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	<title>Business &#38; MoneyCategory: Banking &#124; Business &#38; Money &#124; TIME.com</title>
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		<title>The Real Lesson Behind Excessive Overdraft Fees</title>
		<link>http://business.time.com/2013/06/17/the-real-lesson-behind-excessive-overdraft-fees/</link>
		<comments>http://business.time.com/2013/06/17/the-real-lesson-behind-excessive-overdraft-fees/#comments</comments>
		<pubDate>Mon, 17 Jun 2013 16:09:10 +0000</pubDate>
		<dc:creator>Dan Kadlec</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Financial Education]]></category>
		<category><![CDATA[Personal Finance]]></category>
		<category><![CDATA[Planning]]></category>
		<category><![CDATA[Saving & Spending]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=81976</guid>
		<description><![CDATA[What’s more effective: consumer protections or consumer education that leads to sound individual decision-making? There is a place for both. But those who question whether financial education works would do well to consider the Consumer Financial Protection Bureau’s new report on bank overdraft fees, which in my opinion demonstrates that when individuals understand their choices, they will protect their pocketbook all on their own, thank you very much. Unfortunately, as the report also shows, individuals too often do not understand the choices. That is the watchdog bureau’s central finding and helps make the case for greater regulation. The report concludes that “each institution’s overdraft policies, procedures, and practices are highly complex and can be difficult for a consumer to navigate.” Among the overdaft complexities: Complicated fee structures Bank polices vary widely. Some cap daily overdraft charges to two a day while others allow you to pile up insufficient funds fees 12 times a day. Coverage limits Some banks have fixed limits on how much they will lend on a check or debit with insufficient funds; others vary the limits based on average daily account balance, overdraft history, and deposit patterns. Complex transaction postings The order in which check, debit card, and other transactions are posted to an account can influence the number of overdraft fees—and banks all do this differently. Some process transactions at periodic intervals throughout the day, some only at night. Some process debits in order, some from largest to smallest during a single day. You can see why confusion reigns. But it was another part of the report that caught my eye: The fact that so-called heavy overdrafters reduced their bank fees by a significant amount after declining overdraft protection. “The average checking account fees per account holder who chose to opt in (to overdraft protection) were $196 in 2011, while the average fees for those who did not opt in were $28,” the report states. (MORE: 4 Reasons Excessive Overdraft Fees Just Won’t Go Away) Just to be clear here, I&#8217;ll reiterate: The people who did not<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=81976&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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	<primary_category>Financial Education</primary_category><primary_category_link>http://business.time.com/category/planning/financial-education/</primary_category_link>
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			<media:title type="html">dankadlec</media:title>
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		<item>
		<title>4 Reasons Excessive Overdraft Fees Just Won&#8217;t Go Away</title>
		<link>http://business.time.com/2013/06/13/4-reasons-excessive-overdraft-fees-just-wont-go-away/</link>
		<comments>http://business.time.com/2013/06/13/4-reasons-excessive-overdraft-fees-just-wont-go-away/#comments</comments>
		<pubDate>Thu, 13 Jun 2013 14:19:44 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Banking]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=81707</guid>
		<description><![CDATA[Despite regulatory reform aimed at reining in checking account overdraft fees, the penalty is still a cash cow for banks &#8212; to the tune of about $31 billion a year. That&#8217;s down from $37 billion in 2009, but a new report from the Consumer Financial Protection Bureau makes clear the number ought to be far lower. Why? Because customers who opt into so-called overdraft protection plans &#8212; which are marketed as a way to avoid unnecessary fees &#8212; end up spending more on checking account fees than those who don&#8217;t.  It would appear that banks have little motivation to clear up this, ahem, unintended consequence: Overdraft fees account for at least 60% of fee income on checking accounts. Perhaps if the causes for this confusion were made clear, however, consumers could protect themselves. Here&#8217;s are four reasons this problem is so persistent: Pricy &#8220;protection&#8221; plans that don&#8217;t protect. In 2010 the Federal Reserve prohibited banks from enrolling customers in overdraft plans that automatically charge $35 per transaction if customers try to buy something without having enough money in their accounts. Instead, the Fed mandated, customers would have to voluntarily opt in to these programs. In response, banks mounted a marketing blitz that made overdrafts sound really scary and recast overdraft penalties as &#8220;protection&#8221; fees, which got a lot of people to opt in without realizing what they were signing up for. A May 2012 study by Pew found that more than half of people who paid an overdraft fee didn&#8217;t realize they&#8217;d opted into the expensive plan. The CFPB finds that roughly nine out of 10 banks offer a less expensive linked-account transfer to cover overdrafts, but many banks customers today either don&#8217;t know about them or mistakenly believe something with the word &#8220;protection&#8221; in it must be better. Too many names. Overdraft policies are hard for consumers to understand because, in part, they&#8217;re called something different by almost every bank. A May report by the Pew Charitable Trusts says a &#8220;lack of uniformity makes it hard for consumers to compare key practices across institutions.&#8221;<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=81707&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link>
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			<media:title type="html">marthacwhite</media:title>
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		<title>Sallie Mae Plans to Split into 2, Names New CEO</title>
		<link>http://business.time.com/2013/05/29/sallie-mae-plans-to-split-into-2-names-new-ceo/</link>
		<comments>http://business.time.com/2013/05/29/sallie-mae-plans-to-split-into-2-names-new-ceo/#comments</comments>
		<pubDate>Wed, 29 May 2013 12:59:57 +0000</pubDate>
		<dc:creator>Associated Press</dc:creator>
				<category><![CDATA[Banking]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=80985</guid>
		<description><![CDATA[(NEWARK, Del.) — Sallie Mae plans to split into two separate, publicly traded companies. The student loan giant also named John Remondi as its CEO. Sallie Mae, formally named SLM Corp., said Wednesday that the two separate companies — an education loan management business and a consumer banking business — would help unlock value and boost its long-term growth potential. The education loan management business would include the company&#8217;s portfolios of federally guaranteed and private education loans, as well as most related servicing and collection activities. Remondi will continue as its CEO. The principal assets of the business are likely to include approximately $118.1 billion in federally guaranteed loans, $31.6 billion in private education loans, $7.9 billion of other interest-earning assets; and a leading education loan servicing platform that services loans for about 10 million federal education loan customers. This includes 4.8 million customer accounts serviced under Sallie Mae&#8217;s contract with the U.S. Department of Education. (VIDEO:   Face the Red: This New Short Film Will Scare You Into Paying Your Debt) Sallie Mae&#8217;s private education loan origination and servicing businesses, including Sallie Mae Bank and the private education loans it currently holds, will operate separately under the Sallie Mae brand. Joseph DePaulo, executive vice president of banking and finance will serve as the consumer education lending franchise&#8217;s CEO. The consumer banking business&#8217; assets are likely to include about $9.9 billion of assets made up mostly of private education loans and related origination and servicing platforms; cash and other investments and the Sallie Mae Upromise Rewards program. The two separate companies will initially be owned by Sallie Mae stockholders, but the separation of the businesses does not require a shareholder vote. Newark, Del.-based Sallie Mae anticipates the split, if given final approval by its board, could be completed within 12 months. Remondi will succeed Albert Lord, who is retiring earlier than initially planned. Lord is also stepping down as vice chairman. Remondi has served as president and chief operating officer since 2011 and was CFO and vice chairman before that. Remondi&#8217;s<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=80985&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link>
