Posts Tagged ‘credit card debt’

Consumers Shun Credit Cards – Credit Card Usage Drops, Debit Card Usage Rises

Consumers Shun Credit Cards – Credit Card Usage Drops, Debit Card Usage Rises

Courtesy of Mish 

Part of a Credit Card

Consumers have had enough of high interest rates on credit cards but its a case of one plastic for another. Bloomberg reports Cardholders Prefer Debit as Credit-Card Use Falls

Americans are shunning their credit cards and using debit to avoid incurring more debt, said Javelin Strategy & Research.

Total payment volume for debit cards surpassed credit-card volume for the first time in 2009 and will continue to eclipse it in 2010, according to a report released today by the Pleasanton, California-based market-research firm that specializes in financial services.

At San Francisco-based Visa Inc., the world’s biggest payments network, the total payment volume for debit cards increased by 7.9 percent in 2009 to $883 billion as credit-card volume declined by 7.3 percent to $764 billion. Volume for debit cards at No. 2 MasterCard Inc. in Purchase, New York, rose by 5.8 percent and 2.8 percent at No. 4 Riverwoods, Illinois-based Discover Financial Services.

Fifty-six percent of consumers said they had used a credit card in the past month compared with 87 percent who said they had in 2007, according to the study, which surveyed 3,294 people in November 2009 for that question. Other findings were based on data collected online from 5,211 respondents in March 2010 and 5,000 consumers in November 2009. If the rate of decline continues, 45 percent of consumers will reach for a credit card in 2010, the study said.

Long-Term Shift

Another cause for reduced credit-card use is financial reform aimed at protecting consumers, which has decreased the number of new cards given and cut available spending limits, the Javelin report said. Federal legislation that limits overdraft fees, caps on fees banks charge merchants for debit-card transactions and credit-card legislation mean banks have to recoup losses and are only giving cards to the most creditworthy borrowers, the study said.

Younger people also favor debit over credit because of the immediate nature of making a payment, which means the shift to debit will be long-term, said Van Dyke. And since younger cardholders favor the convenience of debit cards, they won’t turn to cash or checks, he said.

Purchase transactions generated by credit and debit cards in the U.S. totaled more than 27 billion from Jan. 1 through June 30, according to the Nilson Report, an industry


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More good news: record high credit card defaults

Courtesy of Tyler Durden

More good news: record high credit card defaults

No, seriously – this is actually good news. The basic problem was an overleveraging across all sectors of the economy and this is good news because the US consumer unequivocally needs to deleverage before a recovery can be viable. The choice has always been simple if you owe too much money: declare bankruptcy, inflate your way out of it or find a sucker to help you roll it until you can pay it off.

 
The inflation part is both politically and socially intractable (pop quiz: what do the AARP and the largest Communist nation in history agree on?) – the level of inflation needed to devalue our debt would start approaching historical levels. Maybe not as bad as Weimar Republic or Zimbabwe levels, but significant enough to really hurt.
 
Pitching increased capital suckage into the US economy until we can slowly repay our debt back also doesn’t seem like a great option. The pitch may go well and the capital may be out there but inherently it assumes a level of self-restraint and foresight that is laughably distant from our American democracy. When we are still wasting billions on Cold War weapons, it is tough to believe that as a nation, we will patiently delever.
 
In practicality, as always, the answer will be some combination of the three options. Bankruptcy is tremendously traumatic on a personal level, not to mention the lasting effect that it has on your credit score and the waterfall effects of that. However, on a macro level it is good and serves a very practical purpose – it wipes out debt, allows the economy to bounce back rather than stagnate in zombie land and punishes lenders for making stupid decisions. Some may argue that it makes debt more expensive – we would argue it more accurately prices money going forward. Which would you rather have?

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Zero Hedge

GM Considers Expanding Into Electric-Flying Air-Taxis

Courtesy of ZeroHedge View original post here.

Like an elderly man wobbling into a party and trying to fit in with young kids by using "hip new lingo", General Motors - days after seeing its partnership with Nikola come under fire - has now come out and said it is going to now be exploring options in the "aerial taxi" market. 

