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Hier — 27 mars 2024Flux principal

Visa and Mastercard Agree To $30 Billion Settlement Over Credit Card Fees

Par : msmash
27 mars 2024 à 12:00
Two of the world's largest credit card networks, Visa and Mastercard, as well as the banks that issue cards with them, have agreed to settle a decadeslong antitrust case brought upon by merchants. From a report: The settlement is set to lower swipe fees merchants pay when customers make purchases using their Visa or Mastercard by $30 billion over five years, according to a press release announcing the settlement Tuesday morning. The settlement, which only applies to US merchants, is the result of a lawsuit filed in 2005. However, nothing is considered finalized until it receives approval from the US District Court for the Eastern District of New York. Even then, the case can also be appealed in what could be a lengthy battle. Typically, swipe fees cost merchants 2% of the total transaction a customer makes -- but can be as much as 4% for some premium rewards cards, according to the National Retail Federation. The settlement would lower those fees by at least 0.04 percentage point for a minimum of three years. Additionally, the settlement would require Visa and Mastercard to maintain the swipe fee rates that existed as of December 31, 2023 for five years.

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À partir d’avant-hierFlux principal

Why Do People Let Their Life Insurance Lapse?

Par : msmash
20 mars 2024 à 17:20
The abstract of a new paper published on Journal of Financial Economics: We study aggregate lapsation risk in the life insurance sector. We construct two lapsation risk factors that explain a large fraction of the common variation in lapse rates of the 30 largest life insurance companies. The first is a cyclical factor that is positively correlated with credit spreads and unemployment, while the second factor is a trend factor that correlates with the level of interest rates. Using a novel policy-level database from a large life insurer, we examine the heterogeneity in risk factor exposures based on policy and policyholder characteristics. Young policyholders with higher health risk in low-income areas are more likely to lapse their policies during economic downturns. We explore the implications for hedging and valuation of life insurance contracts. Ignoring aggregate lapsation risk results in mispricing of life insurance policies. The calibrated model points to overpricing on average. In the cross-section, young, low-income, and high-health risk households face higher effective mark-ups than the old, high-income, and healthy.

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One Year Later, 81% of SVB's Clients Still Bank With Them - and Big Banks Got Bigger

Par : EditorDavid
10 mars 2024 à 17:34
One year after Silicon Valley Bank's collapse and seizure, "Regional bank stocks remain volatile compared to other types of financial institutions," reports the Observer, "indicating investors' lingering worries about the sector." But not everyone suffered: Benefiting from the crisis were big players, like JPMorgan Chase. After acquiring First Republic's $212.6 billion in loans and $92.4 billion in deposits for just over $10 billion in May 2023, JPMorgan saw a 67 percent year-over-year growth in profits that quarter. Overall, larger commercial banks saw inflows as customers sought safer institutions to hold their money. And what happened to Silicon Valley Bank? Axios reports: Today, SVB says it's still the same bank customers loved, but with better risk management and some other tweaks, like smaller deposit requirements for startup borrowers, president Marc Cadieux told Axios last month. 81% of SVB's clients from a year ago are still banking with SVB, according to Cadieux, with "thousands of them" returning after initially switching out... "I think there was an inference that this was a regional bank crisis, but it really wasn't — those were niche banks," Citizens CEO Bruce Van Saun tells Axios. "The failure was is in governance and the business model." Citizens is America's 14th largest bank, and as its CEO, Van Saun was asked by CNN what caused 2023's failures at other banks: CEO Van Saun: Both of those banks [Signature Bank and Silicon Valley Bank] went from $50 billion in assets to over $200 billion in four years. They grew too fast, took in a high percentage of uninsured deposits, had very concentrated, narrow customer bases so they were susceptible to [deposit] flight risk. They also borrowed short and invested long, which is a cardinal sin of banking. They didn't manage their interest rate risk well because they didn't have the muscle that you would have if you grew slowly over the years and were heavily regulated like bigger banks like ourselves. CNN: Who deserves more blame: failed banks' management teams for not ensuring proper guardrails were in place or financial supervisors whose jobs are to identify red flags? Van Saun: It's a joint failure... CNN: [W]hat about commercial real estate? The number of people working in offices is much, much lower than it was pre-pandemic. Are you bracing for another chapter of banking stress? What is Citizens doing to cushion against potential high losses in the sector given close to one-fifth of your loans are there? Van Saun: You have to look under the covers. The nature of our portfolio matters. Within commercial real estate, industrial, warehouse and distribution space is fine. Multi-family homes are generally fine. When it comes to offices, we have certain pockets of life science businesses like lab research facilities that are super safe because they never had to close during Covid. [Loans to general office buildings are riskier though, he said.] We go through all of that and we say we'll lose some money here, but we're not going to lose our shirt and we've put up big reserves against them. We're working on a loan-by-loan basis with our most senior people. I think it's a well-managed process.

