Starbucks CEO Howard Schultz recently announced to shareholders that they should sell stake in the coffee-giant if they don’t appreciate or respect his strong support for gay marriage. 

 

Howard Schultz, the outspoken CEO of coffee empire Starbucks firmly defended his company’s support of gay marriage last week at a shareholder meeting. 

 

In response to a contest from a shareholder that the company’s support of gay marriage was damaging the company’s stock price, Schultz calmly explained that it is not about the profit margins, but about “respecting diversity.” 

 

Last year, Starbucks openly supported Washington state’s referendum that legalized gay marriage. As a result, the National Organization for Marriage launched a protest of the coffee giant. During the annual shareholder’s meeting in Seattle last week, shareholder Tom Strobhar voiced his opinion, suggesting that the boycott was affecting the company’s stock price, “In the first quarter following the boycott, our earnings and our sales were disappointing,” he expressed. 

 

Schultz fired back at the shareholder, claiming that Starbucks’ endorsement of marriage equality was not bad for business, “If you feel that you can get a higher return than the 38 pe4rcent you got last year, it is a free country. You have the right to sell your shares and buy shares in another company. Thank you very much,” Schultz calmly stated, to a standing ovation from the audience. 

 

Schultz; however was quick to underscore that the decision to support gay marriage did not revolve around economics. “We are making the decision to support gay marriage through the lens of our people. We employ over 200,000 people throughout this world, and we want to embrace diversity,” Schultz added. 

 

Starbucks, which last year operated nearly 18,000 stores in 60 countries, endorsed the Washington state bill to legalize same-sex marriage, and released a statement saying the company “deeply dedicated to embracing diversity.” The bill eventually became affirmed as a law. 

 

In his five years as CEO of Starbucks, Schultz has taken on a role as a political activist, launching campaigns calling for corporate social responsibility and political finance reform. 

 

 

Source: Whitehouse.gov

 

Warren Buffet’s Berkshire Hathaway is set to become a long-term investor in Goldman Sachs, as Buffet is well on his way to becoming one of Goldman Sachs’ 10 largest shareholders. 

 

Goldman announced on Tuesday that Buffet’s company Berkshire Hathaway would receive a large chunk of the investment bank’s stock this October. The maneuver marks the outcome of Buffet’s $5 billion emergency cash infusion into the investment giant during the pinnacle of the financial crisis in 2008, when the vast majority of Wall Street firms were frozen in shock after the bankruptcy of Lehman Brothers. 

 

During the peak of the financial crisis, Buffet procured preferred shares of Goldman Sachs worth $5 billion that provided a dividend of $500 million per year. Buffet also received warrants to purchase 43 million shares of Goldman stock for $115 per share by October of this year. If Buffet were to redeem his eventual Goldman shares at the company’s current stock price of roughly $146, his stake would balloon to $6.3 billion, for a healthy profit of $1.3 billion. 

 

However, Buffet and Goldman announced on Tuesday that they had revised the options so that Berkshire would receive shares equal in value to that profit. At Goldman’s current stock price, which would mean an additional 9 million shares would be transferred to Berkshire. The added 9 million shares would be enough to rank Buffet as Goldman’s ninth largest shareholder in the investment bank. 

 

“Berkshire plans to hold a significant state in Goldman Sachs, a firm that I conducted my first business transaction with more than 50 years ago,” said Buffet in a statement. 

Goldman Sachs repurchased its preferred shares from Warrant Buffet in 2011; however, Berkshire continued to hold the warrants from its original investment. Shares of Goldman dropped a tad lower on Tuesday, while Berkshire was up roughly 1 percent. 

 

Long stuck in fourth place, T-Mobile sent shockwaves through the telecommunication industry with its plan to roll out its 4G LTE network and offer bargain plans with no contract requirements to entice potential customers. 

 

In addition to the shift in pricing and contract requirements, T-Mobile also announced that it now offers the iPhone 5 on its network. 

 

Expectations; however, must be scaled back, as T-Mobile has only activated the new 4G network in Houston, Baltimore, Las Vegas, San Jose, Phoenix, Washington D.C. and Kansas City. T-Mobile plans to gradually expand coverage to 200 million Americans by the end of 2013. 

 

T-Mobile’s new plan will run on its existing network, which possesses theoretical data download speeds that are faster than the LTE networks deployed by industry leaders, AT&T and Verizon. 

 

T-Mobile also claims it has nearly 50 percent more bandwidth than AT&T, which technically means that T-Mobile would be able to handle more people on its network and suffer less of a performance hit. 

 

The company plans to pair this rollout with a unique pricing model which terminates contracts but requires consumers to pay the full retail price for their phone. 

