Money Minute: Minimum Wage Hike a Job Killer? Coffee Prices Perk Up

The Congressional Budget Office weighs in on the increasingly heated debate over raising the minimum wage.

The CBO is considered to be an important non-partisan voice in many policy debates. Its report on raising the minimum wage to $10.10 an hour offers ammunition to both proponents and opponents. The CBO says it would help lift 900,000 families out of poverty and increase incomes for 16.5 million people, but it would also lead to the elimination of about 500,000 mostly low-wage jobs.

Critics of the Obama economic program point to the low number of Americans who are counted as being part of the workforce, saying it indicates many people are so frustrated that they've stopped looking for a job. %VIRTUAL-article-sponsoredlinks%But a deeper look at the numbers by the outplacement firm Challenger, Gray & Christmas finds almost all of the decline comes from teens. It says that trend started well before the recession began. And most of those teens aren't dropping out because of a lack of opportunity. Challenger says they don't want to work -- partly because of all the other activities they're involved in.

You might need some of extra change in your pocket to buy that morning cup of joe. The price of coffee futures soared by 10 percent Tuesday, the biggest one day gain in almost a decade. If prices go up at the retail level, you can blame a severe drought in Brazil.

Here on Wall Street, the Dow Jones industrial average (^DJI) lost 24 points Tuesday, but the Standard & Poor's 500 index (^GPSC) edged up by 2 points and the Nasdaq composite (^IXIC) rose 28, stretching its win streak to eight straight sessions.

In merger news, two mall-based jewelry chains are combining. Signet Jewelers (SIG), which owns Kay Jewelers, has agreed to buy Zale (ZLC) for $1.4 billion.

First Ford (F) shocked pick-up lovers by saying it will build next year's F-150 with aluminum, not steel. Now, the Wall Street Journal reports that General Motors (GM) will do the same with its Chevy Colorado and GMC Canyon. Both companies are trying to improve truck fuel economy.

-Produced by Drew Trachtenberg.