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Zurich Paid 30,000 Workers Double In $200 Million Bank Glitch

Par : BeauHD
28 février 2024 à 13:00
An anonymous reader quotes a report from Fortune: Zurich authorities have apologized to city employees after a technical glitch caused a double payment of monthly salaries that local officials are now trying to claw back. About 175 million francs ($200 million) was sent in error on Monday, which was the payday for February, according to a statement. Workers can't keep the money, and officials are trying to devise a streamlined process so that the 30,000 employees affected can easily return it. A technical error at state-owned Zuercher Kantonalbank, which handles the city's salary transfers, is to blame. The bank itself said that faulty software from one of Swisscom AG's contractors caused the glitch. "Swisscom is aware of the seriousness of this incident and apologizes for the inconvenience caused," the telecommunications company said in a statement shared by the bank. The unexpected windfall prompted a flurry of employees calling up the city's offices to ask about the extra money, according to Swiss newspapers. Others mockingly described it as "inflation compensation" on the city's intranet, and demanded a repeat.

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Uber-Like Surge Pricing Is Coming For Fast Food

Par : BeauHD
28 février 2024 à 00:45
Fast food chain Wendy's announced it's adopting a similar approach to Uber's Surge Pricing policy by dynamically adjusting the prices of its menu items during peak demand periods at certain locations. The controversial strategy seeks to leverage real-time data to align pricing and demand, enhancing efficiency and potentially improving customer satisfaction. From a report: During a conference call earlier this month, Wendy's CEO Kirk Tanner said the fast-food chain would experiment with dynamic pricing as early as next year. "Beginning as early as 2025, we will begin testing more enhanced features like dynamic pricing and daypart offerings, along with AI-enabled menu changes and suggestive selling," he said. "As we continue to show the benefit of this technology in our company-operated restaurants, franchisee interest in digital menu boards should increase, further supporting sales and profit growth across the system." Prices seesaw all the time on the sites of online retailers like Amazon that use algorithms and artificial intelligence to monitor competitors and glean insights into individual shoppers, adjusting prices depending on interest in the product or in the brand, said Timothy Webb, an assistant professor at the University of Delaware's hospitality and sport business management program. Coupons and other offers are also routinely dangled in mobile apps to encourage people to make purchases. "A lot of this stuff is already happening even if you don't realize that it is happening. If you have the Starbucks app and I have the Starbucks app, we probably have different offers," Webb said. "We might not be in the drive-through and they just increased the prices, but we are already paying different prices for the same products." But, he says, Wendy's fans will likely see moderate, not massive, price swings during periods of peak demand. "It's not like $200 or $300 on a flight. This is a hypercompetitive industry. If Wendy's goes up $2 to $3 on a burger at dinner time, I would be shocked. People have too many options. They will just walk down the street and eat at Burger King instead," Webb said. "There will just be little price changes here."

