By Susan Tompor

Bet if I asked, the odds are good that many people could tell me to the penny what they just paid for a gallon of gas.

By Charles Mead & Sarika Gangar

Apple Inc. (AAPL), the iPhone maker seeking to help finance a $100 billion capital reward for shareholders, is selling $17 billion of bonds in the biggest U.S. corporate offering on record.

Apple is issuing $3 billion of floating-rate notes and $14 billion of fixed-rate securities in six parts with maturities from three to 30 years, according to a person familiar with the offering. Proceeds may help the company avoid repatriation taxes on its $102.3 billion of funds held overseas as Chief Executive Officer Tim Cook returns an additional $55 billion to shareholders through 2015 to compensate for a stock that’s been hammered by signs of slowing growth.

“You’ll see a meaningful amount of interest,” Ashish Shah, the head of global credit investment at New York-based AllianceBernstein LP, which oversees $256 billion in fixed- income assets, said in a telephone interview. “It’s a high- quality name which brings in a lot of different kinds of buyers.”

The offering, Apple’s first since 1996, is being managed by Goldman Sachs Group Inc. and Deutsche Bank AG and follows a $1.95 billion dollar sale last week from Microsoft Corp. (MSFT) The world’s biggest software maker issued $1 billion of 10-year, 2.375 percent securities to yield 70 basis points more than Treasuries, according to data compiled by Bloomberg. They traded yesterday at 100.2 cents on the dollar to yield 2.35 percent, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

‘Strong Demand’

Apple’s offering would be the largest dollar-denominated sale on record. Roche Holding AG tops the list with a $16.5 billion six-part deal from February 2009 that included $3 billion of one-year floating-rate debt, followed by AbbVie Inc.’s $14.7 billion six-part issue in November, Bloomberg data show.

“There’s strong demand for bonds across the board,” Anthony Valeri, a market strategist with LPL Financial Corp. in San Diego, which oversees $350 billion, said in a telephone interview. “When you bring in a new name to a starved market I think it will be well received.”

The order book for Cupertino, California-based Apple’s offering, a gauge of investor demand for the debt, reached $50 billion, a person familiar with the transaction said.

Average yields on investment-grade debt worldwide dropped to a record-low 2.45 percent yesterday from 3.37 percent a year ago, according to Bank of America Merrill Lynch’s Global Corporate Index.

Price Guidance

Apple’s $1 billion of floating debt due 2016 may pay 5 basis points, or 0.05 percentage point, more than the three- month London interbank offered rate, with a $2 billion, five- year floater potentially yielding 25 basis points more than the benchmark, said the person familiar with the offering.

The $1.5 billion of three-year, fixed-rate debt may pay 20 basis points more than similar-maturity Treasuries; $4 billion of five-year notes may have a relative yield of 40 basis points; $5.5 billion of 10-year securities may have a spread of 75 basis points and $3 billion of 30-year bonds may pay 100, said the person, who asked not to be identified because terms aren’t set.

Libor, the rate at which banks say they can borrow in dollars from each other, was set at 0.273 percent today.

No AAA

While Apple’s $145 billion of cash is more than the combined funds of every AAA rated U.S. company including Microsoft, it failed to win the bond market’s highest credit grade from Moody’s Investors Service and Standard & Poor’s. Moody’s rated the firm Aa1 with S&P giving it a grade of AA+.

That rating tier is “inconsistent” with Apple’s credit risk, according to Fitch Ratings, which yesterday said the company’s “significant liquidity cushion” was overshadowed by the threat of volatile consumer preferences, significant competition and rapid technology changes. While Fitch hasn’t released a public grade for Apple, it said such a ranking would likely fall “at the highest end” of the single-A tier, lower than where Moody’s and S&P graded the debt.

Microsoft, along with Johnson & Johnson, Exxon Mobil Corp. and Automatic Data Processing Inc., is rated Aaa by Moody’s and AAA at S&P.

Concern that Apple’s pace of sales growth is slowing were reinforced last week by a forecast for narrowing gross margins and sales this quarter that may miss analysts’ predictions by as much as $4.9 billion. Apple had its first profit decline in a decade last quarter amid accelerating competition in mobile devices from Samsung Electronics Co.

Returning Cash

Using new debt to finance Apple’s $55 billion addition to its plan to return cash to shareholders through 2015 with buybacks and dividends may require annual issuance of between $15 billion and $20 billion, Ping Zhao, an analyst at CreditSights Inc. in New York, wrote in a report April 23. Apple would probably receive a “very attractive rate” for as much as $50 billion in new debt, Barclays Plc analyst Ben Reitzes wrote in a report last month.

