US–China trade war optimism? Big companies are not buying it

If you follow the markets, there’s been recent reason for optimism about a U.S.-China trade deal. The quarterly survey finds CFOs around the world increasingly are worried about U.S. trade policy as a business risk factor. If a trade deal remains elusive, even that stability may not last long. — CNBC Global CFO Survey Q3 U.S. CFOs taking the survey did reveal significant concerns about the trade war in other responses. Impact of trade tensions new new U.S. tariffs—CNBC Global CFO Survey Q3 The d


If you follow the markets, there’s been recent reason for optimism about a U.S.-China trade deal. The quarterly survey finds CFOs around the world increasingly are worried about U.S. trade policy as a business risk factor. If a trade deal remains elusive, even that stability may not last long. — CNBC Global CFO Survey Q3 U.S. CFOs taking the survey did reveal significant concerns about the trade war in other responses. Impact of trade tensions new new U.S. tariffs—CNBC Global CFO Survey Q3 The d
US–China trade war optimism? Big companies are not buying it Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-13  Authors: eric rosenbaum, anthony volastro
Keywords: news, cnbc, companies, buying, china, big, companies, deal, survey, business, optimism, president, risk, trade, policy, cfo, cfos, war, uschina


US–China trade war optimism? Big companies are not buying it

If you follow the markets, there’s been recent reason for optimism about a U.S.-China trade deal. Some investors are buying it — literally — with recent gains in stocks attributed to positive signals from the U.S. and China after a volatile August. But there’s one group of market insiders not buying the talk: corporate executives. In other words, the people who run the companies whose publicly traded shares have been rebounding. Top executives in the U.S. and around the world are not placing bets that the U.S.-China trade war will be resolved anytime soon. In fact, corporations say they expect to feel the pain of trade tensions over the next six months, according to the third-quarter CNBC Global CFO Council survey. The quarterly survey finds CFOs around the world increasingly are worried about U.S. trade policy as a business risk factor. Chief financial officers also downgraded their view of the U.S. economy, from “improving” to “stable.” If a trade deal remains elusive, even that stability may not last long. “With this level of uncertainty between the U.S. and China, I would think ‘stable’ might actually be a win a couple of quarters from now,” said Jack McCullough, president and founder of the CFO Leadership Council, an executive networking group. “I cannot recall when CFOs were as jittery about a change in policy as they are today.” The CNBC Global CFO Council represents some of the largest public and private companies in the world, collectively managing more than $5 trillion in market value across a wide variety of sectors. The Q3 2019 survey was conducted between Aug. 21 and Sept. 3 among 62 global members of the council.

Trade is the biggest risk factor

Thirty-five percent of CFOs cited U.S. trade policy as the “biggest external risk factor,” which was more than double the second biggest risk highlighted: “consumer demand.” Fears about trade were up from 22% in the second quarter. There was an important split between U.S. CFOs and those based around the world. Thirty-five percent of U.S. CFOs cited consumer demand as the top external risk factor, which can be explained by the fact that the resilience of the U.S. economy, in spite of slowdowns in Europe and China, has been based on consumer strength. What is the biggest external risk factor currently facing your business? — CNBC Global CFO Survey Q3 U.S. CFOs taking the survey did reveal significant concerns about the trade war in other responses. About sixty-five percent said trade policy will be a negative for their business over the next six months. In Q2 that had dropped to 40% — possibly due to a prevailing and false sense of security that a deal would be easier to achieve than has proven to be the case — but it is now back up to a level consistent with the Q3 2018 through Q1 2019 surveys. “The surprise may be that only about 65% of CFOs view that trade policy will be a negative for their organizations,” McCullough said. “While at a macro level it’s easy to understand the motivation behind the recent policy changes, I can’t find a single CFO who has told me it would be a positive for his or her business. … It is uniformly negative for their business, at least in the eyes of finance chiefs.”

While at a macro level it’s easy to understand the motivation behind the recent policy changes, I can’t find a single CFO who has told me it would be a positive for his or her business. Jack McCullough president and founder, CFO Leadership Council