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Tumblr and Wordpress Are Preparing To Sell User Data To OpenAI and Midjourney, Report Says

Par : msmash
27 février 2024 à 19:01
Tumblr and Wordpress are preparing to sell user data to Midjourney and OpenAI, 404Media reported Tuesday, citing a source with internal knowledge about the deals and internal documents. From the report: The exact types of data from each platform going to each company are not spelled out in documentation we've reviewed, but internal communications reviewed by 404 Media make clear that deals between Automattic, the platforms' parent company, and OpenAI and Midjourney are imminent. The internal documentation details a messy and controversial process within Tumblr itself. One internal post made by Cyle Gage, a product manager at Tumblr, states that a query made to prepare data for OpenAI and Midjourney compiled a huge number of user posts that it wasn't supposed to. It is not clear from Gage's post whether this data has already been sent to OpenAI and Midjourney, or whether Gage was detailing a process for scrubbing the data before it was to be sent.

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Reddit Warns That r/WallStreetBets Could Wreak Havoc on Its Stock Price

Par : msmash
23 février 2024 à 21:20
An anonymous reader shares a report: Beware the apes, Reddit told the world in its IPO documents, though not in such explicit terms. Put simply, the company warned potential investors that one of its subreddits, the infamous r/WallStreetBets, could make its stock price and volume extremely volatile -- and there's little Reddit can do about it. Reddit listed r/WallStreetBets as one of the possible risks to investing in the company in its S-1 form on Thursday, referencing the subreddit's role in the meme stock craze of 2021, where retail investors banded together to raise the price of struggling companies like GameStop and AMC. The goal of r/WallStreetBets back then was to screw over professional investors on Wall Street and make them lose money for betting against certain companies. It's entirely possible that the everyday people on r/WallStreetBets, a subreddit of 15 million retail investors who refer to themselves as "apes" and "degenerates," and other online forums could do the same thing with Reddit's stock, the company stated. Reddit writes: "Given the broad awareness and brand recognition of Reddit, including as a result of the popularity of r/ wallstreetbets among retail investors, and the direct access by retail investors to broadly available trading platforms, the market price and trading volume of our Class A common stock could experience extreme volatility for reasons unrelated to our underlying business or macroeconomic or industry fundamentals." The volatility could cause people to lose all or part of their investment, the company explained, if they are unable to sell their shares at or above the IPO price. The long-term effect of movements like those propelled by r/WallStreetBets is already documented, with the takeaway being that surges of interest and heavy investment don't necessarily bring success to companies over time.

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Some 'Apple Pay'/Chase Customers Experienced an Outage

Par : EditorDavid
17 février 2024 à 22:34
"It appears that Apple Pay is down — particularly for Chase customers," reports the Verge: Verge staffers have had their cards declined while trying to pay with Chase cards using Apple Pay, while using the same physical card works just fine. Several people on Threads confirmed the same issue when I asked — although people with non-Chase banks like Citi appear to be using Apple Pay just fine... For what it's worth, the Chase customer service line is currently up to 15-minute wait times, and agents are telling people that Apple Pay is "going through maintenance" to receive "an unexpected upgrade," which is a delightful euphemism. Sadly, no one seems to know when things will be fixed. "Maintenance in progress," says Apple's system status page — saying their maintenance started five hours ago and is "ongoing." (It adds that some users may be "affected," and that some Maryland Users "may have issues.") But the Verge writes that "we've had reports in both New York and Los Angeles," while commenters on their article add that they've also experienced the same problem in Florida and in Colorado. UPDATE (2/18/2024): An Apple spokesperson told the Verge Sunday this "was not an Apple Pay issue, and we saw no problems with our systems." (The Verge adds that "the not-so-subtle subtext there being that this was a Chase problem...") The spokesperson added that Apple's maintenance announcement on their system status page was unrelated.

