Investigation Begins On The Largest Sewage Spill Experienced In A Decade

Every year, massive amounts of sewage are dumped into the Pacific Ocean polluting the water bodies. Sewage spills are a frequent problem that is not dealt properly according to environmentalists. Recently, a sewage spill in Mexico resulted in the dumping of 140 gallons of raw waste into Tijuana River that originates in Mexico and flows into California. The spilling continued for 2 weeks from February 2nd. The local authorities failed to identify the cause of the stench in some neighborhoods which lead to the late discovery of the raw sewage spill.

The Tijuana river has been polluted due to massive sewage spills from USA and Mexico in the past few years. The old sewage system and lack of plumbing infrastructure were blamed for the recurring problem.

The officials in the USA and Mexico have agreed for a bi-national investigation for the sewage spill. The International Boundary and Water Commission (IBWC) is responsible for maintaining water treaties between USA and Mexico. According to the report from IBWC, the spill started on February 2nd during a routine maintenance operation on a sewage collection pipe. When the authorities identified the spill after two weeks, the spill was contained, but several millions of gallons of raw waste had already reached the water by that time.

The polluted Tijuana River has affected several beaches in the San Diego area. It has greatly affected the coastal waters in California. Serge Dedina, the mayor of Imperial Beach, California has commented that the beaches were affected massively due to the largest spill in more than a decade. As a result, several beaches up to Coronado were closed down. A few beaches were opened on Sunday with numerous warning signs in red and yellow, restricting the beach goers.

Dedina has also commented that the spill was not politically motivated, though it was a deliberate action to receive support for the sewage pipeline repair work by Mexico. The mayor wants the US government to support Mexico in improving sewage infrastructure in Tijuana so that such a disaster doesn’t happen in the future.

The Tijuana State Public Service Commission announced that the spill was accidental and that it was caused by heavy rains. The disturbance from the rains resulted in the collapse of sewage interceptor. The sewage spill was reported to IBWC on February 23rd even though the spill started two weeks ago according to USA officials.

The beaches were closed because water polluted with raw sewage could result in various illnesses and infections. About 20 miles of coastland starting from Rosarito, Mexico to Coronado, California was affected due to the massive spill. The representatives from the states have requested the federal government to take actions to prevent such spills in the future.

Edward Drusina, the commissioner of IBWC commented that the information regarding sewage spills must be received by the commission in a timely manner. There is no confirmation on volume and duration of the spill from the IBWC officials. The investigation is likely to end by March so that the results are provided on April 1st.


Snap Shares Decelerate As The IPO Hype Subsides

Snap, the parent company of Snapchat launched its IPO amidst a lot of buzz last week. The shares were initially priced at $14 – $16, but the price continued to surge just in two days. Immediately after the launch, the shares were trading at $24, much higher than the expected pricing. On Monday morning, Snap shares were open at $28.17 which was 4% higher than Friday. However, on Tuesday, the IPO buzz had subsided and the price was at $22.

Even though the price of Snap shares is greater than the expected value, most of the Wall Street experts believe that Snap shares are overvalued. Seasoned investors are not interested in buying Snap shares because they don’t think it is worth the cost. Top analyst surveys indicate that Snap shares are not great to buy. The estimate of share price is between $10 and $23, resulting in an average of $16.5. The valuation has appalled experienced investors because Snap is yet to make any profit. It was clearly mentioned in the prospectus that Snapchat may not generate any profit in the future.

Snap is a small and young company that came up with a revolutionary product which allowed disappearing videos and messages. Snapchat was picked up by the teens immediately after its launch and it was widely used for sexting. The teenage users are not loyal to the brand and Snap is yet to monetize the platform properly. Snapchat is a free app and the revenue can be generated only through advertising. Another alarming feature of Snapchat is the fact that the active monthly user base has stayed flat at 150 million in the last two quarters.

Facebook launched Instagram as a rival to Snapchat and shamelessly copied Snapchat Stories. The ephemeral messaging on Instagram rivaled Snapchat and it is embraced by a mature audience. Instagram is owned by Facebook which has mastered advertising on the internet. Snap doesn’t have the ability or corporate structure to compete with Facebook. The target demographic of Snap is extremely narrow and the app is widely used only in first world countries. While Google and Facebook have an audience of 3.6 billion, Snap is available only to about 650 million all over the world.

While Snap increased its revenue to $400 million from $58 million in just four years, the company incurred $512 million losses. Even though Snap IPO is launched, the company is yet to make a profit. Investors who purchase Snap shares are simply betting that the company would come up with some innovative product that will surpass the popularity and demand of Facebook and twitter. Considering the immature managers and unreliable demographic, this won’t be a possibility.

