Rising incomes doesn’t people spend a lot more

United States financial numbers for May 2010 are in, and according to Bloomberg Business, individual incomes outpaced consumer spending. This made it possible for households to boost their savings and support the economic recovery, although how slower spending boosts the nation’s economic recovery is the question. It might be viewed as one more instance of reporting sleight of hand, which is similar to the way U.S. unemployment numbers were being reported for the past few months.

Article resource: Consumer spending fails to keep pace with rising incomes by Personal Money Store

Where the money needs to go – consumer spending

Reports show that people should be putting money into consumer spending. Americans are working longer, salaries are trending upward, and payroll numbers are up. Then again, it was reported by Bloomberg in an additional story the large number of jobless in The United States actually lowers salaries as there are so many applicants (supply and demand), so perhaps one hand doesn’t know what the other is doing in Michael Bloomberg’s domain. No matter what the case really is, the Federal Reserve has kept interest rates steady, so fewer folks may have to dive into the nearest cheap personal cash loan bunker to make ends meet.

Recovery not propelled by consumer spending

However, as RBS Securities economist Omar Sharif (not the bridge-playing actor) told Bloomberg, the level of consumer spending should be enough for sustained growth, but not enough to drive recovery efforts. Yet despite underwhelming growth in consumer spending, numbers nevertheless beat the median estimate of 61 economists surveyed by Bloomberg (.1 percent gain). Wages were up .5 percent (1.3 percent since March), which was the largest increase over three months given that December 2007 when the current recession is believed to have begun, and individuals looked to the easy loan a lot more often than before. As a result, savings increased considerably: 4 percent from April into May (somewhere around $ 454.3 billion). That’s the highest such increase in a single month since September 2009, reports Bloomberg.

It mostly is good news

According to Sal Guatieri of BMO Capital Markets, American consumers have rolled with the punches. ”As long as jobs are coming back, people will continue to spend,” he explained to Bloomberg. Paying down debt like from debt that comes from a personal cash loan and rebuilding savings are admirable financial goals that will continue to see improvement as good economic factors continue to emerge.

A lot more info about this topic at these websites:

Bloomberg Business

businessweek.com/news/2010-06-28/u-s-economy-income-gains-boost-spending-savings.html

Bloomberg (lower salaries)

bloomberg.com/news/2010-06-27/jobless-produce-u-s-investor-profits-on-productivity-with-less-inflation.html

Consumer spending from the Fox Business point of view:

youtube.com/watch?v=xmK9gC2nW0Y

Notifying credit card holders of interest rates in front of Supreme Court

The Supreme Court will be hearing a new case that questions the responsibilities and rights of credit card holders and lenders. McCoy v. Chase Manhattan Bank, USA, will be heard by the Supreme Court during its next session, which begins in October. The class action suit questions the ability of credit card companies to retroactively increase interest rates without notification of the cardholder. The card issuer is claiming that there was notification – in the initial card holder agreement that was signed.

Article Source: U.S. Supreme Court to consider credit card notification by Personal Money Store

The case of the credit card holder

James A. McCoy alleges that Chase Manhattan Bank violated the law when they increased the rate on his credit card. After McCoy missed a credit card payment, Chase bank retroactively upped the interest rate on that month's transactions. McCoy had agreed to this increase by signing the cardholder agreement, but he did not receive separate notification of the increase. The allegation is that this modification without notification is illegal under federal law.

The case of the credit card issuer

Chase-Manhattan Bank appealed a lower court decision on this case to the Supreme Court, saying the Truth in Lending Act was complied with in this case. The TILA does require that these short term lenders deliver written notice of changes in the interest rates on cards. Chase bank points to one provision that excepts items previously agreed to in the cardholder agreement. Essentially, the debate comes down to interpretation versus ambiguously written laws.

Provisions for late payments in the agreements

A late credit card payment started this whole Supreme Court case. The Truth in Lending Act aims to make the unsecured loan companies that offer credit cards more transparent in what they are charging consumers. What's your opinion: are cardholders responsible for reading and remembering the whole agreement, or should card companies be required to notify them of everything?