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'Apple Pay' Is Down for Some Customers

Par : EditorDavid
17 février 2024 à 22:34
"It appears that Apple Pay is down — particularly for Chase customers," reports the Verge: Verge staffers have had their cards declined while trying to pay with Chase cards using Apple Pay, while using the same physical card works just fine. Several people on Threads confirmed the same issue when I asked — although people with non-Chase banks like Citi appear to be using Apple Pay just fine... For what it's worth, the Chase customer service line is currently up to 15-minute wait times, and agents are telling people that Apple Pay is "going through maintenance" to receive "an unexpected upgrade," which is a delightful euphemism. Sadly, no one seems to know when things will be fixed. "Maintenance in progress," confirms Apple's system status page — saying that it started five hours ago and is "ongoing." (It adds that some users may be "affected," and that some Maryland Users "may have issues.") But the Verge writes that "we've had reports in both New York and Los Angeles," while commenters on their article add that they've also experienced the same problem in Florida and in Colorado.

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Will FTX Customers Fully Recoup Their Money?

Par : EditorDavid
10 février 2024 à 21:43
Former FTX customers "have reasons to believe they could actually recoup their money," reports CNBC: Bankman-Fried, who could spend the rest of his life behind bars, was found guilty in November on seven criminal counts after roughly $10 billion in customer funds from his company went missing. Some of that money went to pay for Bankman-Fried's lavish lifestyle, but much of it went towards other investments that have, of late, appreciated dramatically in value. Lawyers representing the bankruptcy estate of FTX told a judge in Delaware last week that they expect to fully repay customers and creditors with legitimate claims. Bankruptcy attorney Andrew Dietderich, who works with FTX's new leadership team, said "there is still a great amount of work and risk" ahead in getting all the money back to clients, but that the team has a "strategy to achieve it." It's a welcome development for the many thousands of customers (reportedly up to a million) who collectively lost billions of dollars in FTX's collapse 15 months ago, when the crypto exchange spiraled into bankruptcy in a matter of days. Given the lightly regulated and unsecured nature of FTX — and the crypto industry at large — those clients faced the real possibility that the vast majority of their money had evaporated. Plenty of failed hedge funds and lenders lost virtually everything during the 2022 crypto winter... [C]rypto was mired in a bear market, with bitcoin trading at around $16,000. It's now above $47,000... FTX's bitcoin stash, which was worth $560 million at the time of the September report, is today valued north of $1 billion. Bankman-Fried's investments weren't limited to crypto. He also used client money to back startups like Anthropic, the artificial intelligence company founded by ex-OpenAI employees. FTX invested $500 million in Anthropic in 2021, before the generative AI boom. Anthropic's valuation hit $18 billion in December 2023, which would value FTX's roughly 8% stake at about $1.4 billion. CNBC suggests this could affect the length of Bankman-Fried's prison sentence (which will be determined next month). There's now also a so-called "FTX IOU" market where investors are selling their debt, CNBC adds. "One financial firm that had lost around $100 million initially sold its FTX debt for 6 cents on the dollar in a new secondary market out of concern that he may never get a better deal. As of December, those claims were going for more than 70 cents on the dollar." CNBC also reports that FTX "had been negotiating with bidders about a potential reboot of the company, but those efforts were scrapped last month."

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Ring Video Doorbell Customers Angry At 43% Price Hike

Par : BeauHD
9 février 2024 à 23:40
Longtime Slashdot reader Alain Williams shares a report from the BBC: Users of Ring video doorbells have reacted angrily to a huge price hike being introduced in March. After buying the devices, customers can pay a subscription to store footage on the cloud, download clips and get discounted products. That subscription is going up 43%, from $44 to $63 per device, per year, for basic plan customers. The firm, which is owned by Amazon, insisted it still provided "some of the best value in the industry." Its customers appear not to to agree.

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Snap Is Recalling and Refunding Every Drone It Ever Sold

Par : BeauHD
1 février 2024 à 21:25
Snap is recalling all 71,000 of its Pixy flying selfie camera drones because their batteries pose a fire hazard. The Verge reports: Snap and the US Consumer Product Safety Commission say you should "immediately stop using the Pixy Flying Camera, remove the battery and stop charging it" now that there have been four reports of the battery bulging, one fire, and one "minor injury." Then, you can get a full refund for the entire drone and / or any batteries you own -- sounds like we're talking at least $185 back to you, unless you bought it on sale. You don't need a receipt: you can apply for the refund even if you got it as a gift. You can fill out this form to receive a prepaid return label to return the drone. Snap says you will need to safely dispose of the batteries yourself.