McCullough noted that his networking group offers an online forum for more than 1,100 chief financial officers to discuss issues of importance to their business. He said there never has been a question that he can recall about government policy that has dominated discussion as much as the trade policy has recently. That discussion has included whether manufacturing is moving and strategies for dealing with tariffs. “It is top of mind, and they are not confident they will emerge from this unscathed,” he said. Nearly half of North American CFOs surveyed by CNBC said they are facing higher input costs, and more than one-quarter said they have increased prices to offset those costs. They were more likely than European or Asian counterparts to say they have experienced higher costs and passed on those costs to customers. And more likely to say they have moved operations to minimize the impact of tariffs, though that was less than 20% of CFO respondents. While U.S. CFOs indicated in the survey that they were not confident about increasing their capital spend, less than 10% said they had delayed or canceled projects because of trade policy. Impact of trade tensions new new U.S. tariffs—CNBC Global CFO Survey Q3 The daily headlines can be tougher to measure. On Thursday alone, news broke that the U.S. and China were considering an interim trade deal, but a few minutes later a senior White House official told CNBC no such deal was in the works. President Donald Trump did agree to delay increasing tariffs on $250 billion worth of Chinese goods from Oct. 1 to Oct. 15 as a “gesture of goodwill,” and that move was matched by China, which said it would restart purchase of some U.S. agricultural products. Then later in the day, President Trump told reporters he would be open to an interim trade deal with China but would prefer a lasting deal. “It’s something we would consider, I guess,” Trump said. The U.S. and China have agreed to meet again at the negotiating table in October, a plan that was reported after an early September phone call between Chinese Vice Premier Liu He, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin. CFOs view of the trade war is not yet influencing their thinking about President Trump’s reelection chances. The survey found the majority of CFOs of the belief that Trump will be reelected in 2020 and the U.S. economy will not slip into a recession next year.

Trade weighing on business investment


Company: cnbc, Activity: cnbc, Date: 2019-09-13  Authors: eric rosenbaum, anthony volastro
Keywords: news, cnbc, companies, buying, china, big, companies, deal, survey, business, optimism, president, risk, trade, policy, cfo, cfos, war, uschina


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US companies are canceling investment into China at a faster clip, survey shows

However, survey respondents did note an overall improvement in nearly all issues of concern — including intellectual property protection and forced technology transfer. The proportion of businesses that said the Chinese government treats foreign and local companies equally also rose from 34% to 40% in the latest survey. But retaliatory tariffs from both sides are hitting revenues and causing some American firms to change their China strategy, the AmCham survey showed. Just over half of the surve


However, survey respondents did note an overall improvement in nearly all issues of concern — including intellectual property protection and forced technology transfer. The proportion of businesses that said the Chinese government treats foreign and local companies equally also rose from 34% to 40% in the latest survey. But retaliatory tariffs from both sides are hitting revenues and causing some American firms to change their China strategy, the AmCham survey showed. Just over half of the surve
US companies are canceling investment into China at a faster clip, survey shows Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: evelyn cheng
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US companies are canceling investment into China at a faster clip, survey shows

Chinese shipping containers are stored beside a US flag after they were unloaded at the Port of Los Angeles in Long Beach, California on May 14, 2019. – Global markets remain on red alert over a trade war between the two superpowers China and the US, that most observers warn could shatter global economic growth, and hurt demand for commodities like oil. (Photo by Mark RALSTON / AFP) (Photo credit should read MARK RALSTON/AFP/Getty Images) MARK RALSTON | AFP | Getty Images

Some American companies in China are speeding up their move away from the mainland as increasing tariffs continue to hurt their businesses. That’s according to a survey released by the American Chamber of Commerce in Shanghai on Wednesday. More than a quarter of the respondents – or 26.5% – said that in the past year, they have redirected investments originally planned for China to other regions. That’s an increase of 6.9 percentage points from last year, the AmCham report said, noting that technology, hardware, software and services industries had the highest level of changes in investment destination. The research, conducted in partnership with PwC, surveyed 333 members of the American Chamber of Commerce in Shanghai. It was conducted from June 27 to July 25 — during the period when U.S. President Donald Trump and Chinese President Xi Jinping agreed to resume trade talks, and before the latest escalation in retaliatory tariffs. U.S. firms in the mainland also said restrictions to accessing the local market have made it difficult for them to carry out their business, the report said. Asked about the best possible scenarios in ongoing trade negotiations, more than 40% of respondents said greater access to the domestic market would be the most important outcome to help their businesses succeed. That was followed by more than 28% that ranked improved intellectual property protection as key. The third most hoped-for outcome of the trade talks was “increased purchases of U.S. goods,” at 14.3%, the survey showed. That’s in contrast to the Trump administration’s latest efforts to pressure China into buying more American products, especially in agriculture.

Barred from market access

One of the longstanding complaints U.S. companies have about operating in China is that many industries are closed to foreign businesses. In the sectors that are open, it is difficult to compete with state-owned enterprises or privately owned companies that may benefit from local connections or policies, they say. Allegations of forced transfer of critical technology to Chinese partners and lack of intellectual property protection are just some of the challenges U.S. businesses cite for operating in China. The latest AmCham survey found accessing the local market remained one of the key problems companies faced, with more than half the respondents — or 56.4% — saying that obtaining licenses was not easy.

