Current Events in January 2014

One way or another, the old copper-based telephone networks will be going away. Critics say it's already happening, as telephone carriers fail to maintain the networks and fail to adequately repair damage caused by storms and accidents.

Consumers have made it pretty clear they're ready to switch to digital networks, both Internet-based services like Skype and Vonage and the wireless networks that power their smartphones.

Now the Federal Communications Commission is weighing in. It's expected to vote today to authorize trials around the country in which phone companies would switch customers to new Internet-based networks to gather data on what, if any, problems occur.

Rural concerns

Rural areas and small businesses are the primary concerns at the moment. Rural areas tend to lack the higher-speed broadband services available in large metropolitan areas and many consumers have found that Skype and similar services just don't work very well for them.

Likewise, small businesses have a lot of equipment hooked up to the copper network -- things like credit card readers, burglar and fire alarms and automated phone trees. Many of these systems are made to work on analog systems and may have to be replaced or upgraded if the telephone network switches to a digital architecture.

Many consumers are already on digital systems without realizing. Most of the telephone services offered by cable systems are digital, as are FiOS and AT&T's Uverse. 

The plan being considered today would allow phone companies to convert the phones of volunteers in specified service areas to digital. New customers in the test areas would be required to go digital from the start.

Regulatory questions

The question here is not so much technical as regulatory. Everyone knows digital technology works; you're reading this, aren't you? But POTS -- the term old-line telephone types use to refer to Plain Old Telephone Service -- has for the better part of a century been heavily regulated to promote the basic concepts of:

• universal service,
• rate equity, and
• service reliability.

Rand Paul and other Libertarians may not like this, but telephone and electricity service, along with natural gas in some areas, have long been considered "utilities." Companies were allowed to have a monopoly in a region in exchange for agreeing to provide service everyone in their region, to charge everyone the same amount for the same grade of service and to maintain a reasonable reliability standard.

The rapid growth of the Internet and wireless service has broken the regulated monopoly model but the FCC wants to be sure that a conversion to a digital network doesn't leave anyone behind.

This is not a theoretical argument if you are a rancher living 20 miles from your nearest neighbor. Currently, the phone company has to run a line to your house and provide you with service for the same price as someone who lives across the street from the telephone company office in the nearest town.

FCC officials quoted over the last few days have said that the commission will not be rushing into a mass conversion and insist the tests being contemplated today are just the beginning of the process.  

The Wichita lineman may still be on the line, but it might be time for him to have a backup plan.

Well, that didn't last long. It was just last May that Google made a lot of noise about its plan to manufacture a smartphone in the USA, saying the Moto X would be slapped together down home in Ft. Worth, Texas.

Google had purchased Motorola Mobility in hopes of gaining a foothold in the highly competitive smartphone business. Its Android software is already the world's leading smartphone operating system but, apparently, Google was envious of the way Apple had built such fanatical loyalty with its integrated hardware/software system.

So much for that idea.

Mouths dropped yesterday as Google announced it was selling Motorola Mobility to the Chinese computer maker Lenovo, the fast-growing firm that bought IBM's personal computer business a few years ago.

Google paid $12.5 billion for Motorola less than two years ago and is selling it for a little less than $3 billion. That doesn't sound so good but Google is getting a big consolation prize in the form of lots of patents that it got with the Motorola purchase.

There's sensitivity about Chinese companie buying high-tech American businesses but the betting today is that the deal gets done. 

There's no getting around it: This has been one cold winter in many areas of the U.S., with temperatures sinking in areas where folks don't even own a coat.

While nobody likes to be cold, frigid weather can pose special risks to older adults. The National Institute on Aging (NIA) has some advice for helping older people avoid hypothermia -- when the body gets too cold -- during cold weather.

Hypothermia -- what it is

Hypothermia is generally defined as having a core body temperature of 95 degrees Fahrenheit or lower and can occur when the outside environment gets too cold or the body's heat production decreases.

Older adults are especially vulnerable to hypothermia because their bodies’ response to cold can be diminished by underlying medical conditions such as diabetes and by use of some medicines, including over-the-counter cold remedies.

Hypothermia can develop in older adults after relatively short exposure to cold weather or even a small drop in temperature.

Someone may suffer from hypothermia if he or she has been exposed to cold temperatures and shows one or more of the following signs: slowed or slurred speech; sleepiness or confusion; shivering or stiffness in the arms and legs; poor control over body movements; slow reactions, or a weak pulse.

What to do

Here are some tips to help older people avoid hypothermia:

• Make sure your home is warm enough. Set the thermostat to at least 68 to 70 degrees. Even mildly cool homes with temperatures from 60 to 65 degrees can lead to hypothermia in older people.
• To stay warm at home, wear long underwear under your clothes, along with socks and slippers. Use a blanket or afghan to keep your legs and shoulders warm and wear a hat or cap indoors.
• When going outside in the cold, it is important to wear a hat, scarf, and gloves or mittens to prevent loss of body heat through your head and hands. A hat is particularly important because a large portion of body heat can be lost through the head. Wear several layers of warm loose clothing to help trap warm air between the layers.
• Check with your doctor to see if any prescription or over-the-counter medications you are taking may increase your risk for hypothermia.

With the labor market apparently opening up (depending on which month you're looking at) a bit, people who are out of work are putting their resumes in order and preparing for that all important interview.