House Dems seek auto dealer exemption from financial reform

The Hill blog reports that 62 House Democrats are urging lawmakers to pursue an auto dealer exemption in light of upcoming financial reforms being considered by the Consumer Financial Protection Agency (CFPA). The movement, which was actually organized by New York Reps. Bill Owens and Mike McMahon, goes against the wishes of the White House, Defense Department and Treasury Department. It would shield auto finance companies from CFPA oversight and allow auto dealers to maintain the freedom to set lending rates and continue to utilize industry-standard lending practices. Auto dealers will only be able to continue offering dealer-assisted financing if the rules are kept to a minimum, argue pro-auto industry groups.

Resource for this article: House Dems seek auto dealer exemption from financial reform by Car Deal Expert

Is it about helping customers – auto dealer exemption?

As reported by BNet.com, the proposed auto dealer exemption from CFPA financial reform may save dealers money and allow them to pass the savings on to consumers in the form of lower auto finance rates, but the potential dark side cannot be ignored. The auto finance industry as a whole is big business. There is a lot of evidence to suggest that potential gains from the subprime market have seduced auto dealers into lower their auto loans underwriting standards. Their fee structures have also drawn the attention of the Better Business Bureau on numerous occasions, says the National Consumer Law Center.

Giving auto dealers an unfair advantage over other lenders

An auto dealer exemption would give dealerships an unfair advantage over banks, credit unions and other auto loans outlets, according to BNet. As the CFPA would have the power to set rates for everyone outside of dealer-assisted finance circles if the exemption were to pass into law, car dealers could exploit this for their own gain. Finance groups would no longer be where customers could get the best deal. If a dealership were to close in a bad economy, they would also be able to violate any agreement terms more easily without CFPA supervision. A great example of this is failing to pay off existing loans on a trade in. Consumers deserve to have better protection than that, argues BNet; the FTC and government agencies already in place have proved insufficient in their efforts to stand up for Joe Car Buyer.

Dealer assisted financing is dominant and consumers are largely uninformed

The key to getting the best deal on auto loans is knowing that better options exist. The non-partisan Cambridge Winter Center for Financial Institutions Policy recognizes that “auto dealers actively market and price borrowers’ loans,” which is why there are so many consumers that buy into their product. A level playing field would probably make it easier for consumers to find the auto loans that are right for them, without worry of exploitation. Giving the Consumer Financial Protection Agency jurisdiction over auto finance would conceivably make that a reality.

Read more on this topic here

BNet.com

industry.bnet.com/financial-services/100010096/financial-reform-five-reasons-why-we-need-protection-from-car-dealers/

The Hill

thehill.com/blogs/on-the-money/banking-financial-institutions/103917-house-democrats-push-for-auto-dealer-exemption

President Obama’s initial call for financial reform:

youtube.com/watch?v=o-D3Pfa-ViY

28 million stinky cereal boxes affected by Kelloggs recall

A Kellogg’s recall of breakfast cereals was announced Friday after numerous claims that a noxious stench and offensive flavors encountered with several of the cereals caused diarrhea and vomiting in some cases. The Kellogg Business voluntarily recalled about 28 million boxes of breakfast cereals that it markets to kids.

Source of article: Kelloggs recalls cereals reported to cause vomiting and diarrhea by Personal Money Store

Kellogg's recall pulls 28 million boxes of cereal

The Kellogg’s recall involves about 28 million boxes of Apple Jacks, Corn Pops, Froot Loops and Honey Smacks. The Associated Press reports the company volunteered to pull the cereals off the shelves because a “waxy” smell and flavor coming from the package liners could make people sick. About 20 individuals have complained, including five who reported nausea and vomiting, said Kellogg spokesperson J. Adaire Putnam.

Froot Loops – not so smart a choice

The Kellogg’s recall contains Froot Loops, a cereal brand that has been the subject of a few controversies. Foodpolitics.com reports that Froot Loops had been reformulated to contain 3 grams of fiber to win an endorsement from the American Society of Nutrition (ACN), which is manages the Smart Choices program. It's reported that ACN collects $100,000 from Kellogg's and other companies to authorize the Wise Choices seal on cereal products. As a wise nutritional choice, Froot Loops contain no fruit, are 41 percent sugar by weight, deliver 44 percent of the calories with sugar and are made with trans fat, a substance proven to increase the risk of coronary heart disease.

USDA keeps within the loop

In an article about the Kellogg's recall within the Wall Street Journal, Putnam said the nauseating smells and flavors originated in the plastic bags holding the cereal. In late March following the bags hit the market, complaints started to mount. A spokesman for the U.S. Food and Drug Administration said the company initiated the recall and notified the agency.