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			<media:title type="html">timeassociatedpress</media:title>
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		<item>
		<title>Bernanke’s Dilemma: No Good Moves Left</title>
		<link>http://business.time.com/2013/05/22/bernankes-dilemma-no-good-moves-left/</link>
		<comments>http://business.time.com/2013/05/22/bernankes-dilemma-no-good-moves-left/#comments</comments>
		<pubDate>Wed, 22 May 2013 17:28:18 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=80573</guid>
		<description><![CDATA[There’s a term in chess called zugzwang, which describes the point in a game when it&#8217;s your turn to move but every move you could make would worsen your situation. That’s pretty much what the chessboard looked like for Federal Reserve chairman Ben Bernanke when he testified before Congress this morning. What everyone most wants to know is when the Fed is going to start tapering off its bond-buying program (called Quantitative Easing), which has flooded the banking system with money for the past five years and kept interest rates abnormally low. And that was something Bernanke couldn&#8217;t answer. In his testimony, the Fed chairman gave a carefully hedged commitment that the central bank would continue buying bonds – currently $85 billion a month – until the economy is stronger. And he repeated last December&#8217;s official statement that the Fed intends &#8220;to maintain highly accommodative monetary policy as long as needed to support continued progress toward maximum employment and price stability.&#8221; When asked at what point the bond-buying policy might change, Bernanke was more evasive, saying that the Fed might need a few more meetings to make that decision. Asked if it would be decided by Labor Day, he demurred. Bernanke&#8217;s hedging isn&#8217;t primarily a sign of indecisiveness. His real problem is that given current economic conditions, there aren&#8217;t any good moves he can make. The conventional wisdom – and the presumption behind the Fed&#8217;s current policy – is that the economy is steadily improving, even if progress is slow. And while easy money eventually leads to higher inflation, that threat could still be several years away. So ideally, the Fed&#8217;s stimulus could get the economy back to a normal rate of growth before inflation becomes a problem, at which point the Fed could taper off its bond buying little by little and gracefully exit the picture. (MORE: The Unspeakably Wonky Idea That Can Solve the Corporate Tax Debate) But what if the economy isn&#8217;t getting better, or is improving so sluggishly that it will take years to get back to normal?<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=80573&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Federal Reserve</primary_category><primary_category_link>http://business.time.com/category/economy-policy/federal-reserve-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/05/169246414.jpg?w=240</featured_image>
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			<media:title type="html">Federal Reserve Board Chairman Ben Bernanke at a hearing before the Joint Economic Committee  on Capitol Hill, in Washington, D.C., on May 22, 2013.</media:title>
		</media:content>

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			<media:title type="html">michaelsivy</media:title>
		</media:content>
	</item>
		<item>
		<title>Viewpoint: Ben Bernanke, Enabler of America&#8217;s Fiscal Dysfunction</title>
		<link>http://business.time.com/2013/05/08/viewpoint-ben-bernanke-enabler-of-americas-fiscal-dysfunction/</link>
		<comments>http://business.time.com/2013/05/08/viewpoint-ben-bernanke-enabler-of-americas-fiscal-dysfunction/#comments</comments>
		<pubDate>Wed, 08 May 2013 09:45:34 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Currency]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Entrepreneurship]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Management & Leadership]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Too-Big-To-Fail]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=79402</guid>
		<description><![CDATA[Federal Reserve chairman Ben Bernanke doesn’t get much respect. PIMCO’s Bill Gross, who oversees some of the country’s biggest bond portfolios, has warned that Bernanke risks rousing inflationary dragons.  NYU professor Nouriel Roubini, who correctly anticipated the 2008 financial crisis, has argued that Bernanke’s policies are failing to help the economy and are instead fueling a stock market bubble that will end in a financial crisis. Even experts who are sympathetic have been cutting at times. New York Times columnist Paul Krugman has acknowledged that the Fed chairman is a fine economist.  But his long-running disputes with Bernanke – known in some quarters as the Battle of the Beards – have included charges that Bernanke was assimilated by the Fed Borg, a reference to Star Trek’s collective alien intelligence that overwhelms individuality and personal will. Renowned investor and business magnate Warren Buffett has described Bernanke as &#8220;a gutsy guy,&#8221; but he has also criticized the Fed&#8217;s policies as brutal toward retirees, who depend on interest payments from their investments. Indeed, Bernanke himself acknowledged as much in a 2011 press conference: &#8221;We are quite aware that very low interest rates, particularly for a protracted period, do have costs for a lot of people. They have costs for savers. We have complaints from banks that their net interest margins are affected by low interest rates. Pension funds will be affected if low interest rates for a protracted period require them to make larger contributions. So we are aware of those concerns, and we take them very seriously. I think the response is, though, that there is a greater good here, which is the health and recovery of the U.S. economy.&#8221; (MORE: How Silicon Valley is Hollowing out the Economy) It’s understandable that a public official would feel obliged to do whatever is best for the country at any given moment. If the lack of sound long-term fiscal policies is holding back growth, then up to a point the Fed can justify pumping large quantities of money into the banking system as additional stimulus. But there is a limit. In the long run, excessive money creation may engender<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=79402&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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	<primary_category>Federal Reserve</primary_category><primary_category_link>http://business.time.com/category/economy-policy/federal-reserve-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/05/162795895.jpg?w=240</featured_image>
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			<media:title type="html">Ben S. Bernanke, chairman of the U.S. Federal Reserve, during a House Financial Services Committee hearing in Washington, D.C., on Feb. 27, 2013.</media:title>
		</media:content>

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			<media:title type="html">michaelsivy</media:title>
		</media:content>
	</item>
		<item>
		<title>10 Steps to Spring Clean Your Finances</title>
		<link>http://business.time.com/2013/04/29/10-steps-to-spring-clean-your-finances/</link>
		<comments>http://business.time.com/2013/04/29/10-steps-to-spring-clean-your-finances/#comments</comments>
		<pubDate>Mon, 29 Apr 2013 09:45:18 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[401(k) Savings]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Decision Making]]></category>
		<category><![CDATA[Financial Planning]]></category>
		<category><![CDATA[Health Insurance]]></category>
		<category><![CDATA[Insurance]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Personal Finance]]></category>
