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New Car Sales Show Growth


iStock/Thinkstock(NEW YORK) -- New vehicle sales are on pace to have their best April since 2005, according to a monthly forecast from J.D. Power and LMC Automotive released Thursday.

Nearly one-third of young car buyers, those 35 years old and under, are opting for longer financing deals of 72 months or more, said J.D. Power's John Humphrey. The weather is cited as a contributing factor, with related issues decreasing demand in the first quarter of the year through March.

"People are out in dealerships more, so a lot of that demand that was somewhat suppresed due to weather has come back and benefited the April number," Humphrey said.

Total light-vehicle sales in April are expected to reach 1.4 million units, a 4-percent increase from April 2013. The forecast for total light-vehicles for the year remains at 16.1 million units.

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Stocks See Small Gains Following Mixed Earning Reports


iStock/Thinkstock(NEW YORK) -- Positive and negative earnings reports made for mixed stocks on Thursday, with small gains and the Dow Industrial Average remaining unchanged. 

The Dow closed at 16,501.65, marking the first time since 2001 that it closed unchaged. The Nasdaq Composite gained 21 points at 4,148.34, and the S&P 500 added 3 points to end the session at 1,878.61.

Following the closing bell, Microsoft reported its fiscal third-quarter earnings that were better than expected, posting earnings per share of 68 cents on revenue of $20.40 billion. Apple was up 8 percent, one day after an upbeat earnings report and the announcement of a 7 for 1 stock split.

Other companies reported earnings that fell short, including Starbucks and Visa. General Motors plunged as well, announcing profits that dropped approximately 86 percent from the same period in 2013. A series of recalls are attributed to the significant decrease.

Meanwhile, new car sales shifted into high gear this month. Representatives from J.D Power and Associates say numbers are on pace to be the best April since 2005.

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Herbalife, Ackman Respond to "Nightline" Undercover Report


FREDERIC J. BROWN/AFP/Getty Images(NEW YORK) -- The diet and nutrition company Herbalife defended its sales practices Thursday after an ABC News undercover investigation showed independent distributors talking to recruits about the prospects for making big money.

"We provide clear, accurate and timely disclosures to prospective members regarding potential income," a statement by the company said. "Studies have revealed that the vast majority of Herbalife members have realistic expectations of the business opportunity and the effort required to succeed at all levels."

At the same time, the hedge fund Pershing Square released its own response to the reports on ABC News' World News With Diane Sawyer and Nightline. Pershing Square has for a year been urging regulators to investigate Herbalife.

"ABC’s investigative report revealed examples of the pervasive and fraudulent wealth and health claims that drive Herbalife’s pyramid scheme," the statement said.

Herbalife has been under scrutiny from both federal and state law enforcement agencies, which are reported to be looking into allegations that, among other things, the company and its distributors have misled prospective distributors about their earnings prospects.

Those probes have come as Pershing Square, led by the hedge fund billionaire Bill Ackman, has bet $1 billion on the prospect that the company’s stock will be driven down to zero as a result of the investigations. Ackman told ABC News he has already invested more than $20 million lobbying to bring media attention and a government crackdown.

Herbalife President Des Walsh told ABC News the company does not mislead its distributors about their money-making prospects, and that Herbalife’s internal surveys show that very few Americans who sign up with the company are doing so to try and get rich.

“That is not our pitch,” said Walsh. “The reality is that most people know that this is a wonderful way in which to pay a $50 or $60 start-up fee to earn a few hundred extra supplemental dollars a month.”

Yet videos posted online by top Herbalife distributors feature the lure of big homes, private planes and fast cars. In one such video, one of the company’s top distributors pitches the advantage of becoming an Herbalife distributor by showing off his lavish lifestyle.

“I step out of the Ferrari or the Bentley and people say, ‘What does that guy do for a living?’” the distributor says. “And I go, I’m an Herbalife independent distributor.”

“There really is a mystery about this company,” said James Angel, a professor at the Georgetown University Business School. “And that's what makes this so fascinating. Where you see the titans of Wall Street fighting it out over this mysterious company. And you have very smart people who look at it from different dimensions and see very different things.”

That air of mystery prompted ABC News to undertake its own investigation.

