising slightly from 2.69 to 2.70 percent with an average 0.6 point. A year ago it averaged 3.37 percent. The average five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.73 percent this week with an average 0.6 point, up from last week when it averaged 2.72 percent. A year ago, the five-year ARM averaged 3.06 percent.

"Mortgage rates were little changed this holiday week following the employment report for September,” said Frank Nothaft, Freddie Mac's chief economist. “Payroll employment increased by 114,000 workers, although manufacturing jobs dipped for the second month in a row. Employment in the prior two months was revised up 86,000 and the unemployment rate fell to 7.8 percent, marking the lowest rate since January 2009."

Similar move in Bankrate survey

The weekly mortgage rate survey by Bankrate.com also showed a slight uptick in mortgage rates. In that survey the benchmark 30-year FRM rose to 3.59 percent from 3.52 percent last week.

The average 15-year mortgage rate rose from 2.84 to 2.88 percent and the larger jumbo 30-year mortgage rose to 4.19 percent, both at levels seen two weeks ago. There were new record lows on some adjustable mortgage rates, with the three-year and 10-year ARMs plunging to 2.72 percent and 3.24 percent, respectively.

The change in rates probably won't have much impact on a monthly payment, or make the difference in qualifying or not. However, it is a reminder to potential buyers that there may be a limit to how low mortgage rates can go. Waiting for a lower rate could end up costing you.

U.S. consumers stunned by near-record high cooling costs over a hot, dry summer aren't likely to get much relief during the coming winter months. The Energy Information Administration, part of the Department of Energy, expects household heating costs to be sharply higher this winter.

The last couple of winters have been fairly mild. That's expected to change this year with colder temperatures in many parts of the country. No matter how you heat your home, it's probably going to cost more.

Household natural gas heating demand in the October-through-March period is expected to be up nearly 14 percent, heating oil up 17 percent, electricity up 8 percent, and propane up 17 percent, according to EIA's Short-Term Energy and Winter Fuels Outlook for the 2012-13 U.S. heating season.

Reducing consumption

While demand is expected to be higher than last winter, consumption is forecast to be less than the five-year average for all the major heating fuels except heating oil, suggesting consumers will take steps to curtail usage in order to save money.

The reason for EIA's energy forecast can be found in the weather forecast. Meteorologists expect a much colder winter east of the Rocky Mountains compared with last winter, with heating degree days in the Northeast, Midwest, and South expected to be 20-to-27 percent greater this winter, according to National Oceanic and Atmospheric Administration's (NOAA) forecast.

The good news for consumers, however, is energy supplies remain ample. While geopolitical concerns in the Middle East could affect heating oil, they should have no bearing on natural gas or electricity supplies.

Plenty of energy

Natural gas is the most popular heating fuel, used by almost half of U.S. households. Natural gas inventories are expected to climb to 3.9 trillion cubic feet by November 1, a record for that time of year.

Natural gas prices have also been relatively low because of ample supplies. While they may rise on increased demand, the supply situation should keep any price hikes modest.

Electricity is the main heating source for almost 38 percent of households. In addition to record natural gas inventories to draw down to generate electricity, coal stocks held by the U.S. electric power sector are forecast to total 187 million metric tons by November 1, up nearly 19 percent from a year earlier.

Heating oil is burned by only six percent of U.S. households for winter fuel, with eight out of 10 of those heating oil users located in the Northeast. Lower heating oil stocks in the East Coast and Gulf Coast states, along with New York requiring heating oil with lower sulfur levels, are expected to contribute to a tighter heating oil market this winter.

Propane is used to warm about five percent of households, many located in rural areas. Propane inventories totaled almost 76 million barrels in early October, up 32 percent from the same period a year ago.

Tyson Foods of Pine Bluff, AR, is recalling approximately 67,269 pounds of packages labeled as Honey BBQ Flavored Boneless Chicken Wyngz because of misbranding and undeclared allergens.

Buffalo Style Boneless Chicken Wyngz were packaged in bags meant for Honey BBQ Flavored Boneless Chicken Wyngz and contain the allergens milk, soy and egg, which are not declared on the Honey BBQ Flavored Boneless Chicken Wyngz label.

