Dutch bank rescue shows Europe's problems continue

Dutch finance minister Jeroen Dijsselbloem said the rescue will increase government debt

LONDON (CNNMoney)

The Dutch government was forced to rescue SNS REALL to protect savers' deposits after the banking and insurance group racked up huge losses on real estate lending. Attempts to find a private buyer or investor failed.

"I therefore had to use the instrument of last resort, which is nationalization," said Finance Minister Jeroen Dijsselbloem, in a statement. "Nationalization would safeguard financial stability and prevent serious damage to the economy."

The government's intervention comes a day after two of Europe's biggest banks -- Santander and Deutsche Bank -- announced huge writedowns in a bid to reduce their exposure to the region's economic woes and move on from past mistakes.

More banks cleaned house Friday. Spain's second biggest lender BBVA reported a 44% drop in earnings in 2012 due to hefty real estate provisions and rival CaixaBank's earnings fell 78%. France's Credit Agricole announced a €2.7 billion impairment charge, including €852 million related to retail banking in Italy.

Related: Jury still out on eurozone - Draghi

While the investments of shareholders and subordinated creditors at SNS REALL will be wiped out, the rescue will still cost the Dutch state about €3.7 billion in capital injections and writedowns, pushing its budget deficit further above EU targets.

That will embarrass Dijsselbloem as he takes over as chairman of the group of finance ministers charged with policing fiscal policy among the 17 eurozone nations, and anger taxpayers who paid for a €40-billion bailout of the Dutch financial sector in 2008.

"I can well understand the aversion many people will feel because once again, a large sum of taxpayers' money is required," Dijsselbloem said. "This is why I want the private sector to contribute as much as possible."

A one-time levy of €1 billion will be imposed on Dutch banks in 2014 to help pay for the rescue.

Dijsselbloem said the EU needed to legislate to ensure that banks could be broken up more easily and that the cost of future rescues be borne largely by the private sector.

Related: Scandal at world's oldest bank

A working group led by European Central Bank governing council member Erkki Liikanen last October recommended separating investment and retail banking activities to protect taxpayers and savers.

But France has since countered with its own proposal that would stop short of forcing legal separation. So far, the EU has made only small steps toward a banking union -- agreement on a eurozone mechanism for winding up failing banks and protecting depositors is probably years away.

The EU, U.S. and U.K. are all discussing different ways to regulate banks to avoid costly bailouts in the future, leading some industry figures to warn that policymakers are creating unnecessary complexity, and potentially risk, with a confused approach.

UBS Chairman Axel Weber said last week the industry needed a global standard on the issue of separating customer deposits from trading activities.

First Published: February 1, 2013: 2:17 PM ET

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Google stock hits all-time high

Click chart to see more information about Google's stock.

NEW YORK (CNNMoney)

Google's stock rose 2.6% to close at $775.60, topping the all-time high of $774.38 it reached in October 2012. The stock went as high as $776.60.

Google (GOOG, Fortune 500) has been the subject of a three-year European Union probe into its search business. Despite emerging scot free from a similar multi-year investigation in the United States last month, many industry analysts and antitrust experts had expected the European probe to be harder for Google to wriggle out of.

Antitrust laws are stricter in Europe, and Google maintains a 90% share of the search market there -- significantly higher than the two-thirds share it commands in the U.S.

The European Commission has only said that its reviewing Google's proposals that the company delivered to it on Friday, and no settlement has yet been reached. But if the solutions Google proposes are in any way similar to the voluntary concessions Google offered in the U.S., they won't have a noticeable impact on the company's business.

Google's stock has been on a tear during the past few months. The company continues to activate a million Android devices a day, has successfully expanded into the broadband, cable and wireless arenas and remains the dominant search engine. Despite more competition from Microsoft (MSFT, Fortune 500) and Facebook (FB), neither has yet threatened Google's top spot.

Google investors apparently also don't seem to be too nervous about any changes that ex-Googler Marissa Mayer might be making at Yahoo. Mayer left Google to become CEO of Yahoo (YHOO, Fortune 500) last year, and even though she has won praise for changes she's been making to try and turn around Yahoo, the company still has a long way to go before it challenges Google for the online advertising market lead.