Apple’s debt sale is coming more than nine years after the company cleared its balance sheet of bonds when the $300 million of 6.5 percent 10-year notes it sold in February 1994 matured. Apple issued new convertible debt in 1996 that was called in 1999, Bloomberg data show.

Deal Cachet

Apple, which has had little need for Wall Street’s services since its 1980 initial public offering and the two bond deals in the 1990s, picked two underwriters with which it has had a deep history.

Goldman Sachs, which managed both bond deals in the 1990s, was hired by the company after last year’s shareholder meeting to help it improve transparency and governance, including what to do with its growing cash pile, according to people familiar with the decision. The bank has helped advise Apple’s board on ways to return cash to shareholders and respond to hedge fund manager David Einhorn, who began publicly demanding action, a person with knowledge of the plans said in February.

Goldman Sachs ranks first this year among managers of debt sales for technology companies, Bloomberg data show.

Deutsche Bank advised Apple on its 1997 takeover of Next Computer Inc., the deal that led to the return of Steve Jobs, Apple’s late co-founder.

While fees from managing the offering are probably small, the deal will carry prestige and size that can elevate underwriters in so-called league tables that Wall Street uses to claim bragging rights over peers, according to Jim Angel, a visiting professor at the University of Pennsylvania’s Wharton School.

“Whenever you have a very high-profile offering from a famous issuer that is a household name brand and it’s a big offering, everybody wants this because of the prestige angle,” Angel said. “The folks at Apple are no dummies, and I’m sure they’ll exploit their advantage to the maximum.”

By Diana Olick

The U.S. Treasury's mortgage bailout is failing at an "alarming rate," according to a government watchdog, but architects of the four-year-old plan say that it is no worse than they expected.

The Home Affordable Modification Program (HAMP) was launched in early 2009 with the goal of helping 3 to 4 million borrowers avoid foreclosure. So far fewer than one million borrowers are in permanent modifications, and default rates on these modifications are high.

By Javier E. David

If consumers have noticed their utility bills falling, it may not be a figment of their imagination. Although surging natural gas production in the U.S. has yet to result in lower gasoline prices, it has had one benefit already: curbing or even cutting power costs.

By Javier E. David

If consumers have noticed their utility bills falling, it may not be a figment of their imagination. Although surging natural gas production in the U.S. has yet to result in lower gasoline prices, it has had one benefit already: curbing or even cutting power costs.

Generating electricity has been made more efficient because of inexpensive and abundant natural gas. The shale gas boom in the U.S. has left the world's largest economy awash in the power source, which is used by utilities to generate nearly 25 percent of U.S. electricity, according to data from the Edison Electric Institute.

Utilities have traditionally used coal to generate electricity, but the abundance of relatively inexpensive natural gas has given power operators an incentive to shift away from using the black rock, a key contributor to carbon dioxide emissions.

That has created an added benefit in both the residential and commercial use of electricity, observers say. The bounty of shale gas has helped contain electricity prices, which allows power companies to avoid having to pass along higher input costs to the average consumer.

According to a 2012 study by Resources for the Future, an independent research firm, the supply of natural gas "will substantially reduce retail electricity prices over the next 20 years."

Under various scenarios, the think tank expects the natural gas boom could help spur electricity savings of anywhere between 1.4 and 5.7 percent, depending on the year.

While the RRF says commercial customers will derive the most savings from lower costs – simply because of the sheer amount of electricity they use – all U.S. electricity users can expect to save at least $70 billion through 2020. Over the same time frame, residential consumers may save about $25.8 billion.

"As the price of natural gas falls, the cost of purchasing that natgas, or purchasing the power also falls," explained Jim Hempstead, senior vice president of global project and infrastructure finance at Moody's Investors Service.

"Utility companies, all else being equal, will pass on the savings to consumers in lower rates," he said, adding that electricity bills will be "slightly lower or more flattish."

The situation is a win-win for all, Hempstead added, because consumers get lower or stable electricity rates, companies can produce more electricity at lower costs, and regulators aren't forced to crack down on suspected price-gouging.

According to Donald Henschel, a senior market analyst at IHS, utilities that once used natural gas only for "peaking power plants" – operated at times during the day when energy usage was highest – have now switched to broader use of natgas.