One important fact to keep in mind is that the first few minutes of the interview may be the most crucial. A new survey from CareerBuilder finds that nearly half (49%) of employers say they know within the first five minutes whether a candidate is a good fit for the position. Another 87% know within the first 15 minutes.

That said, there are a lot of things you should NOT do when talking with a hiring manager.

Most memorable mistakes

When asked about the most outrageous mistakes candidates made during a job interview, employers gave the following real-life examples:

• Applicant warned the interviewer that she “took too much Valium” and didn’t think her interview was indicative of her personality
• Applicant acted out a Star Trek role
• Applicant answered a phone call for an interview with a competitor
• Applicant arrived in a jogging suit because he was going running after the interview
• Applicant asked for a hug
• Applicant attempted to secretly record the interview
• Applicant brought personal photo albums
• Applicant called himself his own personal hero
• Applicant checked Facebook during the interview
• Applicant crashed her car into the building
• Applicant popped out his teeth when discussing dental benefits
• Applicant kept her iPod headphones on during the interview
• Applicant set fire to the interviewer’s newspaper while reading it when the interviewer said “impress me”
• Applicant said that he questioned his daughter’s paternity
• Applicant wanted to know the name and phone number of the receptionist because he really liked her

Common mistakes

The top most detrimental blunders candidates make in interviews are often the most common:

• Appearing disinterested – 55%
• Dressing inappropriately – 53%
• Appearing arrogant – 53%
• Talking negatively about current or previous employers – 50%
• Answering a cell phone or texting during the interview – 49%
• Appearing uninformed about the company or role – 39%
• Not providing specific examples – 33%
• Not asking good questions – 32%
• Providing too much personal information – 20%
• Asking the hiring manager personal questions – 17%

Proper communication

Communication involves much more than simply words, and forgetting that during an interview could harm your chances. These are the worst body language mistakes candidates make in job interviews:

• Failure to make eye contact – 70%
• Failure to smile – 44%
• Bad posture – 35%
• Fidgeting too much in one’s seat – 35%
• Playing with something on the table – 29%
• Handshake that is too weak – 27%
• Crossing one’s arms over one’s chest – 24%
• Playing with one’s hair or touching one’s face – 24%
• Using too many hand gestures – 10%
• Handshake that is too strong – 5%

“Employers want to see confidence and genuine interest in the position. The interview is not only an opportunity to showcase your skills, but also to demonstrate that you’re the type of person people will want to work with,” said Rosemary Haefner, Vice President of Human Resources at CareerBuilder. “Going over common interview questions, researching the company, and practicing with a friend or family member can help you feel more prepared, give you a boost in confidence, and help calm your nerves.”

A bump in the road for home sales.

According to the National Association of Realtors (NAR), the Pending Home Sales Index (PHSI), which is based on contract signings, fell 8.7% In December to 92.4 from 101.2 in November. That puts the index 8.8% below its level of a year ago, and at the lowest level since October 2011

The data reflect contracts but not closings.

Weather among the factors

Several factors were working against buyers. “Unusually disruptive weather across large stretches of the country in December forced people indoors and prevented some buyers from looking at homes or making offers,” he said Lawrence Yun, NAR chief economist. “Home prices rising faster than income is also giving pause to some potential buyers, while at the same time a lack of inventory means insufficient choice. Although it could take several months for us to get a clearer read on market momentum, job growth and pent-up demand are positive factors.”

Widespread declines

• The PHSI in the Northeast dropped 10.3% to 74.1 in December, and is 5.5% below a year ago.
• In the Midwest the index declined 6.8% to 93.6, and is 6.9 % lower than December 2012.
• Pending home sales in the South fell 8.8% to an index of 104.9, and are 6.9% below a year ago.
• The index in the West, which is most affected by constrained inventory, dropped 9.8% to 85.7, and is 16.0% below December 2012.

NAR expects total sales of existing homes should hold close to 5.1 million this year -- essentially the same as 2013, but inventory remains limited in much of the country. The national median existing-home price is projected to rise about 5.4%.

Mortgage rates

Average fixed mortgage rates (FMRs) moved lower this week following the release of weaker housing data.

Freddie Mac reports the 30-year FRM averaged 4.32% with an average 0.7 point for the week ending January 30, down 7 basis points from last week when it averaged 4.39%. A year ago at this time, it averaged 3.53% percent.

The average this week for the 15-year FRM was 3.40% with an average 0.6 point, compared with last week's average of 3.44%. The 15-year FRM averaged 2.81% last year at this time.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged was down 3 basis points to 3.12% with an average 0.5 point. A year ago, the 5-year ARM averaged 2.70%.

The 1-year Treasury-indexed ARM averaged 2.55% this week with an average 0.4 point, up 1 basis point from last week when it averaged 2.54%. At this time last year, the 1-year ARM averaged 2.59%.

Frank Nothaft, vice president and chief economist, Freddie Mac, says much of the drop can be attributed to the weaker housing data this week.

"Mortgage rates eased somewhat as new home sales fell 7% in December to a seasonally adjusted pace of 414,000 units, below the consensus,” he pointed out, adding, “The S&P/Case-Shiller 20-city composite house price index declined 0.1 percent for the month of November -- the first decrease since November 2012."

The robust economic growth reported for the third quarter was apparently a fluke.

After expanding at an annual rate of 4.1% in the July-September period, the gross domestic product (GDP) increased at an annual rate of 3.2% in the fourth quarter. That brought the performance of GDP

-- the output of goods and services produced by labor and property located in the U.S. -- to an annual rate of 1.9% for all of 2013.

