European bailout funds downgraded

The European Union flag flies amongst member countries' national flags in front of the European Parliament in Strasbourg, France.

NEW YORK (CNNMoney) -- Another day, another European downgrade.

Ratings agency Moody's announced a downgrade Friday of the continent's main bailout vehicle, the European Stability Mechanism, knocking it one notch from prized Aaa status to Aa1.

The ESM, which was finalized in October, is a bailout fund designed to have a lending capacity of €500 billion that can issue bonds and also receives funding from European member states. It was conceived as an eventual replacement for the European Financial Stability Facility, which has backed bailouts for Greece, Portugal and Ireland.

The EFSF received a similar one-notch downgrade Friday.

Moody's said the moves were driven by its downgrade of France earlier this month from Aaa to Aa1. France is the second-largest contributor to the two bailout vehicles after Germany, kicking in roughly 20% of the funding for each. Moody's said there was "a high correlation" between the creditworthiness of the bailout funds and that of their largest contributors.

The agency maintained its negative outlook for both the ESM and EFSF, meaning further downgrades are possible.

Klaus Regling, managing director of the ESM and CEO of the EFSF, called the downgrades "difficult to understand."

"This rating action does not inhibit ESM or EFSF in any way," he said in a statement Friday night.

Related: Europe's jobless lines keep growing

In downgrading France earlier this month, Moody's cited the country's fiscal challenges, weak growth prospects and exposure to additional eurozone shocks.

Yet Moody's said France was still in good shape when compared to its neighbors, citing its large and diverse economy and praising its commitment to structural and fiscal reform. France's borrowing costs remain low, with the country's 10-year bond yielding around 2% in recent months, suggesting investors do not view the country as a credit risk.

Fellow ratings agency Standard & Poor's downgraded France from AAA back in January.

First Published: November 30, 2012: 6:07 PM ET

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Stocks: Job reports in focus this week

Click the chart for more stock market data

NEW YORK (CNNMoney) -- U.S. stocks have been stuck at a standstill recently, but reports on the job market, manufacturing and consumer spending this week may provide the market with a jump start.

Investors have been hesitant to pull the trigger over the last few weeks, as lawmakers and President Obama struggle to find consensus over year-end tax hikes and spending cuts. There's fears that, if unresolved, the so-called fiscal cliff will harm the economy at a time when the outlook for growth is already in question.

Last week, the Dow Jones Industrial Average and S&P 500 ended flat for the week. The Nasdaq eked out a gain of 1.4%.

Analysts are hopeful that this week's economic data will light a fire under lawmakers to make a deal, especially if there's evidence that employers are postponing hiring until there's resolution in Washington.

Investors will first get a sense of the nation's employment picture on Wednesday from payroll processing firm ADP and from the Challenger job cuts report on Thursday.

The main event comes Friday, when the Labor Department releases its nonfarm payroll numbers and the nation's unemployment rate.

"This week may bring some more progress towards a deal to prevent the U.S. fiscal cliff," said Paul Dales, senior U.S. economist at Capital Economics. "November's employment report...may provide further incentive."

Related: Fear & Greed Index

The U.S. labor market has been inching back in recent months. Labor Department reports have shown improvement in hiring and a decline in the number of job cuts. But the impact of Superstorm Sandy may rear its head in November's report.

The number of those seeking help in the wake of the hurricane spiked in November, as many hourly workers whose employers were forced to close in the wake of the storm filed for unemployment benefits.

How Americans are feeling and spending will also be in focus this week, with consumer credit, Michigan consumer sentiment and auto sales due out throughout the week.

Investors will be watching these numbers carefully after the Commerce Department reported last week that consumer spending stalled in October as income growth waned. Consumer spending accounts for more than two-thirds of the nation's economy. A stall in spending could be a troublesome sign, especially in the midst of the holiday season.

Factory sales, the ISM manufacturing index, productivity and labor costs will give investors a better picture of the U.S. manufacturing sector.

Global manufacturing has been a mixed picture. China's manufacturing industry exhibited signs of improvement in November. But a report last week showed that the European manufacturing sector was contracting, and eurozone service industry companies are more pessimistic about their prospects than at any time since early 2009.

