Actual finance blog

Facebook’s stock market debut finally came and went — but for all the breathless hype, shares ended right near their offering price.

On Thursday night, Facebook () set its final IPO price at $38 a share. When the stock began trading at 11:30 a.m. ET on Friday, the first trade came in at $42.05 per share — a gain of nearly 11%.

What is an IPO?

But the stock quickly reversed course, dropping down to hover right around the $38 IPO price for much of midday trading. Though shares rose modestly for short bursts of time throughout the day, they ended the session at $38.23.

While the price itself didn’t move much, trading was fast and intense. More than 80 million shares changed hands in the first 30 seconds of trading. By the end of the day, volume had spiked to around 567 million shares.

That easily set a new volume record for IPOs, smashing the previous record that automaker General Motors (, Fortune 500) set in 2010 with trading of around 450 million shares.

Facebook’s trading had been expected to start around 11 a.m. ET, but the opening was delayed.

Facebook founder and CEO Mark Zuckerberg rang the Nasdaq opening bell remotely, from the company’s headquarters in California. Facebook celebrated its public debut by gathering its staff Thursday night for an all-night hackathon.

At the $38 IPO price, Facebook is on track to raise $16 billion — making it the largest tech IPO in history. It’s the third largest U.S. IPO ever, trailing only the $19.7 billion raised by Visa (, Fortune 500) in March 2008 and the $18.1 billion raised by automaker GM in November 2010, according to rankings by Thomson Reuters.

Underwriters have the option to purchase an extra 63.2 million shares to cover any so-called over-allotments for excess demand. If that happens, Facebook will sell 484.4 million shares in total. That would bring the amount raised to $18.4 billion.

How much Facebook is worth: At $38 per share, Facebook’s market capitalization would be around $81 billion on IPO day.

Many Facebook employees and executives hold unexercised stock options. If all of those shares were exercised, Facebook’s outstanding share count would rise to around 2.8 billion — pushing the company’s total valuation closer to $107 billion.

Among all global companies, Facebook has the third-highest IPO-day valuation in history, according to data from DealLogic.

SecondMarket, an exchange on which people can buy and sell stock in private companies, posted data on Friday about Facebook’s private-trading history.

It wasn’t until 2010 that SecondMarket’s Facebook trades racked up significant volume, so Facebook’s trades before that tended to be one-off deals at a low per-share price. In April 2010, Facebook fetched an average price of $9.82 per share on a monthly average basis. One year later, the rate jumped to $31.46.

As of April 5, Facebook shares were trading for an average of $42.72 each — nearly $4 higher than the IPO price.

Who’s selling shares: Zuckerberg plans to sell 30.2 million shares in the IPO offering. That will net Zuckerberg about $1.1 billion.

But Zuckerberg won’t be hanging on to his cash. Facebook said he will use the "substantial majority" of the windfall to cover the massive tax bill he’ll be hit with, thanks to his plan to exercise a large stock-options grant that will increase his ownership stake in the company he founded.

After the offering, Zuckerberg will still hold 503.6 million shares, or about 31% of the company. That stake is worth $19.1 billion at the IPO price.

Venture capital firm Accel Partners, which is the largest shareholder outside of Zuckerberg, is selling 49 million shares in the offering. That’s about a quarter of its Facebook holdings.

– CNNMoney’s Chris Isidore and Maureen Farrell contributed reporting. 

Source

Instant payday loan. In a few quick and easy steps we will help you get up to $1500 the same business day.

A U.K. factory index fell more than economists forecast in April and U.S. manufacturing probably slowed as the world economy stayed reliant on China to drive economic growth.

The gauge of British factory output dropped to 50.5 from 51.9 in March, London-based Markit Economics said today. The median forecast of 27 economists in a Bloomberg News survey was for a decline to 51.5. The Institute for Supply Management

There are various ways on how to get free credit report online; but there is only one official website that is mandated by the government as your certified source for your annual credit report for free.

The European Central Bank held its main interest rate at 1.0 percent on Wednesday as persistently high inflation offset pressure to respond to the euro zone’s shaky economic recovery.

The ECB also said the interest rate on its deposit facility would remain at 0.25 percent, and the rate on the marginal lending facility would stay at 1.75 percent.

