Morning Money Memo…
A huge car safety settlement between the Justice Department and Toyota would be one of the largest payouts ever made by an auto maker. Toyota is said to have agreed to pay at least $1 billion to end a 4-year criminal investigation.
The deal with prosecutors is over unintended acceleration. The same office is now investigating General Motors’ delayed ignition switch recall. Toyota says it is co-operating with the U.S. Attorney’s office and has made fundamental changes to become a more responsive and customer-focused organization.
General Motors CEO Mary Barra has apologized for deaths linked to the delayed recall of 1.6 million compact cars. “I am very sorry for the loss of life that occurred,” Barra said, admitting GM took too long to tell owners to bring their cars in for repairs.
Barra is trying to distance the GM she now runs from the pre-bankruptcy firm that buried the problem in bureaucracy. The company has acknowledged it learned about the problem switches at least 11 years ago but did not recall the cars until last month. Long-time analyst David Cole, formerly of the Center for Automotive Research, said it was the first time in his memory that a GM CEO has apologized for a safety problem.
Today’s main event for financial markets will be Janet Yellen’s first news conference as Fed Chair. Markets will be listening closely to what she has to say after the Federal Reserve’s two-day meeting on interest rates and the money supply. The big question is whether the Fed could change its language on the outlook for interest rates. The policy statement will also include the Fed’s latest look on the U.S. economy. Short-term rates have been near zero since December 2012.
Apple, Samsung and other tech rivals better watch out for Google. Android Wear is a brand-new version of Google’s mobile operating system for smartwatches and other wearable devices. Software makers are being invited to create apps for new watches, putting Google at the forefront of what could be the next huge market for mobile computing. With voice commands and advanced but simple design features, information such as the weather, driving directions and email could be shown instantly on your watch.
Sniffing the milk before pouring it into the cereal bowl could soon be a thing of the past. Chinese researchers are working on a set of color-coded tags that can be attached to outside of any food, beverage or pharmaceutical container. These high-tech “smart tags” would be able to determine whether food is going — or has gone — bad. They can also determine whether medicines are still active and safe to use. The best part? The tags are the size of a corn kernel and will cost less than a penny a piece.
A federal grand jury is convening as part of a growing criminal investigation into coal ash pollution in North Carolina. It was triggered by a massive spill involving Duke Energy. The spill coated 70 miles of the Dan River with toxic sludge. Regulators are under pressure to force Duke to clean up ash pits.
Richard Davies is a business correspondent for ABC News Radio.