First Published: December 2, 2012: 11:30 AM ET

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Workers' Christmas wish: Fire the boss

Nearly a quarter of workers' top workplace resolution for 2013 is to look for a new job, a new survey found.

NEW YORK (CNNMoney) -- The end of a year is a time for reflection, making resolutions and setting new goals. For some employees, one objective includes ousting their bosses.

Some 2% of workers admit their top resolution going into the new year is to help get their boss fired, according to a survey of more than 2,000 workers conducted by Glassdoor, a jobs and career website.

Another 23% said their main goal is looking for a new job.

Surveyed employees aren't all naughty when it comes to work-related wishes. A third of them said a top priority was to work hard to get a salary raise.

Related: Holiday shopping: What women want, men don't give

With the election settled, and the job and housing markets seeing signs of improvement, employees may finally be feeling more secure. Glassdoor saw glimmers of optimism in the survey, with more workers confident that they'll get more cash out of their employers this year.

The survey found that 76% of workers said they are eligible for a bonus this year, up from 73% last year. That's up from 63% four years ago, when the nation was hanging in the depths of an economic recession.

"As employment confidence gradually improves, it's no surprise to see employees looking to wrest back control over their own destiny," said Rusty Rueff, Glassdoor career and workplace expert.

Bonus expectations are not gender neutral. Roughly 60% of younger male employees expect a bonus under the Christmas tree this year, compared to 44% of younger women.

First Published: December 2, 2012: 1:39 PM ET

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Judge orders Paul Ceglia to pay Facebook $100,000 in fees

Ceglia will have to reimburse Facebook for more than $89,000 in legal and expert fees, plus nearly $7,000 for related travel.

NEW YORK (CNNMoney) -- A federal judge has ordered Paul Ceglia, an upstate New York man who claimed he's owed 50% of Facebook, to pay the social network nearly $100,000 in legal and travel fees.

The order came after Ceglia canceled 10 planned depositions in July and August at the last minute, after Facebook had already paid its lawyers to prepare for and travel to the depositions. Seven were scrapped with less than 48 hours' notice, and three were canceled with less than 24 hours' notice.

As punishment, Ceglia will have to reimburse Facebook for more than $89,000 in legal and expert fees, plus nearly $7,000 for related travel.

The bizarre Ceglia-Facebook legal saga began in July 2010, when Ceglia filed suit in New York claiming that he paid Facebook founder Mark Zuckerberg to build a website similar to what became Facebook, and that they agreed to split the company. Both Facebook (FB) and Zuckerberg have strenuously denied Ceglia's claims.

Ceglia's credibility took a big hit last month when federal agents arrested him on charges of perpetuating a "multi-billion-dollar scheme" to defraud Facebook. If convicted, Ceglia faces up to 40 years in prison.

The government's complaint against Ceglia echoes Facebook's accusations. Ceglia "doctored, fabricated, and destroyed evidence to support his false claim," according to a statement from the U.S. attorney's office. The complaint accuses Ceglia of altering a contract and inventing emails that didn't exist.

This week a federal jury indicted Ceglia on the fraud charges. His lawyer, Dean Boland, also filed a motion to withdraw from the case -- although Ceglia is fighting to keep him. Boland did not return a call seeking comment.

Ceglia has already lost several legal teams in the past. A judge will have to decide whether Boland will be allowed to leave the case.

First Published: November 30, 2012: 12:05 PM ET

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What's my retirement 'Number'?

NEW YORK (CNNMoney) -- What number do we need to hit to retire comfortably? $1 million, $2 million, more? -- Jim Rodgers, Madison, Wisc.

Your question is timely: Mutual fund titan Fidelity recently released its estimate of how much people should have in savings to retire. The Number: eight times final salary.

That figure caught my attention because it's a lot lower than most targets you see. Just last month MONEY recommended you shoot for a nest egg of 12 times your income by retirement.

These numbers vary for many reasons, which I'll get into below. But the real issue here is that no single figure can possibly reflect your specific financial circumstances. At best this kind of number is a ballpark estimate for how much you should save, not a substitute for planning. Before you use one as even a rough guide, though, you should know what goes into it.