Under the plan, phones can be paid in full up front, and eligible consumers can also put $99 down and pay $20 a month over two years. Once the phone is paid for, T-Mobile will unlock the phone, allowing users to select any carrier they wish. 

 

Mobile plans under T-Mobile’s new cost either $50, $60 or $70 a month with access to unlimited texting and voice data. The plans are attached with 500 megabytes, 2 gigabytes or unlimited data, respectively. 

 

John Legere, the CEO of T-Mobile insists its customers will save money in the long run because the plans are cheaper. That said, the cheapest plans offered by AT&T are priced similarly over the span of two years to the cheapest T-Mobile plan with a new iPhone 5. 

 

The new data network and pricing model makes T-Mobile sound like an alluring option for those currently disgruntled with their cell phone carriers. The most glaring wild card attached to the new pricing model will be whether the new network can live up to its bold performance claims. 

 

Source: Associated Press

 

Mercedes-Benz has unveiled a revolutionary electric car developed in partnership with Tesla Motors. The new electric car is a version of Mercedes’ B-class hatchback, which was just released in the United States last month. 

 

The 2014 Mercedes B-class Electric Drive will be released first in the United States before reaching other markets. The new car will go on sale early next year in just a few states but will become widely available later on. 

 

This new car is a much small version of the Mercedes brand that Americans have grown accustom to. Currently the smallest Mercedes on the market is the C-class; however, the luxury automaker will soon begin selling the smaller CLA-model and even smaller cars are expected to be available in the states within the next couple of years. 

California-based electric car maker Telsa Motors agreed to help Mercedes develop and manufacture parts of the new car’s electric drive system, including the lithium ion battery, electric motors, on-board chargers and other electronic equipment associated with the vehicle. Besides making its own vehicle, the Telsa Model S sedan, the company already manufacturers electric drive components for the battery-powered Toyota Rav4 EV. 

 

The Mercedes Electric Drive vehicle possesses a “quick charge” feature that gives the vehicle a range of 60 miles after just a 2-hour charge. With a full charge, which takes roughly 7 hours to complete, the vehicle will travel roughly 115 miles. The car is equipped with a 134 horsepower electric motor that allows the vehicle to accelerate from zero to 60 miles an hour in under 10 seconds. 

 

The new Mercedes will come with a number of safety and luxury features including active parking assistance and a system that helps drivers stay in their lanes. 

Mercedes already offers a version of the B-class powered by Hydrogen fuel; these fuel cells turn hydrogen into water and electricity inside the vehicle. 

 

Mercedes’ parent company, Daimler, also offers the Smart Electric Drive, which is a two-seater that is set to go on sale in the United States in May of this year. The electric version of the Mercedes’ high-performance SLS AMG sports vehicle, which features a 751-horsepower electric motor, is hit the market within a year, although the U.S. release date has to be affirmed.

 

 

The India-based advertising agency that created an ad showing three women tied up in the back of a Ford has fire several of the employees responsible for creating the images. 

 

The cartoonish advertisement, produced by WPP unit JWT, were not officially part of a paid advertisement campaign; however, they struck a nerve as the nation of India institutes new regulations to protect women following a rash of high-profile gang attacks and rapes. 

 

One of the most disturbing of the images depicts Silvio Berlusconi the disgraced prime minister of Italy driving a Ford with three tied-up females in the trunk. Another of the images depicts Paris Hilton driving a Ford Figo with what appears to be the three Kardashian sisters tied-up in the trunk. A third image of the campaign depicts three male race-car drivers tied up in a similar vehicle. 

 

“After a detailed internal investigation, we have taken the appropriate disciplinary action with those responsible for these images,” the company stated in an announcement. “These were necessary steps to ensure that both the right procedures and oversight are strictly enforced so that this will not happen again.”

 

A spokesperson for the advertising agency declined to mention how many employees had been fired over the distasteful advertisements. The ads were also no published nor seen by senior officials at the agency or Ford. 

 

“We regret this incident and fully support our partners that it should have never happened,” the automaker industry said this week in a prepared statement. “The advertisements are contrary to the standards of decency and professionalism within the Ford Company and our agency partners.”

 

WPP also released a statement claiming that it “deeply regrets the existence of the distasteful advertisements.” 

 

The Ford Motor Company unveiled the Figo, a sub-compact vehicle in 2009 to be produced in India and exported to Africa and other Asian countries. 

 

Source: Associated Press

 

Yahoo CEO Marissa Mayer took home a $1.12 million cash bonus for her first half-year on the job in 2012. In addition to the cash bonus, Mayer received restricted stock worth another $13 million, according to Yahoo company filings. 

 

Filings also disclosed that Mayer, who joined Yahoo in July of 2012, will receive a $1 million base salary in 2013 and a cash bonus of up to $2 million. 

