TIME Treasury

U.S. Sells Off Last Major TARP Investment, 6 Years On

U.S. taxpayers made around $2.4 billion in the Ally investment

The U.S. has finally sold off its remaining major investment in the Troubled Asset Relief Program, six years after beginning to bail out auto companies, banks and financial institutions in the depths of the Great Recession.

The Treasury Department announced Friday that it will sell its remaining stake in Ally, the former financing division of General Motors, capping the end of its last major TARP investment and the auto rescue program.

Treasury touted that selling the nearly 55 million shares netted $1.3 billion for taxpayers, and $19.6 billion overall after spending $17.2 billion on Ally. However, the government’s overall losses on the $85 billion auto industry bailout were about $10 billion, the Detroit News reports.

After former President George W. Bush signed TARP into law in October 2008, the U.S. poured hundreds of billions of dollars to stabilize banking institutions, AIG, the auto industry and families facing foreclosure.

“The Auto Industry Financing Program helped save the auto industry, more than one million jobs, and prevent a second Great Depression,” said Treasury Secretary Jacob J. Lew.

“Thanks to President Obama’s leadership, our economy has rebounded from the depths of the financial crisis and is now creating jobs at the fastest pace since the 1990s. There is more work to do, but as we exit the last major financial investment, it’s important to take stock of the progress we have made, and the critical role TARP and the Auto Industry Financing Program played in getting us to this point.”

MONEY Odd Spending

‘The Interview’ Poster Now Listed at $1,000 on eBay

141219_EM_Interview
Would you pay $1,000 for this poster? © Columbia Pictures—courtesy Everett Collection

After Sony cancelled the release of the controversial Seth Rogen movie The Interview, some collectors are thinking posters of the film are worth big bucks.

The Interview may make no money whatsoever at the box office, and it could wind up costing Sony Pictures over $100 million after the decision was made this week to cancel all screenings amid widespread threats to theaters. Still, the film—a comedy that depicts the assassination of North Korea leader Kim Jon Un, and which appears to be the impetus for North Korea’s involvement in a devastating hack of Sony, the production company behind it—could wind up earning some folks a pretty penny.

The Huffington Post noticed on Thursday that posters from the canceled movie had begun surfacing for sale on eBay, with asking prices in the neighborhood of $500. Pop culture experts forecast that these posters will be worth “$15, maybe $20″ in a year, when, presumably, all the hubbub about The Interview and the Sony hack are old news.

Still, this hasn’t stopped entrepreneurs from trying to milk the movie’s moment in the spotlight for quick and easy profits. At last check on Friday, there were around 500 results on eBay for “The Interview Poster.” Some sellers are asking $1,000 or more for vinyl 5′ x 8′ posters of the controversial film.

The highest price paid on eBay for one of the posters appears to be $787 for a 27″ x 40″ double-sided theatrical print that received 59 bids in an auction that ended on Thursday. The market appears to cooling off significantly, however. As of Friday morning, very few posters listed at eBay auction had been bid up beyond $250, and dozens of new listings had no bids whatsoever.

TIME Autos

Google Wants To Make Android-Powered Cars

Google Car
A Google Inc. map is displayed on a screen in a Tesla Motors Inc. Model S sedan electric vehicle (EV) parked in the area of Cyberport in Hong Kong, China, on Friday, July 5, 2013. Bloomberg—Bloomberg via Getty Images

More tech giants are eyeing the "connected car"

Not content to control your life on your PC and your mobile phone, Google is now going after your car.

The search giant is planning to build the next version of its Android operating system, dubbed Android M, directly into automobiles, according to Reuters. That would allow drivers to access the Internet and use Android apps without the synching their car with a smartphone.

Google already has a foothold in automobiles through Android Auto, its operating system tailored for cars, and the Open Automotive Alliance, a partnership through which several large automakers like Hyundai and General Motors have pledged to bring Android functionality to their vehicles. But the company is now eyeing making Android central to the driving experience rather than a supplement, according to the Reuters report. Such tight integration could give Google more vital user data, which it uses to power its business.

But Google is hardly alone in trying to bring tech to automobiles. Apple is rolling out an iOS-powered car operating system called CarPlay, while some automakers are also building their own proprietary Internet-enabled interfaces.