		<category><![CDATA[Planning]]></category>
		<category><![CDATA[Saving & Spending]]></category>
		<category><![CDATA[Smart Spending]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[401k]]></category>
		<category><![CDATA[budgeting]]></category>
		<category><![CDATA[credit cards]]></category>
		<category><![CDATA[insurance]]></category>
		<category><![CDATA[IRS]]></category>
		<category><![CDATA[saving money]]></category>
		<category><![CDATA[savings]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=78144</guid>
		<description><![CDATA[When it comes to spring cleaning, you probably haul the junk out of your garage, scrub your fridge, and wash the rugs and drapes. But don&#8217;t forget about your personal finances. Just after tax season is the perfect time to perform an annual evaluation and tidying up of your budget, bank accounts, debts, and investments. Here are ten steps for straightening up your finances: Evaluate your debt load. How much do you owe, and how much are you paying the lenders in interest? Comparison shop what you&#8217;re paying in interest with what&#8217;s available now, and consider refinancing your mortgage or asking your credit card company for a lower interest rate. If you want to take advantage of the 0% balance transfer offers that are all over the place, make sure you’ll be able to pay off the transferred balance in full before the promotional period expires — and resist the temptation to run up new debt on the old card. Chip away at that debt. The question has always been whether you should you start paying off the balance with the highest interest or knock out the smallest bills first. Although starting with the highest interest rate makes the most sense mathematically, researchers found that people are more motivated to continue with a debt-reduction plan if they knock out a small debt in its entirety rather than merely a chunk of a bigger one. Also known as the &#8220;snowball approach&#8221; as advocated by personal finance expert Dave Ramsey, paying off one debt gives you the momentum to keep chipping away until that debt is history. Update your budget. If you’ve undergone a major job-related change like getting a big promotion or switching from two incomes to one, revisit your household budget. If you&#8217;d like to have one partner stay home with a child or go back to school full-time in 2013, the best way to adjust to being a single-breadwinner family is to start living like one six months beforehand. This will expose any weak spots in your budget or expenses you’ve<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=78144&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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	<primary_category>Personal Finance</primary_category><primary_category_link>http://business.time.com/category/personal-finance-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/04/145629365-copy.jpg?w=240</featured_image>
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			<media:title type="html">Piggy Bank</media:title>
		</media:content>

		<media:content url="http://0.gravatar.com/avatar/9a5a9e4f28beb5afb59b1202632d219a?s=96&#38;d=http%3A%2F%2F0.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">marthacwhite</media:title>
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		<title>Europeans Are Thinking the Unthinkable: That Debt Defaults Might Make Sense</title>
		<link>http://business.time.com/2013/04/23/europeans-are-thinking-the-unthinkable-that-debt-defaults-might-make-sense/</link>
		<comments>http://business.time.com/2013/04/23/europeans-are-thinking-the-unthinkable-that-debt-defaults-might-make-sense/#comments</comments>
		<pubDate>Tue, 23 Apr 2013 07:00:01 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Currency]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Labor]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=78185</guid>
		<description><![CDATA[The euro-zone crisis has slipped off the radar screen during the past couple of weeks as gun control and the Boston bombers have dominated U.S. news. But none of the euro zone’s problems have gone away. Political crises beset France, Italy and Spain. Smaller countries, from Portugal to Cyprus, face even more pressing financial troubles. Germany grows less and less willing to foot the bill for bailouts. And for the first time, serious public figures in Europe have begun openly discussing the pros and cons of allowing countries to default on their national debt. There is, in fact, a historical case for tolerating default. Argentina suffered a financial crisis in 1999 that led to a period of high unemployment. Over the next several years, it became harder and harder to maintain the value of currency. In 2002, the country defaulted on more than $100 billion in debt. Inflation soared, and workers&#8217; purchasing power plummeted. Savers lost a big chunk of their money. But a year later, growth bounced back to an 8% to 9% annual rate, and wages rose even faster. The same issues arose during the 2008 banking crisis. Ireland bailed out its banks, while Iceland couldn’t afford to and allowed a partial default. The results were that Ireland had no inflation, but unemployment topped 14% as growth ground almost to a halt. By contrast, in Iceland the currency lost almost half its value and inflation reached 5.4%. However, economic growth picked up slightly and unemployment didn’t rise much above 6%. (MORE: Why the Case for Austerity Took a Big Hit) In all these cases, policymakers had to choose whether working people or financial interests should be the ones to suffer most during a serious economic crisis. Default hurt affluent savers and financial institutions, but proved to be better for ordinary workers over the long term. What is happening now in Europe is that populations are resisting further austerity. In response, politicians and technocrats are beginning to question whether default might ultimately be less painful than doing what will be required to keep<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=78185&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Europe</primary_category><primary_category_link>http://business.time.com/category/economy-policy/europe-economy-policy/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/04/biz-euro-default-130422.jpg?w=240</featured_image>
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			<media:title type="html">A man walks past a closed down business in Madrid</media:title>
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			<media:title type="html">michaelsivy</media:title>
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		<title>The Real Significance of the Bitcoin Boom (and Bust)</title>
		<link>http://business.time.com/2013/04/12/the-real-significance-of-the-bitcoin-boom-and-bust/</link>
		<comments>http://business.time.com/2013/04/12/the-real-significance-of-the-bitcoin-boom-and-bust/#comments</comments>
		<pubDate>Fri, 12 Apr 2013 09:45:40 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Currency]]></category>
		<category><![CDATA[E-commerce]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economics & Policy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Financial Privacy]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Information Technology]]></category>
		<category><![CDATA[Retail]]></category>
		<category><![CDATA[Saving]]></category>
		<category><![CDATA[Taxes]]></category>
		<category><![CDATA[Technology & Media]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[Wealth]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=77371</guid>