Positive factors

The fourth-quarter increase reflected positive contributions from personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory investment, and state and local government spending. They were partly offset by drops in federal government spending and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

The deceleration in the fourth quarter reflected a slowdown in private inventory investment, a larger decrease in federal government spending, a downturn in residential fixed investment, and decelerations in state and local government spending and in nonresidential fixed investment that were partly offset by accelerations in exports and in PCE and a deceleration in imports.

The complete GDP report is available on the Commerce Department website.

Jobless claims

A surprising spike in first-time jobless claims last week.

The government reports initial applications for state unemployment benefits jumped by 19,000 in the week ending January 25 -- to seasonally adjusted 348,000. Economists surveyed by Briefing.com were forecasting a drop to 325,000.

While the Department of Labor (DOL) says there were no unusual factors in the claims data, analysts believe extreme cold over the past couple of weeks coupled with the Martin Luther King, Jr., holiday may have contributed to some of the gain. They look for the claim level to fall back to around 330,000 over the next few weeks

The 4-week moving average, which is less volatile and seen as a more accurate gauge of the labor market, inched up 750 to 333,000.

More information can be found on the DOL website.

Missouri Attorney General Chris Koster says his office has reached a settlement with the owners of a former vehicle extended-service-contract seller, Dealer Warranty Services, LLC, which also did business nationwide under the name "Certus" and "Certus Assurance Group." 

The settlement establishes a restitution fund of $55,000 to provide refunds to Missouri consumers who were sold this additive coverage. Nothing is provided for consumers in other states.

Under the terms of the settlement, the company and its vice president and president, Theodore Conrad and Jeff Zykan, are ordered to pay $60,000 to settle claims of deception, unfair practices, and unlawful insurance practices. The men are permanently prohibited from selling unlawful vehicle service contracts in Missouri.

According to Koster, Dealership Warranty Services marketed throughout the United States primarily through direct mail advertisements, urging consumers to call for a limited-time extended warranty program to save thousands of dollars on repair bills.

Once on the phone, salespeople would sell vehicle breakdown coverage with a generalized and often misleading description of the coverage. Many customers later discovered their contracts were actually provided by a third party, and did not contain the coverage promised. Consumers who asked for refunds faced numerous objections and delays.

Gree Electric Appliances is expanding an earlier recall of dehumidifiers to include 352,700 in the U.S. and Canada with the GE brand name. The company previously recalled 2.2 million dehumidifiers under 12 other brand names.

The dehumidifiers can overheat, smoke and catch fire, posing fire and burn hazards to consumers.

The firm has received 16 reports of incidents with the recalled GE-brand dehumidifiers, including 11 reports of overheating with no property damage beyond the units, and 5 reports of fires beyond the units which were associated with about $430,000 reported in property damage. This is in addition to more than 71 fires and $2,725,000 in property damage reported with other brands of Gree-manufactured dehumidifiers in the previous recall. No injuries have been reported.

This recall involves 30, 40, 50, 65-pint dehumidifiers with the GE brand name. The brand name, model number, pint capacity and manufacture date are printed on the nameplate sticker on the back of the dehumidifier. The dehumidifiers are light gray plastic and measure between 19 and 23 inches tall, 13 and 15 inches wide, and 9 and 11 inches deep.

Recalled model numbers are listed below.

The dehumidifiers, manufactured in China, were sold at Sam’s Club, Walmart and other stores nationwide and in Canada, and online at Amazon.com and Ebay.com, from April 2008, through December 2011, for between $180 and $270.

Consumers should immediately turn off and unplug the dehumidifiers and contact Gree to receive a refund.

Consumers may contact Gree toll-free at (866) 853-2802 from 8 a.m. to 8 p.m. ET Monday through Friday, and on Saturday from 9 a.m. to 3 p.m. ET.

Much of the nation may be shivering through this winter, but home prices are showing no signs of cooling.

According to the S&P/Case-Shiller Home Price Indices, the 10-City and 20-City Composites increased 13.8% and 13.7% year-over-year through November.

Dallas posted its highest annual return of 9.9% since 2000, while Chicago boasted an annual rate of 11.0% -- its highest since December 1988.

For the month of November, the two Composites dipped 0.1%, the first decrease since November 2012. Nine out of 20 cities recorded positive monthly returns. Of these nine, Boston and Cleveland were the only cities not in the Sun Belt. Minneapolis and San Diego remained relatively flat. After declining last month, Dallas edged up to set a new index high, while Denver was 0.6% off of its highest level due to two consecutive months of declines.

A good month nonetheless

“November was a good month for home prices,” said David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices. “Despite the slight decline, the 10-City and 20-City Composites showed their best November performance since 2005. Prices typically weaken as we move closer to the winter. Las Vegas, Los Angeles and Phoenix stand out as they have posted 20 or more consecutive monthly gains.

November continued a steady rise in year-over-year increases that started in June 2012, even though the rate of increase slowed. Looking at the year-over-year returns, the Sun Belt continued to push ahead with Atlanta, Las Vegas, Los Angeles, Miami, Phoenix, San Diego, San Francisco and Tampa taking eight of the top nine spots. Detroit continued to recover but remains the only city with prices below its 2000 level.

“Home prices continue to rise despite last May’s jump in mortgage interest rates,” said Blitzer. “Mortgage applications for purchase were up in recent weeks confirming home builders’ optimism shown by the NAHB survey. Combined with low inflation -- 1.5% in 2013 – home owners are enjoying real appreciation and rising equity values. While housing will make further contributions to the economy in 2014, the pace of price gains is likely to slow during the year.”