[Reuters]

TIME

Wall Street Money Can Predict How Democrats Vote. Here’s How

Follow the money in the latest budget vote which rolled back regulations on banks and divided House Democrats

A week after the gargantuan spending deal squeezed through Congress, many Democrats are still smarting over a provision in the bill that rolls back regulation on how banks can take risks with taxpayer money.

While the financial sector’s boon was too big a pill for many on the left to swallow, 57 Democrats in the House ultimately voted for the legislation, pushing the bill over the goal line. (The final vote for the bill, which picked up the nickname “Cromnibus” along the way, was 219-206).

As the Washington Post noticed last week, those 57 Democrats received considerably more money in campaign donations from the financial sector than their colleagues who voted against the bill. While this may not be terribly surprising, it is an usually clear example of the correlation between money and votes. (As always, the causation–whether the money directly influenced a lawmaker’s vote–does not come along for the ride in this analysis.)

To put a finer point on it, TIME collected data from the Center for Responsive Politics on how much money financial companies gave to each House Democrat in the past two years. When you line up the members in the order of how much they got and how they voted, the pattern is pretty clear. (A handful of newer members are missing due to incomplete data.)

The controversial provision was originally a standalone bill, parts of which was reportedly drafted by Citibank lobbyists. That bill passed the House in 2013 with the support of 70 Democrats but never became law. The divide in the party among those who receive significant contributions from the financial sector was even more apparent then.

Finance, Insurance and Real Estate companies gave a total of $304 Million to members of congress in the last election cycle, more than any other industry identified by the Centre for Responsive Politics. Cory Booker (D-NJ), Mitch McConnell (R-KY) and John Boehner (R-OH) are top recipients from this industry each receiving over $3 Million. The same companies also gave Rep. Kevin Yoder (R-KS), the congressman who introduced the controversial amendment into the spending bill, $206,700 in the same cycle. These figures don’t include the money that groups like Citibank spent on lobbying efforts.

Members of Congress make voting decisions based on an extraordinary number of considerations, and any given representative can argue quite persuasively that he or she is not motivated by the wants and desires of major donors. When you zoom out, however, you see a correlation between donations and voting behavior that is very unlikely to be a random occurrence, regardless of the root causes.

Methodology

These figures represent political action committees (PACs) representing financial companies made to candidates, not employees who work for those companies, and do not include contributions made to members’ leadership PACs. The Center for Responsive Politics defines financial companies as commercial banks, credit unions, real estate companies, and a variety of other related industries. The correlation coefficient between the binary outcome of the vote and the dollar amount of contributions was 0.34 for HR 83 and 0.42 for HR 992.

 

TIME Companies

Hellman’s Maker Unilever Drops Suit Over ‘Just Mayo’

Hampton Creek CEO and Founder Josh Tetrick poses with a bowl of a species of yellow pea used to make Just Mayo, a plant-based mayonnaise, at Hampton Creek Foods in San Francisco.
Hampton Creek CEO and Founder Josh Tetrick poses with a bowl of a species of yellow pea used to make Just Mayo, a plant-based mayonnaise, at Hampton Creek Foods in San Francisco. Eric Risberg—AP

(ENGLEWOOD CLIFFS, N.J.) — Hellman’s mayonnaise maker Unilever says that it has withdrawn its lawsuit against the maker of “Just Mayo.”

Unilever had filed suit against Hampton Creek earlier this year claiming false advertising for Just Mayo, an eggless product.

Unilever argued that “Just Mayo” has no eggs and therefore doesn’t meet the definition of mayonnaise. Unilever had said that the word mayo implies that the product is mayonnaise, and that Just Mayo was stealing market share from Hellman’s.

Unilever said Thursday that it decided to withdraw the lawsuit so that Hampton Creek can address its label directly with industry groups and regulatory authorities.

Hampton Creek says it marketed its product as “mayo” to meet labeling regulations.

TIME stocks

Biggest Gains for U.S. Stocks in Years

Traders on the floor of the New York Stock Exchange on Dec. 18, 2014.
Traders on the floor of the New York Stock Exchange on Dec. 18, 2014. Andrew Burton—Getty Images

The rally marked the biggest two-day increase for the Dow Jones index in three years

U.S. stock indexes surged Thursday, with the Dow rallying over 400 points, driven higher by reassurances from the Federal Reserve that it won’t imminently raise interest rates.