The surging price of Google is also in stark contrast to the big decline in Apple (AAPL, Fortune 500). Shares of Apple have plunged more than 35% since hitting an all-time high last September.

Related story: 5 reasons why Google has its mojo back

But concerns remain about Google, particularly with its mobile business. The amount that advertisers pay Google for clicks has continued to slip, and Google keeps losing money on its Motorola unit.

Google CEO Larry Page has said that he doesn't expect the cost-per-click issue to be a "long-term problem," but he also hasn't indicated when he thinks this figure would be more closely aligned with overall click growth.

First Published: February 1, 2013: 1:14 PM ET

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Auto makers post strong sales in January

NEW YORK (CNNMoney)

The world's major car makers reported strong U.S. sales for the month of January on Friday, providing further indication that demand for new vehicles that lagged amid the weak economic recovery in the past few years is starting to return.

January vehicle sales came in at a seasonally adjusted annual rate of 15.3 million, according to Autodata, up from 14.0 million a year ago.

General Motors (GM, Fortune 500) led the way among the top four U.S. automakers with 194,699 vehicles sold, up 16% versus a year prior. Ford (F, Fortune 500) had 166,501, a 22% gain. Toyota (TM) sold 157,725 vehicles, up 27% versus a year prior, and Chrysler Group had 117,331, a gain of 16%.

Related: Consumer Reports says Toyota and Ford are best-liked car brands

Sales remained in high gear in January even after a strong December. Overall, industry sales rose 13% in 2012 to 14.5 million, the biggest increase since 1984.

CNNMoney's Chris Isidore contributed reporting.

First Published: February 1, 2013: 1:24 PM ET

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Barclays CEO: I don't deserve a bonus

Barclays CEO Antony Jenkins tells board he won't take bonus after scandal-scarred year for British bank.

NEW YORK (CNNMoney)

"The year just past was clearly a very difficult one for Barclays and its stakeholders, with multiple issues of our own making besetting the bank," he said Friday in a statement. "I think it only right that I bear an appropriate degree of accountability for those matters and I have concluded that it would be wrong for me to receive a bonus for 2012 given those circumstances."

In July Barclays agreed to pay U.S. and U.K. regulators $453 million after admitting that its employees conspired to manipulate the Libor rate in order to make money for its traders. The rate, which is supposed to represent what banks charge each other to borrow money, is used as the basis for setting rates for up to $800 trillion in loans and financial securities.

Barclays chairman Marcus Agius and CEO Bob Diamond resigned within days of the scandal becoming public, and many other banks admitted they were also under investigation. UBS (UBS) agreed to pay $1.5 billion for its role in the Libor scandal in December.

Related: Bank fines top $10 billion in '12

Jenkins, who had been head of Barclays' retail and business banking, was tapped to be the new CEO at the end of August. His task has been repairing the banks' image, especially in its home market, where the Libor scandal generated significant publicity and public outrage.

Barclays (BCS) shares have done well since Jenkins took over, rebounding more than 60% in London trading.

First Published: February 1, 2013: 7:40 AM ET

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Jobs report: Steady hiring continues

NEW YORK (CNNMoney)

Job growth at that level is weaker than in December, when employers added 196,000 jobs.

Meanwhile, hiring is barely keeping pace with population growth. The unemployment rate was 7.9% in January, as 12.3 million people were counted as unemployed.

Check the unemployment rate in your state

Construction was one of the strongest sectors, adding 28,000 jobs and reflecting a stronger housing market and rebuilding efforts after Superstorm Sandy. Health care added 23,000 jobs, mostly in ambulatory health care services, which includes doctors' offices and outpatient care centers.

Retail added 33,000 jobs, with about a third of those gains at clothing stores.

Manufacturers added about 4,000 jobs, but the Labor Department noted that employment in this sector has changed little since July.

The government continued to cut jobs for the fourth month in a row.

The Labor Department also released revisions to its 2012 data, showing the economy added 335,000 more jobs during the year than originally reported.

It's a recovery, but it's still a slow one. The U.S. economy lost 8.8 million jobs in the financial crisis, and is still down about 3.2 million jobs from the labor market's height in January 2008.

Did you get a job in January? Tweet @CNNMoney with the hashtag #Igotajob to tell us about it.

