Democrat and Chronicle from Rochester, New York on October 22, 2015 · Page B4
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October 22, 2015

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Democrat and Chronicle from Rochester, New York · Page B4

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Rochester, New York
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Thursday, October 22, 2015
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USA SNAPSHOTS © Find more interest rates at rates.usatoday.com. JAE YANG AND VERONICA BRAVO, USA TODAY Source Bankrate.com As of Wednesday: Average CD yields 6-month This weekLast weekYear ago 0.15%0.17%0.17% 1-year This weekLast weekYear ago 0.26%0.28%0.28% 2 1 ⁄ 2 - year This weekLast weekYear ago 0.40% 0.44%0.44% 5-year This weekLast weekYear ago 0.83%0.85%0.85% $172,860 $200,000 $150,000 $100,000 $50,000 $0 Source Oce of the State Comptroller, New York GEORGE PETRAS, USA TODAY ’12’14’08’10 ’06 Wall Street bonuses may fall as much as 10% this year, analysts say. Average securities industry bonus amounts: BONUSES MAY FALL Wall Street’s famous bronze bull, which is rubbed by traders f or good luck, could sure use some loving right now. Big banks and brokerages slashed their bonus pools last quarter after pitiful trading activity led to double-digit revenue declines. Unless things turn around —and soon — Wall Streeters will see shrunken bonuses and possible layo s, experts say. “The sun could shine brightly the rest of the year, but most people would be quite surprised if that happened,” says Alan John- son, a compensation cons ultant for Wall Street b rokerages. Johnson w arned that bonuses c ould be down as much as 10% this year — fol- l owed by job cuts next year — if trends continue. Wall Street’s woes started in August when investors became rattled by China’s unexpected move to devalue its currency. That, combined with uncertainty over the direction of U.S. interest rates, led investors to pull back from trading in bonds, currencies and commodities. Fast forward to October. Morgan Stanley reported a 16% plunge in non-interest- b earing revenue in the t hird quarter, which led t o an 18% decline in c ompensation and bene- fits. Goldman Sachs s lashed compensation and benefits by 16% amid an 18% drop in non-interest-bearing revenue. And JPMorgan Chase reported a 7% decline in compensation due to an 11% drop in revenue tied to activities like trading and investment banking. There’s still a slim chance of record payouts if business turns around. That’s because, for the first nine months of the year, bonus pools at the largest banks and brokerages were largely on par with where they had been during t he same period last year, which p roved to be a bonanza. A t JPMorgan and Goldman, f or example, compensation exp enses through September were d own 1% from the same period in 2014. M organ Stanley, which suffered some of the biggest losses from rocky trading in August and September, said compensation and benefit expenses fell 3%. “Bonuses, like profits, are going to hinge on the fourth quarter,” says Kenneth Bleiwas, deputy comptroller for the state of New York. Bank executives have already warned that the problems plaguing the third quarter continue to linger. Wall Street faces shrinking bonus pool Kaja Whitehouse USA TODAY NEWS MONEY AUTOS TRAVEL SPORTS LIFE 4B E3 USA TODAY—DEMOCRATANDCHRONICLE THURSDAY,OCTOBER22,2015 WESTERN DIGITAL ACQUIRES SANDISK FOR $19 BILLION Computer data storage giant Western Digital announced Wednesday it will acquire SanDisk, which specializes in flash-memory storage devices, for $19billion. The deal values SanDisk at $86.50 per share, Western Digital says. Shares of SanDisk closed up 2.1% at $7 6.78, while Western Digital shares sank 4.6% to $71.44. SUBWAY TO MEASURE SUBS AFTER L AWSUIT Subw ay is putting its “foot-long” subs up to a tape measure to guarantee they are actually what they advertise. The chain proposed measuring breadin response to a 2013 class-action suit alleging Subway served customers less food than they were paying for. While it denies the claims, Subway announced a proposed settlement Monday . Accor ding to court documents, franchisees would be required