The broad S&P 500 index posted its biggest jump in nearly two years, extending a Fed-fueled rally from the previous day, as tech shares gained after stronger-than-expected results from business software giant Oracle.

The Dow Industrials also posted big gains following a rally in the prior trading session, marking the biggest two-session percent increase for blue-chip index since November 2011, according to The Wall Street Journal.

The Dow Jones industrial average closed the day up 421 points, or 2.4%, while the S&P 500 gained 48 points, or 2.4%, and the Nasdaq composite added 104 points, or 2.2%.

Stock indexes rallied as investors continued to find good cheer in the Federal Reserve’s accommodative approach to monetary policy. On Wednesday, the Fed said it would be patient about the timing of its first rate hike, suggesting its expected increases will be slow and steady.

—Reuters contributed to this report.

This article originally appeared on Fortune.com

TIME Startups

How LearnVest’s CEO Raised Her First $1 Million in 6 Months

"There was no pitching. People just got it."

The day the LearnVest website went live is a day burned into Alexa von Tobel’s memory. It was New Year’s in 2010, and von Tobel was on a ski vacation with her family. She had spent the last few weeks building a website brimming with financial advice. There was just one problem.

“The site crashed because we had just so many people sign up really quickly,” von Tobel says. “I was actually literally at the top of a mountain trying to get down it on skis, and I am lucky I don’t have a concussion because that’s how quickly I was going to try to get down and get a computer to see if I could fix it.”

Von Tobel has only picked up speed since then. As the 31-year-old CEO of LearnVest, she has built one of the fastest growing financial planning companies in the country. The website now includes a suite of tools to visualize a budget — what comes in and what goes out. But those charts are just a conversation starter. Von Tobel’s grander ambition is to pair each of those users with one of nearly 45 certified financial planners she has waiting by the phones. The tools are free. Access to a financial planner, however, comes at a starting price of $19 per month after a $299 setup fee.

While LearnVest keeps the number of paying subscribers a closely guarded trade secret, one thing is publicly known — it has money to burn. Von Tobel raised $75 million for the company in just four years. By her own admission, she had no trouble persuading investors to part with their money. “There was no pitching,” she says. “People just got it.”

At this point any entrepreneur who’s spent years fighting for a financial lifeline might be wondering how LearnVest appeared to spring from von Tobel’s head fully formed. The truth is, she had been wrestling with the subject of financial literacy since adolescence. She credits her success, so far, to this slow-building fixation. “It’s why I get out of bed every single day,” she says, “because this is such an enormous epidemic that we can solve, because it’s math.”

Von Tobel’s first encounter with money matters came as a dramatic shock. Her father died suddenly when she was 14, leaving her mother to manage the family’s finances. Her mother’s scramble to get up to speed left a deep impression on von Tobel, who was even more surprised when she graduated from Harvard with a first-rate education while still feeling incapable of answering the most basic questions about her finances. As she widened the conversation from family to friends and coworkers, she found that most everyone around her, regardless of their education, seemed to be largely clueless when it came to managing their own money.

“It would literally be almost recipe-like the way people were managing their finances, ‘My mom taught me this trick and so this is what I always do,'” she says.

She also was struck by the dearth of financial advisors willing to enlighten her family. Personal advisors have a stubborn tendency to chase after the wealthiest 1%. Merrill Lynch, for instance, raised the minimum account balance for its advisory service from $100,000 to $250,000 in 2012. Smaller fish need not apply. To von Tobel, the market was moving in exactly the wrong direction.

“It would be the equivalent of if doctors overnight said, ‘We’re only going to see healthy people,'” she says.

So she began taking notes, committing to paper everything she could learn about personal finance. “It was in gibberish,” she says. Still, it was passionate gibberish, sprawling across 75 pages by the time she was in Harvard Business School in 2008.

“I thought about answers to all the tough questions,” she says. “What’s the business model going to be? How does it get out there? Who are the competitors? How do you actually make money?” In short, she had asked the very same questions skeptical investors might lob her way.

The more questions she answered for herself, the more eagerly she awaited graduation day. Her studies began to feel like a diversion. So von Tobel made what she calls a “terrifying” decision — she counted up her savings and dropped out of school the same year she began to spend roughly nine months on LearnVest, “in the heart of a recession,” she notes, “with no salary, no income and trying to go build a dream.”