		<description><![CDATA[The volatile rise-and-fall of Bitcoin has prompted lots of stories explaining why the online virtual currency is a classic bubble. Many compare it to tulip mania in 17th century Holland, where prices of rare tulip bulbs soared to absurd heights and then crashed, ruining the speculative investors who had bought them. But the Bitcoin phenomenon is more than a bubble. It says something important about the current and future state of the global economy. The scale of the recent boom-and-bust has been staggering indeed. At the start of the year, a Bitcoin was worth $13.51. Earlier this week, it traded as high as $266. And on Thursday, it plummeted to less than $100, as one of the exchanges where Bitcoins are traded closed temporarily. This would be comparable to the exchange rate for the British pound soaring from $1.62 (where it was on Jan. 1) to $31.90 and then falling back to $12. Such monumental appreciation and volatility are clearly the result of speculation — people buying the online currency just because they think its value will rise, not because they want to use it to purchase goods and services. But Bitcoins’ gains are not the result of speculation alone. They partly reflect the fact that the Bitcoin system is much better designed than previous online currencies. And more significantly, the run-up also reflects anxiety about the safety of the global banking system and the stability of major international currencies. (MORE: No Money, No Problems: Canada Considers Completely Digital Currency) The technicalities of the Bitcoin system are complex, but to make this online currency more successful than previous versions, the designers overcame two key challenges. First, to prevent counterfeiting, they attached a history of transactions to each currency unit — but allowed users to keep their transactions nearly anonymous. Counterfeiting is hard because fake Bitcoins would need an authenticated history to pass muster. Second, they strictly controlled the supply of Bitcoins outstanding — thereby saving it from the disastrous fate of, for example, the paper currency known as assignats that were issued during<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=77371&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>World Finance</primary_category><primary_category_link>http://business.time.com/category/world-finance/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/04/biz-bitcoin-130412.jpg?w=240</featured_image>
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			<media:title type="html">Bitcoin Value Soars And Drops</media:title>
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		<media:content url="http://2.gravatar.com/avatar/b8875a12f713f52ecc28fe72efed7fd4?s=96&#38;d=http%3A%2F%2F2.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">michaelsivy</media:title>
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		<title>Financial Independence? Today&#8217;s Young People Don&#8217;t Expect It Anytime Soon</title>
		<link>http://business.time.com/2013/04/04/financial-independence-todays-young-people-dont-expect-it-anytime-soon/</link>
		<comments>http://business.time.com/2013/04/04/financial-independence-todays-young-people-dont-expect-it-anytime-soon/#comments</comments>
		<pubDate>Thu, 04 Apr 2013 11:00:42 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Budgeting]]></category>
		<category><![CDATA[Careers & Workplace]]></category>
		<category><![CDATA[Credit Cards]]></category>
		<category><![CDATA[Educational Financing]]></category>
		<category><![CDATA[Financial Education]]></category>
		<category><![CDATA[Job Markets]]></category>
		<category><![CDATA[Planning]]></category>
		<category><![CDATA[Saving]]></category>
		<category><![CDATA[Saving & Spending]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[adult children]]></category>
		<category><![CDATA[children]]></category>
		<category><![CDATA[college]]></category>
		<category><![CDATA[family]]></category>
		<category><![CDATA[financial independence]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=76494</guid>
		<description><![CDATA[In a mere two years, the proportion of teenagers who expect to be financially dependent on their parents until their mid-20s has doubled. That gives us all another reason to feel sympathy for parents who have teenagers right now.  A new survey conducted by Junior Achievement, a group that teaches kids about money and jobs, found that 25% of teens think they won’t be able to support themselves until their mid-20s. Two years ago, just 12% of teens surveyed said that they&#8217;d have to reach the 25-to 27-year-old age bracket before being able to pay all of their own bills. Correspondingly, the proportion of teens who expect to achieve financial independence by the ages of 18 to 24 has plummeted, from 75% in 2011 to 59% today. Are these kids just unmotivated? Maybe some of them are, but many more are facing escalating college costs and poor job prospects. An alarming number have a poor understanding of budgeting and basic finance as well. Plus, the old stigmas attached to relying on one&#8217;s parents well into adulthood, and even moving back home after college, seem to have faded. To make ends meet, Generation X crowded in with roommates, ate Ramen and slept on futons. Post-college millennials still have roommates, but they increasingly call them &#8220;mom&#8221; and &#8220;dad.&#8221; The number of young adults living with their parents spiked during the Great Recession era. Today&#8217;s teens apparently don&#8217;t mind the idea of moving back in with the &#8216;rents, or they at least understand the necessity of making such a move given the state of the economy and the likelihood of large student loans down the road. (MORE: Being 30 and Living With Your Parents Isn’t Lame — It’s Awesome) Providing a place to live isn&#8217;t the only way parents are helping out their adult children. In many families, it’s become the norm for parents to step in and pay bills for smartphones, Internet access, music and TV subscription services like iTunes and Hulu. A survey of parents with adult children up to 35<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=76494&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Education</primary_category><primary_category_link>http://business.time.com/category/planning/financial-education/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/04/137470615-e1365022434293.jpg?w=240</featured_image>
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			<media:title type="html">three teenage girls</media:title>
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		<media:content url="http://0.gravatar.com/avatar/9a5a9e4f28beb5afb59b1202632d219a?s=96&#38;d=http%3A%2F%2F0.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">marthacwhite</media:title>
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		<title>Why Banks Love Debit Cards Again</title>
		<link>http://business.time.com/2013/03/28/why-banks-love-debit-cards-again/</link>
		<comments>http://business.time.com/2013/03/28/why-banks-love-debit-cards-again/#comments</comments>
		<pubDate>Thu, 28 Mar 2013 13:00:17 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Paying With Plastic]]></category>
		<category><![CDATA[Personal Finance]]></category>
		<category><![CDATA[Saving & Spending]]></category>
		<category><![CDATA[bank fees]]></category>
		<category><![CDATA[debit cards]]></category>
		<category><![CDATA[Fees]]></category>
		<category><![CDATA[interchange]]></category>
		<category><![CDATA[interchange fees]]></category>
		<category><![CDATA[overdrafts]]></category>
		<category><![CDATA[swipe fees]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75869</guid>
		<description><![CDATA[Debit cards were supposed to be toast. The industry started writing their obituary when financial reform targeted overdraft fees and interchange or “swipe” fees, which had made debit cards extremely lucrative for banks. So why is it that banks are now pushing debit cards like never before?  A couple years ago, the banking industry warned federal regulators that reform efforts could lead to both an increase in fees and a decrease in debit card usage. “Banks and credit unions could charge for various debit card‐related products and services that are now offered free of charge, such as free debit cards and free debit card transactions,” a consortium of financial industry executives wrote in a 2011 letter to the Federal Reserve arguing against reform. “Issuers could also be forced to discourage the use of debit cards for certain transactions &#8230; there could also be a reduction or termination of various products and services associated with debit card programs.” As it turned out, none of that really happened. After an initial retrenchment, banks now are marketing debit cards as aggressively as ever. They&#8217;re even adding back debit card rewards programs, which many had discontinued in anticipation of the hit the regulations would deliver to their bottom lines. New Federal Reserve data shows that the caps on interchange or swipe fees are working as intended. The average fee &#8212; the amount card issuers (banks) charged to merchants for each card swipe &#8212; dropped to 24 cents from 50 cents before the legislation took effect in 2011. CardHub.com crunched the numbers and estimated that big banks are losing about $8 billion a year as a result. (MORE: Another Swipe-Fee Battle Looms — This Time Over Credit Cards) Because banks are earning less from debit cards, you might think that they&#8217;d want to steer customers away from using them. In fact, just the opposite is true. Banks are trying to make up for the decrease in the amount collected per fee with increased volume. “You need economies of scale” to make today&#8217;s debit-based business model<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75869&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2012/03/identity_theft_02291.jpg?w=240</featured_image>