Who to call about the Kellogg's recall>

Consumers can contact Kellogg at 888-810-4163 from 8 a.m. to 8 p.m. Eastern time to learn a lot more about the recall or get a refund. The business said products marked with the letters "KN" following the "better if used before" date are part of the recall.

More details accessible at these sites:

www.google.com/hostednews/ap/article

Foodpolitics.com

wsj.com

Ireland and recession are nevertheless well-acquainted

It seems like yesterday that Ireland was in recession and losing jobs at the rate of one every five minutes. Yet according to the Wall Street Journal, a 2.7 percent bump in GDP as it relates to Ireland’s export market is an official sign of the end of recession. However, Ireland’s road to economic recovery remains long. One of the hardest-hit euro zone countries in the recent global recession, Ireland’s GDP had fallen by more than 14 percent entering 2010. As the New York Times indicates, a tremendous deficit and 13 percent unemployment have prompted Irish Prime Minister Brian Cowen to warn that there’s no easy way out of the economic quagmire.

Post resource: Has Ireland exited the recession? A quick fix seems unlikely by Personal Money Store

Investors’ role in Ireland and the recession

Ireland’s recession has continued to roll on the wheels of high-priced benchmark bonds, writes the Times. This has given investors pause and has not reduced guaranteed loan borrowing, making it all the more difficult for Dublin to take care of business. Higher taxes, lower public salaries and the burst housing bubble have also stretched patience to the limit, yet Ireland remains steadfast in its goal of recapturing investor confidence without overindulging in low cost loans.

Hanging their hat on exports

Ireland attracted companies like Intel, Microsoft, Facebook and LinkedIn to address previous recessionary woes, but this time, the Irish government is depending upon an export revival, according to the Times. When lower public wages and energy costs may have helped somewhat, the fear that the export market won’t create enough jobs – not to mention fear for the falling euro – is very real, writes the Times. In fact, wage cuts have driven young workers away. They want quick cash, not the promise of a better Ireland in 10 to 15 years, when experts predict future infrastructure spending will resume.

Cowen worried about 2012

Ireland will escape recession via touch economic choices, says the nation’s government. But it will likely not happen fast enough for Irish voters within the next election. Prime Minister Cowen has promised the already slashed public salaries won’t go lower, but that may be a case of too little, too late. Irish voters might not be able to wait any longer.

Discover more information:

http://online.wsj.com/article/SB10001424052748703426004575338433422665358.html?mod=googlenews_wsj

http://www.nytimes.com/2010/06/29/business/global/29austerity.html?hp=&pagewanted=all

Operation Sunset - No body count, just dead jobs

Operation Sunset is going to place a rate cap on short-term loans that will drive those lenders out of business and out of the state. However, the Tucson Citizen reports, Arizona Attorney General Terry Goddard is prepared to mount a massive offensive against the supposedly heinous crimes of purveyors of easy personal loans. Part of that offensive is an information campaign informing Arizona citizens what is going to happen after Operation Sunset takes effect on July 1, 2010.

Article Source: Operation Sunset – No body count, just dead jobs by Personal Money Store

There was no surprise from operation sunset

Think about the phrase "operation sunset". As found on Wikipedia, the most popular use of the term refers to a bloody offensive during the Eritrean–Ethiopian War (1998-2000) where Ethiopia liberated the key town of Badme. Thousands of lives were lost, which makes it all the more disgusting that Arizona lawmakers chose to call the end of easy personal loans in their state “Operation Sunset.”

The sun always sets gradually, and Operation Sunset has been waiting in the wings for some time. Despite opposition that came from the check cash advance industry and the good word of consumers who wanted to make their own financial decisions rather than being spoon fed by the government, Operation Sunset will commence. ”Consumer loans with annual interest rates over 36 percent (plus authorized fees) will be illegal as of July 1, 2010,” according to the Attorney General’s office. Consumers with outstanding balances on fast personal loans will “probably not” be able to ignore those charges as of July 1, says the AG. Yet the Attorney General who equates the end of easy personal loans in Arizona with a campaign from a bloody African war does not go into detail on their informative website as to what “probably not” means. What is clear, however, is that amounts due cannot be rolled over into other loans during the Operation Sunset cam! paign. Rollover isn't a good idea.