But the gamble paid off. Within six months, von Tobel had secured $1 million in seed money. She had convinced investors that she could not only tap a hugely underserved market, but that she could dispense advice at a cost lower than any existing advisory service.

“You go to a mom and pop certified financial planning firm,” she says, “you’re paying for that overhead, for that parking lot, for that mahogany desk, for that receptionist at the front,” she says. LearnVest, on the other hand, is just a website. It shifts the data entry onto users and the number crunching onto automated software. As a result, her staff can focus on dispensing advice in unprecedented volumes. Von Tobel says LearnVest is aiming to have a single financial advisor serve upwards of 1,000 customers, a ten-fold increase over the typical small firm.

It’s an ambitious play for efficiency, and LearnVest will have to grow rapidly to fulfill its promise to investors. But von Tobel says investors are willing to take a risk on the right person, even a mid-20’s dropout whose only credential is 75 pages of gibberish.

“I always tell other entrepreneurs, don’t worry about, ‘How old am I? Have I done this before?” she says, before shifting to the questions that really matter: “Do you know the most about this space? Have you thought tirelessly?”

TIME intelligence

White House Doesn’t Rule Out Cybercounterattack in Sony Hack

Calls it a "serious national security matter"

The White House is treating the massive hack of Sony Pictures Entertainment as a “serious national security matter” and is currently devising a “proportional response” to the cyberattack, press secretary Josh Earnest said Thursday.

Earnest said there have been a number of daily meetings at the White House about the hack, and that there are “a range of options that are under consideration right now” for a response. Earnest would not rule out a U.S. cybercounterattack on those behind the Sony hack, saying officials are mindful of the need for a “proportional response.”

“This is something that’s being treated as a serious national security matter,” he said. “There is evidence to indicate that we have seen destructive activity with malicious intent that was initiated by a sophisticated actor.”

Read more: Everything we know about Sony, The Interview and North Korea

Earnest would not publicly name the “sophisticated actor” behind the attack, even as U.S. officials have linked North Korea to the hack — something Pyongyang has denied. “I’m not in a position to confirm any attribution at this point,” Earnest said.

The incident remains under investigation by the FBI and the National Security Division of the Department of Justice, and Earnest said those efforts are “progressing.” Earnest said it’s unlikely officials will be able to fully disclose the eventual response. “I don’t anticipate that we’ll be in a position where we’re gonna be able to be completely forthcoming about every single element of the response that has been decided upon,” he said.

Asked about Sony’s decision to pull the film The Interview from distribution in response to threats of 9/11-style attacks from hackers, Earnest said: “The White House stands squarely on the side of artists and other private citizens who want to freely express their views.”

Read more: You can’t see The Interview, but TIME’s movie critic did

“This is a decision that Sony should make,” Earnest added. “This is a private company.”

The hack exposed reams of employees’ data and embarrassing email exchanges between executives. It came as Sony was preparing to release The Interview, which has been fiercely criticized by North Korea for depicting a fictional assassination attempt of the country’s leader, Kim Jong Un. With a growing number of movie theaters saying they wouldn’t screen the film amid the threads of attack, Sony canceled its release late Wednesday.

“Administration officials were consulted about the film prior to its release at the request of the company that was producing the movie,” Earnest said, confirming that officials had screened the film.

MONEY deals

Free Shipping Day Deals: Better Than Black Friday and Cyber Monday?

shipping box with confetti and styrofoam peanuts coming out of it
Sverre Haugland—Getty Images

Thursday, December 18, is Free Shipping Day, when more than 1,000 retailers are offering free shipping on all orders—and sometimes an extra 50% off on top of that.

Let’s be honest: Free shipping isn’t all that hard to come by. E-retailers are well aware of how exorbitant (or, for that matter, any) shipping costs are likely to cause online shoppers to abandon their virtual shopping carts before completing transactions, so nearly all merchants offer some form of free shipping—typically, when a minimum purchase threshold of $50 or $75 is met.

On Free Shipping Day, however, participating retailers agree to offer free shipping with no minimum purchase required, and the event is held one week before Christmas so that orders can be delivered by December 24. Still, let’s have another reality check: Many Free Shipping Day participants have offered free, no-minimum-purchase shipping on plenty of other days in the holiday season. Target has been doing this for two months, and stores such as REI are offering free, no-minimum shipping guaranteed to arrive by Christmas Eve on orders placed as late as 10 a.m. on December 23.