		<media:thumbnail url="http://timebusinessblog.files.wordpress.com/2012/03/identity_theft_02291.jpg?w=240" />
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			<media:title type="html">credit card, identity theft</media:title>
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		<media:content url="http://0.gravatar.com/avatar/9a5a9e4f28beb5afb59b1202632d219a?s=96&#38;d=http%3A%2F%2F0.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">marthacwhite</media:title>
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		<title>With Cyprus Bail-In, Europe Bids Adieu to &#8216;Too Big to Fail&#8217;</title>
		<link>http://business.time.com/2013/03/28/with-cyprus-bail-in-europe-bids-adieu-to-too-big-to-fail/</link>
		<comments>http://business.time.com/2013/03/28/with-cyprus-bail-in-europe-bids-adieu-to-too-big-to-fail/#comments</comments>
		<pubDate>Thu, 28 Mar 2013 07:00:28 +0000</pubDate>
		<dc:creator>Peter Gumbel</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Cyprus]]></category>
		<category><![CDATA[EU]]></category>
		<category><![CDATA[Euro]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75973</guid>
		<description><![CDATA[In June 2012, the European Commission outlined a set of proposals for dealing with failing banks in the E.U. Known as the “E.U. framework for bank recovery and resolution,” the proposals didn’t receive much public attention at the time, but in hindsight they should have, because at their core is a startling premise: the hitherto guiding principle of “too big to fail” should no longer apply to troubled banks and other financial institutions. Instead, they should be allowed to go under, in as orderly a fashion as possible, and the financial burden shared by creditors and depositors, rather than automatically shouldered by taxpayers. The Commission has some executive powers but its proposals aren’t always accepted by the E.U.’s 27 member states. However, nine months after the publication of that document, it is increasingly clear that this premise has become a central plank in Europe’s strategy to combat continuing financial problems and create a fully fledged banking union. The Cyprus rescue agreed to over the weekend is the most obvious sign: European taxpayers will be paying $13 billion for the latest E.U. bailout. But Cyprus’ two biggest banks have been folded together, and their depositors and creditors are on the hook for the $7.5 billion “bail-in” that Cyprus itself must deliver as its contribution to the rescue package. (MORE: Cyprus Rescue: The Destruction of a Tax Haven) Cyprus is the first country to have received this treatment, but it isn’t the first case of an imposed bail-in. A precedent was set by Denmark, when it imposed losses on senior creditors at tiny Amagerbanken and Fjordbank Mors in 2011. Earlier this year the Dutch government took a much bigger step when it rescued SNS Reaal, a troubled real estate lender, and in doing so, expropriated its subordinated bondholders to recoup about $1.3 billion. At the time, the Dutch Finance Minister Jeroen Dijsselbloem suggested that the government even considered confiscating SNS’s senior bonds, but decided against doing so because of fears of the effect this might have on stock and bondholders of other big Dutch<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75973&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/03/164714807.jpg?w=240</featured_image>
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			<media:title type="html">Cyprus EU Bailout Reached</media:title>
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			<media:title type="html">petergumbeltime</media:title>
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		<title>Why Derivatives May Be the Biggest Risk for the Global Economy</title>
		<link>http://business.time.com/2013/03/27/why-derivatives-may-be-the-biggest-risk-for-the-global-economy/</link>
		<comments>http://business.time.com/2013/03/27/why-derivatives-may-be-the-biggest-risk-for-the-global-economy/#comments</comments>
		<pubDate>Wed, 27 Mar 2013 15:06:48 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Bonds]]></category>
		<category><![CDATA[Commodities]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economics & Policy]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Exchanges]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Financial Reform]]></category>
		<category><![CDATA[Financial Regulation]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Investment Banking]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Municipal Government]]></category>
		<category><![CDATA[Private Equity]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[The Economy]]></category>
		<category><![CDATA[Too-Big-To-Fail]]></category>
		<category><![CDATA[Wall Street]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[Wealth]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75881</guid>
		<description><![CDATA[Four years after the U.S. recession ended, the global economy is still beset by problems. The present danger comes from Cyprus – where the sea foam once gave birth to the goddess Aphrodite but now only creates froth in panicky financial markets. The proposed bailout plan for troubled Cypriot banks would impose losses of up to 40% on the largest depositors. And that, in turn, could undermine confidence in the banks of other troubled euro zone countries. Cyprus is only the latest challenge for global financial stability, however. In the U.S., deteriorating urban finances – from Detroit to Stockton, Calif. – threaten municipal bond holders, public-sector workers, and taxpayers. In addition, a rise in long-term interest rates seems inevitable sooner or later, either because of inflation or because the Federal Reserve backs away from its easy-money policies. Higher interest rates would mean big losses for bond investors, and also for government-sponsored entities, such as Fannie Mae and Freddie Mac, that hold mortgage-backed assets. The greatest risk of all, however, may be one of the least visible – namely, the expanding, shadowy market for derivatives. These highly sophisticated investments have contributed to financial disasters from the 2008 bankruptcy of Lehman Brothers to J.P. Morgan’s 2012 trading losses in London, which totaled more than $6 billion. (MORE: The $600 Billion the IRS Can&#8217;t Collect) Basically, derivatives are financial contracts with values that are derived from the behavior of something else – interest rates, stock indexes, mortgages, commodities, or even the weather. Just as homebuyers make only a down payment when they buy a house with a mortgage, derivatives traders put down only a small amount of cash. Moreover, one derivative can be used to offset or serve as collateral for another. The result is that a massive edifice of derivatives can be supported by a relatively small amount of real money. Some derivatives, such as typical stock options, trade on exchanges. But many are simply private contracts between banks or other sophisticated investors. As a result, it’s hard to know the total<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75881&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
		<wfw:commentRss>http://business.time.com/2013/03/27/why-derivatives-may-be-the-biggest-risk-for-the-global-economy/feed/</wfw:commentRss>
		<slash:comments>0</slash:comments>
	<primary_category>Economy &amp; Policy</primary_category><primary_category_link>http://business.time.com/category/economy-policy/</primary_category_link>
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			<media:title type="html">michaelsivy</media:title>
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		<title>Cyprus Rescue: The Destruction of a Tax Haven</title>
		<link>http://business.time.com/2013/03/25/cyprus-rescue-the-destruction-of-a-tax-haven/</link>
		<comments>http://business.time.com/2013/03/25/cyprus-rescue-the-destruction-of-a-tax-haven/#comments</comments>
		<pubDate>Mon, 25 Mar 2013 08:32:15 +0000</pubDate>
		<dc:creator>Peter Gumbel</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[banking]]></category>
		<category><![CDATA[Cyprus]]></category>