Increases vs. declines

Nine cities showed price increases from October to November. Miami took the lead with a gain of 1.4% and Las Vegas, the previous leader, followed at +0.6%. Chicago experienced the largest decline -- 1.2%. Nine Metropolitan Statistical Areas (MSAs) showed acceleration as measured by their monthly returns – Boston, Cleveland and San Francisco showed returns that were over 50 basis points higher in November compared with October.

After experiencing its first decline in 19 months, San Francisco rebounded to positive territory with a 0.4% gain in November. Las Vegas, Los Angeles, Miami, Phoenix and Tampa are the only cities that recorded positive gains for 12 or more consecutive months.

Boston, Chicago, Cleveland, Dallas, Las Vegas, Miami, New York, Tampa and Washington were the nine cities to accelerate on an annual basis. Boston showed an annual rate of 9.8%, an improvement of 1.2 percentage points from last month. Cleveland and New York followed with November year-over-year returns of 6.0% compared to 4.9% for October. Despite the improvement, Cleveland and New York remain the two lowest ranked cities. 

The U.S. Postal Service (USPS) has some severe financial problems, defaulting on a $5.6 billion retiree benefits payment last October. Besides its huge advance pension liability the USPS is losing money on first class mail, with email cutting deeply into its revenue.

What's the answer? Perhaps some bold, outside-the-box thinking. At least that's what has emerged from a USPS Inspector General's Office report.

If the USPS can't make money selling stamps, the report concludes, maybe it needs to sell something else. Looking around, the watchdog came up with a short list of services it says are needed and could be profitable.

Debit cards and small loans

For example, why not sell financial services, such as debit cards, check-cashing services, and even make small dollar loans, without the triple-digit interest rates charged by the corner payday loan store?

With millions of consumers dropping out of the banking system because of high fees, the Inspector General's report suggests there is a huge market for these services.

"While banks are closing branches all over the country, mostly in low-income areas like rural communities and inner cities, the physical postal network is ubiquitous," the inspector general's office said in its paper. "The Postal Service also is among the most trusted companies in America and trust is a critical element for implementing financial services."

The report points out that more than a quarter of Americans live partially or completely without access to mainstream financial services and are often forced to rely on costly services like payday loans or check cashing stores to cover their everyday expenses.

Potential $89 billion market

“These households spent $89 billion in 2012 just on fees and interest – an average of almost 10 percent of their income,” the authors write.

But what does the USPS know about banking? Admittedly, not a lot. However, the reports suggests the agency could partner with banks and other organizations to develop financial services. It could be a way for banks to reconnect with disillusioned consumers and turn into a win-win.

The report points out the Postal Service already provides non-bank financial services like money orders and international money transfers, and it says many American families could benefit if the Postal Service expanded its offerings.

Intriguing numbers

The numbers are intriguing. Today, millions of Americans do not have a bank account. The use of costly services like payday loans and check cashing exchanges, just to make ends meet, is well documented and is a source of concern among many consumer groups.

When it comes to financial services, the underserved population comprises more than a quarter of all U.S. households — some 68 million adults. They are an economically diverse mix of working and middle class families, poor and unemployed people hurt by the recent economic crisis, young people, immigrants, and others who are trying to make it paycheck to paycheck. Add it all up and it's a pretty big market, the report says.

This bold idea is not original, the Inspector General admits. Post offices in other countries have been involved in providing financial services to their customers for years. Because the infrastructure is mostly there, it's a move that just makes sense, the report's authors contend.

Physical link to cashless society

“As society becomes increasingly cashless, the Postal Service’s ability to provide a physical link to the new digital economy will become more and more vital,” the report said.

As a first step the Inspector General's Office said the Postal Service could explore services similar to those it is already authorized to provide, such as money orders and international money transfers. In addition, it proposes small market tests in key geographic areas to demonstrate new products’ viability.

Although some financial services may have a longer development period before they are producing strong revenue, the report contends others have the potential to be a big hit right away.

“There is a clear market need for innovative financial products, and millions of families would benefit from more affordable solutions,” the report concludes. “The Postal Service could be exactly what they are looking for.”

President Obama's guaranteed retirement savings plan got only a few lines in his State of the Union speech last night and isn't being much remarked upon today, but it could give vulnerable Americans a shot at beginning to save at least a few dollars for their retirement.

"Let’s do more to help Americans save for retirement," Obama said. "Today, most workers don’t have a pension. A Social Security check often isn’t enough on its own. And while the stock market has doubled over the last five years, that doesn’t help folks who don’t have 401ks." 

The plan -- called MyRA, as in "My IRA" -- is basically very simple: It's a savings bond that pays a little bit more than a regular Treasury bill. Technically, it's a Roth IRA, a savings vehicle that lets you invest after-tax funds and withdraw them after retirement without paying tax on the interest you've earned.

As Obama put it: "It’s a new savings bond that encourages folks to build a nest egg. MyRA guarantees a decent return with no risk of losing what you put in." 

Professional investment advisors are skeptical of the plan's prospects for success, however.

“It's not going to go anywhere. It adds to the alphabet soup of all the different kinds of IRAs,” George Papadopoulos, the head of a financial advisory firm that bears his name, said. He predicted that workers will procrastinate, according to the trade journal Investment News.