The point is that free shipping, while nice and all, is hardly the most unique and dazzling deal in today’s promotion-heavy marketplace. And free shipping alone shouldn’t make you pull the trigger on any old purchase.

The best deals for online shoppers combine free shipping with substantial discounts. Many retailers are pairing up across-the-board markdowns with Free Shipping Day promotions, and they’re presenting them as amazing, can’t-pass-up bargains. But are they? Below, we’re listing some seemingly impressive Free Shipping Day deals, and we’re comparing them with what these same retailers were offering on Black Friday, Cyber Monday, and other times during the holidays. Indeed, many are truly good deals—on par or better with what we’ve seen on other big sales days—but others just aren’t that special.

Here’s just a sample of today’s offers. As you’ll see, before biting on any Free Shipping Day deal, it’s wise to do some clicking around to investigate whether the promotions you see today are the same, better, or worse than what these retailers were offering days or weeks ago—and may offer again tomorrow.

Abercrombie & Fitch: Use code 15588 for 50% off everything plus free shipping—the same exact deal the retailer offered on Cyber Monday. Abercrombie offered across-the-board sales of “only” 40% off on Thanksgiving and Black Friday.

American Eagle: Use code HOLIDAZE for 40% off everything and free shipping on all orders—the same exact offer promoted on Black Friday weekend and Cyber Monday.

Children’s Place: Use code 25OFFER3 for free shipping on all orders, plus an extra 25% off sitewide—on top of sales marking down all merchandise by 40% to 60%; on Black Friday, by contrast, Children’s Place offered free shipping and a flat 50% off all merchandise.

Hollister: 50% off everything in store and online (use code: 35588), plus free shipping on all orders; Hollister also knocked 50% off everything on Black Friday, but shipping cost extra for customers who didn’t meet a minimum purchase threshold.

Lane Bryant: Free shipping and 50% off select merchandise such as pants, jeans, skirts, shoes, and boots (use code: SNOWMANLB), compared with free shipping and 50% off absolutely everything on Cyber Monday.

Levi’s: 30% off everything (through December 21) and free shipping (on December 18 only); occasionally, the Levi’s site is known for discounting all purchases by 40% off, but only on orders of $250 or more.

Sports Authority: Customers get 15% off nearly all merchandise and free two-day shipping for orders placed on Free Shipping Day; from time to time earlier in the season, this sports retailer has offered 25% off and free (standard) shipping on all orders.

Tommy Hilfiger: Use code TOMMY100 for free shipping on all orders and $30 off if you spend $100 or more; it’s not nearly as good a deal as the Cyber Monday deal of 50% off your entire purchase.

TIME technology

Amazon Is Now Delivering to New Yorkers in Less Than an Hour

Getting batteries — or tens of thousands of other daily essentials — just got a bit easier

If you live in Manhattan, getting batteries — or tens of thousands of other daily essentials — just got a bit easier, and you don’t even have get off your couch.

Amazon announced today the launch of Prime Now, a one-hour delivery service for customers who are members of Amazon’s Prime service. Using a smart phone app, members of the service will be able to get items such as “paper towels, shampoo, books, toys and batteries” delivered within one hour, according to a company news release.

One-hour delivery will cost $7.99, while those who are a bit more flexible can get two-hour delivery for free. The service is available seven days a week between 6 a.m. and midnight.

“There are times when you can’t make it to the store and other times when you simply don’t want to go. There are so many reasons to skip the trip and now Prime members in Manhattan can get the items they need delivered in an hour or less,” Dave Clark, Amazon’s senior vice president of worldwide operations, said in a statement.

Prime Now is powered by Amazon’s growing network of fulfillment centers. It is launching in parts of New York, and will be available in other cities next year.

Major retailers are battling to improve their delivery times. Earlier this week, Amazon extended the deadline for placing Christmas orders to this Friday. Walmart, meanwhile, announced today that shoppers could place an order on Walmart.com up till Dec. 23 and get free pickup in stores on Christmas Eve.

Who knows what these deals will mean for the companies’ margins, but the deals are definitely good for one group: holiday shopping procrastinations.

This article originally appeared on Fortune.com

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