Quote of the Month:
"Visa, USA reports that for the first time the number of purchases with debit cards outpaced the purchases made with credit cards."
| Forecasts & Statistics |
| Product Trends |
| Industry Trends |
| Issue Archive |
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| Consumer Sentiment Hits New Low |
| The University of Michigan's preliminary index of consumer sentiment in late October fell to 80.6, its lowest level in 10 years, down from 86.1 in September and 87.6 in August. In his monthly report, the Director of Michigan's Surveys of Consumers, Richard Curtin, noted that a combination of factors were responsible for the slide, including a slowing economy, lower household wealth and saber-rattling talk of an impending war with Iraq. |
| Small Business Owners Foresee Slow "Jobless" Recovery |
| The September survey of small business conducted by the National Federation of Independent Business (NFIB) found that owner optimism was pretty much unchanged from the previous month. Small business owners don't expect a double-dip recession, but also aren't expecting robust growth. |
| Wide Fluctuations in our Personal Saving Rate |
| In recent years, the personal saving rate in the United States has fallen significantly below earlier levels and in relation to other industrialized countries. What is behind this startling change? In his bank's Economic Letter, Milt Marquis, Senior Economist of the Federal Reserve Bank of San Francisco, provides an excellent analysis of the dramatic change. |
| Student Loan Delinquencies |
| The U.S. Secretary of Education has announced that the national student loan default rate was 5.9 percent for fiscal year 2000, a "historically low" level. |
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| Credit Scores for Insurance Applications |
| Now that FICO risk scores are being disclosed to borrowers to help them understand how the market assesses their creditworthiness, the next challenge appears to be convincing consumers and regulators that such scores are valid for insurance transactions. The use of credit scores by insurance underwriters is widespread but poorly understood by the general public. |
| The Shape that Credit Cards Are In |
| Tired of jamming those "big" [3 3/8 in. x 2 18 in.] credit cards into your purse or billfold? Do not despair. Help is on the way. Bank of America is offering one million of its Visa credit cardholders a "mini-card" that is one-half the size of current credit cards. |
| Debit Cards Outpace Credit Cards |
| Visa, USA reports that for the first time the number of purchases with debit cards outpaced the purchases made with credit cards. Visa has a good deal of evidence, since it processed 3.04 billion debit card transactions in the first half of this year and "only" 2.96 billion credit card transactions. |
| Electronic Commerce Update |
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| Delinquencies and Charge-Offs of Bank Credit Cards |
| The Federal Reserve Board publishes two quarterly releases covering, among other items, seasonally adjusted delinquencies and charge-offs of bank credit cards. Delinquent accounts are defined as those that are past due thirty days or more and accruing interest and those in non-contractual status. |
| The Realities of 0% Financing |
| We have seen the prevalence of 0% financing for the purchase of new cars. Let us consider its effect on consumers who buy new cars and trade in their used cars, as explained by Karen Lundegaard in her recent article in the Wall Street Journal. |
| Outstanding Debt Collectors |
| Are you looking for debt collectors who are "efficient, polite and, above all, they love their jobs"? Moreover, "they are the most eager learners you'll ever find." Working as a customer service representative is a prized job. In working at their job, they have "an overwhelming desire to learn how to do things right." |
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| Future Legislation |
| Legislation often follows public meetings, conferences, etc. where issues that may require legislation are discussed. The Consumer Federation of America, which has been an advocate of consumers' interests for many years, is sponsoring a conference in Washington D.C. on December 5 and 6: "The Consumer Financial Services Revolution." |
| Effect of Predatory Lending Laws on Mortgage Credit |
| In a thoughtful article in the Wall Street Journal, Patrick Barta examines the effect of anti-predatory lending laws on mortgage credit. He bases his analysis on an anti-predatory lending law in Georgia that took effect on October 1, 2002. The legislators' intent was to bar "unwarranted fees," and "unfair interest rates for unsophisticated borrowers." |
| Household Settles Major Litigation |
| Household International has reached a settlement with about a dozen states to settle charges of "predatory lending." The payments, totaling $484 million, would be paid into restitution funds in each state. |