John Hauserman, president of RetirementQuest Wealth Management, called it "silly," saying it deprived working people of the much higher gains they could achieve in the stock market. 

Decent though modest

Obama, in introducing the plan, had compared it favorably to the stock market, saying that not everyone could enjoy the high returns the market has returned over the last year, though he didn't say why not.

Earnings from MyRA would be, Obama said, decent though modest -- about 1.4% at current rates. But earning a little bit of interest and saving the principal is a lot better than saving nothing. 

Obama's plan is indeed modest. It would only allow savings up to $15,000, at which point the money would have to be rolled over into a regular, privately-administered Roth IRA. 

MyRA is also simple, and is intended to encourage workers to start saving right now, rather than putting it off until someday in the dim and distant future, a day that all too often never comes. 

Contributions could come through regular payroll deductions of as little as $5. And although employers would collect the money, they would not be in control of the fund -- therefore, the employee's money wouldn't wind up being invested in company stock that might conveniently turn out to be worthless down the road.

The program is similar to the Thrift Savings Plan that's now available to federal employees.  Obama is implementing the program through executive order, basically directing the Treasury Department to go ahead and do it.

By itself, MyRA won't solve the critical problem of Americans approaching retirement with virtually no assets but it could help older Americans squirrel away a few dollars. And, more importantly, it could help younger Americans get into the habit of investing and would demonstrate the power of compound interest over time, setting an example for future generations.

But will it match the stock market? Not likely, most financial professionals seem to agree.

The nation's unemployment rate is finally beginning to fall but economists generally agree that's due in large part to discouraged job seekers dropping out of the labor force. The unemployment rate only counts those looking for work.

A sizable portion of those who have dropped out are the long-term unemployed. In a national study by the employment site CareerBuilder.com, 30% of workers who were previously employed full time and who have been out of work for 12 months or longer said they haven't had a single job interview since they became unemployed.

Some of these long-term unemployed also reported losing their homes, struggling to feed their families and having to turn to their parents to supplement income.

"There are many talented people in the U.S. who are having a tough time finding a job – not because of a lack of ability, but because of ongoing challenges in the economy," said Rosemary Haefner, Vice President of Human Resources at CareerBuilder. "While our study explores the struggles they are facing, it also brings to light the resilience of these workers who remain optimistic, look for jobs every day and take measures to learn new skill sets to open the doors to new opportunities."

Grinding effect

Being out of work for a long period of time can have a grinding effect. A quarter of those surveyed said they don't always have enough money for food. Another 25% said the situation has caused strained relationships with family and friends.

Significantly, 66% of the long-term unemployed said they believed their age or experience had been an obstacle to getting a job. The number jumped to 92% among those 55 and older.

While older workers may feel the deck is stacked against them in the labor market, there are plenty of employers who value maturity and experience. AARP, which tracks employment trends for those 55 and older, reported some progress in late 2013 for job seekers in that age group.

Better news for older job seekers

At the end of the year the jobless rate for 55-plus workers was 5.1%, significantly lower than the population at large. It was a nine-tenths of a percent improvement over the previous 12 months. In another piece of good news for this group, the average duration of unemployment for older job seekers fell to 45.8 weeks from 50.7 weeks between November and December. Even so, many older job seekers believe they are over-represented among the long-term unemployed.

In a Catch-22, 63% questioned in the CareerBuilder survey said the longer they are without a job, the more leery prospective employers are perceived to be.

Staying proactive

Despite the discouragement, however, 20% of those questioned said they are working to expand their professional contacts and learn new skills. Twelve percent have taken a class and five percent have gone back to school full time.

And despite the discouragement, they are still trying. Forty-four percent of the long-term unemployed said they look for jobs every day; 43% look every week.

Even though three in ten long-term unemployed said they haven't had any interviews since they lost their jobs, the same number said they have had five or more interviews. Only one in ten said they have turned down a job while being out of work.

A 2013 report by the Urban Institute concluded that “even if the economy returns to full employment, there are likely to remain many workers facing long-term unemployment challenges.” The reasons why are not so clear cut.

A Kansas company has agreed to make changes in the procedure it uses to make minivans accessible to wheelchair users after an investigation by the New Jersey Division of Consumer Affairs.

The potential fire and explosion hazards were discovered by the New Jersey agency during its investigation into complaints by a consumer who was concerned about a check engine light in her modified minivan.

The defect was found in Toyota Siena minivans that had been modified for wheelchair accessibility by ElDorado National (Kansas), Inc. The New Jersey consumer had purchased her vehicle from a New Jersey Toyota dealership; it was then shipped to ElDorado for wheelchair accessibility modification.

The Division’s investigation found the same defect and various stages of damage in a total of six ElDorado-modified Toyota Siena minivans in New Jersey. ElDorado said that a total of 82 minivans nationwide were affected.

In response to the Division’s investigation and findings, ElDorado issued a nationwide recall of all affected Toyota Siena minivans that it had modified, and has corrected all defects at no cost to consumers. The company also provided free loaner vehicles to the six affected New Jersey consumers. ElDorado says that it has changed the way it modifies Toyota Siena minivans, in order to prevent similar defects. No injuries were reported as a result of the defects.

"Saved lives"

“Our investigation and swift action potentially saved lives, plain and simple,” Acting Attorney General John J. Hoffman said. “I am very proud of the Division of Consumer Affairs investigators who acted with alacrity to help this consumer, found a potentially deadly problem, and worked with the company to get these vehicles off the roads in New Jersey and across America.”