Two ABC News reporters signed up to experience -- and at times document using undercover cameras -- the process of becoming Herbalife distributors and then supervisors. They attended entry-level training seminars run by local distributors and national corporate-run Herbalife conferences.

All of the sessions featured numerous personal testimonials from distributors touting the nutritional and weight loss benefits of Herbalife’s products and the business opportunities presented by distributorship.

The sessions included statements, live or on tape, from company executives saying that personal experiences as distributors could vary and that no particular testimonials should be viewed as average or expected.

The sessions also included information about how distributorship or membership could take various forms -- from purchasing Herbalife products for one’s own use, to selling them directly to others, to signing up other distributors and getting paid royalties and bonuses by Herbalife based on their product sales, known as the “downline.”

There was also no shortage of substantial income claims.

During one local training event for newly recruited distributors, an Herbalife distributor said, “Last month, I made almost, almost $8,000.” Another said, “Because of Herbalife, I’m able to buy my house, a million-dollar house, all cash paid for.”

At the same training session, a high-ranking Herbalife distributor explained that “you don’t have to be some sort of super-salesman” to earn a very large income as a distributor who signs up other distributors.

“Before you know it, not only will you be a supervisor, but you’ll have supervisors under you, who’ll have five supervisors under them, who’ll have five supervisors under them,” the instructor explained at the Herbalife seminar in Flushing, Queens. "That’s 155 supervisors and if they’re each doing about 2,000 to 2,500 volume points a month, you’re going to be making somewhere in the neighborhood of $42,000 a month."

That would be over $500,000 a year.

Yet, according to Herbalife’s “Statement of Average Gross Compensation” for 2013, which every distributor is required to read, only a fraction of one percent of all U.S. distributors, 199 individuals, were paid $250,000 or more from the company’s “multi-level compensation opportunity” derived from sponsoring others.

In the press release issued Thursday morning in response to the ABC News investigation, Herbalife said it releases “clear, accurate and timely disclosures to prospective members regarding potential income...” The company said further that “studies have revealed that the vast majority of Herbalife members have realistic expectations of the business opportunity and the effort required to succeed at all levels.”

Concerns about the way Herbalife distributors recruit new members have dogged the company from its earliest days. In the 1980s, the California Attorney General’s office took the company to court alleging that its founder, Mark Hughes, and others had deceived new members with false claims about the potential for getting rich.

In a settlement with the state, the company agreed to abide by an injunction which barred Herbalife from “making false or misleading representations … relating to … an amount of money a participant may earn through bonuses and overrides.”

Walsh told ABC News the company responds immediately to reports of rogue distributors who overstate the potential of an Herbalife career. “We believe that we’re fully compliant with those provisions,” he said of the 1986 injunction.

Copyright 2014 ABC News Radio

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Weekly Jobless Claims Jump to 329K


iStock/Thinkstock(WASHINGTON) -- Jobless claims shot up during the third week of April, climbing to 329,000, the Labor Department reported Thursday morning.

For the week ending April 19, the number of people filing for benefits rose by 24,000. The previous week, claims stood at 305,000 -- an upward revision of 1,000.

The four-week average also went up, increasing by 4,750 to 316,750.

Copyright 2014 ABC News Radio

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FDA to Regulate E-Cigarettes


iStock/Thinkstock(WASHINGTON) -- The U.S. Food and Drug Administration announced Thursday morning plans to regulate electronic cigarettes.

The proposed regulations will require that the manufacturers disclose to the FDA what is in their products and will require that the devices come with a warning label. Although e-cigarette sales to minors will be prohibited, there are currently no advertising restrictions.

The regulation has been long-anticipated as millions of Americans have started using e-cigarettes. The devices are battery-operated nicotine inhalers.

Dr. Richard Besser, ABC News's chief health and medical editor, said public health officials are concerned that e-cigarettes could be a gateway to further tobacco use.

“Data show use of e-cigarettes by high school and junior high school students is on the rise," Besser said. "Once addicted to nicotine, will users move on to using tobacco with all the inherent health risks?”

“Countering the view are those who view e-cigarettes as an important step towards risk reduction for current cigarette smokers," he added. "They do not deliver the carcinogens that are the cause of so many health problems.”