First Published: February 1, 2013: 8:46 AM ET

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Heroes helping others find jobs

Dave Phillips, co-founder of a Detroit technology professional networking group, connects laid-off IT professionals with recruiters.

(Money Magazine)

Dave Phillips, 40, co-creator of networking group for Detroit technology professionals

Why he's a hero: An Internet systems architect, Phillips was sick of the pitches he endured from sponsors and salespeople at industry networking events.

So in 2001 he helped set up Detroitnet.org as a free, low-key forum for information technology workers wanting to talk shop and socialize over a beer.

Phillips -- who also informally coaches peers seeking employment -- threw the group's first Pink Slip Party in 2009 to connect laid-off IT professionals with recruiters; since then, more than 400 people have found jobs through Detroitnet.

Related: 14 Money heroes: Their financial advice

"Your network is your lifeline," he says. "It is the most important thing you will develop over your career."

Jack Rosenthal, 77, co-founder of group putting professionals 55-plus back to work

Why he's a hero: A veteran New York Times editor who had covered older Americans' efforts to stay active, Rosenthal joined with social service advocate Herb Sturz in 2005 to launch ReServe, a nonprofit that pays retired professionals a $10-an-hour stipend to work in schools, government offices, and community agencies.

Typical jobs: bookkeeping for small charities and college counseling at underserved high schools.

From its first office above a Brooklyn drugstore, ReServe has expanded to seven cities, placing 3,000 workers in more than 350 organizations.

"There's a new stage of life between 65 and 85, when most adults are still sharp and want to contribute," he says.

THREE TIPS FOR JOB HUNTERS

With new budgets and projects starting up, January and February are hot hiring months. Jump-start your search with these steps:

Be indispensable. Don't interview hoping people will hire you; make them feel they can't afford not to. Research a company's goals and develop a plan to help meet them. "Think of yourself as a consultant: Come in with a proposal in mind," says Jean Erickson Walker, author of The Age Advantage.

Related: 4 crusaders fighting for seniors' financial rights

Get on the inside track. Among the 44% of unemployed workers ages 55-plus who have been jobless for over a year? Referrals open doors. At social events, be ready to let people know your goals and skills -- without being pushy.

Join a networking group for structure. "It's like Weight Watchers for job searchers," says career coach Mary Eileen Williams.

Tweet to compete. A social media presence is a must -- a big change over the past year, says Greg Simpson, a career transitions executive at Lee Hecht Harrison. Using Twitter and LinkedIn to stay current is fine, but more activity will heighten your visibility.

First Published: February 1, 2013: 9:23 AM ET

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Investing in TIPS: Can retirees beat inflation?

NEW YORK (Money Magazine)

If your goal is to protect the value of your assets and your income from inflation over the course of a long retirement, then you should certainly consider TIPS, or Treasury Inflation Protected Securities.

But before you go stuffing your retirement portfolio with them -- or more likely, TIPS funds -- you first need to understand the type of the inflation risks you face in retirement. You'll also want to keep in mind that you already have a very powerful inflation buffer in Social Security, as its payments are pegged to the inflation rate.

So as important as hedging your retirement portfolio against inflation is, you don't want to overdo it.

Essentially, you need to guard against two forms of inflation during retirement. The first is what economists call expected inflation, or the steady rise in the price level that takes place over many years.

Hedging against this version of inflation is relatively straightforward: Keep a portion of your savings in investments that have the potential to generate returns several percentage points or more above the inflation rate over the long term.

Stocks are clearly one such investment, although mutual funds that invest in REITS and other real estate-related investments can also provide long-term inflation-beating returns. (Don't forget that if you own a truly diversified portfolio of stocks, such as a total stock market index fund, you already have REITs in the mix.)

Related: Long-term investing -- keep it simple

The second type of inflation you need to protect against is unexpected inflation. This is the kind that can flare up suddenly, like the oil-price shocks of the mid-1970s and early 1980s.

These spikes are usually relatively short-lived, so they're not a major issue for people still investing for a retirement that's decades down the road. But if you're a retiree relying on your investments for current spending cash, even short spurts of inflation can make it more difficult to maintain your standard of living.

The issue is how to deal with this second inflation threat. Many advisers recommend investments like commodities or gold, which have the potential to generate lofty returns when unanticipated inflation takes off.