to have a measurement tool in stor es and adhere to regular inspections, including measuring a sampling of baked br ead. FERRARI STOCK SURGES AS IPO KICKS OFF TRADING Investors zoomed into Ferr ari stock during the luxury br and’s initial public offering Wednesday as the stock jumped after the opening bell. The maker of exotic cars, which is being spun off from Fiat Chrysler Automobiles, was priced to trade at $52 per share, but Ferrari’s stock came out of the gates at $60 and later closed the day at $55. Fiat Chrysler is selling about a tenth of its stakein the luxury sports car brand in an effort to raise funds to fuel its own product investments. MONEYLINE INDEXCLOSECHG Nasdaq composite 4 840.12 y 4 0.85 S &P 5002018.94 y 11.83 T- note, 10-year yield 2 .04% y 0 .04 O il, light sweet crude$45.21 y 0.34 Euro (dollars per euro) $ 1.1337 y 0 .0001 Y en per dollar 1 19.96 x 0 .04 SOURCES USA TODAYRESEARCH, MARKETWATCH.COM DOW JONES INDUSTRIAL AVG. -48.50 17,100 17,150 17,200 17,250 17,300 17,350 9:30 a.m. 17,217 4:00 p.m. 17,169 WEDNESDAY MARKETS Awave of digital financial crimes was traced to a shadowy ring of “thumb bandits” who gained access to corporate and high-end individual bank accounts around the world, unlocking hundreds of millions of dollars in treasure as well as cy- b er secrets that could compromise national security, federal authorities said this week. The ring, believed to operate out of Silicon Valley and which leaves a mysterious thumbs-up icon at the scene of many of its biggest crimes, uses biometric technology to gain access to well- p rotected mobile bank accounts, thumb- pad-activated de- p osit boxes, Bloomberg finan- c ial terminals, even the ubiqui- t ous iPhone. Arash of illegal “thumb muggings” is at the heart of the scheme, with hundreds of people reporting being zapped unconscious by their m obile phones while in the hospital, only to wake up with a bloody stump where their right or left thumb used to be. Sound crazy? It certainly was in the late 1980s, when screenwriter Bob Gale envisioned a futuristic world in 2015 for his Back to the Future series, inhabited by thumb bandits who committed crimes with stolen thumbs used t o operate locks and appliances. While three decades later most o f us still use good old-fashioned keys or key cards to enter our h omes and o ces, biometric security is quickly becoming the n orm as technology develops. And the concept that it could be used to access financial accounts is as simple as activating your Twitter feed. W hile thumb amputations still s eem a bit, well, Hollywood, the idea of stealing or counterfeiting biometric characteristics is not o ut of the realm of crimi- n al thought. The Black- B erry revolution of the late 1990s was a giant step in the human evolutionary process, one in which we became capable of using our thumbs to communicate and survive. P revious thumb use — confined to hitchhiking, green thumbs, thumbs in the eye, Fonzie-like thumbs-up mating attempts and the ubiquitous Facebook “like” button — could only take us so far. Now, great novels can be written with thumbs. Journalists thumb from t he front lines. Drones flown by pilot thumbs can bomb terrorists thousands of miles away. Great s hips of war can be directed across video game screens and s eas of virtual reality. And, of course, we initiate banking trans- a ctions, access airline tickets and summon Uber rides with them. T humb prints at your local police station are now used by Little League baseball teams to vet the records of potential coaches for children. The “Global Entry” sys- t em for entering the U.S. from o utside its borders hinges on fi n- ger recognition, though not thumbs. “Fat fi nger” trades have d isrupted stock markets and just t his week caused Deutsche Bank t o announce it had mistakenly sent $6 billion to a hedge fund client. Indeed, the criminal opportunity for counterfeit, or stolen, thumbs and assorted digits seems bigger every day. Thumb branding, popular as a way of identifying criminals in 18th-century England, could be r evived, perhaps as a fashion fad in today’s tattoo-obsessed culture. Thumb farms could sprout, using DNA technology to grow a sinister army of cyber outlaws, perhaps