Finance news. My opinion.

An attorney for Bank of America says 13.2 million customers may be eligible for a settlement in a lawsuit claiming the bank charged excessive overdraft fees.

The final tabulation came Monday as a Miami judge considers whether to finalize a $410 million settlement during a hearing to consider any objections or other issues related to the deal reached in May.

The class-action lawsuit contends the Charlotte, N.C.-based bank processed its debit card and check payments in a way that triggered more overdrafts and therefore more fees. Even though it agreed to the settlement, the bank insists the overdraft system was proper.

The lawsuit covers people with Bank of America debit cards between January 2001 and May 2011.

New bank regulations prohibit this type of debit card fee unless customers approve.

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The echo boomers are finally moving out of their parents’ homes and expected to be the biggest rush of renters to hit Toronto’s housing market since the early 1990s, according to projections by the Canada Mortgage and Housing Corp.

But they’re likely to be renting for quite a while — much longer than their parents, thanks to a job market that remains tentative and offers far less of the stable, full-time employment that made their parents the most affluent generation of all time.

That boom in rental demand is already being felt with bidding wars for prime units and vacancy rates for apartments and rental condos hovering at 1.6 per cent, the lowest vacancy rate in a decade, says Shaun Hildebrand, CMHC’s senior market analyst for the GTA.

That vacancy rate has been declining steadily since 2004 when it stood at 4.3 per cent.

There are currently 325,000 rental apartments across the GTA, says Hildebrand, but just 1,500 new units are being added each year, most of them high-end rentals aimed more at affluent, downsizing baby boomers.

Even the unprecedented condo boom across the GTA, much of it driven by investors, many of whom are putting up their units for rent, is having a hard time keeping up with demand, says Hildebrand.

That is already playing out in bidding wars for brand new and two-bedroom units, with some would-be renters offering to pay more per month or offering up to six months’ rent in advance.

The GTA has seen such an unprecedented building boom the last few years that we now have almost as many condos as rental apartments.

The total number of condos now stands at 300,000 with another 80,000 under development and 60,000 more approved but yet to start, Hildebrand told bankers, developers and housing market watchers Thursday during its annual 2012 Housing Outlook Conference at the Metro Toronto Convention Centre.

But there are now 875,000 echo boomers between the ages of 25 and 35 across the GTA, accounting for about 18 per cent of the population.

With the average price of a GTA home expected to hit $469,700 next year — in Toronto that’s closer to $530,000 — and condos averaging $500 a square foot, echo boomers’ dream of owning a home may be just that.

A dream.

Hildebrand expects to see growing demand for basement apartments, both as an affordable place to live for those heading into their first jobs, and for homeowners struggling to pay high mortgages.

Already the shifting demographics are playing out in increased demand for townhouses and row houses which offer all the amenities of traditional detached homes, but at more affordable prices and often on infill lots closer to the downtown core, he said.

“All eyes are on the (Toronto) condo market,” Hildebrand told the crowd, because of a “healthy level of fear” that this unprecedented boom is on the verge of bust.

Instead, he predicts the condo market — which now accounts for 25 per cent of all MLS sales — will soon start to “self correct.”

New condo prices have escalated to the point where rents can’t keep pace with costs, and that should ease demand among investors to more realistic levels, he said.

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President Barack Obama is wrapping up a three-day tour through crucial political states, searching for votes and money and unveiling executive steps to prime the economy even as his jobs bill struggles in Congress.

Obama held six fundraisers, including star-studded events in Los Angeles. He gathered backers in Denver and Las Vegas, urging them to find energy for the 2012 campaign. And he coined a new slogan _ “We can’t wait” _ to draw distinctions with congressional Republicans who oppose his $447 billion economic plan.

On Wednesday, at the University of Colorado’s Denver campus, he will highlight a new initiative to make it easier for graduates to repay their student loans. He earlier announced a mortgage refinancing program and on Tuesday the White House announced new steps to help veterans.