But Vanguard Investment Counseling and Research principal John Ameriks points out that these outsized returns aren't a given. "There are many historical instances where you see high inflation and low commodity returns," says Ameriks. Indeed, research shows that there's roughly a 30% chance that commodities could post negative returns if inflation goes up.

TIPS, on the other hand, are uniquely suited for handling unexpected inflation. Unlike commodities or gold, which may be statistically likely to climb in value if inflation spikes, TIPS have been specifically designed to rise along with increases in the consumer price index.

Related: Are emerging market bond funds a safe haven?

That said, TIPS also have some drawbacks. They are bonds, so their value can fall if real interest rates rise. What's more, demand for TIPS from investors seeking shelter from inflation has pushed their real yield, or their payout after inflation, close to or even below zero. Recently, for example, the real yield on 10-year TIPS was -0.53%.

Many advisers have pointed to TIPS' negative real yields as a reason not to own them. But while investing in TIPS when their real yield is negative does mean you'll earn less than the inflation rate, the principal value of the TIPS and the income they throw off will still rise if inflation picks up. Thus, by owning them you are still protecting yourself should inflation climb in the future or spike unexpectedly in the short-run.

Besides, it's not as if regular Treasuries or other bonds will thrive if inflation heats up. Quite the opposite. Conventional 10-year Treasuries recently yielded about 2.03%. So if inflation exceeds that level over the next 10 years, regular 10-year Treasuries would generate a loss. And if inflation exceeds 2.56% -- the recent difference between the -0.53% yield for 10-year TIPS and the 2.03% yield for 10-year nominal Treasuries -- then TIPS will outperform regular, or nominal, Treasuries.

That's why you really want to own both TIPS and regular Treasuries and other bonds. If inflation rises over time or just spikes for a shorter period at some point in the future, then TIPS could be the better performer. If inflation stays tame or becomes even more docile, then conventional bonds will generate better returns. By owning both, you're hedging your bets.

Related: Cost of living: How far will my money go in another city?

You can argue about how much of a retiree's bond stake should go to TIPS vs. nominal bonds. But if your retirement portfolio already includes some stocks to protect against expected inflation over the longer term, then devoting, say, 25% to 30% of your bond holdings to TIPS seems a reasonable way to guard against both expected and unexpected inflation.

Bottom line: Investing in TIPS is a reasonable way for you to protect your purchasing power in retirement. But do it in moderation. Because the more you focus your investing strategy toward dealing with one risk, the more vulnerable you are to others.

First Published: February 1, 2013: 5:55 AM ET

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8 apps for losing weight, staying fit

MONEY picks eight phone-worthy health apps.

(Money Magazine)

"Smart devices are moving health care from the hospital or doctor's office to the home," says Chris Edwards, assistant dean for information technology at the University of Cincinnati College for Nursing.

MONEY's top picks for apps help you lower health care costs, get fit, lose weight, and more:

BEST APPS FOR WEIGHT LOSS

Lose It!

Available on: iPhone, Android

Cost: Free

Overweight people rack up hundreds of dollars more a year in health care expenses than those of normal weight. Lose It! helps monitor your food and fitness.

Log your meals using the easy-to-navigate database, and the app will automatically update your target calorie count based on what you've burned that day via exercise.

Related: Cut your health-care costs at any age

Coolest feature: If you're eating on the go, scan the bar code on food packages to record calorie information.

Fooducate

Available on: iPad, iPhone, Android

Cost: Free

All too often the word "healthy" on a food package is merely a marketing gimmick to justify a higher price. Use this app to decode nutrition labels and see how your favorite eats rate against others, based on calories, sugar content, and the percentage of additives and other processed junk inside.

Coolest feature: Along with the rating, Fooducate suggests better options to help you make a smarter selection.

BEST APP FOR FITNESS

RunKeeper

Available on: iPhone, Android, BlackBerry

Cost: Free

Related: How to save on health insurance

Plug in your weight and goal and get a personalized fitness plan. A coach urges you to stick to a pace as you run (or walk or bike); when you finish a workout, you get a complete breakdown of your stats, including calories burned.

"It's like a free trainer at the gym," says Suzanne Kantra, editor-in-chief of Techlicious.com.