The share price performance of Snap is surprisingly good despite the challenges faced by the company. Investors are willing to hold on to the shares for at least one year and this has increased the demand in the market. Advertisers too are keen on the target demographic of Snap, which could help the company if it comes with the never-before-seen product that couldn’t be copied by Facebook.


GM Sets Its Vision On Revenue Generation As It Gets Rid Of European Brands

General Motors (GM) confirmed that it has finalized a $2.3 billion deal to sell Opel and Vauxhall brands of the company to Peugeot. Effectively, this means that GM is getting out of the European market willfully. The CEO Mary Barra has taken the most courageous step to get rid of the perennial loser for GM. The 109-year old company was selling its cars to every market without considering the consequences. The new move to sell the European brands has helped the company to focus on revenue generation.

Analysts are happy with this decision that tells the investors that GM now wants to focus on areas that generate better returns in long term. The Opel and Vauxhall brands in Europe has not generated any profit for GM in the past two decades. In fact, several experts consistently questioned the measures GM took to stay in the European market despite evident failure. The $2.3 billion deal is profitable for GM as it can target its audience and produce cars for those who want. The parent company of Peugeot and Citroen, PSA is operated by the French government with 14% shares.

While the move to exit the European market is a great idea by GM, it has consequences as well. By leaving Europe, GM is effectively losing its market share. Just in last year, 1.2 million GM cars were sold in Europe. The headquarters of Opel is in Germany, which is adored by car manufacturers for the endless possibilities of innovation and design engineering.

The car sales in Europe has helped GM to take care of the investment cost of car manufacture in other parts. North American Cruze is modeled after European products. Europe is undeniably one of the biggest markets for car sales and GM is potentially losing it all with this deal.

The stock price of GM has been low ever since Barr took her office in 2014. The shares were priced at $40 in 2014, but it has gone down to $37. Barr tries hard to increase the share price of GM stocks, but it continues to stay well below the $40. The business profile of GM undergoes an overhaul with this deal. The company is hoping to provide better returns for the shareholders by cutting out the losses.

GM requested and obtained federal bailout in 2009 as the company was approaching bankruptcy. The bailout was granted because the collapse of the largest US car manufacturer would result in another Great depression. The sales in North America and China are sufficient to keep the business afloat.

The Europeans prefer Ford over GM because they aren’t interested in SUVs and pickup trucks. By taking $4 billion charges on the sale of Opel, GM will have the cash flow to buy back its stocks. The representative said that the company will purchase $4 billion stocks in the upcoming months. GM is now focused on developing electric cars such as Chevrolet Bolt and has also invested $500 million in Lyft service.


Hhgregg Joins Businesses Closing for Thanksgiving


Consumer electronics company Hhgregg has joined the growing list of businesses in the U.S. that have announced they will close their doors to customers on Thanksgiving Day.

The electronics chain, which had opened for business on Thanksgiving Day in recent past years, said on Tuesday that it was important for its workers to spend time with their family members during the turkey feast. To this end, it will have its over 200 brick-and-mortar stores in the country closed for the day, but deals will continue to be available to its customers via its website.

“We stand behind our core values and beliefs of being a family-first company,” CEO Bob Riesbeck said in a release. “It’s important to us that our associates are able to be home with their families on Thanksgiving, and we are encouraging our customers to do the same – knowing great deals will be available online, on Black Friday, and through the weekend.”

For the past two years, Hhgregg opened its doors to customers at 4 p.m. on Thanksgiving Day, until midnight. It had opened for round-the-clock shopping in the two years before then.

Riesbeck told the Associated Press that Black Friday sales have been spreading out earlier and earlier into the week in recent years, noting that things have become “consistently tougher” on employees.

The consumer electronics chain felt it was time for leaders in the electronics industry to “take charge” and push for a change that would enable employees spend more quality time with their friends and families on Thanksgiving, according to SVP of Marketing Chris Sutton.

Staples Inc announced in September that it would not open for the second straight Thanksgiving, although, like Hhgregg, it will make deals available to customers on its website.

The Bloomington, Minnesota-based Mall of America also revealed last week that it would close on Thanksgiving this year. This decision will benefit its 1,200 employees and several thousand others working with its tenants. But the mall stated that essential personnel, including security, may remain on duty as some of its tenants may decide to open on that day.

Major U.S. retailers, such as Target, Macy’s and Kohl’s, have been opening earlier on Thanksgiving in recent years, with each seeking to outdo its rivals. This move has also been partly driven by rising competition from ecommerce businesses. Many workers have, unsurprisingly, not been pleased with the decision of these traditional retailers, complaining that profit motives of these businesses are being placed above time workers get to spend with their family during the holiday.