Fidelity assumes retirement at age 67 and figures your savings must last 25 years. We reckon you'll retire at 65 and want your savings to support you for 30 years. Those two more years on the job, which can boost your Social Security check by 15% to 20%, plus the fact that your savings don't have to last as long, shrinks your target.

Related: Why high-income savers need to put more away now

Another variable is how much you'll draw from your savings. Fidelity aims to provide 85% of your after-tax income, an approximation of what you were actually spending. After estimating how much Social Security will provide, the number crunchers calculate your withdrawals. With a $75,000 salary at retirement, you'd need to take just over $35,000 from your savings the first year.

This methodology seems reasonable to me, but then things get tricky. Pulling $35,000 from a $600,000 portfolio ($75,000 times eight) represents a withdrawal rate of almost 6%. To have a reasonable chance of your savings lasting 25 to 30 years, most advisers suggest something closer to 4%.

When I asked Fidelity senior vice president Steve Feinschreiber for the probability that a portfolio would last 25 years starting with a near-6% withdrawal rate, he estimated it "very roughly" at 70%. A Morningstar retirement-income calculator put the likelihood at about 50%.

Related: Can I afford to retire early?

Finally, the higher your income, the less of your salary Social Security will replace and the more you'll have to withdraw. In fact, Fidelity concedes that with a six-figure income your target might have to be higher than eight.

To be safe, I'd recommend you shoot to save 10 to 12 times your salary. Better yet, use an online tool like Fidelity's own Retirement Income Planner or T. Rowe Price's Retirement Income Calculator to get an estimate of your retirement readiness.

Look at The Number if you want. Just don't pin your fortunes on any single one.

First Published: November 30, 2012: 12:28 PM ET

08.36 | 0 komentar | Read More

European bailout funds downgraded

The European Union flag flies amongst member countries' national flags in front of the European Parliament in Strasbourg, France.

NEW YORK (CNNMoney) -- Another day, another European downgrade.

Ratings agency Moody's announced a downgrade Friday of the continent's main bailout vehicle, the European Stability Mechanism, knocking it one notch from prized Aaa status to Aa1.

The ESM, which was finalized in October, is a bailout fund designed to have a lending capacity of €500 billion that can issue bonds and also receives funding from European member states. It was conceived as an eventual replacement for the European Financial Stability Facility, which has backed bailouts for Greece, Portugal and Ireland.

The EFSF received a similar one-notch downgrade Friday.

Moody's said the moves were driven by its downgrade of France earlier this month from Aaa to Aa1. France is the second-largest contributor to the two bailout vehicles after Germany, kicking in roughly 20% of the funding for each. Moody's said there was "a high correlation" between the creditworthiness of the bailout funds and that of their largest contributors.

The agency maintained its negative outlook for both the ESM and EFSF, meaning further downgrades are possible.

Klaus Regling, managing director of the ESM and CEO of the EFSF, called the downgrades "difficult to understand."

"This rating action does not inhibit ESM or EFSF in any way," he said in a statement Friday night.

Related: Europe's jobless lines keep growing

In downgrading France earlier this month, Moody's cited the country's fiscal challenges, weak growth prospects and exposure to additional eurozone shocks.

Yet Moody's said France was still in good shape when compared to its neighbors, citing its large and diverse economy and praising its commitment to structural and fiscal reform. France's borrowing costs remain low, with the country's 10-year bond yielding around 2% in recent months, suggesting investors do not view the country as a credit risk.

Fellow ratings agency Standard & Poor's downgraded France from AAA back in January.

First Published: November 30, 2012: 6:07 PM ET

08.36 | 0 komentar | Read More

Judge orders Paul Ceglia to pay Facebook $100,000 in fees

Ceglia will have to reimburse Facebook for more than $89,000 in legal and expert fees, plus nearly $7,000 for related travel.

NEW YORK (CNNMoney) -- A federal judge has ordered Paul Ceglia, an upstate New York man who claimed he's owed 50% of Facebook, to pay the social network nearly $100,000 in legal and travel fees.

