Economic cracks, consumer credit and sentiment, jobless claims, no-show fees, your credit card, and summer travel.
Another crack in the economic concrete
You may recall that the last few weeks have been all about expectations. What did this week bring?
Consumer Credit was expected to increase to $14.8B. It only increased by $6.3 billion.
Initial jobless claims were expected to be 214,000 for the week. It came in at 231,000.
Consumer sentiment was expected to come in at 76, down slightly from the previous month's 77.2. It came in at 67.4.
Most of the drop in consumer sentiment was the belief that prices, jobs, and interest rates would not be going in the right direction.
Since the Fed is focused on jobs and prices, the consumer credit number, while nice, is more of a sidebar. The big number was the increase in jobless claims, up from the previous week of 209,000.
So, in the last couple of weeks, we have had new jobs come in much lower than expected and now you have unemployment claims come in higher than expected.
That might be a crack in the concrete and the Fed will keep a close eye on that.
No Show Fees
What are these?
It’s what your personal trainer, salon, or even housekeeper may charge you for canceling on them without appropriate notice.
And restaurants, too.
It is so much easier for everyone to get your credit card number when you “book” something online and you glide right by the “Terms & Conditions” box as you check that you’ve “read and understand” it all.
Buried in there may be a condition that you agree to pay a nominal fee if you don’t show up.
Conversely, as a small business owner, you may think about inserting that into your terms and conditions when someone books a time with you.
Then if they don’t show up, you have the capability of charging them something.
If you’re the one who’s been charged, you may be irritated, but you also didn’t show up or called to cancel within 24 hours or whatever the “condition” might be.
What are the odds of disputing the amount with your credit card company?
Silly me, I misspoke. The odds of disputing it are high; it’s the odds of getting your money back that may not be as high.
But we’ll talk about that in the next section.
Changes to your Credit Card Account
From time to time, you may receive a letter from your credit card purveyor with a variety of updates to the do’s and don’ts of your credit card.
This past week, I got one from USAA, which is the main credit card we use.
So, evidently having nothing else to do at the time, I perused it.
My card can only be used for personal expenses, no business purchases. Interesting; I did not know that. I’m not sure what the penalty is, but it’s a no-no.
And you can’t use it for illegal purchases, such as your local meth dealer, assuming he has a merchant account to accept cards. But if you do, you are still liable for the amount. That’s good news for your local meth dealer.
Balance Transfers, Cash Advances, and Convenience Checks: I really don’t care since I use none of those products, but there were many rules. You should probably know what they are if you do those sorts of things.
Foreign Transactions: “The card network or the merchant does the foreign exchange calculation, so don’t come crying to us when you don’t like the exchange rate.” Well, perhaps not those exact words, but the intent was certainly there.
If I am not happy with a credit card purchase and the merchant won’t refund me my money, I can appeal to USAA with the following conditions:
The purchase must be more than $50. I guess if it’s under $50, I’m out of luck.
And if that “no show” fee was under $50, it’s probably pretty tough to argue a refund – see previous section.
The purchase must be made in my home state or within 100 miles from my address.
Better not be on a road trip out of state.
You must have made the purchase with your card; no courtesy checks, please.
I mention all of this since many of us are unaware of the particulars that come with our credit cards.
You should always know the rules of any financial products you use, including your checking account, home loan, business loans, and others.
Summer Travel
Travelling to Europe this Summer?
Why not? There are three great reasons to do so:
Paris Olympics: July 26 to August 11
The Euro Cup: June 14 to July 14 – this is a HUGE quadrennial soccer tournament in Europe.
Taylor Swift tour: May 9 to August 20; she will be all over Europe during this time so watch out for the Taylor Swift inflation effect.
It is also a phenomenal time to get the value of the dollar. As I write this, 1 Euro can be exchanged for $1.08 USD. When I went there 15 years ago, it cost me $1.58 USD to buy a single Euro. So a hotel that cost 120 Euro was the equivalent of $189.60 USD.
It’s also a great time to buy stuff there and ship it back here.
The bad news is that a lot of folks may recognize that it’s a great time to go there, meaning a lot of crowds. And you’ll be competing with the Swifties and the sports fans.
Or you can make your plans for September when a lot of folks are back in school.
And speaking of summer, It’s the middle of May and we are almost hitting the summer selling season. This is to say, the time when your prospects tell you to call back after Labor Day. Don’t fall for that. If they are telling that to all of the folks hitting them up for a meeting, then they actually have more time for meetings. It’s your job as a business owner or sales professional to help them make the time to meet with you.
Make it so!