Division of Consumer Affairs investigators, and an expert mechanic and vehicle inspector contracted by the Division, inspected ElDorado’s correction of the defects. The Division representatives inspected each replacement part, attended the training of ElDorado technicians who would perform the correction, and watched the technicians perform several vehicle corrections.

In the settlement announced today, ElDorado agreed, among other things, to provide consumers with clear and prominent notification about the weight limits of its wheelchair-modified vehicles, as well as the dangers of exceeding those limits. Wheelchair-modified vehicles contain heavy equipment that significantly reduces the total occupant and cargo weight they can safely carry. This safety information will be conspicuously placed in owner’s manuals and hang tags placed on the vehicles.

ElDorado also will develop reporting requirements for its dealerships when they receive complaints from consumers. The dealerships will be required to report all complaints and related information to ElDorado in a timely manner. ElDorado also has paid $10,000 to reimburse the state’s attorney’s fees and investigative costs.

The safety defects came to light after a consumer residing in Monroe Township filed a complaint with the Division of Consumer Affairs about concerns regarding her Toyota Siena minivan, following its modification by ElDorado.

Fuel filler neck

An independent mechanic and vehicle inspector, contracted by the Division of Consumer Affairs, examined the vehicle and was alarmed to find that its fuel filler neck was coming into contact with the left rear shock absorber, allegedly as a result of ElDorado’s modification.

The fuel filler neck was visibly worn. Damage to a vehicle’s fuel filler neck can allow gasoline or gasoline vapors to escape, potentially resulting in a fire or explosion that could cause injury or death.

In its settlement, ElDorado also agreed that it will continue to comply with all National Highway Transportation Safety Administration laws and regulations, particularly those that pertain to reporting known safety defects and responding to safety concerns.

It's common to hear people say things like, "I'm a zombie without my morning coffee" but in fact, many people are dependent on caffeine to the point that they suffer withdrawal symptoms and are unable to reduce caffeine consumption even if they have another condition that may be impacted by caffeine—such as a pregnancy, a heart condition, or a bleeding disorder.

These symptoms combined are a condition called "Caffeine Use Disorder," and according to a recent study coauthored by American University psychology professor Laura Juliano, health professionals have been slow to characterize problematic caffeine use and acknowledge that some cases may call for treatment.

Caffeine, she notes, is the most commonly used drug in the world — and is found in everything from coffee, tea, and soda, to OTC pain relievers, chocolate, and now a whole host of food and beverage products branded with some form of the word "energy."

"The negative effects of caffeine are often not recognized as such because it is a socially acceptable and widely consumed drug that is well integrated into our customs and routines," Juliano said. "And while many people can consume caffeine without harm, for some it produces negative effects, physical dependence, interferes with daily functioning, and can be difficult to give up, which are signs of problematic use."

"Caffeine Use Disorder: A Comprehensive Review and Research Agenda," which Juliano coauthored with Steven Meredith and Roland Griffiths of the Johns Hopkins University School of Medicine and John Hughes from the University of Vermont, was published in the Journal of Caffeine Research.

Grounds for more research

The study summarizes the results of previously published caffeine research to present the biological evidence for caffeine dependence, data that shows how widespread dependence is, and the significant physical and psychological symptoms experienced by habitual caffeine users. Juliano and her coauthors also address the diagnostic criteria for Caffeine Use Disorder and outline an agenda to help direct future caffeine dependence research.

In so far as heeding the call for more research, the scientific community is beginning to wake up and smell the coffee. Last spring, the American Psychiatric Association officially recognized Caffeine Use Disorder as a health concern in need of additional research in the Diagnostic and Statistical Manual of Mental Health Disorders — the standard classification of mental disorders, now in its fifth edition (DSM-5), used by mental health professionals in the United States.

"There is misconception among professionals and lay people alike that caffeine is not difficult to give up. However, in population-based studies, more than 50 percent of regular caffeine consumers report that they have had difficulty quitting or reducing caffeine use," said Juliano, who served as an appointed advisor to the DSM-5 Substance Use Disorders work group and helped outline the symptoms for the Caffeine Use Disorder inclusion.

Lack of labelling

Based on current research, Juliano advises that healthy adults should limit caffeine consumption to no more than 400 mg per day — the equivalent of about two to three 8-oz cups of coffee. Pregnant women should consume less than 200 mg per day and people who regularly experience anxiety or insomnia — as well as those with high blood pressure, heart problems, or urinary incontinence — should also limit caffeine.

But limiting one's caffeine intake is often easier said than done as most people don't know how much caffeine they consume daily.

"At this time, manufacturers are not required to label caffeine amounts and some products such as energy drinks do not have regulated limits on caffeine," Juliano said, adding that if this changed, people could perhaps better limit their consumption and ideally, avoid caffeine's possible negative effects.

But in a nation where a stop at Starbucks is a daily ritual for many people, is there really a market for caffeine cessation? Juliano says yes.

"Through our research, we have observed that people who have been unable to quit or cut back on caffeine on their own would be interested in receiving formal treatment—similar to the outside assistance people can turn to if they want to quit smoking or tobacco use."

It's official -- Fiat S.p.A. has completed its acquisition of Chrysler Group LLC, creating a new company that from now on will be known as Fiat Chrysler Automobiles NV.

Fiat directors approved the change today at a meeting in Turin, Italy. The company will be organized in the Netherlands and will be listed on the New York and Milan stock exchanges.

