Finance news. My opinion.

A former St. Peters vehicle-service contract business and its owner have settled with the state over alleged violations of the Missouri Merchandising Practices Act, Attorney General Chris Koster said today.

Vehicle Services, which no longer is in business, marketed what appeared to be “extended auto warranties” through the mail, the internet and by telephone, Koster said. The warranties actually were service contracts or automotive additives, he said.

The company and its owner, Steven Chapa, agreed to pay the state $25,000 in restitution and civil penalties for the costs of the investigation, said Nanci Gonder, a spokeswoman for Koster’s office.

Chapa could not be reached immediately for comment.

Gonder said the office has been contacting customers who filed complaints in an effort to help them get restitution.

Koster’s office received 85 complaints about the company, she said.

Koster said many customers were led to believe their current vehicle warranties were about to expire, and they had to act immediately or lose the chance to buy an extended warranty payday lenders. Many weren’t told Vehicle Serivces wasn’t affiliated with their dealership or manufacturer, he said.

He said customers who bought service contracts by telephone often learned later that the coverage was limited. Those who asked for a cancellation or refund when they discovered the provider wouldn’t pay a claim often were denied a refund or made to go to great lengths to get part of their money back, he said.

Gonder said anyone who is seeking restitution or who has complaints about businesses selling extended motor vehicle service contracts can contact the Attorney General’s Office through its website or by calling the consumer protection hotline at 1-800-392-8222.

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Wal-Mart Stores Inc., the nation’s largest private employer, is scaling back the eligibility of health care coverage offered to future part-timers and raising premiums for many of its full-time workers.

The discounter, which employs more than 1.4 million people, said all future employees working less than 24 hours a week, on average, would not be covered under the plan, starting next year.

Premiums will rise for many current workers, and the company will reduce by half the amount it contributes for each worker to help pay for health care expenses not covered under their plan.

A number of companies have been looking for ways to cut health care costs and have been shifting more of the burden to their employees. But Drew Altman, president and CEO of the Kaiser Family Foundation, said that a big package of cuts from one company was unusual.

“While we do see increases in cost sharing, this is unusual and is outside the bounds,” said Altman.

Furthermore, Altman said that he hadn’t seen companies just drop coverage of a chunk of part-time workers. Still, only about 42 percent of overall companies offer health care coverage to part-time employees, according to Kaiser.

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Stock futures are rising, helped by encouraging corporate news in the U.S. and Europe.

Google Inc. rose more than 7 percent in premarket trading after the tech giant reported its third-quarter profit climbed 26 percent. Food and soap company Unilever PLC announced a major acquisition, and Swiss agrochemicals firm Syngenta reported strong third-quarter sales.

European markets rose.

Toymaker Mattel Inc. reported a 6 percent rise in its third quarter earnings.

The government reports before the market opens on retail sales in September, a key early barometer of consumer activity no fax payday loans.

S&P 500 futures are up 8 points, or 0.7 percent, at 1,206 at 7:51 a.m. Eastern time. Dow Jones industrial average futures are up 74, or 0.7 percent, at 11,466. Nasdaq 100 futures are up 14, or 0.6 percent, at 2,340.

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Hundreds of protesters, emboldened by the growing national Occupy Wall Street movement, streamed through midtown Manhattan on Tuesday in what they called a “Millionaires March.”

They marched two by two up the sidewalk, planning to pass the homes of some of New York City’s wealthiest residents. An organizer said they didn’t have a permit and wanted to avoid blocking pedestrian traffic.

“No Billionaire Left Behind,” said a placard hoisted by Arlene Geiger, who teaches economics at Manhattan’s John Jay College of Criminal Justice.

Protesters expressed concern about how much less the wealthy will pay _ and who would be negatively affected _ when New York’s 2 percent “millionaires’ tax” expires in December.

In the closest they’ve come to naming names, the protesters planned to visit the homes of News Corp. CEO Rupert Murdoch, JP Morgan Chase CEO Jamie Dimon and oil tycoon David Koch, among others.