known as the Rule of Thumb, with the ability to access all but the smallest financial portals. The Rolling Stones song Under My Thumb could be its anthem. What Gale envisioned, viewed n ow from the prism of the future, might still seem as crazy now as it d id then. But after all we’ve lived through that has come true since t he movie series, we’d be silly to, uh, thumb our noses at it. David Callaway dcallaway@usatoday.com USA TODAY ADP’s Workforce Vitality Report for Q3 2015 shows total hourly wages are being driven up about 3.5% overall. A breakdown of wage increases by category: A BREAKDOWN OF WAGE INCREASES Source ADP FRANK POMPA, USA TODAY Construction Education-Health Finance Leisure-Hospitality Manufacturing Professional Services Trade 16-2425-3435-5455-plusMaleFemalePart time Full time Midwest Northeast South West 50 workers or less 50-499 workers 500-999 workers 1,000 workers or more BY TRADE BY AGE BY GENDERBY HOURS BY REGION BY COMPANY SIZE 4.5% 3.8% 2.9% 2.3% 4.4% 3.0% 2.6% 4.4% 2.9% 2.5% 2.9% 5.9% 3.1% 3.9% 4.2% 3.0% 4.3% 3.0% 4.1% 5.3% 7.2% 3.8% 1.8% Wage growth may be accelerating more rapidly than government d ata has been showing. G iant payroll processor ADP said Wednesday that the average h ourly wages of job holders — em- p loyees in the same job for at least 1 2 months — rose 3.5% in the third quarter, up from 1.9% in the fi rst quarter. B y contrast, the Labor Department said that average hourly earnings in September were up just 2.2% from a year ago, roughly in line with the sluggish 2% pace that has marked the recovery. ADP’s report covers about 24 million U.S. employees whose employers contract with ADP to handle their payrolls, or about 20% of all private-sector workers. Abig reason the firm’s data show sharper pay increases is that it’s measuring raises for individual employees in the same jobs at least a year, says Sophia Koro- peckyj, an economist at Moody’s Analytics, which helps ADP compile its figures. The Labor Department averages wage growth from a sampling of employers across the economy. As a result, average pay hikes have been tempered by the ongoing retirement of higher-paid Baby Boomers and the entry into the workforce of lower-paid Mil- lennials, Koropeckyj says. “We think (ADP) is more accurate,” Koro- peckyj says, adding the pickup in wages is masked by demographic shifts in Labor’s data. J ob holders make up the vast majority of workers, ADP says. Pay increases for job switchers — those changing jobs within the last year — are even higher at an average 6.5% the past 12 months. Younger workers, who tend to switch jobs for better pay more readily, led the earnings gains in t he third quarter, with 25- to 34- y ear-olds snaring increases of 3.8%. A mong industries, manufactur- i ng, which is struggling to fi nd s killed workers, hoisted pay by 7.2%, ADP says. M any economists have been p uzzled by the lack of a pickup in wage growth in Labor’s data. The unemployment rate has fallen to a near-normal 5.1% from 10% in 2009, a development that should force employers to lift pay to attract a shrinking the pool of available workers. Some experts say many part-time workers who want full-time jobs and discouraged workers on the sidelines — groups not counted in the unemployment rate — have allowed businesses to keep a lid on raises. ADP’s data may be skewed by the fact that companies that can a ord its services are likely doing better than U.S. businesses overall and so are able to a ord bigger raises. Still, the sharp rise in pay gains likely foreshadows a pickup in Labor’s data by early next year, Koropeckyj says. Economist Jim O’Sullivanof High Frequency Economics, says “it’s plausible” ADP is more accurately capturing faster pay growth. But he’s skeptical that demographic changes have curbed the pay gains measured by Labor given that trend has been occurring for years. Payroll processor ADP’s gauge more optimistic than Labor’s outlook WAGE GROWTH IS SEEN O N AN UPSWING Paul Davidson USA TODAY Analysts warn of 10% drop this year, with layo s possible in 2016 Digital crime now a rule of thumb A‘Back to the Future’-ish era of actual t humb bandits could soon be upon us

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