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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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Constellation Brands Inc. said Thursday its fiscal second-quarter profit jumped 78 percent on improved wine and spirits sales in North America, a lower tax rate and a drop-off in charges after four years of cost-cutting.

Its stock rose more than 7 percent in afternoon trading.

The world’s No. 2 vintner raised its full-year guidance, acquired the rest of Italy’s Ruffino wines that it didn’t already own and said it had bought back $251 million worth of its own shares.

Constellation has been pruning methodically to solidify its supremacy in higher-margin wines priced from $5 to $20 a bottle and revive profits and revenue in a choppy economy.

Its brands range from Robert Mondavi, Clos du Bois and Ravenswood wines to Svedka vodka and Black Velvet Canadian whiskey. Through a joint venture, it also imports moderately priced beers such as Corona Extra, Tsingtao and St. Pauli Girl.

“We continue to make significant progress in a number of areas despite the prospects of an unsettled consumer environment,” Chief Executive Rob Sands said in a conference call with analysts.

The June-to-August results exceeded Wall Street expectations, and its shares surged $1.46, or 7.8 percent, to $20.18 in afternoon trading. The stock is trading near the upper end of a 52-week range of $16.42 to $23.19.

Its net income climbed to $162.7 million, or 76 cents per share, in the three months ended Aug. 31 from $91.3 million, or 43 cents per share, a year earlier. Its effective tax rate dropped to 3 percent in the quarter, down from 35 percent a year earlier.

Revenue after deducting excise taxes fell 20 percent to $690.2 million from $862.8 million a year ago, largely because it sold 80 percent of its struggling Australian and British wine business in January.

Excluding $4 million in restructuring and other one-time items, Constellation earned 77 cents per share. Wall Street expected 65 cents per share, according to a survey by FactSet. A year ago, the company recorded $17 million in one-time charges.

Operating income in its beer business fell 4 percent on higher marketing costs despite a 7 percent rise in sales by its Crown Imports joint venture with Mexican brewer Grupo Modelo.

Its wine and spirits sales in North America rose 5 percent. After a sharp drop in wine sales in 2009, especially in bars and restaurants, industry volumes have rebounded this year as Americans take advantage of more discounts to trade up to higher-priced brands.

Constellation jumped into California’s coveted wine market by netting Franciscan in 1999, Turner Road and Ravenswood wineries in 2001 and Robert Mondavi Corp. in 2004. Its 21 acquisitions over 21 years ran through 2007 when it bought Fortune Brands’ U.S. wine business, maker of Wild Horse and Clos Du Bois. Then came the cost-cutting.

It divested Almaden, Inglenook and other low-priced wines that generally sell for less than $5 a bottle, paring its 300 brands to 100. It has slashed its debt to below $3 billion from $5.3 billion and shrunk its payroll to 4,300 from 9,400.

On Thursday, the Victor, N.Y.-based company raised its full-year guidance by 10 cents to a range of $1.92 to $2.02 per share. Analysts expected $1.97 per share.

It also said it had purchased the 50.1 percent it didn’t already own in Ruffino S.r.l. from MPF International S.r.l., which is controlled by the Folonari family of Tuscany, Italy. The price was about $69 million, the company said, and it also assumed about $73 million of debt.

This year, Constellation lost its eight-year status as the world’s No. 1 winemaker when it offloaded 80 percent of a once-promising Australian wine business that had gone awry.

It dropped back to No. 2 in the vintner-by-volume rankings behind longtime leader E. & J. Gallo of Modesto, Calif. But it remains the world’s biggest premium-category winemaker with an estimated 17 percent share of that segment in the United States, ahead of rivals that include Gallo, Treasury Wine Estates, Kendall-Jackson and Diageo.

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The most closely kept secret about the iPhone 5? There isn’t one _ yet.