“Today is one of the most important days in my career at Fiat and Chrysler," said Sergio Marchionne, CEO of Fiat and Chairman/CEO of Chrysler Group. "Five years ago we began to cultivate a vision that went beyond industrial cooperation to include full cultural integration at all levels. We have worked tenaciously and single-mindedly to transform differences into strengths and break down barriers of nationalistic or cultural resistance."

"Solid foundations"

Marchionne said today's action creates "solid foundations for a global automaker with a mix of experience and know-how on a level with the best of our competitors."

What all this means for consumers, of course, remains to be seen. Chrysler has lurched from crisis to crisis and been through multiple ownerships and reorganizations in recent years, most notably its failed marriage to Mercedes Benz. Its Chrysler, Dodge and Jeep brands have been holding their own in recent years. 

Fiat, which makes everything from tiny Fiat 500s to Maseratis and Ferraris, has been virtually invisible in the United States for decades and trails competitors including Toyota, Volkswagen and Hyundai in Europen and Asian markets.

The new company will maintain assembly plants in Europe and North America, a touchy political point. Fiat is the largest employer in Italy and Chrysler was bailed out by U.S. taxpayers after its 2009 bankruptcy.

Engines, transmissions and other components are already being shared among the company's brands, but a few of Fiat's crown jewels, like Alfa Romeo and Maserati, will continue to be built exclusively in Italy.

We've all heard about the recent breaches of payment card and other data at Target and other merchants and banks.

In an effort to help you if you were among those bitten -- or even if you weren't -- the Consumer Financial Protection Bureau (CFPB) has put out a consumer advisory  to help you protect yourself. Included is information on where to get help if you suspect your information has been compromised.

“Consumer financial products often involve significant amounts of consumer data,” said CFPB Director Richard Cordray. “In light of recent data breaches, we want to be sure that consumers know how to protect themselves and where to turn if they do suspect fraud.”

Credit, debit, and prepaid cards

Payment cards such as credit, debit, and prepaid cards are among the most commonly used consumer financial products. Over 70% of U.S. consumers have at least one credit card. Debit cards are now used for more consumer purchases than credit cards, and prepaid card use is continuing to grow.

In recent months, data breaches have apparently exposed millions of payment card accounts to potential fraud. In addition, millions of consumers’ names, phone numbers, emails, and addresses also appear to have been stolen separately from card information.

What to do

Here are some of the steps you can take to protect your data:

• Monitor accounts for unauthorized charges or debits: Consumers should regularly review their accounts online if possible, and at a minimum examine their monthly statements closely. Consumers should report even small problems immediately as some thieves may process a small charge or debit just to see if the account is live, or whether the consumer notices. Fraudulent charges may occur many months after information is stolen. Even if consumers think the PIN on their debit card was not stolen, they should consider changing the PIN in order to be on the safe side.
• Alert bank or card provider immediately if fraud is suspected: Consumers should alert their bank or card provider immediately if they suspect an unauthorized debit or charge. If fraudulent charges appear, the consumer should ask the card provider to close access to the account and issue a new card before more transactions come through. Under federal law and other applicable rules, consumers are generally not responsible for unauthorized debits or charges to credit or debit card accounts, as long as they report them quickly to their bank or card providers.
• Follow up with the bank or card provider and maintain records: If consumers find a fraudulent transaction, they should call the bank or card provider’s toll-free customer service number immediately, and also ask how they can follow up with a written communication. When consumers communicate in writing, they should be sure to keep a copy for their own records. Consumers should write down the dates on which they make follow-up calls and keep this information together in a file.
• Avoid scams that ask for personal information over email or by phone: A common scheme, known as “phishing,” involves a scammer contacting a consumer over email or phone and asking to verify account information. Banks and credit unions never ask for account information through email. If consumers receive this type of email, they should immediately contact their card provider and report it. If consumers receive this type of phone call, they can ask for a call-back number to verify the requestor is actually their financial institution.

Following up

If you are dissatisfied with how your bank or card provider responds when you report fraudulent charges, you can submit a complaint to the CFPB. Card providers should investigate charges and respond quickly. You have a right to see the results of the bank’s or card company’s investigations.

You can submit a complaint by:

• Going online at consumerfinance.gov/complaint
• Calling the toll-free phone number at (855) 411-CFPB (2372) or TTY/TDD phone number at (855) 729-CFPB (2372)
• Faxing the CFPB at (855) 237-2392
• Mailing a letter to: Consumer Financial Protection Bureau, P.O. Box 4503, Iowa City, Iowa 52244

A bit of a slowdown in mortgage activity last week.

According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey, mortgage applications dipped 0.2% during the week ending January 24. The results include an adjustment to account for the Martin Luther King, Jr. holiday.

Refinancings were down 2% from the previous week, bringing the refinance share of mortgage activity down 2% from the previous week -- to 62 percent of total applications, the lowest level since late September. The adjustable-rate mortgage (ARM) share of activity held steady at 7% of total applications.

Contract interest rates

The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($417,000 or less) decreased 5 basis points from 4.57% to 4.52%, the lowest rate since the week ending November 29, 2013, with points increasing to 0.40 from 0.36 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $417,000) fell to 4.47%, the lowest rate since the week ending November 15, 2013, from 4.57%, with points increasing to 0.27 from 0.18 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year FRMs backed by the FHA was down 6 basis points -- to 4.18 percent, the lowest rate since the week ending November 29, 2013, with points increasing to 0.33 from 0.23 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year FRMs fell to 3.59%, the lowest rate since the week ending November 29, 2013, from 3.68%, with points decreasing to 0.26 from 0.29 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs rose 2 basis points -- to 3.25%, with points decreasing to 0.33 from 0.37 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

IKEA North America Services LLC, of Conshohocken, Pa., is expanding an earlier recall of 40,000 KRITTER and SNIGLAR junior beds. Another 3,500 beds have been added.

