United fined $1.1 million over Chicago delays

Passengers were stuck on planes for stretches ranging from just over three hours to nearly four-and-a-half hours.

NEW YORK (CNNMoney)

The DOT said the penalty is the largest for such a violation since a rule limiting long tarmac delays took effect in April 2010. The rule states that U.S. airlines with with 30 or more passenger seats on their domestic flights can't allow their planes to remain on the tarmac for more than three hours without giving passengers the opportunity to disembark.

Passengers on 13 United flights were stuck on their planes during severe thunderstorms on July 13, 2012 for stretches ranging from just over three hours to nearly four-and-a-half hours. Bathrooms were inaccessible on two planes for portions of the delays, the DOT said.

"It is unacceptable for passengers to be stranded in planes on the tarmac for hours on end," Transportation Secretary Anthony Foxx said in a statement.

Related: Toyota settles acceleration case after $3 million jury verdict

United said it was "committed to complying with the tarmac delay regulations, and we continue to improve our procedures while maintaining the safety of our customers and co-workers."

The fine amounts to a slap on the wrist for a company that reported $590 million in profits for the third quarter.

Correction: An earlier version of this story incorrectly stated that United was pursuing a merger with US Airways. The proposed merger is between American Airlines and US Airways.

First Published: October 25, 2013: 2:42 PM ET

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JPMorgan paying $5.1 billion to Fannie, Freddie over mortgages

It's been a rough year for JPMorgan.

NEW YORK (CNNMoney)

The bank has also been in talks with the Justice Department and other government officials over another potential settlement based on similar claims. That settlement will likely be even more expensive for JPMorgan.

The claims relate to conduct at JPMorgan and at Bear Stearns and Washington Mutual, which JPMorgan purchased in 2008. At issue are allegations that the firms sold risky mortgages and mortgage securities while misrepresenting their quality.

Among the purchasers were Fannie Mae and Freddie Mac, the government-backed housing finance giants that required a massive bailout in 2008 when their housing investments soured.

The deal was announced by the Federal Housing Finance Agency, which has overseen Fannie and Freddie since their 2008 rescue.

Agency head Edward DeMarco said the accord "provides greater certainty in the marketplace and is in line with our responsibility for preserving and conserving Fannie Mae's and Freddie Mac's assets on behalf of taxpayers."

"This is a significant step as the government and JPMorgan Chase move to address outstanding mortgage-related issues," DeMarco said.

The firm reached the agreement without admitting or denying wrongdoing.

Related: More banks in crosshairs

JPMorgan will pay $4 billion to resolve claims related to the alleged misrepresentation of mortgage-backed securities -- investment products created by bundling payments from individual loans.

It will also repurchase $1.1 billion worth of mortgages sold to Fannie and Freddie between 2000 and 2008 that the firms say do not meet their quality standards.

JPMorgan (JPM, Fortune 500)said the settlements "are an important step towards a broader resolution of the firm's [mortgage-backed-securities]-related matters with governmental entities, and reflect significant efforts by the Department of Justice and other federal and state governmental agencies."

JPMorgan acquired Washington Mutual in 2008 after the failed bank had been taken over by the Federal Deposit Insurance Corporation. It's unclear whether JPMorgan will be able to pursue reimbursement claims with the FDIC for the portion of the settlement related to WaMu.

This issue has been a point of contention in JPMorgan's negotiations with the Justice Department, which wants to prevent the bank from passing on any settlement costs.

Securities sold by WaMu accounted for roughly $1.15 billion worth of the FHFA settlement.

Related: Half of nation's foreclosed homes still occupied

Investors initially shrugged off the news, which has been rumored for weeks. JPMorgan shares were up slightly in after-hours trading Friday, and have gained 20% so far this year.

JPMorgan is just one of 18 banks sued by the FHFA back in 2011 over the alleged misrepresentation of mortgage-backed securities, and is only the fourth to reach a settlement.

UBS (UBS) agreed to a settlement with the FHFA in July for $885 million. The agency has also settled with Citigroup (C, Fortune 500) and General Electric (GE, Fortune 500) for undisclosed sums.

JPMorgan is large enough to easily absorb the settlement costs. It's the biggest bank in the nation, with assets of $2.5 trillion and net income of $21.3 billion in 2012.