Protesters have been camped out for weeks in lower Manhattan’s Zuccotti Park, near Wall Street, saying they’re fighting for the “99 percent,” or the vast majority of Americans who do not fall into the wealthiest 1 percent of the population.

Their causes range from bringing down Wall Street to fighting global warming. The movement gained traction through social media, and protests have taken place in several other cities nationwide.

In Boston, hundreds of college students marched through downtown Boston on Monday and gathered on Boston Common, holding signs that read “Fund education, not corporations.”

The protesters are angry with an education system they say mimics “irresponsible, unaccountable, and unethical financial practices” of Wall Street.

About 50 protesters in Boston were arrested overnight after they ignored warnings to move from a downtown greenway near where they have been camped out for more than a week, police said.

Several hundred protesters were arrested in New York more than a week ago after police said they ignored warnings to stay in place. There was no word on any arrests in Tuesday’s protest in New York.

The protest comes as New York Comptroller Thomas DiNapoli released a report showing that Wall Street is again losing jobs because of global economic woes, threatening tax revenue for a city and state heavily reliant on the financial industry.

“Excessive risk-taking on Wall Street was a major factor leading to the financial crisis and the recession,” DiNapoli said. “Regulatory changes that reduce risk and focus attention on long-term profitability rather than short-term gains will enhance stability.”

Christopher Guerra, a 27-year-old artist and Occupy Wall Street protester from Newark, N.J., said he thought the job losses weren’t necessarily bad.

“That means more people on our side,” said Guerra, who calls himself an Eisenhower Republican but says he’s opposed to today’s corporate behavior. “The companies are destroying this country by helping themselves, not the people, and pushing jobs out of America.

“If they get shafted, they will realize that what we are saying is true.”

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Telecom policies, particularly Internet and wireless issues, have generated enormous public interest over the past year. Politicians have evidently taken note with all political parties expressing concern over Internet data caps, net neutrality, and the competitiveness of Canadian wireless services.

The political shift toward consumer-focused telecom concerns has unsurprisingly attracted the attention of the large incumbent telecom providers such as Bell and Telus, who have found their regulatory plans stymied by political intervention and the admission by some Canadian Radio-television and Telecommunications Commission commissioners that the current policy environment has failed to foster sufficient competition.

The incumbent telecom providers recently served notice that they are gearing up to fight back, with Bell adding former industry minister Jim Prentice to its board of directors, and Telus doing the same with former public safety minister and Treasury Board president Stockwell Day. The addition of two prominent, recently departed Conservative cabinet ministers makes it clear that Bell and Telus recognize the increasing politicization of telecom policy.

The addition of former politicians to telecom boards is nothing new. As Carleton professor Dwayne Winseck recently chronicled, the path between politics and telecom boardrooms is well trodden, with the likes of Brian Mulroney (Quebecor), former Liberal cabinet minister Ed Lumley (Bell), former B.C. finance minister Carole Taylor (Bell), and former Ontario premier David Peterson (Rogers) all making the jump. Moreover, former New Brunswick premier Bernard Lord heads the Canadian Wireless Telecommunications Association.

The mix between politics and telecom policy is nothing new either. Since telecom’s beginnings as an industry, competition regulators have played a crucial role in establishing the limits of companies that have frequently enjoyed near-monopolistic market power.

However, this round of appointments signals an important shift no faxing 1 hour payday loans. The companies were at pains to emphasize that the addition of Prentice and Day is not about lobbying per se, since both face five-year

Asian equity markets were sharply down early Tuesday as investors fearing a possible global economic slowdown continued to flee stocks.

Oil fell below $78 per barrel, toppling to its lowest price of the year on concerns that a slowing global economy could crimp demand for fuel.

Japan’s Nikkei 225 index plunged 4.4 percent to 8,694.31 in the morning session, while Hong Kong’s Hang Seng index plummeted 7.3 percent to 18,998.51. South Korea’s Kospi index plummeted 8.2 percent to 1,716.05.