Because natural gas is inexpensive, and easier to turn on and off than coal because of its composition, it helps to contain the costs passed along to consumers.

"With natural gas prices coming down so much it's a viable solution," Henschel said in an interview. "For base generation [times of the day when power is at an ebb], coal was historically a more affordable solution. Now with natgas so affordable, you can run combined cycle base load generation plants burning natural gas."

That transition is helped by the rising costs of burning coal, which is being made more expensive by regulations governing clean energy, he added.

There is a risk to that scenario, however. Henschel points out that natural gases could easily spike – which could easily put upward pressure on electricity costs and reverse the virtuous circle. This is not outside the realm of possibility, as natural gas prices have been trending upward since late last year.

By Jessica Silver-Greenberg

To retirees, the offers can sound like the answer to every money worry: convert tomorrow's pension checks into today's hard cash.

But these offers, known as pension advances, are having devastating financial consequences for a growing number of older Americans, threatening their retirement savings and plunging them further into debt. The advances, federal and state authorities say, are not advances at all, but carefully disguised loans that require borrowers to sign over all or part of their monthly pension checks. They carry interest rates that are often many times higher than those on credit cards.

In lean economic times, people with public pensions -- military veterans, teachers, firefighters, police officers and others -- are being courted particularly aggressively by pension-advance companies, which operate largely outside of state and federal banking regulations, but are now drawing scrutiny from Congress and the Consumer Financial Protection Bureau.

The pitches come mostly via the Web or ads in local circulars.

''Convert your pension into CASH,'' LumpSum Pension Advance, of Irvine, Calif., says on its Web site. ''Banks are hiding,'' says Pension Funding L.L.C., of Huntington Beach, Calif., on its Web site, signaling the paucity of credit. ''But you do have your pension benefits.''

Another ad on that Web site is directed at military veterans: ''You've put your life on the line for Americans to protect our way of life. You deserve to do something important for yourself.''

(Read More: Five Pays to Put More Cash in Your Pocket in 2013)

A review by The New York Times of more than two dozen contracts for pension-based loans found that after factoring in various fees, the effective interest rates ranged from 27 percent to 106 percent -- information not disclosed in the ads or in the contracts themselves. Furthermore, to qualify for one of the loans, borrowers are sometimes required to take out a life insurance policy that names the lender as the sole beneficiary.

LumpSum Pension Advance and Pension Funding did not return calls and e-mails for comment.

While it is difficult to say precisely how many financially struggling people have taken out pension loans, legal aid offices in Arizona, California, Florida and New York say they have recently encountered a surge in complaints from retirees who have run into trouble with the loans.

Ronald E. Govan, a Marine Corps veteran in Snellville, Ga., paid an interest rate of more than 36 percent on a pension-based loan. He said he was enraged that veterans were being targeted by the firm, Pensions, Annuities & Settlements, which did not return calls for comment.

''I served for this country,'' said Mr. Govan, a Vietnam veteran, ''and this is what I get in return.''

The allure of borrowing against pensions underscores an abrupt reversal in the financial fortunes of many retirees in recent years, as well as the efforts by a number of financial firms, including payday lenders and debt collectors, to market directly to them.

The pension-advance firms geared up before the financial crisis to woo a vast and wealthy generation of Americans heading for retirement. Before the housing bust and recession forced many people to defer retirement and to run up debt, lenders marketed the pension-based loan largely to military members as a risk-free option for older Americans looking to take a dream vacation or even buy a yacht. ''Splurge,'' one advertisement in 2004 suggested.

Now, pension-advance firms are repositioning themselves to appeal to people in and out of the military who need cash to cover basic living expenses, according to interviews with borrowers, lawyers, regulators and advocates for the elderly.

''The cost of these pension transactions can be astronomically high,'' said Stuart Rossman, a lawyer with the National Consumer Law Center, an advocacy group that works on issues of economic justice for low-income people.

''But there is profit to be made on older Americans' financial pain.''

(Read More: Bank Trick May Push Your Pension Into Murky Corner)

The oldest members of the baby boom generation became eligible for Social Security during the recent housing bust and recession, and many nearing retirement age watched their investments plummet in value. Some are now sliding deep into debt to make ends meet.

The pitches for pension loans emphasize how difficult it can be for retirees with scant savings and checkered credit histories to borrow money, especially because banks typically do not count pension income when considering loan applications.