The bank has been buffeted by legal problems in the past few months, however.

It has paid over $1 billion in fines in connection with last year's "London Whale" trading debacle, and $80 million more over its allegedly unfair credit card billing practices.

In July, the bank agreed to pay $410 million to settle charges that it manipulated electricity prices in California and the Midwest. It is also facing scrutiny over its hiring practices in China and its alleged involvement in the Libor rate-fixing scandal.

JPMorgan posted a loss for the third quarter based on its massive legal expenses. CEO Jamie Dimon called the loss "painful" and warned that litigation costs could continue to be a drag on earnings for several quarters.

First Published: October 25, 2013: 5:26 PM ET

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Feds seize $28 million in bitcoins from alleged Silk Road operator

There are currently about 11.9 million bitcoins in circulation, according to the website Blockchain.

NEW YORK (CNNMoney)

Bitcoin, which allows users to conduct online transactions while obscuring their identities, was the only currency accepted on Silk Road. Law enforcement officials arrested the site's alleged proprietor, Ross Ulbricht, earlier this month, and have shuttered the operation.

Ulbricht faces a potentially lengthy prison sentence for charges ranging from narcotics trafficking to computer hacking to money laundering. Federal officials have now seized over $33.6 million worth of bitcoins in connection with the case.

"This seizure sends a clear notice to those who think they can commit crimes and conceal the fruits of their criminal activities in digital anonymity," IRS Special-Agent-in-Charge Toni Weirauch said in a statement.

Ulbricht's lawyer could not be reached for comment.

Related: How porn links and Ben Bernanke slipped into Bitcoin's code

Silk Road operated on an anonymous network known as Tor, making activity on the site virtually untraceable.

The use of bitcoin gave buyers and sellers an extra layer of protection. The currency is anonymous, decentralized and can only be used in digital form.

To process bitcoin transactions, Silk Road used what the FBI described as a "tumbler," a complex system that used countless dummy transactions to digitally conceal a payment's origins.

Over the past two and a half years, federal officials say the site generated sales of more than 9.5 million bitcoins, a sum valued at about $1.8 billion at Friday's exchange rate. In addition to illegal drugs, the site offered weapons, hacking software and other illicit products.

Bitcoin surged in value earlier this year, when a banking crisis in Cyprus shook confidence in government-issued currencies.

First Published: October 25, 2013: 9:31 PM ET

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Cut to food stamps coming next Friday

Cuts totaling $5 billion from the food stamp program will mean less money for groceries for millions of people.

WASHINGTON (CNNMoney)

The cuts, totaling $5 billion, will mean less money for groceries for millions of people who rely on food stamps. It's a tough time to have less food on the table, just a few weeks before the start of the holiday season.

Congress has the power to halt the cutback. However, experts say it's highly unlikely at a time when Republicans are calling for even more drastic cuts to food stamps.

Food stamp benefits were bumped up in the midst of the recession. The temporary provision expires Nov. 1.

Related: McDonald's helps workers get food stamps

As families have struggled during the recession and also the slow economic recovery, enrollment has soared in the Supplemental Nutrition Assistance Program.

Some 47.6 million people, or nearly 15% of the population, get food stamps, according to September federal data. That compares to 26.3 million, or 8.7% of the population, in 2007.

The average benefit per person is $133.19 a month.

Families nationwide have already received emails and letters warning that their benefits will be reduced. For a family of four getting the maximum benefit of $668 a month in food stamps, the cuts would trim $36 a month, according to the U.S. Department of Agriculture Food and Nutrition Service.

Even though the economy remains on shaky ground, lawmakers are unlikely to extend the extra benefits. In fact, the discussion among Republicans is to what degree food stamps should be whittled down.

In September, the Republican-controlled House passed a bill that tightens eligibility for food stamps. It trims $40 billion from funding food stamps over the next decade.

"It's hard to imagine anything that could stop this happening in a week," said Elizabeth Lower-Basch, policy coordinator at CLASP, an advocacy group for the poor. "There are studies that this really did help people buy slightly higher quality food."

Related: Poor hit hardest by Washington budget cuts

But conservatives say it was never intended to be anything more than temporary. They say extending the extra money is out of the question, mostly because they believe the food stamps program is already bloated and in need of changes.