Elsewhere, Australia’s benchmark S&P/ASX-200 index lost 4.5 percent to 3,806.70. Taiwan’s TAIEX dropped 4.9 percent and New Zealand’s benchmark NZX 50 index shed 3.8 percent.

Michael McCarthy, chief strategist at Sydney-based stockbroker CMC Markets, attributed the market turbulence to fears that the U.S. economy was slowing down.

“We’re clearly in fear territory,” McCarthy said. “The major driver here seems to be weakness in the U.S. economy. There are fears that it’s starting to stall and if that’s the case, the whole global growth scenario could fall over.”

Shane Oliver, chief economist of Australian investment manager AMP Capital, said he was surprised that the Australian market had not stabilized Tuesday after steep falls on the previous two trading days.

“I would have thought we would have factored in a lot of the weakness, but obviously the fall on Wall Street was greater than Australian investors and Asian investors expected this time yesterday,” Oliver told Australian Broadcasting Corp. television.

The losses come on the heels of a rout on Wall Street on Monday, the first trading day since ratings agency Standard & Poor’s downgraded American debt.

The Dow Jones industrials fell 634.76 points, the sixth-worst point decline for the Dow in the last 112 years and the worst drop since December 2008. Every stock in the Standard & Poor’s 500 index declined.

Worries about the U.S. economic recovery have been building since the government said that economic growth was far weaker in the first half of 2011 than economists expected. Intensifying concerns were reports showing that the manufacturing and services industries barely grew in July, although job growth was better than economists expected last month.

Investors are also worried that Italy and Spain could become the next European countries to have trouble repaying their debts. Greece, Ireland and Portugal have already received bailout loans because of Europe’s 21-month-old debt crisis.

The fears have pushed investors to shun Spanish and Italian bonds, which have led to higher yields and in even higher borrowing costs for the two countries.

The European Central Bank stepped in Monday and bought billions of euros worth of their bonds. The move helped to lower yields on Spanish and Italian bonds, at least temporarily.

In currencies, the dollar weakened to 77.26 yen from 77.70 yen late Monday in New York. The euro slipped to $1.4193 from $1.4196.

Benchmark crude fell $3.96 to $77.40 per barrel on the New York Mercantile Exchange. That is the lowest settlement price of the year for crude, but it’s still higher than the $71.63 per barrel low of the past 12 months.

Oil hit that on Aug. 24 of last year, when a combination of disappointing economic news and abundant supplies drove down prices.

The contract settled at $81.31 per barrel on the Nymex on Monday.

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Moneyville blogging contest runner up Larry Cuozzo is 43, a teacher and has built a net worth of $2 million without inheriting a penny. Here’s how he did it.

I’m a 43-year-old Toronto teacher and I have not inherited any money or won any lotteries. However, my wife and I have managed to build a net worth of $2 million by making the sort of choices any middle-class family can with a little discipline and planning.

There are no tricks, no need for high-risk investing and you and your family do not have to live in poverty to make it happen. I know because we did it. We have become financially independent at a relatively young age by saving, being disciplined and being lucky.

The $2 million is made up of our mortgage-free house in a Toronto suburb and the value of our pensions and investments. I admit we have been lucky in some respects with timing beyond our control but the principles remain the same.

It took us 38 years to hit the $1 million mark and another six to hit $2 million. I have no idea if this will continue. It doesn’t really matter. For the past 20 years, we have been able to contribute to society and enjoy life with much less money than we have now. I don’t see why that would change.

The guide for how to live our lives came from our parents. Mine emigrated from Italy in the 1960s and eventually settled in Scarborough. My wife grew up in Brantford. My parents taught me that it was important to develop realistic but optimistic financial goals because you can accomplish almost anything with effort, patience and planning.

In high school I started a disc jockey business with friends. The money I earned doing that, plus summer jobs, help from my parents and a small scholarship meant I could move away from home for university and still graduate debt free. This was my first lesson.