Stores are finding it increasing hard to retain employees as a result of this. Some are now resorting to the use of perks and promise of increased pay on Thanksgiving to lure workers.

Riesbeck said Hhgregg would not do badly during the Thanksgiving week if it did not open on the holiday. He told the AP that the consumer electronics retailer can actually do “exceedingly well,” based on observation from time spent in local markets and speaking with store managers. According to him, sales on Thanksgiving have declined over the past two years.

Founded in 1955, Hhgregg operates 220 stores across 19 states in the U.S. The Indianapolis-based chain deals in home appliances and consumer electronics among other offerings from top brands.


Mars Buys Out Buffett For Full Control of Wrigley


U.S. candy maker Mars Inc has revealed that it is buying out the stake of Warren Buffett in Wrigley in a move that would enable it take full control of a subsidiary it bought about eight years ago.

This announcement was made by Mars in a statement released on Thursday. The M&Ms and Snickers bar maker said it would buy the minority 20 percent stake in Wrigley belonging to the Buffett-owned company Berkshire Hathaway.

Buffett had been a partner to Mars since its acquisition of Wrigley in 2008. Berkshire Hathaway contributed $2.1 billion to the $23 billion takeover deal for stake in the snack brand. The company got preference shares paying an annual dividend of five percent in the deal.

Mars was also lent $4.4 billion by Berkshire to bring the acquisition deal to reality. The amount borrowed has already been repaid three years ago.

The chocolate maker said in the statement that it would combine Wrigley with his operations to create Mars Wrigley Confectionery. The stake buyout will further strengthen the company’s foremost position in the global confectionery market, which is valued at around $177 billion.

Mars is considered one of the most tightly-held private companies in the world. It is known to avoid partnerships with external investors, which might mean the one with Buffet was very necessary, especially considering the high cost of the financing. This explains why the company is moving fast to secure full control over an acquisition that ranks among the biggest in its 126-year history.

“We are grateful for the strong and productive partnership we have with Warren Buffett and Berkshire Hathaway. It is a great relationship that has yielded value on both sides,” CEO Grant F. Reid said. “We’re equally pleased that sole ownership of Wrigley provides us with an opportunity to rethink how we simplify our chocolate and Wrigley businesses so that we can bring a more holistic approach to the vibrant category.”

Berkshire expects the preferred shares to be cashed out as early as this year. The Wall Street Journal reported that the company received at least $680 when its bonds were paid off by Mars in 2013. Those bonds earned Buffett a handsome 11.45 percent in interest, according to the New York Times. He has earned around $840 million in dividends on the preferred shares received as part of the Wrigley acquisition deal.

The original agreement gave Mars the right to purchase half of the stake held by Buffett this year. The rest can be bought by 2021. But the confectioner decided to accelerate the full takeover, although the financial terms of the deal were not been revealed.

Mars and its subsidiary already held the leading position in the global confectionery market. They combine for 13.5 percent share, with fellow American company Mondelez trailing. Euromonitor estimates that Mars and Wrigley control a quarter of the U.S. market.

Martin Radvan, Wrigley global president, will be the head of the new Mars Wrigley Confectionery, whose headquarters will be in Chicago. He has reportedly been with the leading confectioner for 30 years.

Mars expects to complete full integration of the two businesses in 2017.


Payday Loan Provider Wonga Admits it Double-Charged Thousands of Clients

Wonga, the top payday loan provider in the United Kingdom, continues to diminish its reputation. The latest scandal consists of taking out additional payments from its customers’ bank accounts.

According to the payday lender, it double-charged an estimated 7,000 customers for their payday loans on Friday. This mean that many of its clients were unable to pay their bills on the final day of the month. Wonga blames the incident on an “internal system error.”

The British firm confirmed that it will work diligently to refund extra costs and additional charges that customers have incurred. Wonga did concede, however, that this process may take a few working days. This isn’t good for the large number of customers who are cash-strapped and will have direct debits and mortgage payments debited from their checking accounts in the same week.

“We experienced an internal system error on Friday morning which resulted in Flexi Loan payments being debited twice from some customers,” the company said in a statement. “We notified all those affected and took action to credit the right amounts back to customers on Friday. We apologize for the inconvenience caused.”

Not all payday loan borrowers were affected. The only customers that have been harmed in the situation were customers who took out Flexi loans. These are short-term, high-interest loans that have to be repaid in three instalments over the course of three months. Therefore, if you have borrowed one of these loans then you will need to check your bank account to determine if you’ve been double charged.