Whistleblowers should blow

Reputable check cash advance companies abide by the laws of the land regarding their products. However, Goddard advises consumers via the Tucson Citizen that if they see any kind of stray businesses continuing to offer the same products that were outlawed by Operation Sunset, they should then inform the Operation Sunset Enforcement Team. They can very easily be contacted at operationsunset@azag.gov and (866) 879-5219 (866) 879-5219 (866) 879-5219, or by writing to: Arizona Attorney General's Office of Consumer Complaints, 1275 W. Washington St., Phoenix, AZ 85007.

The beloved check cash advance cry

Consumers can use the AG’s website to figure out which lenders are actually currently licensed in Arizona. {In the event that credit counseling is necessary for consumers who have overextended themselves, they can call (202) 514-4100 or choose an agency licensed by the U.S. Trustee|In the event that credit counseling needed, they can call (202) 514-4100 or choose an agency licensed by the U.S. Trustee|In the event that credit counseling is necessary for any of those consumers who have overextended themselves, they can call (202) 514-4100 or choose an agency licensed by the U.S. Trustee.

Additional information at these websites

Wikipedia

en.wikipedia.org/wiki/Eritrean%E2%80%93Ethiopian_War

Tucson Citizen

tucsoncitizen.com/hot-off-the-press-release/2010/06/23/ag-answers-questions-about-payday-loan-law-sunsetting-next-week/

Arizona AG on Operation Sunset:

youtube.com/watch?v=hhKKqSt0mCE

Rodolfo Torre slaying puts many spotlight on peso, border security

The recent assassination of Rodolfo Torre has proven once a lot more the northeast Mexican state of Tamaulipas is not only a flash point in Mexico’s drug war, but of great concern in the ongoing battle for U.S. border security. It was reported by Reuters that Torre – an opposition candidate representing the Institutional Revolutionary Party (PRI) – was slain along with four of his aides in the border town of Valle Hermoso. The responsible party of 16 hooded gunmen is believed to represent the notorious Los Zetas gang.

Post resource: Rodolfo Torre slaying puts spotlight on peso, border security by Personal Money Store

Border security agents and investors worried about Rodolfo Torre's killing

Mexico’s drug war has claimed a lot more than 25,000 lives since 2006, when violent gun battles began spilling to the streets, but Rodolfo Torre’s death is allegedly the largest-scale example to date of a drug cartel attempting to influence Mexico’s politics. Tourists are reportedly avoiding Tamaulipas and foreign investors have bailed on the peso in extremely big numbers. Reuters indicates that its recent position at 12.71 per $ 1 U.S. was .46 percent weaker. Televised images of Rodolfo Torre’s body in the media don't seem to help to reverse this trend. In addition, local stocks remained flat as all of this news out of the recent G-20 summit point toward an end to fiscal stimulus in the region.

Border security is influencing Mexico’s credit picture

The Wall Street Journal reports that Credit Suisse has had some positive things to say about Mexico’s financial condition. Particularly, Credit Suisse decided to praise the nation’s “record or near-record low yields on government debt,” and pointed out that Mexico’s central bank is enjoying a level of inflation that rests within what experts consider to be a comfort zone. Lately the inflation level has ranged from 2 to 4 percent. Also, Credit Suisse believes that Mexico’s recovering growth is, “as good as it gets.”

Creditors are given pause by Mexico's ongoing drug war. ”The violence problem seems to have worsened notably in 2010, with the number of drug-related killings making new highs, and with organized crime defying the state a lot more openly than ever before,” Credit Suisse explained. “We aren’t sure this is as bad as it gets on the security front, sadly.”

Washington is watching closely

The United States seems to be noticing. The death of Rodolfo Torre appears to be just a stone’s throw from American soil has the U.S. on alert. Border security against bold drug cartels just a small measure in American politics, from the president’s funding of additional forces to the ongoing immigration debates. While Los Zetas might not represent all illegal traffic that crosses the U.S. border, their actions do little to dissuade states like Arizona from abandoning their own bold stance against the risks of illegal immigration.

Discover a lot more about this topic here:

Reuters

reuters.com/article/latestCrisis/idUSN28512369

Wall Street Journal

online.wsj.com/article/BT-CO-20100628-709931.html

Wikipedia

en.wikipedia.org/wiki/Los_Zetas

Rodolfo Torre campaign video (en Español):

youtube.com/watch?v=FqAtnZ6B5BE