ECB President Mario Draghi will explain the Governing Council’s decision at a 8.30 a.m. EDT (1230 GMT) news conference cash advance payday loan.

Markets are looking for hints on how long the ECB is planning to keep its wait-and-see stance on interest rates.

They also expect Draghi to be grilled on whether the central bank has started discussing exiting from its non-standard measures, which include pushing a 1-trillion-euro wall of cash into money markets in 3-year loans.

Read more

The average cell phone customer now switches carriers as soon as his or her second two-year contract is up. That startling decline in loyalty is causing wireless companies to rethink the way they do business, according to a new study released Monday.

The average length of relationships between carriers and their under-contract customers fell to an all-time low of 48 months last year, PricewaterhouseCoopers’ found in the latest edition of its North American wireless industry survey. The comprehensive annual study includes data from all of the region’s major carriers.

The trend has building for a few years. What’s shocking is how quickly it accelerated. In 2010, the average customer-carrier relationship was 59 months — nearly a full year longer.

The most precipitous decline came among smaller cell phone companies, but large carriers like Verizon (, Fortune 500), AT&T (, Fortune 500) and Sprint (, Fortune 500) didn’t fare much better. Their average relationships with customers under contract lasted just 51 months.

"Competition is fierce, and pricing is a key element," said Pierre-Alain Sur, global communications industry leader at PwC. "That accelerates the jump from one carrier to another at the end of a contract period."

If customers are going to cut and run frequently, carriers will need to rethink their pricing models — particularly when it comes to expensive smartphones.

They’ve been encouraging customers to upgrade to smartphones because the devices bring in a new revenue stream. Most providers charge smartphone customers a premium for data usage, with plans averaging about $25 per month.

But what carriers didn’t anticipate were the incredible costs of keeping smartphone customers satisfied.

To get smartphones down to the magic price point of $200, carriers pay an average subsidy of $280 for each device — four times as much as the $70 average subsidy on a feature phone. Plus, smartphone customers are data hogs, requiring wireless companies to spend tens of billions of dollars each year improving their 3G network capacity and building out their 4G networks.

Meanwhile, average revenue per smartphone user is actually declining.

As data use grows, people are talking on their phones less easy payday loans. The average subscriber used just 638 voice minutes per month in 2011, down from 720 minutes in 2010. Customers are cutting back their voice plans, sending carriers’ average revenue per smartphone user down to $83 per month last year. That’s a drop from $86 in 2010 and $93 from 2009.

Less loyalty, growing subsidies, higher infrastructure costs and declining revenues have created an unsustainable dynamic for carriers. Profit margins are falling, and analysts expect the trend to get worse.

The iPhone is a nightmare for carriers

That means sweeping changes are coming.

"The business model is shifting, so they have to find a solution," Sur said.

Carriers have a few options.

First, they can increase prices on their phones. That’s already started to happen. Verizon and AT&T now offer a small selection of 4G phones for more than $200, with some as high as $300.

Another tactic is for them to pressure handset manufacturers to reduce device costs. Some may bargain, but the maker of the single most popular smartphone — Apple’s (, Fortune 500) iPhone — is no pushover.

Carriers could also try to find alternative sources of revenue. Right now, most are "dumb pipes," taking no revenue from the content that travels over their networks. If carriers could nab a slice of app store sales or video purchases, that might reverse their fortunes.

Finally, cell phone companies could switch to the "bring your own device" model that is popular overseas.

North American carriers have embraced the subsidy model for decades for two reasons: incompatible technologies presented steep obstacles to switching, and the subsidy model seemed to build customer loyalty.

Now, the whole industry is migrating to the 4G-LTE standard. With loyalty going out the window, carriers may drop subsidies and contracts altogether. Some may even try leasing handsets to customers.

Whichever option carriers choose, they will have to act fast, Sur thinks.

"They are going to have to determine what’s going to be the business model of the future," he said. "Carriers are at an inflection point." 

Source

U.S. sales of previously occupied home dipped last month but the sales pace for the winter was the best in five years.

The National Association of Realtors said Wednesday that home sales fell 0.9 percent last month to a seasonally adjusted annual rate of 4.59 million. That’s down from a revised 4.63 million sold in January _ the highest level since May 2010.