"I don't think calling it (the Nov. 1 drop in benefits) a cut is the right way to frame it," said Rachel Sheffield, a policy analyst at the conservative Heritage Foundation. "This was a temporary increase in spending."

First Published: October 25, 2013: 9:46 AM ET

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Friday Links

NEW YORK (CNNMoney)

A weekly collection of design, data and interactive links.

Design/Data viz
How music travels | The evolution of western dance music
Wind map | Classic look at wind patterns across the country
ProCATinator | Procrastinate with cat music videos
Modern Japanese graphic design | 1964 Tokyo Olympics Posters by Yusaku Kamekura
Snap.svg | The JavaScript SVG library for the modern web

Photo/Video
Visualizing big data in milliseconds | MiT improves the ability to display large data sets
DDoS attacks explained | Google explains distributed denial of service attacks
Stainless | Moving images from Adam Magyar
$500 glass house | Two artists build a glass house
Hand lettering demo | Glen Weisgerber demonstrates the round-hand lettering technique.
SansSouci Issue N.1 | A new art book including works of more than 40 contemporary artists.

See last week's links

Have a nice weekend!
@dubly and @talyellin

First Published: October 25, 2013: 9:36 AM ET

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Tech stocks are on fire

Click chart for more markets data.

NEW YORK (CNNMoney)

Amazon (AMZN, Fortune 500) posted a loss but sales were much better than forecasts. Amazon's shares soared more than 10% in early trading. Microsoft (MSFT, Fortune 500) easily topped estimates for sales and profits. Microsoft's stock shot up more than 7%.

Even Zynga (ZNGA), the troubled online video game company, surprised Wall Street by reporting losses that were slimmer than expected, sending shares up more than 10%.

Related: Amazon trumps Wall Street predictions

Tech stocks helped pushed all three indexes modestly higher. The Nasdaq gained the most, up roughly 0.7%. The tech-heavy index is now within striking distance of 4,000, a level it last hit in September 2000.

The Dow and the S&P 500 rose about 0.3%.

The three indexes are on track to close the week higher.

Investors have been pleased by earnings reports, but they also remained convinced that the Federal Reserve will delay winding back its massive bond-buying program. The Fed has a policy meeting next week and is widely expected to say it will continue buying $85 billion in bonds and mortgage-backed securities a month.

Consumers less confident? The University of Michigan's October reading on consumer confidence fell far below expectations and was also below September's levels.

Still, UPS (UPS, Fortune 500) is confident that consumers will be shopping in force over the holidays. The shipping giant predicted a robust holiday season, which sent shares higher. The company also reported quarterly income that exceeded forecasts. Earlier this week, UPS rival FedEx (FDX, Fortune 500) said it thought that Cyber Monday, the first Monday after Thanksgiving, will be its busiest day ever.

Related: Fear & Greed Index continues to show greed is good

Twitter's IPO is coming soon: Twitter revealed late Thursday that it plans to raise upwards of $1.4 billion in its initial public offering, selling 70 million shares at between $17 and $20 per share. At the high end of that range, Twitter would be worth nearly $11 billion.

European markets were mostly higher in afternoon trading, with modest gains after the U.K.'s third quarter GDP report met expectations. Stocks in Asia were hit by a weaker yen and concerns over tighter liquidity in China.

First Published: October 25, 2013: 9:47 AM ET

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MacBook Air is the best Apple laptop

NEW YORK (CNNMoney)

It says a lot that the 2010 revamp of Apple's ultra-thin laptop was the lynchpin that single-handedly forced Intel (INTC, Fortune 500) to create the specifications for rival PC ultrabooks in 2011. Three years later, it's still the gold standard for laptop hardware -- and CNNMoney's Best in Tech for the Apple laptop category.

The MacBook Air's aluminum chassis is near perfect -- so much so that Apple (AAPL, Fortune 500) has gone nearly four years without making a major change to it.

On paper, the MacBook Air's low-power, dual-core Intel Core processor may seem modest, but it has been well-optimized to handle nearly anything you could throw at it. Web browsing, HD video and light photo and video editing are tasks well within the scope of the MacBook Air.