The order came after Ceglia canceled 10 planned depositions in July and August at the last minute, after Facebook had already paid its lawyers to prepare for and travel to the depositions. Seven were scrapped with less than 48 hours' notice, and three were canceled with less than 24 hours' notice.

As punishment, Ceglia will have to reimburse Facebook for more than $89,000 in legal and expert fees, plus nearly $7,000 for related travel.

The bizarre Ceglia-Facebook legal saga began in July 2010, when Ceglia filed suit in New York claiming that he paid Facebook founder Mark Zuckerberg to build a website similar to what became Facebook, and that they agreed to split the company. Both Facebook (FB) and Zuckerberg have strenuously denied Ceglia's claims.

Ceglia's credibility took a big hit last month when federal agents arrested him on charges of perpetuating a "multi-billion-dollar scheme" to defraud Facebook. If convicted, Ceglia faces up to 40 years in prison.

The government's complaint against Ceglia echoes Facebook's accusations. Ceglia "doctored, fabricated, and destroyed evidence to support his false claim," according to a statement from the U.S. attorney's office. The complaint accuses Ceglia of altering a contract and inventing emails that didn't exist.

This week a federal jury indicted Ceglia on the fraud charges. His lawyer, Dean Boland, also filed a motion to withdraw from the case -- although Ceglia is fighting to keep him. Boland did not return a call seeking comment.

Ceglia has already lost several legal teams in the past. A judge will have to decide whether Boland will be allowed to leave the case.

First Published: November 30, 2012: 12:05 PM ET

08.37 | 0 komentar | Read More

What's my retirement 'Number'?

NEW YORK (CNNMoney) -- What number do we need to hit to retire comfortably? $1 million, $2 million, more? -- Jim Rodgers, Madison, Wisc.

Your question is timely: Mutual fund titan Fidelity recently released its estimate of how much people should have in savings to retire. The Number: eight times final salary.

That figure caught my attention because it's a lot lower than most targets you see. Just last month MONEY recommended you shoot for a nest egg of 12 times your income by retirement.

These numbers vary for many reasons, which I'll get into below. But the real issue here is that no single figure can possibly reflect your specific financial circumstances. At best this kind of number is a ballpark estimate for how much you should save, not a substitute for planning. Before you use one as even a rough guide, though, you should know what goes into it.

Fidelity assumes retirement at age 67 and figures your savings must last 25 years. We reckon you'll retire at 65 and want your savings to support you for 30 years. Those two more years on the job, which can boost your Social Security check by 15% to 20%, plus the fact that your savings don't have to last as long, shrinks your target.

Related: Why high-income savers need to put more away now

Another variable is how much you'll draw from your savings. Fidelity aims to provide 85% of your after-tax income, an approximation of what you were actually spending. After estimating how much Social Security will provide, the number crunchers calculate your withdrawals. With a $75,000 salary at retirement, you'd need to take just over $35,000 from your savings the first year.

This methodology seems reasonable to me, but then things get tricky. Pulling $35,000 from a $600,000 portfolio ($75,000 times eight) represents a withdrawal rate of almost 6%. To have a reasonable chance of your savings lasting 25 to 30 years, most advisers suggest something closer to 4%.

When I asked Fidelity senior vice president Steve Feinschreiber for the probability that a portfolio would last 25 years starting with a near-6% withdrawal rate, he estimated it "very roughly" at 70%. A Morningstar retirement-income calculator put the likelihood at about 50%.

Related: Can I afford to retire early?

Finally, the higher your income, the less of your salary Social Security will replace and the more you'll have to withdraw. In fact, Fidelity concedes that with a six-figure income your target might have to be higher than eight.

To be safe, I'd recommend you shoot to save 10 to 12 times your salary. Better yet, use an online tool like Fidelity's own Retirement Income Planner or T. Rowe Price's Retirement Income Calculator to get an estimate of your retirement readiness.

Look at The Number if you want. Just don't pin your fortunes on any single one.

First Published: November 30, 2012: 12:28 PM ET

08.37 | 0 komentar | Read More

European bailout funds downgraded

The European Union flag flies amongst member countries' national flags in front of the European Parliament in Strasbourg, France.