The last three months have been the best for winter sales in five years. A mild winter and a stronger job market have helped boost sales ahead of the all-important spring buying season.

Even with the gains, sales remain below the 6 million that economists equate with healthy markets. And the makeup of those sales still signals a troubled market.

Sales among first-time buyers, who are critical to a housing recovery, fell slightly to 32 percent of all purchases. That’s down from 33 percent in January. In healthy markets, first-time buyers make up at least 40 percent.

And homes at risk of foreclosure made up 34 percent of sales, down only slightly from 35 percent in January. In more stable markets, foreclosures make up less than 10 percent of sales.

There have been other signs of improvement in the depressed housing market.

Homebuilders have grown more confident in the past six months after seeing more people express interest in buying a home. In February, they requested the most permits to build homes since October 2008.

Mortgage rates are near record lows. And the supply of homes has fallen to its lowest level in seven years.

A lower supply helps push up prices, which lures more sellers onto the market and generally improves the quality of homes for sale. Rising prices also boost sales because buyers want to invest in homes that are appreciating in value.

For the past few years, the market has been saturated for years with foreclosures. That has put downward pressure on prices and driven away buyers.

A key reason for the brighter housing outlook is the job market has strengthened. From December through February, employers added an average of 245,000 jobs a month. The unemployment rate has fallen to 8.3 percent, the lowest in three years.

Still, economists caution that the damage from the housing bust is deep and the industry is years away from fully recovering.

Fewer first-time buyers, who are critical to a housing recovery, are in the market for a home. They made up roughly one-third of sales last year. In healthy markets, the percentage is at least 40 percent.

Many can’t qualify for loans or meet higher down-payment requirements. Even those with excellent credit and stable jobs are holding off because they fear that home prices will keep falling.

Sales are measured when buyers close on homes. Some deals have been scuttled before the closing after banks declined mortgage applications, home inspectors found problems, appraisals showed a home was worth less than the bid, or a buyer lost a job.

The high rate of foreclosures has made resold homes cheaper than new ones. The median price of a new home is roughly 30 percent above the price of one that’s been occupied before _ twice the normal markup. Investors are taking advantage of the discounts.

Source

WASHINGTON — Beware of car dealer ads that promise to pay off the loan on your trade-in.

In a first-of-its-kind case, the Federal Trade Commission targeted five car dealers in four states that regulators say deceived consumers by promising to pay off their loans, no matter what was owed on the cars. The balance, the FTC said, was usually rolled right into the new car loan. One dealer later required customers to pay the balance out of pocket.

Settlements agreed to by the dealers would require them to stop running the ads on their webpages and other sites such as YouTube. The settlements remain subject to a final vote by the commission after a 30-day public comment period.

Wednesday’s announcement from the commission named the following companies: Billion Auto Inc. of Sioux Falls, S.D.; Frank Myers AutoMaxx LLC of Winston-Salem, N.C.; Key Hyundai of Manchester LLC in Vernon, Conn., and Hyundai of Milford LLC in Milford, Conn., which advertised jointly; and Ramey Motors Inc. of Princeton, W.Va.

The FTC has brought cases against auto dealers before, but not for this kind of advertising.

“Buying a new car or truck is a major financial commitment, and the last thing consumers need is to be tricked into thinking that a dealer will pay off what they owe on their current vehicle, when they really won’t,” said David Vladeck, head of the commission’s consumer protection bureau.

The promises might sound attractive to anyone facing tough financial times. Rosemary Shahan, president of California-based Consumers for Auto Reliability and Safety, says this kind of misleading advertising pitch is a common practice among dealers, and that people who are upside down on their loans — owing more on the old car than its actual value — are especially vulnerable.

“A huge percentage of people are upside down,” Shahan said. “What they don’t realize is that they are just getting deeper and deeper into debt.”

She says it’s usually better to keep the old car and pay off the loan before buying a new car. Despite the claims, consumers still ended up being responsible for paying the difference between the trade-in loan balance and the vehicle’s value, the commission said.

As part of the proposed settlements, the dealers would be barred from future deceptive ads. They also would not be allowed to misrepresent any other facts.