		<category><![CDATA[EU]]></category>
		<category><![CDATA[Euro]]></category>
		<category><![CDATA[Russia]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75671</guid>
		<description><![CDATA[Cyprus is paying a high price for the $13 billion financial rescue it finally obtained from the E.U. early Monday after a week of high drama: the destruction of a key pillar of its economy, its status as the offshore tax haven of choice for wealthy Russians. Under the terms of the deal, Cyprus will proceed with a massive cutback of its major banks. The biggest losers will be bondholders and depositors who have more than $130,000 in their accounts; the exact size of their losses still has to be calculated, but it could easily be above 20% and perhaps much higher in some cases. However, smaller depositors with less than $130,000 will be spared, a significant change from the initial rescue deal agreed upon a week ago that was rejected by the Cyprus parliament. Under that arrangement, all bank-account holders would have been taxed, regardless of the size of their deposits, to enable the island to come up with its own $7.5 billion contribution toward the bailout. (MORE: Cyprus Banking Crisis: The Endgame Begins) The deal still needs to be formally ratified by parliaments in E.U. countries, but — crucially — it has already jumped the biggest hurdle, that of approval in Cyprus itself. On Friday, the island’s parliament approved a range of legislation, including one to restructure the banking sector, which enabled the deal to be sealed. The overall impact will be a dramatic change for Cyprus’ economy. Over the past 30 years, since the fall of the Berlin Wall, the island has banked on its ability to attract money from Russia and elsewhere as an offshore center. Oversight has been tightened up since Cyprus joined the E.U. in 2004, but it remains relatively lax by international standards, and foreign companies pay a flat tax rate of just 10%. For a while the strategy seemed to work well; Cyprus built up a gargantuan banking industry, which is currently about five times the size of its total economy, according to Standard &#38; Poor’s. About one-third of the $88 billion in deposits<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75671&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/03/cyprus_deal_0325.jpg?w=240</featured_image>
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			<media:title type="html">Michael Sarris, Cyprus&#039;s finance minister</media:title>
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		<media:content url="http://1.gravatar.com/avatar/783e38ca70db3efb556acb700d4696ed?s=96&#38;d=http%3A%2F%2F1.gravatar.com%2Favatar%2Fad516503a11cd5ca435acc9bb6523536%3Fs%3D96&#38;r=G" medium="image">
			<media:title type="html">petergumbeltime</media:title>
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		<title>Cyprus Banking Crisis: The Endgame Begins</title>
		<link>http://business.time.com/2013/03/21/cyprus-banking-crisis-the-endgame-begins/</link>
		<comments>http://business.time.com/2013/03/21/cyprus-banking-crisis-the-endgame-begins/#comments</comments>
		<pubDate>Thu, 21 Mar 2013 23:50:57 +0000</pubDate>
		<dc:creator>Peter Gumbel</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Cyprus]]></category>
		<category><![CDATA[Euro]]></category>
		<category><![CDATA[European Union]]></category>
		<category><![CDATA[Russia]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75550</guid>
		<description><![CDATA[The ultimatum has been issued: the E.U. is pressuring Cyprus to end its standoff over a proposed financial-rescue package and agree to new terms very rapidly — or face bankruptcy. Cyprus is scrambling to respond with a revised plan that would shield small depositors, but it still needs to finalize details and then win approval from the E.U. Two days after the Cyprus parliament overwhelmingly rejected the bailout, which would have taxed the deposits of all bank-account holders, the E.U. hit the island with a one-two punch. The first blow was a brief two-line announcement from the European Central Bank (ECB) that it would stop providing emergency liquidity assistance to Cypriot banks on Monday, March 25, unless the island nation agreed to a bailout deal with the E.U. and the International Monetary Fund before then. The announcement was a blunt attempt to force Cyprus&#8217; hand, mainly because the tiny nation&#8217;s biggest banks have racked up heavy losses from soured loans to Greece and are dependent on liquidity from the ECB. Cutting off that financial lifeline would push them into bankruptcy, perhaps even taking the government with it, because the banks’ assets are estimated by Standard &#38; Poor’s to be five times the size of Cyprus’ economy. “Neither the bank shareholders nor Cyprus&#8217; government appear able on their own to meet the banks&#8217; pressing capital needs,” S&#38;P said in a statement announcing it was lowering the island’s long-term credit rating to CCC from CCC+, judging the financial outlook to be “negative.” (VIDEO: Could Cyprus Bring Down the European Economy? TIME Explains) The second blow was a conference call by the so-called Eurogroup, comprised of finance officials from the 17 nations that have the euro as their currency. A statement after the call made it clear that the E.U. would not back down on its key condition for a $13 billion rescue, namely that Cyprus itself put up $7.5 billion. The Eurogroup called on the Cyprus government to put forward a new proposal “as rapidly as possible.” However, the statement made clear that the E.U.<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75550&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/03/2be01e6e4e3443ddbfe850d425ef5e9d-0.jpg?w=240</featured_image>
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			<media:title type="html">A woman waits as  two people use the ATM machines in central capital Nicosia, Cyprus, on March 22, 2013.</media:title>
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			<media:title type="html">petergumbeltime</media:title>
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		<title>Can the U.S. Dollar Become Almighty Once Again?</title>
		<link>http://business.time.com/2013/03/20/can-the-u-s-dollar-become-almighty-once-again/</link>
		<comments>http://business.time.com/2013/03/20/can-the-u-s-dollar-become-almighty-once-again/#comments</comments>
		<pubDate>Wed, 20 Mar 2013 14:35:25 +0000</pubDate>
		<dc:creator>Michael Sivy</dc:creator>
				<category><![CDATA[Austerity]]></category>
		<category><![CDATA[Banking]]></category>
		<category><![CDATA[Commodities]]></category>
		<category><![CDATA[Currency]]></category>
		<category><![CDATA[Economic Indicators]]></category>
		<category><![CDATA[Economics]]></category>
		<category><![CDATA[Economy]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Energy]]></category>
		<category><![CDATA[Europe]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[Finance]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Investing]]></category>
		<category><![CDATA[Jobs]]></category>
		<category><![CDATA[Markets]]></category>
		<category><![CDATA[Mutual Funds]]></category>
		<category><![CDATA[Oil]]></category>
		<category><![CDATA[Portfolio Strategy]]></category>
		<category><![CDATA[Stocks]]></category>
		<category><![CDATA[Wall Street]]></category>
		<category><![CDATA[Wall Street & Markets]]></category>
		<category><![CDATA[Wealth]]></category>
		<category><![CDATA[World Finance]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75257</guid>
