Tuesday Afternoon Business Brief
May 13, 2014, 1:47 PM
- There's a little less exuberance on Wall Street today, though the S&P 500 index has pushed through another threshold, briefly crossing 1,900 for the first time. Investors have been assessing the April retail sales report from The Commerce Department. It shows sales grew just 0.1 percent last month. In afternoon trading, the S&P is up a fraction. The Dow is modestly higher, while the Nasdaq composite is down.
- General Motors' recall involving defective ignition switches has revealed a gap in knowledge about the performance of air bags. Crashes tied to the ignition switch problem have killed 13 people. In each case, the air bags failed to deploy even after the cars hit trees, guard rails or other objects. Federal safety regulators told Congress last month they believed the cars' air bags should have worked for up to 60 seconds after the engine stalled. But GM tells The Associated Press that the time is just 150 milliseconds.
- Student lender Sallie Mae has reached a $60 million settlement with the federal government to resolve allegations it charged military service members excessive interest rates on their student loans. Attorney General Eric Holder calls the conduct "inexcusable," and says the settlement sends a message to all lenders that such practices won't be tolerated. Federal officials estimate some 60,000 service members will be compensated as part of the settlement.
- A new report finds at least a half-million more people have signed up for Medicaid in states that have refused a federal offer to expand eligibility for the safety-net program for the poor. Avalere Health says Georgia has the most new Medicaid recipients at nearly 99,000. In states that do expand Medicaid, Washington pays the full cost for newly eligible residents through 2016.
- California's tax revenue is running more than $2 billion ahead of expectations. But Gov. Jerry Brown's office says the state's expenditures are growing at a similar rate. Brown released a state budget that projects $107.7 billion in spending. That's 24 percent more than during the 2011-12 fiscal year, the low point of the recession when California cut billions of dollars from state programs and furloughed state workers.
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