The new iPhone is faster, has a better camera and allows you to sync content without needing a computer. It includes a futuristic, voice-activated service that responds to spoken commands and questions such as “Do I need an umbrella today?” It will now be available to Sprint customers as well as those from AT&T and Verizon Wireless.

But there’s a catch. Apple named it 4S when most people were expecting the iPhone 5. Immediately, tech bloggers and Apple fans alike began to wonder if this new iPhone was not as cool as they had hoped. Investors were disappointed, too. Apple’s stock fell more than 5 percent before getting a late bump.

If Tuesday’s unveiling seemed like a letdown, it was because Apple didn’t do a good job of managing expectations. That’s a familiar problem for Apple, whose penchant for secrecy invites hyperbolic speculation between its product announcements. Given that it had been 16 months since the previous iPhone hit the market, imaginations had even more time to run wild this time.

“This is the typical Apple scenario: People keep wanting it to do the impossible,” said Tim Bajarin, a Creative Strategies analyst who has been following the company for decades.

Apple’s approach to the event didn’t do any favors for Tim Cook in his first major public appearance since he succeeded Steve Jobs as CEO six weeks ago. Jobs, the Apple visionary and co-founder, relinquished the reins to focus on his health problems.

Cook handled his presentation in a pedestrian fashion that lacked Jobs’ flair. The format and stage setting were similar to the presentations that Jobs had orchestrated so masterfully, giving Cook little opportunity to make his own mark, said Adam Hanft, a marketing consultant who runs his own firm in New York.

“It wasn’t fair to Tim in his inaugural because there he didn’t have any product to show off that was a real barnburner,” Hanft said.

“This allowed him to get his sea legs, but he still needs to find his voice and style. They need to come up with a new setting that is equally Apple-like aesthetically, but not the same that they had while Steve was there.”

Even though the iPhone 4S is an improvement over its predecessor, it isn’t being perceived as a breakthrough partly because it’s not being branded as an iPhone 5, as most people had been expecting, said Prashant Malaviya, a marketing professor at Georgetown University.

Not all investors were disappointed.

Stephen Coleman, chief investment officer for Daedalus Capital and an Apple investor since 2004, calls his Apple stock “the safest investment that I own.” He said Tuesday’s upgrades were “incremental” _ and praised Apple for not messing too much with a model that’s working.

“To those who say they’re underwhelmed, I’d say they’ve been fast asleep,” Coleman said. “Anyone who’s been paying attention at all would have to be dazzled by the product, and earnings.”

The stock has risen more than 15 percent this year, at one point hitting an all-time high of $422.86. It has nearly quadrupled since the first iPhone was announced in 2007. The device has been the cornerstone of one of the most remarkable runs in technology history. Apple is now one of the world’s most richly valued companies, holding its own against oil companies and international conglomerates.

“What is there to lament?” Coleman said. “For people like me, it’s peace on earth. This is one of the great economic stories of our time.”

The new iPhone has an improved camera with a higher-resolution sensor. The processor is faster _ the same A5 chip found in the iPad 2 _ so the phone will be able to run smoother, more realistic action games. It’s also a “world phone,” which means that Verizon iPhones will be useable overseas, just as AT&T iPhones already are.

The fact that a more radical revision of the phone was a no-show leaves room for speculation that Apple will reveal a new model in less than a year, perhaps one equipped to take advantage of Verizon’s and AT&T’s new high-speed data networks free credit report and score.

There had also been speculation that Apple would include a chip that could talk to payment terminals at retail stores, turning the iPhone into a mobile wallet. Competitors are starting to include this capability in their phones, though the payment systems are still immature. The iPhone 4S doesn’t have this.

The iPhone 4S will come with new mobile software that includes such features as the ability to sync content wirelessly, without having to plug the device to a Mac or Windows machine. The phone includes Siri, which lets people speak questions and commands and represents an advanced version of speech-recognition software found on other phones.