		<description><![CDATA[Financial turmoil in Cyprus, where the parliament rejected a plan an eurozone bailout deal that would have taxed bank deposits, is prompting investors to shift cash from the euro zone to the U.S. That’s boosting the value of the dollar &#8212; and it’s just the latest installment in a story that has helped the dollar strengthen for more than a year. Despite gridlock in Washington and a string of economic mishaps, the dollar has risen by 7% since late 2011. That’s a striking turnaround for a currency that was in relentless decline for decades. If the upward trend continues – and there are good reasons to think it will – then the U.S. dollar could become almighty once again. The dollar’s decline over the past 30 years has been far greater than most Americans realize. It has lost almost half its value against other major currencies since 1985 and is down 33% in the past 11 years alone. Indeed, the value of the U.S. dollar is lower today than it was in 2009 when the recession ended. In part, this fall occurred because of government policies in Europe and Japan that kept the euro and the yen overvalued. A weak currency can bolster a country’s economy in the short run, by making goods cheaper for foreign buyers and thereby encouraging exports. But over the longer term, a robust economy is typically accompanied by a strong currency. A currency rises in value when more foreign money is flowing in than is flowing out. These inflows occur not only because of export sales but also because foreigners see investment opportunities or are seeking safe places to park their cash. As a result, a stronger dollar is a bellwether of an improving economy and a brighter outlook for U.S. stocks. And there are three reasons economists think the dollar’s rise could continue: (MORE: Cyprus: The E.U. &#8216;Rescue That Risks Backfiring) Other major countries are worse off economically. The U.S. economy may be sluggish, but it has grown for 14 straight quarters since the recession ended<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75257&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>World Finance</primary_category><primary_category_link>http://business.time.com/category/world-finance/</primary_category_link>
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			<media:title type="html">michaelsivy</media:title>
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		<title>Too Big To Fail: 3 Lessons of the &#8220;London Whale&#8221; Debacle</title>
		<link>http://business.time.com/2013/03/20/what-have-we-learned-3-lessons-from-the-london-whale-trading-debacle/</link>
		<comments>http://business.time.com/2013/03/20/what-have-we-learned-3-lessons-from-the-london-whale-trading-debacle/#comments</comments>
		<pubDate>Wed, 20 Mar 2013 07:00:45 +0000</pubDate>
		<dc:creator>Christopher Matthews</dc:creator>
				<category><![CDATA[Banking]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75023</guid>
		<description><![CDATA[Of the many scandals that have plagued Wall Street of late, the &#8220;London Whale&#8221; trades, which cost banking giant JPMorgan Chase more than $6 billion, has captured the attention of the financial media more than any other. The biggest reason for journalists&#8217; obsession with this story is that it tarnished the reputation of JPMorgan CEO Jamie Dimon, who is widely thought to be one of the most competent bank CEOs in the business, and one of the few who ably steered his bank through the subprime-mortgage crisis. And as far as the media is concerned, the bigger they come, the more people like to watch ’em fall. But there is more to this story than the comeuppance of the biggest banker on the Street today. The London Whale debacle, and the subsequent Senate investigation, gives us a window into the culture and operations of the biggest bank in America as it adjusts to a postcrisis world in which Dodd-Frank is the law of the land. And the picture painted isn&#8217;t exactly comforting. The Senate&#8217;s report on the losses, coupled with Friday&#8217;s public hearing, describes a bank where complex derivatives and other methods were used to hide risk from bank regulators, investors and themselves, all in an effort to boost profits. Luckily, these trades didn&#8217;t come close to putting the bank at risk of insolvency. But that doesn&#8217;t mean a similar series of events couldn&#8217;t play out at a more poorly managed institution without the competence or scruples to contain the situation quickly. Could it be a $36 billion trading loss the next time around? Let&#8217;s hope not. With any luck, lawmakers and regulators will use this episode as an impetus for continued regulatory reform. Here are three lessons we should learn from the London Whale fiasco: 1. Derivatives Are Dangerous Ironically, the $6 billion London Whale loss occurred in an area of the bank — the Chief Investment Office (CIO) — that was in charge of investing excess bank deposits in a low-risk manner. As part of this effort to manage the bank&#8217;s risk, the CIO bought synthetic derivatives (referred<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75023&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Financial Reform</primary_category><primary_category_link>http://business.time.com/category/economy-policy/financial-reform-economy-policy/</primary_category_link>
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			<media:title type="html">christopherrmatthews</media:title>
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		<title>Cyprus Banking Crisis: Will Russia Ride to the Rescue?</title>
		<link>http://business.time.com/2013/03/19/cyprus-banking-crisis-will-russia-ride-to-the-rescue/</link>
		<comments>http://business.time.com/2013/03/19/cyprus-banking-crisis-will-russia-ride-to-the-rescue/#comments</comments>
		<pubDate>Wed, 20 Mar 2013 00:28:34 +0000</pubDate>
		<dc:creator>Peter Gumbel</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[bailout]]></category>
		<category><![CDATA[bank]]></category>
		<category><![CDATA[Cyprus]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=75295</guid>
		<description><![CDATA[The Cyprus government is scrambling to find alternative ways to fund its part of an E.U. bailout, including asking for help in Moscow, after the island’s parliament resoundingly rejected the terms initially agreed. The lawmakers&#8217; vote was seen as a complete denunciation of the controversial plan to levy a one-time tax on bank deposits of Cypriots and non-Cypriots alike. Despite the international uproar that the bailout has generated, the E.U. shows no sign of budging from its insistence that Cyprus itself must fund a part of its own rescue package. Together with the International Monetary Fund, the E.U. has said it is willing to put up $13 billion — but only if Cyprus itself contributes about $7.5 billion in revenue. German Finance Minister Wolfgang Schaüble told a TV interview on Tuesday evening that he “regretted” the parliament’s decision to reject a package that had been worked out together with the government. If public indignation wasn&#8217;t already palpable over the E.U. deal, which was agreed upon this weekend after a 10-hour negotiation process between euro-zone Finance Ministers, the plan was put up for a parliamentary vote Tuesday in which not a single member of the 56-strong Cypriot parliament voted to endorse it: 36 deputies voted against, 19 abstained and one wasn’t present. The island has run into serious financial difficulty because its banks were heavily exposed to Greek debt. But the government can’t afford to bail out the banking system on its own. In the parliamentary debate, Averof Neofytou, the deputy head of President Nicos Anastasiades’ party, warned, “We are on the brink of an unruly bankruptcy.” Bankruptcy would be the worst outcome for all of Europe, since it would once again put at risk the continent&#8217;s single currency, the euro. However, the European Central Bank says that, for the moment at least, it is continuing to provide liquidity to Cyprus’ banks in accordance with its usual rules and procedures. In reality, the Cyprus government has precious few options. One is to revamp the proposed levy in order to exempt small depositors,<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=75295&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/03/cyprusbank.jpg?w=240</featured_image>
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			<media:title type="html">Reaction As Banks And Economy Come Under Pressure In Cyprus</media:title>
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			<media:title type="html">petergumbeltime</media:title>
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		<title>Cyprus: The E.U. &#8216;Rescue&#8217; That Risks Backfiring</title>
		<link>http://business.time.com/2013/03/17/cyprus-the-eu-rescue-that-risks-backfiring/</link>
		<comments>http://business.time.com/2013/03/17/cyprus-the-eu-rescue-that-risks-backfiring/#comments</comments>
		<pubDate>Mon, 18 Mar 2013 02:54:46 +0000</pubDate>
		<dc:creator>Peter Gumbel</dc:creator>
				<category><![CDATA[Banking]]></category>
		<category><![CDATA[Economy & Policy]]></category>
		<category><![CDATA[Cyprus]]></category>
		<category><![CDATA[Euro]]></category>
		<category><![CDATA[European Union]]></category>
		<category><![CDATA[Russia]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=74896</guid>