The metal rod connecting the guard rail to the bed frame can break in use, posing a laceration hazard.

IKEA has received one additional report from the UK of a metal rod on a SNIGLAR bed breaking. A child received a small scratch to the arm from the broken metal rod. In the earlier recall, there were two reports of the metal rod on the beds breaking, but no injuries have been reported.

Recalled IKEA junior beds include the KRITTER and SNIGLAR models with a guard rail on one side. The pine wood KRITTER beds have animal cut-outs, such as a dog and cat on the headboard. A label on the headboard or underside of the KRITTER bed has a date stamp of 1114 to 1322 representing the year and week of production (YYWW), a 600.904.70 model number, and 19740 supplier number. The SNIGLAR natural beech wood beds have a white painted fiberboard insert on the headboard and footboard of the bed. A label on the headboard or underside of the SNIGLAR bed has a date stamp of 1114 to 1318 (YYWW), a 500.871.66 model number, and 18157 supplier number. This recall expands the date code for SNIGLAR beds to 1049 to 1318. The beds measure about 65 inches long by 30 inches wide with a 22 to 26 inch high headboard.

The beds, Manufactured in Poland, Bosnia Herzegovina, Romania and China, were sold exclusively at

IKEA stores nationwide and online at www.ikea-usa.com from July 2005, through May 2013, for between $60 and $90.

Consumers should immediately stop using the recalled KRITTER and SNIGLAR junior beds and contact IKEA to receive a free repair kit.

Consumers may contact IKEA toll-free at (888) 966-4532 anytime.  

Used car dealers will often say the first quarter of the year is their busiest time. That's when consumers have received income tax refunds and, if they need to buy a car or truck, they have the money to do so.

If that's the case there is some good news for these car shoppers – they should find some pretty good deals on the used car lots. Editors at the NADA Used Car Guide say a rise in the number of late-model used cars and light trucks is expected to reverse a five-year run of price increases.

One reason is the growing popularity of auto leases. In the last few years leases have become a better deal, thanks in large part to the fact that new cars hold more of their value longer.

A glut of lease vehicles

This year the number of vehicle leases expiring is up 18%. In many cases those off-lease vehicles are sold at auction and end up on used car lots. So if you are looking for a three-year old vehicle you might find a pretty good deal.

Palmen Auto Stores, a chain of dealerships in Wisconsin, reports that strong December clearance sales has also resulted in a big jump in its inventory of used vehicles. The dealership says it has lowered prices on some to clear them out.

If you are looking for an older vehicle, deals might be harder to come by. NADA says the supply of units six to eight years in age should continue to fall as a byproduct of the new vehicle sales decline from 2006 to 2009, when the economy was sliding into recession.

"These diverging trends will result in late-model used vehicle prices dropping more substantially than their older counterparts," said Jonathan Banks, executive automotive analyst for the NADA Used Car Guide.

Better deals on newer vehicles

That means you might consider a newer model than you would otherwise. NADA predicts prices of used vehicles up to four years old will fall by an average of 2.5% on an annual basis in 2014. At the same time, prices of units from five to eight years in age will essentially remain flat.

On average NADA expects the average price of used vehicles up to eight model years in age will drop by 0.5% to 1% this year. That would be a reversal from 2013, when prices grew by a slight 0.4%. Used car prices have risen 18% since 2007.

"Although availability of off-lease units will be better this year, it's important to place volume levels into historical context," Banks said. "Despite the increase, lease volume will still be 11% below 2009 levels."

New car sales still strong

Meanwhile, plenty of consumers are choosing new cars over used ones. According to Kelly Blue Book (KBB) new vehicle sales for January should be 1.6% higher than January 2013, giving dealers their best January since 2007, at the start of the Great Recession.

"January is typically the weakest sales month of the year as many consumers take advantage of holiday deals in December, said Alec Gutierrez, senior analyst for Kelley Blue Book. However, winter storms also could impact new-vehicle sales this month, as much of the country deals with historically cold weather and snowstorms,". "Early estimates indicate fleet sales will be down as well."

January's leaders

What are consumers buying? KBB predicts Chrysler will post a respectable gain in January with strength from its Jeep and RAM brands. Following the recent launch of the Cherokee crossover, Jeep sales surged 34% in December, while the overall industry was flat. At the same time, RAM sales finished the year 22% higher than the previous year. Nissan is also coming on strong.

"We expect Nissan to record a solid sales month in January from its top products, the Altima and the all-new Rogue," said Gutierrez. "Both set record sales in 2013, and the Rogue has become an integral part of Nissan's portfolio with compact crossover sales booming among consumers."

Compact crossovers will also likely remain hot, reporting double-digit growth for the fifteenth month in a row. Look for entry-level luxury cars to also post positive numbers, thanks to the recently launched BMW 4 Series and all-new Mercedes-Benz CLA-Class.

What's not so hot? Gutierrez thinks that, after a huge 2013, full-size pickup trucks should see slower 2014 sales. Despite the slower sales, he does not expect to see carmakers pony up significant incentives.