Lesson 1: If you can stay out of debt, everything you make belongs to you.

I enrolled in pre-business at the University of Western Ontario and my goal was to get in to the honours business administration program in third year. In the summer of first year, I became the manager of a College Pro window cleaning franchise, hoping to impress the business school selection committee. It worked and I graduated with a degree in business administration.

The degree opened doors and I found a job with a large consumer goods company as an assistant marketing manager. I quickly realized I hated my job. I enjoyed studying business and economics, but found the day-to-day life quite dull, even though it was well paid. Eventually, I quit and followed my future wife Liana into teaching. The cost was huge. It took five years before my salary as a teacher equalled my beginning salary in business. But here I learned another lesson.

Lesson 2: Don’t be afraid to invest in your career or future, even if in the short term it doesn’t pay off.

After teacher’s college I found a job in a small high school in a town about 90 minutes from home. I enjoyed teaching business and economics. Because it was a small school, I became a department head after three years, which would not have happened if I had been in a large school guaranteed personal loan approval.

One of the benefits of teaching in Ontario is the pension plan. Eleven per cent of your gross pay is automatically deducted and our school board matches this amount. This arrangement is fantastic.

First, it is a forced savings plan; teachers must contribute to this plan. Second, the Ontario Teacher’s Pension Plan can invest at very little cost. So, while many mutual funds charge fees of 2.5 per cent or more, the teacher’s plan fees are around 0.5 per cent. This makes a big difference and is the main reason the vast majority of mutual funds do not beat market indices over the long term.

If I had stayed in business, my employer would have provided a matching contribution to my Registered Retirement Saving Plan, up to 9 per cent of my gross annual pay. I would have taken advantage of this benefit and invested this money in financial products that do not charge high fees. This was my third lesson.

Lesson 3: Start saving for retirement early and let the compounding power of interest help you. Any saving is better than none and payroll deduction is a painless way since you don’t notice it.

In the early 1990s the Toronto-area real-estate bubble had burst and we were lucky to be looking for our first home. We had saved $59,000 and bought a tiny 900-square-foot home at Yonge and Sheppard, just steps to the subway, for $197,000. We saw the potential to live on the main floor while renting the basement, so we turned the basement into a rental suite. For the next six years a tenant helped us pay down the mortgage.

Lesson 4: Alternate sources of income are a good way to reduce your debt, pay down a mortgage or save for something you want.

By the late 1990s our mortgage was gone and we decided to have kids, so we needed a bigger house. We sold our first home for $255,000 and bought a monster in Markham for $455,000. It was 4,250 square feet, brand new and in the suburbs, close to my parents. We took out a mortgage of $180,000.

Six years and a second child later my wife decided to take an extended maternity leave. Our monster home was worth more than $700,000, but we decided to downsize. After a bidding war, our home sold for $721,000. (It’s a lot more fun being on the selling side during a bidding war.) Our new house cost $475,000, and we pocketed $201,000.

So, it was the summer of 2005, we owned our home mortgage-free and had a considerable nest egg set aside. When the value of our pension plans was added to our other assets, our family’s net worth surpassed the $1 million mark. We had reached my original goal of being financially secure by age 40.

Also read:

5 things your grocery store won’t tell you

Larry Cuozzo teaches business and is a department head at an adult high school in Toronto. He enjoys taking charge of his personal financial affairs.

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Are too many condominiums being built in Toronto?

Analysts have been sounding warning bells for more than a year that the market is being seriously overbuilt. But so far, sales and prices have been chugging merrily upward.

According to the Building, Industry and Land Development Association, last month was the best May ever for sales. High-rise sales are up by a staggering 50 per cent in May to 2,433 sales. This comes on the heels of an April that was also the best on record.

On a year to date basis total new home sales in the GTA are running 12 per cent ahead of last year, but that’s purely on the back of condominiums, since low rise sales are down from last year.