Apple also unveiled software that can send greeting cards through the postal system for $2.99 each.

Cook said the most recent iPhone, which came out in June 2010, sold more quickly than previous models, but the iPhone still has just 5 percent of the worldwide handset market. Among smartphones, devices running Google Inc.’s Android software make up 43 percent of the market in the second quarter, while the iPhone captures 18 percent, according to Gartner Inc.

Apple is hoping to grow that share with the iPhone 4S _ something it can do by luring new customers from Sprint and elsewhere, even if existing owners don’t see a need to upgrade.

Bajarin, the longtime Apple watcher, is confident that Apple will quickly overcome the perception problem once technology reviewers get a better handle on all the new bells and whistles. He believes that the improved camera and speech-recognition technology are compelling enough additions to make the iPhone 4S another hit for Apple.

“People are going to get over their initial disappointment and want this phone,” he said.

Apple’s new mobile software, iOS 5, will also be available on Oct. 12 for existing devices _ the iPhone 4 and 3GS, both iPad models and later versions of the iPod Touch.

Apple said Oct. 12 will also mark the launch of its new iCloud service, which will store content such as music, documents and photos on Apple’s servers and let people access them wirelessly on numerous devices. One component is a $25-per-year service, called iTunes Match, that will allow people to play their personal jukeboxes on any device with iTunes software instead of keeping them tethered to a personal computer that must be synced with other devices.

The new phone will come in black or white. It will cost $199 for a 16 gigabyte-version, $299 for 32 GB and $399 for 64 GB _ all with a two-year service contract requirement. Pre-orders will begin Friday with availability on Oct. 14.

The previous version, iPhone 4, will now cost $99 for 8 GB. The 2009 model, the iPhone 3GS, will be given away for free with 8 GB. Both also require a two-year service contract.

Don’t expect to see an iPhone available with prepaid, contract-free service plans any time soon _ at least not with AT&T. Ralph de la Vega, AT&T’s head of wireless and consumer services, said in an interview that the carrier has no plans to offer iPhones with prepaid plans, because even phones that are free with two-year contracts _ namely the iPhone 3GS _ would cost customers a significant amount up front. Wireless companies typically subsidize the cost of phones and make that back from monthly service fees over the life of the contract.

Apple also unveiled a new line of iPods, including a Nano model with a multi-touch display that promises to be easier to navigate.

Apple’s stock fell $2.10, or 0.6 percent, to close Tuesday at $372.50 after dropping earlier to $354.24.

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A stock trader dubbed the Octopussy because he reached for so much inside information was sentenced Wednesday to 10 years in prison and a California finance researcher convicted in a separate but related insider trading case received a four-year prison term as two judges tried to send a stern warning to Wall Street.

“Insider trading is very, very hard to detect. Because of that, it has to be dealt with harshly,” U.S. District Judge Richard Sullivan said as he gave 34-year-old Zvi Goffer one of the longest prison terms ever handed down in an insider trading case. He added: “These crimes are not going to be tolerated, certainly not in my courtroom.”

U.S. District Judge Jed Rakoff said it was important that each sentence send a tougher message to deter inside trading than previously thought necessary.

“It’s hard to detect but easy to commit so the temptations are great,” Rakoff said as he sentenced Winifred Jiau, 43, of Fremont, Calif., who has remained imprisoned for nine months because it was determined that the Taiwan-born researcher was a risk to flee. Still, the sentence was only half of what was called for by federal sentencing guidelines.

The Israeli-born Goffer, who lives in Brooklyn, was convicted with two others in June in a conspiracy to pay bribes to coax confidential information out of two shady lawyers at a Manhattan firm. The arrests were part of what prosecutors called the biggest hedge fund insider trading case in history. In all, more than two dozen people have been convicted in the probe.

The sentencings Wednesday came weeks before the scheduled sentencing next month of Raj Rajaratnam, a one-time billionaire hedge fund founder who was convicted on insider trading charges earlier this year. Prosecutors say he made more than $50 million through illegal trades and are seeking a prison term of more than 24 years.