There are more than 250 brands of e-cigarettes and an estimated 4 million Americans use them, according to the Tobacco Vapor Electronic Cigarette Association. However, whether the small devices are “safer” than traditional cigarettes remains unproven. Without FDA regulation it’s unclear how much nicotine or other chemicals each brand of e-cigarette holds.

A widely publicized study into the safety of e-cigarettes was done when researchers analyzed only two leading brands and concluded the devices did contain trace elements of hazardous compounds, including a chemical that is the main ingredient found in antifreeze.

Despite the announcement, it will be months to years before concrete regulation is implemented. First there will be a six-month review process after the 75-day comment period. It will be another two years before current products need to be approved by the FDA and 25 months before they need to display warning labels.


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Which TV Streaming Service Is Right for You?


iStock/Thinkstock(NEW YORK) -- It's been a busy week in the world of streaming media services.

First, Netflix announced that it's planning a price increase of between $1 and $2, depending on the country, to help fund new content for your viewing pleasure.

Then, Amazon Prime announced members will have access to HBO classics like The Wire and The Sopranos.

Now, Dish says it's considering launching the first Internet-only pay-TV service this summer, potentially becoming first U.S. provider to offer such a standalone service.

To see a comparison of four streaming services that offer film and TV shows, their prices and potential drawbacks, click here.

Copyright 2014 ABC News Radio

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Facebook Buys Activity Diary App 'Moves'


Justin Sullivan/Getty Images(MENLO PARK, Calif.) -- Facebook now has a stake in your "moves."

The company jumped into the fitness tracking market Thursday with the acquisition of Finnish company ProtoGeo Oy, which produces the popular activity diary app, Moves.

"The Moves team has built an incredible tool for the millions of people who want to better understand their daily fitness activity, and we’re looking forward to the app continuing to gain momentum," a Facebook spokesperson told ABC News.

The terms of the deal were not disclosed.

Facebook said the app will continue to run as a "separate, stand-alone application."

As users go about their daily activities, Moves operates quietly by gathering data from a smartphone's accelerometer.

The app is able to discern if a person is walking, running, biking or riding public transportation. It then displays a person's activity results for the day using colored circles that include metrics such as the number of steps walked and miles ran.

Facebook said key members of the Moves team will join their offices in Menlo Park, Calif.

On Wednesday, Facebook smashed analysts' expectations by posting a 72 percent increase in revenue for the first quarter.

The site also continues to grow -- with 802 million daily active users last month, an increase of 21 percent year-over-year, according to Facebook.

"We've made some long term bets on the future while staying focused on executing and improving our core products and business," Facebook CEO and founder Mark Zuckerberg said in a statement. "We're in great position to continue making progress towards our mission."

Copyright 2014 ABC News Radio

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Blowout Earnings for Apple and Facebook


Kevork Djansezian/Getty Images(NEW YORK) -- Two tech giants announced first-quarter results and both surprised Wall Street with stronger-than-expected earnings.

Apple shares overnight gained more than 8 percent after the company said it plans to buy back $30 billion in stock and raise its quarterly dividend by 8 percent. Apple also announced a 7-for-1 stock split.

It’s really benefiting from an alliance with China Mobile, selling 44 million iPhones worldwide, many in China.

Facebook now has more than a billion and a quarter users with two-thirds of them logging in every day. First-quarter earnings and sales surged with advertising revenue rising 82 percent.


ABC US News | ABC Business News

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Vacations Aren't the Same Without Your Phone


iStockThinkstock(NEW YORK) -- Used to be that people were advised never to leave home without traveler’s checks when they went on vacation.

Hardly anyone carries traveler’s checks anymore but they do carry cellphones and TripAdvisor says 90 percent of vacationers will use their mobile devices, no ifs, ands or buts about it.

As for what they’re doing on their phones, the TripAdvisor survey finds that nearly three in four need it for navigation purposes, 62 percent consult their phones for restaurants and over half will find things to do while vacationing.

Of course, in this age of having to be connected to the home base, 62 percent of people on vacation check their emails with half that number claiming to see what’s happening at work.