It also easily provides users with an entire workday's worth of power before having to recharge. Coders, gamers, and creative professionals will likely need more from their machines, but for the rest of us, the MacBook Air is plenty of machine. Apple's higher end MacBook Pro laptops are objectively more powerful. But for most people, the added benefits of the MacBook Pro simply don't justify the considerable extra cost over the MacBook Air, which starts at $999.

Related story: The iPad mini is now the iPad

Apple's multitouch trackpads are the best you'll find on any laptop, and the MacBook Air is no different. Spacious and responsive, you never have to think about getting the cursor where it needs to be on the screen, or having to click a specific part of the trackpad. The keyboard is also quite excellent, though a few companies, such as Lenovo, may be slightly better in that category.

The one current knock against the MacBook Air might be the display. It has always been good, but as PC competitors move to 1080p HD displays, the MacBook Air screen is starting to show signs of age. Still though, it is above average any way you look at it.

As for audio, laptop speakers are laptop speakers. They'll never replace a proper desktop system, or a good pair of headphones, or even a decent Bluetooth speaker. But for all basic personal uses, the MacBook Air speakers are fine.

Related story: Macs down, PCs up

There's a case to be made for the $999 11-inch MacBook Air (namely portability and value), but shelling out $100 more for the 13-inch model will give you a reasonablly sized screen and an SD card reader -- a wonderful convenience if you regularly use a stand-alone camera.

And when you compare the $1,099 MacBook Air to its competitors, you actually aren't subject to much of the alleged "Apple tax." Of course, there are cheaper 13-inch ultrabooks to be found, but they're lesser devices in many ways. When stacked up against other ultrabooks that promise the same combination of functional design and performance - as Acer, Asus, and Lenovo do - the MacBook Air is either on par or cheaper.

Apple laptops aren't for everyone. But for those who do prefer them -- or don't care one way or the other -- the 13-inch MacBook air is the best Apple laptop available.

First Published: October 25, 2013: 7:06 AM ET

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Could teaching employees to code be key to success?

Modernizing Medicine has 16 physicians, in 8 different specialties, who have been trained to write code.

NEW YORK (CNNMoney)

Launched in 2010, his Boca Raton, Fla.-based firm designs electronic record-keeping systems for hospitals and doctors' offices. Like most tech startups, ModMed has a staff of engineers and software developers. What's more unusual is that it also has 16 physicians, in 8 different specialties, who write code.

"It's a lot easier to teach doctors how to program than it is to teach medicine to engineers," he said. Cane started ModMed with dermatologist Dr. Michael Sherling, who signed on after he grew frustrated with having to fill out routine paperwork multiple times.

"In the beginning, I tried getting Michael to explain to me how doctors think," Cane said. "We realized after about a week that that wasn't going to work."

Instead, he taught Sherling how to program and, together, they invented a new programming language specifically for medical records.

Related: 9 apps every business traveler needs now

Since then, the doctors they have brought on board have refined the company's cloud-based electronic medical records system, designed product updates and helped develop an iPad app. About 2,500 hospitals and medical practices now subscribe to ModMed's services, Cane said. And the company's revenues have soared from $2 million in 2011 to $9.3 million last year.

Cane believes ModMed's business model would work for any software firm that caters to a specialized professional market. "Banking, law, accounting, architecture -- there are plenty of fields where training subject-matter experts to be programmers would make a lot of sense," he said. "You could offer products and services to customers that most engineers and developers simply don't have the knowledge to design."

Teaching professionals from another field to be programmers can take some time, however.

"[It] depends on how computer-savvy they already are," Cane said. "But there are very basic, straightforward types of programming that any smart person can learn very quickly. Then, as they get proficient at those and gain confidence, they can move up to more advanced projects."

His main piece of advice for startups that want to follow ModMed's lead: "Instead of expecting subject-matter experts to think like engineers and conform to existing software, build the tools around the experts. Let their specialized knowledge dictate how you design the software."

Related: What I look for in a new hire

It's also essential, he added, to be highly selective about hiring. Sherling recruited most of ModMed's doctors from his vast network of colleagues and acquaintances. Even so, the company interviewed "many dozens" of physicians before handpicking its current crop.

"You want people who are not only distinguished in their field," Cane said, "but who are also excited about the chance to learn a new technical skill that can help others in their profession work smarter."