 

The 585,000 shares of Yahoo stock that Mayer received in grants was added to her 2.1 million options and shares worth roughly $47 million at Wednesday’s closing price. Under Mayer’s employment contract, which was disclosed last year, she received a retention bonus of $15 million in Yahoo stock, $15 million in stock options based on company performance and an additional $14 million in stock to offset the money she left on the table from leaving Google to take the post at Yahoo. 

 

Yahoo share prices have boomed since Mayer took over as CEO; since July of last year, the company’s stock price has nearly doubled. Mayer’s success has been closely watched; the company beat earnings in her first two quarters as CEO, and to continue the success, Mayer announced revitalization plans to ensure solid revenue growth. 

Meyer is no stranger to the news; starting last summer when disclosed a pregnancy at the same time she was appointed CEO. Meyer gave birth to her first child in September and received even more attention when she claimed that giving birth while on the job was “easy.” 

 

Last month Meyer, through an email from the head of Human Resources at Yahoo, told employees that they would no longer be able to work from home. This new policy has been widely criticized, especially by women who are on the verge of giving birth. 

 

Business activities in France shrank in March at the most rapid rate in four years, defying expectations for a broad improvement. Moreover, the gloomy figures probably plunge the euro zone’s second-largest economy into a widespread recession several surveys revealed on Thursday.

 

Data gatherer Markit claimed that its preliminary composite purchasing managers’ index, responsible for covering activity in the manufacturing and services sector combined, revealed a 42.1 rating, which was down from 43.1 in the month of February. 

The decrease brought the index to its lowest level since March of 2009, when the nation of France and the majority of the developed world was mired deep in a recession as triggered by the global financial crisis. 

 

Separate indicators for the manufacturing and services sectors revealed that business activity was slumping faster than economists originally polled by Reuters. Markit chief economist Chris Williamson opined that the figures suggest the nearly 2 trillion European economy could shrink by as much as 0.7 percent this quarter after dropping 0.3 percent over the last three months. 

 

Such a drop would mean that France, which has already terminated its 2013 deficit target due to a substantial lack of growth, has entered into its third recession since the global crisis. 

 

“At this moment, I can just envision significant contraction, and potentially an increase rate of contraction as the year winds nears its end. The only way to stop this contraction is to stimulate growth and strengthen business and consumer confidence.” 

 

“If this does not occur, companies and homes will move into cost-cutting initiatives,” he claimed. The index for the services sector, which generates nearly 57 percent of French economic activity, decreased to its lowest rate since February of 2009 as it hit 41.9 compared to 43.7 in February. 

 

Economists polled by Reuters forecasted an increase to 44. 

 

The long-suffering manufacturing industry fared only slightly betters as its index went unchanged from February. Williamson pointed to new export orders were a signal that French businesses were failing to take advantage of improving foreign demand in major economies such as the United States. 

 

The increasing poor state of French businesses is all the more frightening as consumers are in no place to pick up the slack. Unemployment is currently above 10 percent, and there is no sign that it will drop any time soon. 

 

Source: Associated Press

 

Cyprus has not been the luckiest nation in the recent weeks; however, at the end of 2011, an American energy firm made a find that was a bit more than fortuitous: the company found a massive giant natural gas field off of Cyprus’ southern coast. 

The natural gas field is modest by international standards; Noble, the company which discovered the field estimates the field’s yield between 5 and trillion cubic feet of gas. For comparison, fields developed off the coast of Israel yield four times as much gas and Qatar, one of the world’s largest holders of natural gas, possesses over 900 trillion cubic feet. 

 

However, for a country roughly the same size as Connecticut, with about the same population New York City, “It was the third largest discovery in 2011,” said Michael Stoppard, chief strategist at the consultancy firm HIS. “This discovery dwarfs local demand for the next half century.”

 

The discovery means that Cyprus, which is currently attempting to secure a European bailout to cover enormous budget deficits and bad bank holdings, could begin exporting the gas to raise capital. Also, the discovery opens the possibility that some energy companies may offer Cyprus cash in return for a share of the natural gas. 

So how much capital can Cyprus raise from its natural gas? Well, that is currently hard to say right now. Some of the gas would likely be utilized for local consumption as Cyprus gets the bulk of its energy from the costly proposition of burning oil. The rest of the gas would then probably be liquefied, loaded onto tankers and delivered to markets in Asia and Western Europe. 

 

Packaging and shipping gas are costly endeavors; however, as wells need to be drilled and pipelines constructed some 100 miles offshore. Ultimately, it would require the island nation to raise $10 billion in investment and roughly eight years to get the natural gas flowing. 