The following products are subject to recall:

• 25.5 oz. (1.59 lb.) bags of “Tyson any’tizers Boneless Chicken Wyngz Honey BBQ Flavored.” Each bag bears the USDA mark of inspection. The establishment number “P13456” and the use by date “Aug 072013” or “Aug 082013” are inkjetted on the back of the bags.
• 12.75 lb. shipping cases of “Fully Cooked Boneless Chicken Wyngz Buffalo Style.” Each case bears the USDA mark of inspection. The establishment number “P13456” and the use by date “Aug 07 2013” or “Aug 08 2013” are inkjetted on the cases. Identifying case codes “2202PBF0208:xx” through “2202PBF0223:xx” or “2212PBF0200:xx” through “2212PBF0223:xx,” where the last four digits represent hours and minutes (“xx”) in military time, also can be found inkjetted on cases subject to recall.

The products were produced on Aug. 7 and Aug. 8, 2012, and distributed to retail stores nationwide.

Tyson Foods was alerted to the problem through consumer complaints. There have been no reports of adverse reactions due to consumption of these products. Anyone concerned about a reaction should contact a healthcare provider.

Consumers with questions about the recall should contact Tyson Foods’ Consumer Relations at (866) 328-3156.  

Walmart and American Express did more than just announce a new product this week. It appears they've fired a shot across the bow of the banking industry.

The retailer and financial services companies announced Bluebird, a new prepaid card with very few fees. It's aimed at consumers who have dropped out of banking, or are getting fed up with bank fees.

Bluebird works like a debit card. You load it with your own money and can use it online, at ATMs and anywhere American Express Cards are accepted. There are no overdraft fees, monthly service charges or activation fee.

Competitors swoon

Wall Street took note immediately. Shares of NetSpend Holdings Inc. and Green Dot Corp., two of the largest prepaid card companies, plunged soon after the announcement.

Wall Street banking industry analyst Dick Bove said American Express is charging Walmart less than what it charges banks like JP Morgan Chase, Bank of America and Wells Fargo in swipe fees.

"The Durbin Amendment sets prices on interchange fees,” Bove wrote in a note. “Wal-Mart avoids these price controls because its new product is not called a debit or cash card. It is being handled by American Express as if it were a Traveler’s Check. Presumably, by using this technique, WalMart avoids Durbin and it can receive whatever 'commission' American Express chooses to pay on these cards."

How good for consumers is it?

Suddenly, it seems, the banks are on the defensive. Does that mean Bluebird gives consumers a real alternative to banks?

“Overall, the Bluebird Prepaid Card seems like a great addition to the growing prepaid card market,” said Odysseas Papadimitriou, a former Capital One senior director and current CEO of the credit card comparison website CardHub.com. “Not only is it one of the few cards out there that’s even suitable for each of the main ways consumers use prepaid cards, but it’s also one of the least expensive options for each application.”

Papadimitriou said he based his conclusions on his analysis of what Bluebird offers and what it costs. He found it can be free to use as a replacement checking account, since it does not charge fees for activation, monthly or annual maintenance, or ATM withdrawals at 22,000 MoneyPass ATMs nationwide if you are enrolled in direct deposit.

The fact that it also offers free online bill pay means it is on par with the GreenDot Gold Prepaid Card, which was Card Hub’s selection for the Best Prepaid Card to Use as a Replacement Checking Account in 2012.

Just two negatives

Papadimitriou said he really only found two negatives: If you are a heavy ATM user and don't use direct deposit, those ATM fees will add up. Second, you can't automatically deposit federal benefits, such as Social Security or VA benefits, to the card.

“The fact that its only major fee is a $2 charge for all but your first monthly ATM withdrawal -- which is waived for those enrolled in direct deposit -- means that it will be among the least expensive prepaid cards, depending on how exactly you use it,” Papadimitriou said. “The ability to load funds via check by taking a picture through Amex’s mobile application also makes it one of the few cards suitable to be an alternative check cashing tool.”

Which all means banks should probably be worried. Walmart, after all, has repeatedly identified market segments where consumers were being poorly served and eventually owned the market. Selling a wide list of generic prescription drugs for $4 comes to mind.

In 2006 Walmart seriously considered seeking a charter for its own bank, with branches in all its stores, before finally giving up on the idea. With Bluebird, it may have revived it.