''The result often leaves retired pensioners viewed like other unqualified borrowers,'' one of the lenders, DFR Pension Funding, says on its Web site. That, the firm says, ''can make the 'golden years' not so golden.''

The combined debt of Americans from the ages of 65 to 74 is rising faster than that of any other age group, according to data from the Federal Reserve. For households led by people 65 and older, median debt levels have surged more than 50 percent, rising from $12,000 in 2000 to $26,000 in 2011, according to the latest data available from the Census Bureau.

While American adults of all ages ran up debt in good times, older Americans today are shouldering unusually heavy burdens. According to a 2012 study by Demos, a liberal-leaning public policy organization, households headed by people 50 and older have an average balance of more than $8,000 on their credit cards.

Meanwhile, households headed by people age 75 and older devoted 7.1 percent of their total income to debt payments in 2010, up from 4.5 percent in 2007, according to the Employee Benefit Research Institute.

Financial products like pension advances, which promise quick cash, appear especially enticing because their long-term costs are largely hidden from the borrowers.

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Federal and state regulators are spotting fresh examples of abuse, and both the Consumer Financial Protection Bureau and the Senate's Committee on Health, Education, Labor and Pensions are examining these loans, according to people with knowledge of the matter.

Though the firms are not directly regulated by states, officials from the California Department of Corporations, the state's top financial services regulator, filed a desist-and-refrain order against a pension-advance firm in 2011 for failing to disclose critical information to investors.

That firm has since filed for bankruptcy, but a department spokesman said it remained watchful of pension-advance products.

''As the state regulator charged with protecting investors, we are aware of this type of offer and are very concerned with the companies that abuse it to defraud people,'' said the spokesman, Mark Leyes.

Borrowing against pensions can help some retirees, elder-care lawyers say. But, like payday loans, which are commonly aimed at lower-income borrowers, pension loans can turn ruinous for people who are already financially vulnerable, because of the loans' high costs.

By Mark Koba

The growing underground economy may be helping to prevent the real economy from sinking further, according to analysts.

The shadow economy is a system composed of those who can't find a full-time or regular job. Workers turn to anything that pays them under the table, with no income reported and no taxes paid — especially with an uneven job picture.

"I think the underground economy is quite big in the U.S.," said Alexandre Padilla, associate professor of economics at Metropolitan State University of Denver. "Whether it's using undocumented workers or those here legally, it's pretty large."

"You normally see underground economies in places like Brazil or in southern Europe," said Laura Gonzalez, professor of personal finance at Fordham University. "But with the job situation and the uncertainty in the economy, it's not all that surprising to have it growing here in the United States."

Estimates are that underground activity last year totaled as much as $2 trillion, according to a study by Edgar Feige, an economist at the University of Wisconsin-Madison.

That's double the amount in 2009, according to a study by Friedrich Schneider, a professor at Johannes Kepler University in Linz, Austria. The study said the shadow economy amounts to nearly 8 percent of U.S. gross domestic product.

Much of that money goes into cash registers, said Gonzalez, as personal consumption has risen since the recession.

"There is consumer spending in the short term, with people having money even if it's not reported, and that's boosting the economy," she said. "But in the long run, an underground economy is telling us that things have to change."

Shadow economies are usually associated with illegal activity, such as drug dealing. But anecdotal evidence indicates that off-the-books work in today's job market includes personal and domestic workers, such as housekeepers and nannies.

"The jobs are in service industries from small food establishments to landscaping." said David Fiorenza, an economy professor at Villanova University. "Even the arts and culture industry is not immune to working off the books in areas of music and entertainment."

It also includes firms that hire hourly or day construction labor, information technology specialists and Web designers. Many who have a job that doesn't pay enough take another one that pays under the table.

"We've always had people who make income without recording it, so it's not really new," said Peter McHenry, an assistant professor of economics at William & Mary College. "But the fact that more and more people are doing it shows how bad the job picture is," he added.

The reasons behind the underground economy's growth are fairly simple, according to Gonzalez.

(Read More: Spooked by Uncertainty, Little Main Street Hiring)

"There's a lot of uncertainly about immigration changes and who will be legal, and about paying for Obamacare," she said, adding that most workers in the shadow economy are in the country illegally. "Government rules are keeping businesses from hiring."

A report from ADP Research Institute states that many employers, especially in low-wage businesses such as retail and food service, plan to reduce workers' hours to less than 30 a week to avoid having to offer health benefits through Obamacare (or pay a fine).

"This type of regulation could put more people out of work and into an underground economy," McHenry said.