This is, of course, a market that hardly exists. But it certainly sounds cool, doesn't it?

GM will be looking...



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Phil's Favorites

The Fed Announces New Bank Stress Tests: Will Look at What Would Happen if a Major Counterparty Defaulted

Courtesy of Pam Martens

Randal Quarles, Vice Chairman for Supervision, Federal Reserve

At the time the Fed released the results of its bank stress tests in June, it announced that because of the pandemic and unprecedented economic downturn, it would require additional stress testing of the biggest banks later this year. This afternoon, the Fed released those plans.

Among the various hypothetical scenarios that the banks will have to perform against, 13 of the banks with significant trading operations will have to consider what would happen if a major counterparty blew up. The banks that will have to submit outcomes under ...



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ValueWalk

GoodRX (GDRX) S-1 Breakdown Analysis

By Alex. Originally published at ValueWalk.

GoodRX (GDRX) filed their S-1 earlier this week. I read It so you don’t have to (but you should). Here’s a thread on what I found interesting, fascinating and down-right incredible from the company. I’m starting at zero. Follow along here.

Q2 2020 hedge fund letters, conferences and more

GDRX Facts & Figures
  • # 1 most downloaded medical app
  • 4.9M Monthly Active Users
  • 80%+ Repeat Activity
  • $20B+ in Consumer Savings
  • 150B daily pricing data point...


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Politics

Faked videos shore up false beliefs about Biden's mental health

 

Faked videos shore up false beliefs about Biden's mental health

Joe Biden faces a disinformation campaign promulgating the false notion that he is in cognitive decline. Gage Skidmore/Flickr, CC BY-SA

By Dustin Carnahan, Michigan State University

From Ronald Reagan in 1984 to Bob Dole in 1996 and even ...



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Kimble Charting Solutions

Gold Breakout Triggers Buy Signal, Is $3000 Next Target?

Courtesy of Chris Kimble

90-days ago this cup & handle pattern was discussed on See It Market when Gold was trading at 1717.

Fast-forward to today and Gold is up 15 percent. So it’s time for an update!

As we pointed out 90-days ago, the initial price magnet for the rally was the 261.8 Fibonacci extension that marked the 2011 high at (1).

That high has served as price resistance for nearly 9 years! …But it may be ...



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Biotech/COVID-19

Smoke from wildfires can worsen COVID-19 risk, putting firefighters in even more danger

 

Smoke from wildfires can worsen COVID-19 risk, putting firefighters in even more danger

Firefighters have battled camp crud before, but COVID-19 brings new risks with the potential for heart and lung damage. Robyn Beck/AFP/Getty Images

By Luke Montrose, Boise State University

Two forces of nature are colliding in the western United States, and wildland firefighters are caught in the middle.

Emerging research suggests that ...



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Chart School

Gold Gann Angle Update

Courtesy of Read the Ticker

Golds bullish trend has worked well in 2020, so what is next over the immediate 3 to 6 months? Will we continue to see a golden future.

The US dollar had been strong into COVID 19, since then the FED has printing a lot of money, and they are also considering YCC (Yield Curve Control), last seen during WW2. [Note YCC lasted 9 years over WW2. WOW, that is a lot of money printing.]

The FED is now forecast to over take competing central banks balance sheets in size, and the release valve will be a falling US dollar. Therefore we should continue to see the US dollar maintain is slow leak down over the next 3 to 6 month, say on the DXY 82 to 88. 

Also, US election worries will add to the weakening of the dollar. Of course extreme chaos in W...

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Digital Currencies

Cryptocurrencies Rarely Used To Launder Money, Fiat Preferred

Courtesy of ZeroHedge View original post here.

Authored by Shaurya Malwa via Decrypt.io,

Traditional channels continue to dominate the estimated $2 trillion global money laundering racket instead of cryptocurrencies, a report says.

In brief
  • Money laundering via cryptocurrencies is not a preferred tool for criminals, a report said...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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