“Those high rise sales are extremely high and above normal demographic levels, suggesting there is a lot of investor activity,” said Toronto housing analyst Will Dunning.

On an annualized basis, May sales are running at 26,000 units per year, when demographic demand would suggest a rate of 14,000 to 15,000 per year, said Dunning.

“The economy is in a recovery and a lot of the jobs are focused on downtown, but even in a healthy economy I don’t know if those numbers would be supported,” said Dunning.

Bank of Canada governor Mark Carney warned last week that housing, particularly in big city condo markets were in danger of overheating, fueled by ultra-low interest rates.

The sale of a $28 million penthouse at the Four Seasons residences in Toronto last month by a foreign investor certainly caught the attention of the international real estate community. At 9,038 square feet, the condo sold for about $3,000 a square foot, by far the highest price paid for a high rise unit in Canada.

Nationally, Carney said prices are about 13 per cent above pre-recession peaks. In cities such as Vancouver, prices are up by a significant 25.7 per cent year over year, to $831,55 or 11 times the average household income.

In Toronto, where average prices are $485,000 prices are at 6.7 times income compared with 4.3 times income in 2001, according to figures by BMO Capital Markets.

“Prices simply can’t keep rising forever,” warned Capital Economics economist Dave Madani.

Capital Economics has warned of a bubble in the Canadian housing market and that a decline of up to 25 per cent in the average price over the next three years is not out of the question.

“The likelihood of a substantial decline in house prices over the next year or two is fairly high,” said Madani.

The investor driven condo market has been the subject of particular concern by some analysts. The Toronto market alone has more than 280 projects being marketed, thought to be the most in North America. Investors buy an estimated 45 to 60 per cent of all new units according to market research firm Urbanation Inc. One issue for investors is that while prices are rising, rents have barely budged, making it more difficult to see positive cash flow on their investments.

That could spell trouble in the market. If investors are unable to cover their expenses then they will pull out.

“Too many homes have been built over the last ten years,” said economist Madani in a report. “Over building is reflected on the supply side and the demand side, which is mirrored by the disproportionate share of total household wealth being accounted for by housing assets. Our concern is that these excesses will eventually lead to a house price correction.”

If investors started selling their properties because prices were falling, you would see an overflow of new listings in the resale market, said Madani.

“Such a situation would exert downward pressure on home sale transaction prices, or worse case scenario, lead to a noxious downward price spiral.”

However, some analysts have said that the condo building boom is sustainable, mainly because of a structural shift in the market. There is a shortage of new low rise housing in urban areas, which forces buyers into towers. And for some buyers, high rise living is now a much more acceptable lifestyle choice.

“These last few months have witnessed some incredible condo buyer demand,” said Stephen Dupuis, CEO of the Building, Industry and Land Development Association, which represents builders. “The primary factors driving the market appear to be affordability, low interest rates, and to give builders their due, some great building and suite designs.”

According to the Conference Board of Canada in a report Tuesday most Canadian markets remain in “balanced” territory, neither favoring buyers or sellers.

The Toronto market, which saw prices increase by 8.5 per cent year over year in May, is experiencing tighter than normal listings, according to the board.

Listings are down by about 20 per cent in May compared with a year earlier, creating upward pressure on pricing, said board economist Robin Wiebe.

Analysts expect more listings in the second half of the year which should help to cool the market. However, that could also depend on the extent of investor interest, particularly from overseas.

“Some Asian wealth is being invested in selected international housing markets as those investors seek out diversification and hard assets,” said central banker Carney in a speech last week.

As in Vancouver, an influx of Asian buyers primarily from China and Hong Kong have helped to buoy the Toronto market.

Some investors pay mainly by cash, and are not as affected by a rise in interest rates. However, they can also be fickle.

“They are mainly concerned about capital preservation, so they are holding on for the long term, they see Canada as a safe, stable place to park their money,” said real estate investor Ken Chin. “But trust me, they are also looking closely at the Toronto market to see whether prices have peaked.”

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