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One in Seven People Say They're Asleep on the Job


Creatas/Thinkstock(NEW YORK) -- Working hard or hardly working? One way or the other, some people are able to catch a few winks while on the job, according to a survey by Virgin Pulse Institute, which bills itself as an evidence-based organization that puts research to work to help employees and companies thrive.

In a poll of nearly 1,140 workers from three U.S. companies, 15 percent admit that they napped at work at least one day a week.

That’s likely because three out of four respondents complained about feeling tired during most of the work week.

With 30 percent complaining about their sleep quality, the Virgin Pulse Institute asked why people feel so tired all the time.

The wrong room or bed temperature was the number one complaint, followed by their partners’ sleeping issues, unwanted noise or light, problems with mattresses and kids causing disruptions.

Interestingly, only 10 percent blamed health issues for their lack of sleep.

Copyright 2014 ABC News Radio

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Don't Forget to Bring Your Gadget to Your Next Interview


iStock/Thinkstock(NASHVILLE, Tenn.) -- You certainly can’t hurt your chances when looking for work if you’re tech savvy.

Even better, employers believe that the strongest candidates are the ones most up to date on technological advances,

In fact, Steve Hoeffler of Vanderbilt and Stacy Wood of North Carolina State University go as far to say in a new study that, “Those who are tech savvy are also perceived as authoritative on other subjects and as leaders.”

Hoeffler and Wood contend that workplace candidates enhance their chances of employment or improve their current status on the job by merely owning a smartphone, tablet or tech-wear such as Google Glass.

What's more, the researchers believe people are viewed as a better boss or leader if they appear authoritative about a device rather than actually being able to operate it.

Copyright 2014 ABC News Radio

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Diet-Shake Company Says It Disciplined Nearly 600 Distributors Making Medical Claims


Frederic J. Brown//AFP/Getty Images(NEW YORK) -- Nearly 600 independent distributors of the diet and nutrition sales brand Herbalife were disciplined last year for making medical claims when selling the company’s weight-loss shakes and supplements, despite company policies aimed at preventing such tactics.

Herbalife revealed the internal figures after an ABC News undercover investigation found numerous examples of distributors boasting to potential customers that the company’s products helped treat maladies ranging from diabetes to heart disease.

A Staten Island, N.Y., Herbalife distributor even told a potential customer -- who was actually an ABC News reporter wearing a hidden camera -- that a woman with a brain tumor became symptom-free after starting on Herbalife products.

“She used to shake like this because she lost control of her motor skills to the tumor and she said part of her cerebellum was deteriorated,” he said. “If you see her now, she’s like one of us here....Whatever it is that the product did, it helped her a lot.”

Herbalife executives told ABC News that the company had taken pains to prohibit such tactics.

“I am appalled to hear you say this,” said Herbalife President Des Walsh, when confronted with ABC News findings in an interview. “What is happening there is a complete and absolute violation of our rules.”

In training materials, Herbalife instructs its members to avoid such claims. “Nutrition club members may share their experiences from using the products, but the products are not intended to diagnose, treat, prevent or cure any disease or medical condition, and under no circumstances should there be any statements, advertising or implications to the contrary,” one such warning says.

Walsh said that based on the feedback the company gets from “secret shoppers” who conduct compliance inspections for Herbalife, the instances of improper medical claims are rare.

But ABC News reporters encountered them multiple times after going undercover into nutrition clubs and training centers run by local distributors in the New York area.

The company encourages members to use personal testimonials to sell their products and recruit new distributors. At one session in Queens, N.Y., a parade of members rose to talk about their personal experiences with the products. One distributor said before she started with Herbalife she was suffering from early congestive heart failure.

“Nothing worked, I tried everything before Herbalife,” she said. “I had to stop three or four times on a flight of stairs. I got on these products, and in about three days that dry cough that a heart patient has started to go away. And you can see, I have incredible energy, and I love these products.”

Another said, “Thanks to the product, I don’t have any problems at all – I don’t get sick at all during the year with a flu or cold or nothing.”

A distributor elicited cheers when she announced that Herbalife had helped her become pregnant.