		<description><![CDATA[With its $13 billion agreement to bail out Cyprus, the E.U. this weekend thought that it had successfully doused the latest threat to its single currency, the euro. Cyprus has run into trouble because its banks are heavily exposed to Greek debt. Instead, the nature of the bailout – which features a levy on the bank deposits of ordinary Cypriots — has sparked a bank run on the island that threatens to spill over to other European countries. The sudden eruption of panic could still be contained; European officials on Sunday night were looking to revise the terms of the agreement ahead of a vote on the rescue package in the Cypriot parliament, in order to shield smaller depositors. E.U. officials insist that Cyprus was always a special case. But by forcing ordinary citizens to fund the bank rescues up front, through a tax on deposits, the E.U. is setting a precedent that is chilling to people in other countries, like Spain, which has looked at a bailout for its own beleaguered banking system. (MORE: Saving the Euro Zone, One Bank at a Time) In an impassioned address on Cyprus TV on Sunday night, President Nicos Anastasiades said, “Cyprus is in a tragic situation,” but he argued that this rescue package was the best one for the island nation. &#8220;I chose the least painful option, and I bear the political cost for this, in order to limit as much as possible the consequences for the economy and for our fellow Cypriots,&#8221; he said. The $13 billion bailout package may seem like chump change, but in fact it represents about 50% of Cyprus’ total economy. The Cypriot central-bank governor, Panicos Demetriades, has pointed out that, as a proportion of GDP, it is one of the largest bank bailouts ever, second only to the 1997 bank bailout in Indonesia. The government first requested a bailout in June 2012 after the two biggest banks, Laiki Bank and Bank of Cyprus, racked up huge losses on their exposure to Greek debt and themselves needed to<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=74896&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/03/cyprus_0317.jpg?w=240</featured_image>
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			<media:title type="html">Cyprus</media:title>
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			<media:title type="html">petergumbeltime</media:title>
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		<title>Not Knowing About This Credit Report Can Burn You</title>
		<link>http://business.time.com/2013/03/11/not-knowing-about-this-credit-report-can-burn-you/</link>
		<comments>http://business.time.com/2013/03/11/not-knowing-about-this-credit-report-can-burn-you/#comments</comments>
		<pubDate>Mon, 11 Mar 2013 20:05:01 +0000</pubDate>
		<dc:creator>Martha C. White</dc:creator>
				<category><![CDATA[Banking]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=73739</guid>
		<description><![CDATA[Even if we&#8217;re not quite sure what goes into our credit report or how that information boils down to a three-digit score, we know that a higher number means a better shot at getting a credit card or mortgage loan, along with a better interest rate on money we borrow. But many Americans don&#8217;t know about another type of credit report that&#8217;s just as important &#8212; in fact, a poor score can lock you out of the financial mainstream for years.  It&#8217;s called your ChexSystems report, and it tracks certain behaviors and activities related to checking or savings accounts. Bounced a check? That goes in the report. Had an account closed by your bank after you ran it into the red? That does, too. These black marks stay on your record for five years, and can keep you from opening a bank account. According to an FDIC-commissioned study, 25% of banks won&#8217;t let you open an account with them if you have even a single derogatory item. There are a couple of other companies that also track this kind of information, but the largest is Chex Systems Inc., which is part of Fidelity National Information Services, a big player in the financial services industry. It serves around 80% of banks in the United States. While nobody&#8217;s saying serial bad-check writers should get a free pass, consumer advocates say there are some problematic elements in the way ChexSystems operates, starting with that one-strike-you&#8217;re-out standard that many banks use. In a blog post on CreditSlips.org titled &#8220;Secret Creditor Reports, Overdraft Fees and the New Unbanked: The Perfect Storm,&#8221; University of New Mexico law professor Nathalie Martin says, &#8220;Nearly 90% of financial institutions use ChexSystems or similar reports in their account opening process, yet they are under no duty to disclose this to consumers until an account is denied due to information contained in the report. For those consumers denied accounts, it is too late.&#8221; &#8220;The first problem is that they’re only a negative blacklist,&#8221; says Ed Mierzwinski, consumer program director at U.S. PIRG. Nearly all items contained<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=73739&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link>
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			<media:title type="html">marthacwhite</media:title>
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		<title>Viewpoint: Why Capping Bankers’ Pay Is a Bad Idea</title>
		<link>http://business.time.com/2013/02/28/viewpoint-why-capping-bankers-pay-is-a-bad-idea/</link>
		<comments>http://business.time.com/2013/02/28/viewpoint-why-capping-bankers-pay-is-a-bad-idea/#comments</comments>
		<pubDate>Thu, 28 Feb 2013 10:21:26 +0000</pubDate>
		<dc:creator>Michael Schuman</dc:creator>
				<category><![CDATA[Banking]]></category>

		<guid isPermaLink="false">http://business.time.com/?p=73324</guid>
		<description><![CDATA[I’ve come to dislike bankers as much as the next guy. How can anyone with a sense of justice and fair play not be angry at them? First they tank the global economy with their risky shenanigans, then they take taxpayer money in costly bailouts, then they unrepentantly continue to pay themselves gargantuan bonuses, then they complain about the big deficits and rising government debt that are a result of the recession they caused and the rescues they received. What’s to love? Still, for me at least, the proposed limits on banker pay being considered by the European Union are a misguided – if not dangerous – intrusion of government into the affairs of private companies. On Wednesday, negotiators for the European Parliament and E.U. member states reached a preliminary agreement to cap banker bonuses at the same level as their salaries. (With shareholder approval, that can be increased to two times the salary.) There may be some wiggle room built into the rules – for instance, some sorts of long-term compensation may be counted differently and allow bankers to earn more money – but the restrictions the E.U. is proposing are still the most overbearing recently considered in the industrialized world. (MORE: Bankers: Who Needs Them?) Such measures may soothe the public, but if they are finalized and come into effect, they have the potential to reshape the international banking industry – without making the finance industry any more stable. Ostensibly, the restrictions on pay are an attempt to force bankers to take fewer risks of the type that caused the 2008 financial crisis. Back then, bankers gorged on high-risk but high-return sub-prime mortgage securities that eventually caused the balance sheets of some of the world’s most venerable institutions to implode, rippling through the global economy and sparking the Great Recession. To prevent that from happening again, governments have tried various means to place more restrictions on or improve the oversight of the banking industry, such as the Dodd-Frank reform legislation in the U.S. The E.U. caps on banker pay<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=business.time.com&#038;blog=31173800&#038;post=73324&#038;subd=timebusinessblog&#038;ref=&#038;feed=1" width="1" height="1" />]]></description>
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		<slash:comments>0</slash:comments>
	<primary_category>Banking</primary_category><primary_category_link>http://business.time.com/category/banking-2/</primary_category_link><featured_image>http://timebusinessblog.files.wordpress.com/2013/02/161587473-copy.jpg?w=240</featured_image>
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			<media:title type="html">Views Of the Canary Wharf Business And Financial District</media:title>
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			<media:title type="html">michaeljschuman</media:title>
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