Still, with no sign of a trade agreement, 2019 will be a difficult year; without a trade deal, 2020 may be worse. AmCham Shanghai and PwC survey

By industry, the one that most sought improved market access was the banking, finance and insurance sector. The high 81% of respondents in that sector seeking a better business environment contrasts with Beijing’s announcements in the last 18 months that it will be relaxing foreign ownership rules in the financial sector. Some measures include allowing majority foreign ownership of a local securities venture and increased foreign ownership of local stocks. However, survey respondents did note an overall improvement in nearly all issues of concern — including intellectual property protection and forced technology transfer. The proportion of businesses that said the Chinese government treats foreign and local companies equally also rose from 34% to 40% in the latest survey.

Tariffs hurting US firms

The U.S. business presence in China remains strong, with American companies and their affiliates raking in more than $450 billion in sales in the Asian country, according to an August report from research firm Gavekal Dragonomics. The analysis also pointed out that sales figure is more than twice the value of U.S. exports of goods and services to China. But retaliatory tariffs from both sides are hitting revenues and causing some American firms to change their China strategy, the AmCham survey showed. If Washington were to impose all the duties as threatened, essentially all Chinese goods exported to the U.S. will be subject to tariffs by the end of the year. In response to the increasing American duties, Beijing has countered with tariffs of its own on U.S. exports to China.

Just over half of the survey respondents said revenue has decreased as a result of the increased tariffs. One third of them attributed a drop of between 1% and 10% of revenue to the higher duties. Overall profitability did not decline in 2018, the report said. But more respondents said revenue and margins declined last year, especially compared with operations in other countries. Pessimism levels shot up by 14 percentage points to about 21% — respondents felt less optimistic about the outlook for 2019 due in part to a slowing domestic economy.

Bright spots remain in China

The survey, however, did find some areas of optimism among respondents in China. The pharmaceuticals, medical devices and life sciences category ranked among the industries with the most respondents reporting revenue growth last year. That sector also came in second among those most optimistic about 2019. The AmCham report said the positive outlook was “likely due to government policy changes, including accelerated approvals of foreign drugs.” More than two-thirds of companies in food and agriculture planned to increase investment in 2019, the most of any industry, the report said. Retail and consumer companies also intended to invest more in China, especially in smaller cities where many analysts still see a major growth opportunity. However, businesses are getting ready for a drawn out trade war between the two economic giants. Of those surveyed, 35% expect trade tensions to continue for another 1 to 3 years, while nearly 13% say it will go on for 3 to 6 years. About 17%, however, were even more pessimistic, and predict that the trade conflict will drag on indefinitely. The report added: “Still, with no sign of a trade agreement, 2019 will be a difficult year; without a trade deal, 2020 may be worse.”


Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: evelyn cheng
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US Treasury yields tick higher as investors await key central bank meetings

US companies are canceling investment into China at a faster… The latest Amcham survey shows that some U.S. firms in China are speeding up their move away from the mainland as increasing tariffs bite. China Economyread more


US companies are canceling investment into China at a faster… The latest Amcham survey shows that some U.S. firms in China are speeding up their move away from the mainland as increasing tariffs bite. China Economyread more
US Treasury yields tick higher as investors await key central bank meetings Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: sam meredith
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US Treasury yields tick higher as investors await key central bank meetings

US companies are canceling investment into China at a faster…

The latest Amcham survey shows that some U.S. firms in China are speeding up their move away from the mainland as increasing tariffs bite.

China Economy

read more


Company: cnbc, Activity: cnbc, Date: 2019-09-11  Authors: sam meredith
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Fall housing shifts quickly to a buyer’s market

“We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.” At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. “It’s not a seller’s market right now. McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. Darrell and Carrie Smith toured the Dallas open house but are


“We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.” At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. “It’s not a seller’s market right now. McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. Darrell and Carrie Smith toured the Dallas open house but are
Fall housing shifts quickly to a buyer’s market Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: diana olick
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Fall housing shifts quickly to a buyer's market

An Open house in Dallas, Sunday, Sept. 8, 2019. Bethany Jordan | CNBC

Mortgage rates are around the lowest in three years, but buyers are suddenly much more cautious about purchasing a home. Competition is cooling, and consequently sellers can no longer command any price. Consumer sentiment in housing did improve in August, according to a monthly survey from Fannie Mae, but only because of a big jump in the share of those who think mortgage rates will keep falling. Other components of the survey were not so rosy. Fewer people think now is a good time to buy or sell a home, and fewer said they are not concerned about losing their job in the next year. “Unfortunately, much of the lower interest rate environment can be attributed to global economic uncertainties, which appear to have dampened consumer sentiment regarding the direction of the economy,” said Doug Duncan, chief economist at Fannie Mae. “We do expect housing market activity to remain relatively stable, and the favorable rate environment should continue supporting increased refinance activity.”