When the charges against Rajaratnam and Goffer were announced in the fall of 2009, prosecutors said they had made unprecedented use of wiretaps, in part because white collar criminals were starting to use techniques to cover up their crimes that made them resemble common criminals.

The wiretaps eventually led to a separate probe of researchers in the securities industry who enable illegal secrets to be passed between hedge fund managers and employees of public companies. Jiau was among 13 people arrested last year in that probe.

At his sentencing, Goffer apologized to investors in the stocks in which he had an unfair advantage, saying: “They didn’t have the information I had.”

He began crying when he apologized to his brother, Emanuel, who was convicted at trial along with him and is awaiting sentencing. A third defendant, Michael Kimelman, also awaits sentencing.

“He knows I love him,” he said of his brother. Zvi Goffer said he didn’t always understand the seriousness of the crime but had awakened to its tragic consequences.

“Now today I have to face it and I am terrified,” he said.

The sentence caused Goffer’s wife to break down in sobs.

“What am I going to do?” she called out in court at one point. “It’s not fair!” A woman beside her then shouted a profanity, causing Sullivan to rise from the bench and threaten to bring in U.S. marshals to make arrests.

“This is a courtroom, not a street corner,” he said. “I am not going to tolerate this.”

Goffer was convicted by a jury that viewed evidence that he had arranged to pay two attorneys nearly $100,000 in 2007 and 2008 for inside tips on mergers and acquisitions.

During the two-week trial, prosecutors introduced evidence that Goffer gave conspirators prepaid cellular telephones in an effort to reduce detection by law enforcement.

The judge said Goffer had repeatedly demonstrated that he knew he was breaking the law and didn’t care.

“It’s a game that you and others seem to find exciting,” he said, adding that Goffer had a gambler’s mentality that led him to “double down and go to trial” when he would have shaved three years off his prison sentence by accepting responsibility before trial and admitting his crimes.

“You went for broke. You gambled and lost on that, too,” Sullivan said.

Before starting his own firm, Goffer worked for nine months for Rajaratnam.

Jiau was convicted of charges that she conspired to accept cash and gifts to feed inside information to hedge funds.

Jiau, a U.S. citizen, worked for two years as a consultant for Primary Global Research, a Mountain View, Calif.-based company.

Prosecutors said she earned more than $200,000 by selling “tomorrow’s news today” about earnings and performance of publicly traded companies. The information, they say, was communicated in code with her co-defendants, sometimes using “cooks” to refer to tipsters, “recipe” for the inside information and “sugar” for what she was paid for

Lawyers for both Jiau and Goffer said their clients were left in financial ruin and their careers were destroyed.

Jiau told Rakoff she was “sorry for being here.”

She also apologized to her dog, a Golden Retriever named Hunter who is being cared for by friends, saying: “I’m sorry I broke my promise to take care of you and be with you.”

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Dominique Strauss-Kahn, the former head of the International Monetary Fund, acknowledged Sunday his sexual encounter with a New York hotel maid was a “moral failing” on his part, but didn’t involve violence, constraint or aggression.

In his first interview since his May 14 arrest over sexual assault accusations, Strauss-Kahn told France’s TF1 television channel what happened between him and the maid, Nafissatou Diallo, “was not only an inappropriate relationship, but more than that, it was an error.”

Strauss-Kahn, a Socialist politician who was widely considered a top contender in next year’s presidential race until the case broke, said “it was a failing, a failing vis-a-vis my wife, my children and my friends but also a failing vis-a-vis the French people, who had vested their hopes for change in me.

“I think it was a moral failing and I am not proud of it. I regret it infinitely. I have regretted it everyday for the past four months and I think I’m not done regretting it,” he said at the start of the 20-minute interview. Much of the exchange came off as staged, with Strauss-Kahn appearing calm and unruffled throughout and not surprised by the questions.