ABC News first began its investigation to learn more about the operations of the multi-level-marketing business, which is now facing investigations from the FBI, the Federal Trade Commission, and the Illinois Attorney General. At the same time, the company has been buffeted by heavy criticism from a New York hedge fund, Pershing Square, which has wagered $1 billion on the prospect that Herbalife would be shut down by the government, resulting in the collapse of its publicly traded stock.

Herbalife has defended itself, saying the company’s business model is a legitimate and proven success with 30 years of history behind it. The company has seen enormous growth in recent years, emerging from a history checkered by controversy.

Walsh noted the company has hired scientists -- even a Nobel laureate -- to help it develop products that support a healthy lifestyle. Richard Carmona, the former United States surgeon general, joined the Herbalife board of directors in October 2013, and says he carefully reviewed the company’s literature and procedures before signing on. He said he would be deeply concerned if Herbalife distributors were selling the company’s products as medical cures.

“It's serious,” he said. “You give people false hope. They may not go to their doctors. They may not take their medicines. That would be absolutely abysmal.”

Copyright 2014 ABC News Radio

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Facebook CFO David Ebersman To Step Down


Dan Kitwood/Getty Images(MENLO PARK, Calif.) -- Facebook's chief financial officer David Ebersman will step down later this year after serving in the position for nearly five years, the social networking company announced Wednesday.

Ebersman will be succeeded by David Wehner on June 1 and remain with the company through September for the transition. Wehner currently serves as Facebook's vice president of corporate finance and business planning.

"David has been a great partner in building Facebook, and I'm grateful for everything he's done to help make the world more open and connected," founder Mark Zuckerberg said in a statement. "David set us up to operate efficiently and make the long-term investments we need, and built an incredibly strong team including Dave Wehner, our next CFO. I look forward to working with Dave in his new role."

Ebersman plans to move back to a career in health care.

In another big announcement Wednesday, Facebook reported its first-quarter numbers, with revenue at $2.5 billion. The total is an increase of 72 percent from the first quarter of 2013.  The number of monthly active users as of March 31 came in at 1.28 billion, an increase of 15 percent year-over-year.

Copyright 2014 ABC News Radio

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Wall Street Stocks Slide Lower After Six-Day Streak


iStock/Thinkstock(NEW YORK) --After a six-day rise, Wall Street markets took a dive following investors' reactions to the latest earning news and a less-than-stellar report on home sales.

The Dow Jones Industrial Average closed down 13 points at 16,501.65. The Nasdaq Composite lost nearly 35 points at 4,126.97, and the S&P 500 fell 4 points at 1,875.39.

A report from the Commerce Department on Wednesday shows a decrease in the number of Americans purchasing new homes. Sales of newly-built homes dropped more than 14 percent in March.  Representatives attributed colder weather to the dip in numbers.

Adding to dropping stocks, surgical robot maker Intuitive Surgical plunged 11 percent after a drop in its first-quarter earnings. Among those advancing were airlines, with Delta up 4 percent.

Facebook reported its first-quarter earnings, announcing a revenue of $2.5 billion and earnings per share of 34 cents. Apple declared a net profit of $10.2 billion, with quarterly sales of $45.6 billion and a 7 for 1 stock split.

Copyright 2014 ABC News Radio

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New Home Sales Down 14.5% in March


iStock/Thinkstock(WASHINGTON) -- For the second month in a row, the number of Americans purchasing new homes has taken a plunge.

The Commerce Department reported on Wednesday that sales of newly-built homes dropped more than 14 percent in March to the lowest rate since July of last year.

"[It's a] bit of a surprise that it dropped so severely after we've gotten past most of the weather effects," says David Crowe, chief economist for the National Association of Home Builders.

Compared to a year ago, new home sales are down sharply -- 13.3 percent.

Crowe says changed requirements for mortgages may be behind the drop.

"We've had tightened mortgage standards. We've had new requirements put in place as a result of legislation that was passed a couple of years ago, and the result has been blocking out a fair number of potential home-buyers. I think that's the primary reason behind the dramatic fall," he explains.

He says he expects a decent return for the rest of 2014, "but it does depend heavily upon Congress coming up with solutions to how the federal government backs mortgages."

Copyright 2014 ABC News Radio

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