NEW YORK (CNNMoney) -- Another day, another European downgrade.

Ratings agency Moody's announced a downgrade Friday of the continent's main bailout vehicle, the European Stability Mechanism, knocking it one notch from prized Aaa status to Aa1.

The ESM, which was finalized in October, is a bailout fund designed to have a lending capacity of €500 billion that can issue bonds and also receives funding from European member states. It was conceived as an eventual replacement for the European Financial Stability Facility, which has backed bailouts for Greece, Portugal and Ireland.

The EFSF received a similar one-notch downgrade Friday.

Moody's said the moves were driven by its downgrade of France earlier this month from Aaa to Aa1. France is the second-largest contributor to the two bailout vehicles after Germany, kicking in roughly 20% of the funding for each. Moody's said there was "a high correlation" between the creditworthiness of the bailout funds and that of their largest contributors.

The agency maintained its negative outlook for both the ESM and EFSF, meaning further downgrades are possible.

Klaus Regling, managing director of the ESM and CEO of the EFSF, called the downgrades "difficult to understand."

"This rating action does not inhibit ESM or EFSF in any way," he said in a statement Friday night.

Related: Europe's jobless lines keep growing

In downgrading France earlier this month, Moody's cited the country's fiscal challenges, weak growth prospects and exposure to additional eurozone shocks.

Yet Moody's said France was still in good shape when compared to its neighbors, citing its large and diverse economy and praising its commitment to structural and fiscal reform. France's borrowing costs remain low, with the country's 10-year bond yielding around 2% in recent months, suggesting investors do not view the country as a credit risk.

Fellow ratings agency Standard & Poor's downgraded France from AAA back in January.

First Published: November 30, 2012: 6:07 PM ET

08.37 | 0 komentar | Read More

Citi plans to cut bonuses by up to 10%

Citigroup plans to cut bonuses and continue cutting headcount as the bank's shares remain down nearly 90% since before the crisis.

NEW YORK (CNNMoney) -- Citigroup (C, Fortune 500) plans to slash bonuses up to 10% as it continues to trim its staff.

Average employees should expect their bonuses to be cut between 5% and 10% this year, according to a source with knowledge of the firm's year-end compensation plans.

However, Citigroup's top performers are not expected to feel the pinch, the source said.

A Citigroup spokesperson declined to comment on the bonus reductions but the bank did acknowledge that it will continue cutting its staff.

"We have been making targeted headcount reductions throughout the year in certain businesses and functions across Citi as part of our efforts to control expenses during the current environment," said Citi spokesperson Danielle Romero-Apsilos.

Related: Citigroup shareholders push for break up

Investors should get more insight into Citi's plans next week, when CFO John Gerspach speaks at a Goldman Sachs financial services conference. During his presentation, he's expected to announce 150 job cuts in Citi's investment banking division by year-end, said the source.

Citigroup continues to eliminate the higher-paying investment banking jobs but the pace of the cuts has been slowing. In the fourth quarter of 2011, Citigroup announced 1,200 layoffs in its investment banking division. The bank cut an additional 350 investment banking jobs in the first half of 2012.

It's been a rocky year for Citigroup. The bank's former CEO Vikram Pandit stunned investors when he announced his immediate departure in mid October, one day after discussing plans for the bank's future on a quarterly conference call.

Related: Pandit's inner circle breaks up

The bank's new CEO, Michael Corbat, is a 29-year veteran of the bank, and he now faces the task of getting Citi onto a more profitable path amid continuing calls to shrink the bank.

Citigroup's board must also wrestle with the ousted CEO's 2011 pay package. Citigroup's shareholders voted down his $15 million pay package during the bank's annual shareholder meeting. While Citigroup said it's been privately meeting with investors, the bank doesn't expect to say much publicly before next year.

Citigroup's shares are up 34% this year, but remain down nearly 90% since the financial crisis. While all bank have struggled to get back near pre-crisis highs, Citigroup's share have been the worst performing bank stock by a wide margin.

First Published: November 29, 2012: 2:49 PM ET

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