 

By 2020, experts claim that Cyrpus’ natural gas could inject $3 billion a year into the struggling economy and generate around $1 billion in annual tax revenue. Cyprus’ current economic output is roughly $24 billion a year, with $11 billion in government spending. 

 

Given its current economy state, Cyprus may cash in on its abundance of natural gas. Russian energy giant Gazprom has offered Cyprus assistance in exchange for a bulk of the gas rights, according to various media outlets. Such an offer may make the Europeans nervous, given Russia’s already prominent influence over Europe’s gas market and its propensity to every geopolitical leverage with its gas holdings. 

 

 

Source: Federal Reserve

The number of Americans filing new claims for unemployment benefits edged higher this past week, but a trend reading dipped to its lowest in five years and pointed to ongoing improvement in the labor market. 

 

Initial claims for state unemployment compensation increased 2,000 to a seasonally adjusted 336,000 according to the Labor Department via a statement released today.

Economists polled by various media outlets had expected 342,000 first-time applications for unemployment benefits this week. 

 

The month-long moving average for new unemployment claims, a significant measure of labor market trends, dropped 7,500 to 339,750, which marks the lowest level since February of 2008.

 

These figures could bode well for job growth in March as last week’s claims data covered the survey period for the U.S. government’s monthly tally of non-agricultural or non-farm jobs. The four-week average of new unemployment claims dipped 6 percent relative to the survey week last month, when nonfarm payrolls increased by 235,000.

Still, while layoffs have dipped over the recent months, companies remain cautious concerning hiring and the Federal Reserve has appeared worried that tightening the government belt could dampen progress in the labor market. The Federal Reserve on Wednesday announced that it would move forward with its aggressive stimulus policy, pointing to high unemployment, risks from abroad and fiscal headwinds out of Washington. 

 

The Federal action came despite a rash of data revealing the economy gaining steam. Retail sales are getting stronger, manufacturing output has increased and employment growth is moving faster than most expected, with the jobless rate failing to 7.7 percent in February from 7.9 percent in January. 

 

The Central Bank maintained that it will continue purchasing $85 billion in bonds per month, promising to maintain its asset purchases until it sees a significant improvement in the labor market outlook. 

 

Earlier this month, the number of people still collecting benefits under regular state programs after an initial week of receiving benefits rose 5,000 to a shade over 3 million in the first week of March. Analysts from the labor Department reported that jobless claims data had not been estimated for a number of states, and there were no significant factors influencing their report. 

 

Source: CNN

 

In finance, binary options are a specific type of option where the payoff can either be a fixed amount of the asset or just nothing at all. Binary options come in two different types, cash-or-nothing binary option and asset-or-nothing binary option.  In a cash-or-nothing binary option, the option pays a fixed amount of money if it expires in-the-money. On the other hand, the asset-or-nothing binary option pays the amount of the underlying security of the option. Thus, both options are binary in nature since there are just two different possible outcomes. These two binary options are also called to as all-or-nothing options, digital options, or fixed return options.

Like a typical vanilla European or American style option, binary options are described by their strike price, maturity date, and underlying reference unit, instrument, commodity or security price.  Binary options are sold for a premium payment made upfront, like other options.  Calls and puts are both available for binary options.

Binary options are characteristically sold and bought in over the counter markets between different financial hedge funds, institutions, large trading partners, and corporate treasuries. Binary options are highly used when the underlying instrument at hand is a rate, event, commodity, currency, or index.  

Binary options can be widely to hedge weather events, like hurricanes, rainfall, or temperature. This is because many transportation and agricultural companies can be heavily affected by the weather conditions.  Since the weather is very unpredictable and hard to measure, it makes it the perfect opportunity for binary options since it lets the binary option seller to assume a set amount of risk associated to the happening of a future event that is impossible to predict. 

Binary options can also be traded on inflation figures, like the Consumer Price Index or the Producer Price Index in the U.S.  These values are reported rather infrequently based on sampling methods done independently, and are typically revised after they are first released once certain input values are further proved.  There is no continuing stream of prices since inflation is not actually a traded instrument.  Without the continual input prices, it is extremely very difficult to mark-to-market binary options, whose values are strongly dependent on the dense volatility and price data.  Binary options allow the buyer to get inflation protection, while at the same time providing the binary option seller with a limited risk in the case where that inflation drops or jumps unexpectedly.

Lastly, binary options are extremely popular in foreign currency markets.  Often, emerging market currencies are subject to quick jump risk resulting from economic or political instability, or just due to the comparatively small volume of foreign trade.  Cultured currency speculators use low-rate developed economy currencies like the USD or EUR and invest them in high-rate market currencies, and then purchase the binary options as a means of protection against any currency risk.  This allows the binary option speculator to earn some profit while protecting being protected from jump risk.