Coolest feature: RunKeeper synchronizes with your Facebook page so you can engage in a virtual competition with your friends.

BEST APPS FOR SELF-DIAGNOSIS

SpotCheck

Available on: iPad, iPhone, Android

Cost: Free

Skin cancer is the most common form of cancer in the U.S., so it's important to check out problematic spots ASAP. Unfortunately the average patient waits 38 days to see a dermatologist.

Related: Check out of the hospital and stay out

With Spot-Check, you snap a photo of your mole and it will be analyzed by a board-certified dermatologist within 24 hours. "Nothing replaces an in-person visit, but you can get real-time peace of mind for free," says New York City dermatologist Bobby Buka, who developed the app.

Coolest feature: Doctors affiliated with SpotCheck see users within two weeks.

PostureScreen Mobile

Available on: iPad, iPhone, Android

Cost: $9.99

Spending big bucks on back pain treatment? Poor posture may be the cause of the strain. The trouble is that posture issues aren't always obvious to the eye.

This app, developed by physical therapy professionals, analyzes your front-and-side photos and points out, say, that one shoulder is higher than the other or that your head juts forward.

Coolest feature: Email your trainer or physical therapist a PDF of the results so she can tailor your workout accordingly.

BEST APP FOR FINDING A DOCTOR

ZocDoc

Available on: iPad, iPhone, Android, BlackBerry

Cost: Free

ZocDoc was developed by a weary road warrior who broke an eardrum on a flight and had a hard time finding treatment once he had landed. ZocDoc can instantly find a dentist or doctor in more than 1,500 cities who takes your insurance.

Related: 5 ways to prevent sports injuries

"That's a huge timesaver," says Dr. Marty Makary, a researcher at the Johns Hopkins University School of Medicine who is not affiliated with the app.

Coolest feature: Use the app to book available appointments.

BEST APPS FOR ORGANIZING

My Medical

Available on: iPad, iPhone

Cost: $3.99

Not keeping track of your medical info can be costly in many ways, from an increased risk of misdiagnosis to fees for missed appointments. My Medical gives you health data for your entire family at a click, from the kids' vaccine records to your latest cholesterol numbers, and stores photos of insurance cards.

Coolest feature: You're pinged with reminders for upcoming appointments.

Good Rx

Available on: iPad, iPhone

Cost: Free

If you're paying full freight for your meds or have co-insurance, the cost of your drugs can vary widely between stores. Enter the specific medication you're looking for (you can search for it by condition), and you'll get a list of pharmacies in your area (as well as online stores) that carry it, along with comparative pricing.

Coolest feature: Automatic notifications about price drops.

First Published: February 1, 2013: 6:27 AM ET

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Consumer Reports: Toyota, Ford best-liked car brands

Toyota tops Consumer Reports' latest survey of auto brand perceptions.

NEW YORK (CNNMoney)

The magazine asked a random sampling of Americans what auto brands they thought highly of in seven different areas: quality, safety, value, performance, design, technology, and environmentally friendliness.

The Toyota brand had dropped in the survey in recent years, in the wake of unintended acceleration issues and recalls, but the brand has come back strongly. Toyota's parent company, Toyota Motor (TM) Corp., which also makes Lexus and Scion brands, also returned to the top of the global sales charts last year.

Second and third place finishers Ford (F, Fortune 500) and Honda (HMC) have also been perennial leaders in the survey.

Related: Consumer Reports' Best Value Cars

Respondents weren't given a list of car brands to choose from. Instead, they were simply asked to name car brands, off the tops of their heads, that they felt were best in each area. Car brands were then ranked by the total number of mentions overall.

Not every car brand is doing better in the minds of car shoppers.

"This past year brought stability and increased sales to much of the automotive industry. Yet, the brand awareness scores for some like BMW, Buick and Hyundai have declined," Consumer Reports on-line editor Jeff Bartlett said in an announcement.

The weakest brands, in terms of consumer perceptions were: Mitsubishi, Scion (Toyota's youth-oriented brand,) and Chrysler's Ram truck brand.