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God Told Him to Launch a Crypto Venture, Said Pastor. Now He's Accused of Pocketing $1.2M

Par : EditorDavid
28 janvier 2024 à 21:51
In Denver, Colorado, a pastor had a message for his congregation, reports CNN. "After months of prayers and cues from God, he was going to start selling cryptocurrency, he announced in a YouTube video last April." The Signature and Silvergate banks had collapsed weeks earlier, signaling the need to look into other investment options beyond financial institutions, he said. With divine wisdom, he said, he was "setting the rails for God's wealth transfer." Shortly afterward, Regalado and his wife, Kaitlyn Regalado, launched a cryptocurrency, INDXcoin, and began selling it to members of his Victorious Grace Church and other Christian communities in the Denver area. They sold it through the Kingdom Wealth Exchange, an online cryptocurrency marketplace he created, controlled and operated. The Regalados raised more than $3.2 million from over 300 investors, Tung Chang, Securities Commissioner for Colorado, said in a civil complaint. The couple's sales pitches were filled with "prayer and quotes from the Bible, encouraging investors to have faith that their investment ... would lead to 'abundance' and 'blessings,'" the complaint said. But Colorado state regulators say that INDXcoin was "essentially worthless." Instead of helping investors acquire wealth, the Regalados used around $1.3 million of the investment funds to bankroll lavish expenditures, including a Range Rover, jewelry, cosmetic dentistry and extravagant vacations, the complaint said. The money also paid for renovations to the Regalados' Denver home, the complaint said. In a stunning video statement posted online on January 19 — several days after the civil charges were filed — Eli Regalado did not dispute that he and his wife profited from the crypto venture. "The charges are that Kaitlyn and I pocketed 1.3 million dollars, and I just want to come out and say that those charges are true," he said, adding, "A few hundred thousand dollars went to a home remodel that the Lord told us to do...." Regalado also said that he and his wife used about half a million dollars of their investors' funds to pay taxes to the IRS. CNN reports that in videos Regalado explains how God "convinced him that it was a safe and profitable investment venture." ("You read it correctly. God's hand is on INDXcoin and we are launching!" explains the launch video's description.) "The Regalados used technical terms to confuse investors and misled them into believing that the coins were valued at between $10-$12 even though they were purchased for $1.50 or, at times, given away, the complaint said."

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Famed Financial Analyst's Final Forecast? 'The Dollar is Finished' as World Reserve Currency

Par : EditorDavid
28 janvier 2024 à 01:59
An anonymous reader shared this report from the The New York Times: Over his 54 years as a financial analyst, Richard X. Bove perfected the art of grabbing attention... American Banker once called him "the country's most quotable bank analyst." Last week, a few hours after completing a spot on Bloomberg television, the 83-year-old announced his retirement. He took that weekend off — and then jumped right back in. In an interview with The New York Times, Mr. Bove (pronounced "boe-VAY"), who goes by Dick, shared a dire outlook on the U.S. economy and his former profession. "The dollar is finished as the world's reserve currency," Mr. Bove said matter-of-factly, perched in an armchair outside his home office just north of Tampa, from which he predicted that China will overtake the U.S. economy. No other analysts will say the same because they are, as he put it, "monks praying to money," unwilling to speak out on the mainstream financial system that employs them... As he spoke, a technician was trying to restore his home internet after his final employer, the boutique brokerage Odeon Capital, pulled the plug on his last day... He sees the offshoring of American manufacturing as the ultimate threat to the financial sector and the dollar, because "the people making the goods elsewhere are getting greater and greater control of the means of production and therefore greater and greater control of the world economy and therefore greater and greater control of money." The article notes that Bove was once called "The Loneliest Analyst." "One way that's still true is that he endorses cryptocurrency — an area that few other financial analysts will touch — which he sees as a natural beneficiary of the decline of the dollar."

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