It was also important to Cane and Sherling that their recruits continued to practice medicine.

"It's important that they stay current, and try out our services in the real world, then create changes and improvements," said Cane.

First Published: October 25, 2013: 7:08 AM ET

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Four-star makeover for the TSA line

The Dallas-Fort Worth checkpoint used to offer stainless steel benches and tables (left). Now, like in Charlotte, travelers will find couches (right).

NEW YORK (CNNMoney)

But one company is trying to change that, bringing couches, mood lighting and music into the world of rope lines, stainless steel and body scanners.

A trial of redesigned security checkpoints at the Dallas-Fort Worth and Charlotte airports opened this month.

"Airports spend a lot of time and money on [comfort from] curbside to planeside, but there has been a gap at airport security," said Joseph Ambrefe, president of SecurityPoint Media, the company behind the new amenities. "Why shouldn't a checkpoint be appointed with the style of a four-star hotel lobby?"

The resemblance to a hotel lobby is no mistake -- the areas were funded by Marriott (MAR, Fortune 500) brand SpringHill Suites, in exchange for exclusive advertising in the areas. Ambrefe declined to say how much the areas cost.

Related: TSA's gun policy: Confiscate it, Instagram it

Travelers approaching the security line see monitors estimating their wait time. Upbeat music and professional announcements play from overhead targeted speakers -- to eliminate the need for TSA officers to shout instructions over the din.

You still have to take off your shoes and belt, but a "recomposure area" after the checkpoint gives travelers a less stressful environment to put themselves back together.

Ken Buchanan, an official at the Dallas-Fort Worth airport, said the checkpoint was part of the airport's effort to make "passenger screening a positive encounter, while maintaining the highest levels of security." The airport said it would evaluate the program's success in three months.

TSA officials didn't immediately respond to a request for comment.

Related: Airline pit crews race the clock

Most of SecurityPoint Media's business has revolved around the plastic bins that carry personal belongings through the x-ray machines. In exchange for maintaining the bin supply and storage carts free of charge, the company is allowed to plaster the bins with advertisements.

The bins and cart system improved efficiency and reduced security line wait times by 16%, according to a test of that program several years ago. It's now used at over 40 major U.S. airports.

If the couches and chairs bring similar improvements, Ambrefe said his company would look at expanding the comforts to additional airports.

First Published: October 25, 2013: 7:12 AM ET

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Solid earnings and China data lift stocks

NEW YORK (CNNMoney)

The Dow Jones industrial average and Nasdaq were modestly higher in early trading. The S&P 500 was flat.

In a sign that manufacturing is improving in the world's second largest economy, Chinese factory activity hit a 7-month high in October. The positive data follows last week's upbeat report that showed China's economy great 7.8% during the third quarter.

A big day for earnings: Dow components 3M (MMM, Fortune 500) and AT&T (T, Fortune 500) reported better-than-expected earnings. But shares of Ma Bell were down 2% while 3M rose slightly.

Ford (F, Fortune 500) shares rallied after the automaker raised guidance and released quarterly earnings and revenue that topped forecasts. Rival GM (GM, Fortune 500) rose on the news as well.

PulteGroup (PHA) shares were also on the rise after the homebuilder's earnings and revenue topped forecasts.

Southwest Airlines (LUV, Fortune 500) gained ground after the discount airline reported solid earnings thanks to higher airfares and declining fuel costs. Southwest was optimistic about the current quarter, highlighting that bookings for November and December are strong.

On the downside, shares of Symantec (SYMC, Fortune 500) got hammered after the company reported earnings and sales that fell short of estimates, and slashed its guidance. Dow Chemical (DOW, Fortune 500) shares were also under pressure after the company's earnings fell short.

Microsoft (MSFT, Fortune 500), Zynga (ZNGA) and Amazon (AMZN, Fortune 500) are due to report results in the afternoon.

Meanwhile, shares of Apple (AAPL, Fortune 500) were relatively flat despite the news that activist investor Carl Icahn sent a letter to CEO Tim Cook reiterating his push for a big share buyback.

Related: Fear & Greed Index still shows greed

European stocks were up in afternoon trading. Asian markets ended mixed.

First Published: October 24, 2013: 9:54 AM ET

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