Related: Consumer Reports names most reliable cars

While these survey results show what people think of the various car brands, there is often little relation between these perceptions and reality, according to Consumer Reports. Volvo, for instance, ranks high for safety among car shoppers but, in reality, many other brands do just as well in crash tests and offer as many, or more, safety-related features, the magazine said.

The survey also showed that quality and safety were the most important factors to car shoppers. Environmental sensitivity was much less important.

First Published: February 1, 2013: 6:51 AM ET

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Red state, blue state: Where Detroit can (and can't) sell cars

If the Detroit Three automakers want to survive, they need to look beyond their traditional red state customer base for car sales.

(Fortune)

But underneath the gauzy good news lies an unpleasant fact. The brands of the Big Three are in danger of becoming regionalized, their appeal strong in some parts of the country and weak in others. What's more, demographic trends and population growth suggest they will grow only more regionalized over time, rooted in their core markets but unable to meaningfully expand beyond them over time.

That's dangerous because it limits Detroit automakers' ability to hold on to their current levels of market share -- much less build on them -- as it creates more opportunities for import brands. And while every dollar made by GM, Ford, or Chrysler largely remains in the U.S., import brands provide jobs here too, but their corporate profits go overseas.

State-by-state sales data, analyzed and provided to me by Edmunds.com, strongly indicates that cars made by the Detroit Three are largely red state cars, popular with the same people, many in the heartland, who voted Republican in the last presidential election.

Imports, by contrast, perform far more strongly in the blue states, where the majority of votes were cast by the Democrats.

MORE: 13 auto execs to watch in 2013

This geographic division does not favor the domestics. Red states tend to be more rural, less populated, and slower-growing than the rest of the country. Blue states, on the other hand, are more urban, more dynamic, and benefit from a greater influx of new population.

That's not good. Being confined to red states slows sales growth and makes it difficult to attract younger buyers. It also creates problems for product planners, because they have to come up with designs that can help conquest new customers without alienating older buyers. That helps explain why import brands have been leaders in new technologies like hybrid gas-electric powertrains, and new product segments like compact crossovers, while domestics have been largely fast-followers.

The domestics have been trying to break out of their red state box for a decade or more, sporadically trying, for instance, to boost sales in California. Their inability to do so has become a subject of frustration. One well-placed Detroit insider told me, "We are terribly concerned about it."

Take a look at the 10 states that have the highest proportion of domestic sales, according to Edmunds.com data. They are, in order: Michigan, North and South Dakota, Iowa, Wyoming, Montana, Nebraska, Oklahoma, Arkansas, and Indiana. The common characteristics they share are stable or declining populations, being mostly ignored by the national media, and having relatively little impact on broader societal trends.

MORE: 13 cars to watch in 2013

By contrast, the imports shine on the coasts. Theories abound why this is so, but import cars seem better adapted where streets are narrower, traffic is heavier, and destinations are closer together. Import buyers also tend to be early adopters who are better informed about choices available to them and are less inhibited by past preferences. The 10 states with the lowest proportion of domestic sales are, in order: Hawaii, District of Columbia, California, Massachusetts, Connecticut, New Jersey, Rhode Island, Florida, Maryland, and Washington State.

The geographic distinction is even more sharply drawn when you look at metropolitan areas. Domestics are anchored to older, slower-growing metro areas like Buffalo, Indianapolis, and Cleveland. But they lag in fast-growing regions such as Miami/Ft. Lauderdale, San Diego, and Portland. Import brands meanwhile dominate in opinion centers like New York City, Los Angeles, and Washington, D.C.

MORE: 3 little letters GM is counting on now

The divide is just as pronounced when you compare the regional sales of two popular midsize cars: the Ford Fusion and Toyota Camry.

The Fusion is most popular in the Midwest, starting with Michigan, where it accounts for nearly 6% of all car sales, followed by Ohio, Kansas, Kentucky, and so on.

Camry's top 10 states in market share begin with red state stalwarts Alabama, Kentucky, and North Carolina. But that is surprising only until you consider that Kentucky is home to Toyota's huge manufacturing complex, and the other two states are nearby. California and Florida, two of the nation's most populous states, are also on the Camry list.

The Detroit Three have made huge strides in sustainability, technology, design, and quality. Now they have to start conquesting buyers who haven't shopped domestic before.

First Published: January 31, 2013: 6:55 AM ET

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