Source

China is blocking orders for at least $12 billion worth of Airbus jets to protest the European Union’s emissions trading fees, in a new challenge to the program aimed at fighting global warming, the planemaker said Thursday.

With some analysts warning of a brewing trade war, Airbus spokesman Stefan Schaffrath said his company is seeing “retaliation threats” from 26 countries, “in particular from China.”

Speaking to The Associated Press, he said 35 orders by Chinese airlines for A330 planes are on hold because China’s government is refusing to approve them. He said orders for another 10 A380 superjumbos are also under threat, and that the combined list prices of the aircraft is $12 billion.

“The economic impact is real,” he said.

Officials at the Chinese Embassy in Paris could not be reached for comment on the Airbus statements Thursday.

EU officials defended the emissions system. Asked about the Airbus complaint at the daily midday briefing, EU spokesman Isaac Valero Ladron said, “I’m not in a position to make any comments about possible trade decisions. I think it’s in everybody’s interest to reduce greenhouse gases, which affects climate change, and airplanes affect that, as well.”

The emissions trading system went into effect at the start of the year as part of European efforts to reduce global warming.

Airlines flying to or from Europe must obtain certificates for carbon dioxide emissions. They will get free credits to cover most flights this year but must buy or trade for credits to cover the rest payday advance.

The United States, China, Russia, India and many other countries are opposed and say the bloc cannot impose taxes on flights outside its own airspace.

EU officials have said they acted unilaterally because of a doubling of aviation carbon emissions in Europe between 1990 and 2006 and the inability of governments to forge a global deal on reducing emissions.

Schaffrath insisted that Airbus is working to reducing emissions but argued that a Europe-only measure creates trade imbalances.

“Our sector is committed to green aircraft,” he said. “We truly believe that the global issue of emissions does not know boundaries, and we need a global solution.”

Airbus made its warnings on the same day that its parent company EADS NV reported its annual earnings. EADS CEO Louis Gallois warned that the emissions scheme would cost Airbus and other European companies business globally. Schaffrath said the Chinese blockage could threaten Airbus’ plans to ramp up production of its popular planes.

China has said it will prohibit its airlines from paying the EU fees, and in Washington Congress has voted to exclude U.S. airlines from the emissions cap-and-trade program.

Source

Federal Reserve Chairman Ben S. Bernanke is trying to compensate for the damage lawmakers threaten to inflict on the U.S. economy, even as Republicans skewer his stimulus efforts for risking inflation.

The potential drag from fiscal restraint contributed to the rationale behind policy makers

The St. Louis region is set to have its newest public company debut.

Post Holdings Inc., the branded cereal business unit of Ralcorp Holdings, will be spun off as a separate publicly traded company after markets close Friday. The spinoff was announced last July.

After the close of trading Friday, Post will replace Comstock Resources Inc. in the S&P MidCap 400 index.

Post’s brands include Honey Bunches of Oats, Grape Nuts, Raisin Bran and Pebbles cereals. Post Holdings is based at 2503 South Hanley Road in Brentwood.

Once the separation is completed, Post will trade Monday on the New York Stock Exchange under the “POST” ticker symbol. Bill Stiritz, chairman of Ralcorp, has been named Post’s new chairman and CEO. J. Patrick Mulcahy, Ralcorp’s vice chairman, will serve as chairman of the board at Ralcorp after the spinoff finalizes business card.

In filings with the U.S. Securities and Exchange Commission, Post signaled it will make changes to its marketing and pricing to grow sales and regain market share. Post’s market share in ready-to-eat cereals dropped from 14 percent in 2008 to 12 percent last year, according to a research note issued this week by Alexia Howard, an analyst at Sanford C. Bernstein & Co.

St. Louis-based Ralcorp Ralcorp Holdings acquired the Post cereals business from Kraft Foods in 2008 for $2.6 billion. Ralcorp is spinning off Post to concentrate on its private-label cereals, pasta and other baked goods. After the spinoff, Ralcorp will retain up to a 20 percent ownership stake in Post.

Source

Swedish inflation-linked bonds may be understating the risk of price gains in the largest Nordic economy as most forecasters, including the central bank, predict inflation will outpace market bets.

The breakeven rate on Sweden