But employers have their own agenda, according to Padilla.

(Read More: Small Business Owners: Can I Get Some Cash Please?

"Businesses are not angels, and they exist to make a profit," Padilla said. "They are going to do everything they can to keep costs down, and if that means paying people off the books, they will do it. The government doesn't really have the resources to track down every business that does this."

What the government is keeping track of is lost revenues. According to the Internal Revenue Service, about $500 billion in taxes were lost last year because of unreported wages, versus $384 billion in 2001.

"The effects of the underground economy are larger than we think," said David Fiorenza. "The result is less tax money paid to the various levels of government."

"Those working and not paying the taxes puts the burden on those who pay the tax," added Fiorenza. "Taxes could be lower if the government where able to capture the underground economy instead of raising taxes on those currently paying the various income and payroll taxes."

But the dangers of a shadow economy go beyond dollars and cents, analysts said. Workers who aren't on the books don't get Social Security or health benefits, and worse.

"People who do these types of jobs run the risk of getting exploited with lower pay or not being paid at all," Gonzalez said. "There could be more exploitation if more people are forced into this type of economy."

"Some income is better than none, but there is a reason we have certain regulations in place to protect workers and what they do," McHenry said.

(Read More: Stealth Sequester? Where It's Really Being Felt)

In the end, what's happening below the normal economy should not come as too much of a shock, according to Gonzalez.

"People are running out of patience when it comes to finding a job and losing income," Gonzalez said. "So it's not that surprising to have workers take jobs that are in the shadow economy. But it's a sign of how bad things are and how we have to get the real economy moving again."

The U.S. will put into circulation a newly designed $100 bill in October that aims to thwart counterfeiters with advanced security features, the Federal Reserve said on Wednesday.

The new greenbacks still bear the portrait of Benjamin Franklin, the 18th century luminary who helped found the new American republic.

The changes in design are mostly in anti-counterfeiting features such as a blue three-dimensional security ribbon and alternating images of bells and the number 100 that move and change as the viewing angle is tilted.

The new notes, which cost slightly more to produce, also feature a bell image inside a picture of an inkwell that changes from copper to green when tilted, as well as a large "100" that does the same.

Under prior plans, the bill was supposed to enter circulation in February 2011, but "its introduction was postponed following an unexpected production delay," the Fed said in a statement.

The $100 note is the most frequently counterfeited denomination of U.S. currency outside the U.S., due to its broad circulation overseas.

The billions of older-design $100s already in circulation will remain legal tender after the new notes are released.

In recent years, U.S. officials have been trying to combat the continued production of extremely high-quality counterfeit $100 notes they say are produced in North Korea, dubbed the "supernote," which are undetectable to nearly all but the most sophisticated currency experts.

The Secret Service, the agency charged with policing the integrity of the nation's currency, maintains that only a tiny fraction of a percent of currency in circulation is counterfeit. But Secret Service officials have said they still encounter supernotes and other highly sophisticated fakes from overseas.

The new notes have been in development since 2003. The blue security ribbon is woven into the note's fabric—not printed on. Another security strip, visible to the left of Franklin's head when the note is held up to light, is embedded into the fabric. Like the old note, the new one has a watermark of Franklin's portrait, also visible when held up to light.

The old notes will be destroyed and replaced as they pass through the Fed system.

The dollar is the dominant currency used in international trade, and even serves as the primary currency in some countries. Officials have said as much as two-thirds of Federal Reserve notes in circulation are outside the U.S.

The Fed said officials will be "reaching out to businesses and consumers around the world" to educate them on how to identify the new bill.

For more information on the new design for the $100 bill, please see www.newmoney.gov.

By Mark Landler

The White House said on Thursday that American intelligence agencies now believed, with "varying degrees of confidence," that the Syrian government had used chemical weapons, but it said it needed conclusive proof before President Obama would take action.

The disclosure, in letters to Congressional leaders, takes the administration a step closer to acknowledging that President Bashar al-Assad has crossed a red line established by Mr. Obama last summer, when he said the United States would take unspecified action against Syria if there was evidence that chemical weapons had been used in the civil war.

The White House emphasized that, "given the stakes involved," the United States still needed "credible and corroborated facts" before deciding on a course of action. The letter, signed by the president's director of legislative affairs, Miguel E. Rodriguez, said the United States was pressing for a "comprehensive United Nations investigation that can credibly evaluate the evidence and establish what happened."