Strauss-Kahn’s initial contrition was peppered with anger at his accuser, a Guinean immigrant who maintained he attacked her after she came into his room at New York’s Sofitel hotel to clean.

He said the New York prosecutor concluded “Nafissatou Diallo lied about everything _ not only about her past, that’s of no importance, but also about what happened. The (prosecutor’s) report says, it’s written there, that ’she presented so many different versions of what happened that I can’t believe a word.’”

Strauss-Kahn suggested that financial motives might have been behind Diallo’s accusations.

He also dismissed as “imaginary” separate claims by a French writer that he tried to rape her during a 2003 interview, again insisting “no act of aggression, no violence” had taken place between the two.

The writer, Tristane Banon, has maintained she and Strauss-Kahn tussled on the floor during an interview in an empty apartment, with the politician trying to open her jeans and bra and putting his fingers in her mouth and underwear.

Because a police investigation into the claims is ongoing, Strauss-Kahn said he would not say anything more about the matter. If Paris prosecutors decide to pursue the case, Strauss-Kahn could face a possible trial.

New York prosecutors dropped all criminal charges against him in the Diallo case last month, though Strauss-Kahn is still facing a lawsuit brought by the maid.

Asked whether he had any intention of returning to politics, Strauss-Kahn said he would “take time to reflect” and rest first.

“But all my life was consecrated to being useful to the public good,” he said, adding “we will see.”

The AP does not name people who report being sexually assaulted unless they agree to be identified or come forward publicly, as Diallo and Banon have done.

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Unbeknownst to most customers, AT&T Inc. has fired up a new wireless data network in five cities in the last few months, offering roughly double the speeds of its older network for a handful of devices quick guaranteed personal loans.

On Sunday, the phone company will start marketing the network in Atlanta, Chicago, Dallas, Houston and San Antonio.

It won’t be selling a new data plan

Fixed mortgage rates fell to the lowest level in six decades for the second straight week. But few Americans can take advantage of the historically low rates.

Freddie Mac said Thursday that the average rate on the 30-year fixed mortgage fell to 4.09 percent this week. That’s the lowest rate seen since 1951.

The average rate on the 15-year mortgage, a popular refinancing option, fell to 3.30 percent, also a new low. Economists say it is likely the lowest rate on the 15-year ever.

Mortgage rates tend to track the yield on the 10-year Treasury note. Worries over Europe’s debt crisis are pushing investors to shift money into safe Treasurys, forcing the yield lower.

Over the past year, the average rate on the 30-year fixed mortgage has been below 5 percent for all but two weeks. That compares with five years ago, when the average 30-year fixed rate was near 6.5 percent. A decade ago, it was higher than 8 percent.

Still, cheap mortgage rates haven’t helped home sales. Sales of new homes are on pace for the worst year on records dating back a half-century. The pace of re-sales is shaping up to be the worst in 14 years.

Many Americans are in no position to buy. High unemployment, scant wage gains and large debt loads have kept them away.

Others can’t qualify for the lowest rates. Banks are insisting on higher credit scores and 20 percent down payments for first-time buyers. Many repeat buyers have too little equity invested in their homes to meet loan requirements.

Most people pay extra fees to get the low mortgage rates. Those fees are known as points, with one point equaling 1 percent of the total loan amount.

The average fees for the 30-year held steady at 0.7 point. Fees paid on 15-year fixed loans and both 5-year and one-year adjustable rate loans were all at 0.6 point.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country Monday through Wednesday of each week.

The average rate on a five-year adjustable-rate mortgage rose to 2.99 percent. That’s higher than last week’s 2.96 percent, the lowest records dating to January 2005 and the sixth straight week of record lows for this type of loan.

The average rate for the one-year adjustable-rate mortgage fell to 2.81 percent from 2.84 percent. That’s the lowest on records going back to 1984.

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