Also, if you were impacted by the systems glitch then you have or will receive a text message from Wonga. The text message, which was sent out on Friday, contains a warning that you might have been overcharged on your repayment.

Many are wondering if they will receive compensation for being double charged, especially if they have other financial obligations and pecuniary responsibilities. Mirror Online checked with Wonga:

“Mirror Online asked Wonga if compensation will be paid out to those affected by the repayments glitch – however the firm said this will be dealt with on a case-by-case basis,” the newspaper reported.

“Wonga has confirmed that they will cover the costs of any charges incurred due to the error, for example fees received as a result of not paying your bills on time, or fees incurred as a result of having to use a credit card instead.”

Ever since the Financial Conduct Authority (FCA) waged war on the payday loan industry, Wonga has been significantly impacted. The FCA has imposed new rules and regulations for payday loan operators.

Wonga, which has quickly become one of the most controversial payday lenders in the country, reported a loss of more than $40 million in 2014. This is a stark contrast from its $40 million profit in 2013. It also experienced a $40 million loss after it had to cancel debts owed by more than 300,000 customers.


How to Protect Your 401(k) When Leaving Your Job

According to the latest news account and financial experts in the field, you have four alternatives available to your when you leave a company that participated in a 401(k).

  1. You can cash out your 401(k).

    If you cash out on your plan, you are subject to taxation on the contributions you made into the plan. You will also suffer a penalty for early withdrawal. If you choose this option, you can reduce your investment by as much as 50%. Unless you are facing a financial crisis, this is not the best choice to make.

  2. Leave your money in your old company’s 401(k) savings plan.

    This option, while viable, does have its drawbacks. For instance, since you are no longer with the company, you are not eligible for matching contributions.

  3. Roll your 401(k) from your previous employer to a qualified plan in a new company.

    This alternative may seem attractive, particularly if your new employer matches contributions. However, 401(k) plans may carry higher fees than other kinds of investment options – charges that can lower the influence of your own contributions as well as the contributions made by your new employer.

  4. Roll over your 401(k) into an IRA.

    A rollover IRA permits you to transfer your retirement funds from a 401(k) into an investment with possible strategic benefits. However, you cannot combine an IRA and 401(k) funds with Roth 401(k) and Roth IRA funding. Therefore, make sure you consider the specifics of the individual plans before making a move.

The last strategy is the most advantageous if you want to make the most of your retirement savings. You may also consider executing one rollover per 12 months between multiple IRAs that you possess, if that is your situation.

Rollover IRAs offer several advantages that are not available through 401(k) type plans. First, a rollover from a 401(k) into an IRA continues to defer your taxes on your retirement contributions. Although you are responsible for reporting such a rollover to the IRS, the proper execution of a rollover does not feature consequences tax-wise.

Another benefit of a rollover to an IRA is its simplicity. Instead of tracking your investments through a variety of financial statements, a rollover IRA account gives you the latitude to keep on track of your investment account through a single statement.


How Being Nice Can Cost YOU money

While being nice costs you nothing, being too agreeable can actually cause you to lose money too. Being nice, according to financial experts, can actually cost you overall.

You are Overcharged

Overages and charges that are more than what you figured can cut into your financial stream. Probably one of the worst offenders in this respect are medical providers. According to statistics, medical providers show a Medicare billing error rate of about 50%. The same research showed that around 63% of Americans received medical bills for medical care that was much more than what they expected.

Financial experts recommend that consumers review bills and receipts so they don’t get too many overcharges and expensive “surprises.” If there is an error, make sure you contest the charge. In fact, you can channel your niceness by politely pointing out the mistake – a much better move to make than showing a display of aggression.

Discounts Are Not Applied

It happens to everyone every now and then – an item does not ring up with the discount applied. While it may be easier to dismiss the incident and pay full price, you are actually doing a disservice to yourself, let alone your bank account. People who overcome the desire to be too nice and contest the oversight actually help discounting systems work more effectively.

Sale Items Are Not Available

If you arrive at a store to buy a sale item but it no longer is featured on the shelf, obtain a voucher or rain check so you can obtain the product for the sale price when it reappears on the shelf or is restocked. If you think asking for the rain check or voucher is too much trouble, think again. Cashiers often ask you if you found everything you needed. Therefore, requesting the voucher is one way to ensure you get what you need, and for less money.

Not Shopping for Better Rates

While it is “nice” to be brand loyal, it also pays you better to shop around and compare prices. You can compare prices on such products as insurance, hotel rates, vehicles, and even medical procedures.

One Final Observation

Although being nice is a positive and pleasant trait, you still don’t want to behave too nicely when it comes to paying bills or saving money. Make sure you obtain the item you need at a cost that is affordable to you.