At an open house in Dallas on Sunday, a few dozen potential buyers toured a home listed at just under $1.4 million. The agent for the home said the market is still moving, but buyers are getting more picky. “I definitely think it has softened a bit,” said Kelley McMahon a Dallas-area agent with Compass. “It’s not a seller’s market right now. Now is not the time for sellers to put out these crazy prices. Appraisals have gotten a lot harder, and buyers are a little more cautious. They’re more willing to take their time.” McMahon said the concern is less about the overall health of the housing market, and more about the future of the economy. “I think people are a little more cautious to pull the trigger, and I definitely think that people want to get through the election year, just kind of see what happens,” she added. That is clearly showing up in the competition, or lack thereof. Just more than 10% of offers written by Redfin in August faced a bidding war, according to the brokerage’s monthly survey. That is down from 42% a year ago. The supply of homes for sale is growing in the midrange and higher end, but it is still tight at the entry level, where low rates matter most because buyers are more cash-strapped. “Despite remaining near three-year lows, mortgage rates have failed to bring enough buyers to the market to rev up competition for homes this summer,” said Daryl Fairweather, chief economist at Redfin. “Recession fears have been enough to spook some would-be buyers from making the big financial commitment of a home purchase.” Darrell and Carrie Smith toured the Dallas open house but are still considering enlarging their current home instead of buying something bigger.


Company: cnbc, Activity: cnbc, Date: 2019-09-09  Authors: diana olick
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China’s factory activity unexpectedly expands in August, a private survey shows

This photo taken on October 17, 2018 shows a worker inspecting shoes at a factory in Qingdao in China’s eastern Shandong province. China’s manufacturing activity expanded in August, according to results of a private survey released on Monday as production increased, but export sales fell amid the country’s escalating trade war with the U.S. The Caixin/Markit manufacturing PMI was 49.9 in July. The results of the private survey came after official data showed the manufacturing PMI fell to 49.5 in


This photo taken on October 17, 2018 shows a worker inspecting shoes at a factory in Qingdao in China’s eastern Shandong province. China’s manufacturing activity expanded in August, according to results of a private survey released on Monday as production increased, but export sales fell amid the country’s escalating trade war with the U.S. The Caixin/Markit manufacturing PMI was 49.9 in July. The results of the private survey came after official data showed the manufacturing PMI fell to 49.5 in
China’s factory activity unexpectedly expands in August, a private survey shows Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-09-02  Authors: huileng tan
Keywords: news, cnbc, companies, shows, trade, manufacturing, amid, fell, factory, pmi, official, chinas, activity, demand, analysts, survey, data, unexpectedly, expands, private


China's factory activity unexpectedly expands in August, a private survey shows

This photo taken on October 17, 2018 shows a worker inspecting shoes at a factory in Qingdao in China’s eastern Shandong province.

China’s manufacturing activity expanded in August, according to results of a private survey released on Monday as production increased, but export sales fell amid the country’s escalating trade war with the U.S.

The Caixin/Markit factory Purchasing Managers’ Index (PMI) was 50.4 in August — better than than the 49.8 analysts polled by Reuters had expected. The Caixin/Markit manufacturing PMI was 49.9 in July.

PMI readings above 50 indicate expansion, while those below that signal contraction.

The subindex for new orders stayed in expansionary territory in August, but inched down from July, suggesting flat demand for manufactured products, said Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group, a subsidiary of Caixin.

However, “the gauge for new export orders remained in contractionary territory and fell to the lowest level this year in August, reflecting declining foreign demand amid an intensifying trade dispute between China and the U.S., ” Zhong said in a press release.

The two countries imposed new tariffs on each other’s imports on Sunday.

Despite the improved headline PMI reading in August, due in part to improved production activity, the outlook is not rosy with long-term downward pressure, said Zhong.

“Overall demand didn’t improve, and foreign demand declined notably, leading product inventories to grow,” he wrote. “There was no sign of an improvement in companies’ willingness to replenish inventories of inputs or in their confidence. Industrial prices trended down.”

The results of the private survey came after official data showed the manufacturing PMI fell to 49.5 in August, China’s National Bureau of Statistics said on Saturday — that’s compared to 49.7 in July. A Reuters poll showed analysts expected the official PMI to stay unchanged from July.

The official PMI survey typically polls a large proportion of big businesses and state-owned enterprises. The Caixin indicator features a bigger mix of small- and medium-sized firms.

The PMI is a survey of how businesses view the operating environment. Such data offer a first glimpse into what’s happening in an economy, as they are usually among the first major economic indicators released each month.

The China PMI is closely watched by global investors for signs of trouble amid a domestic economic slowdown and the ongoing U.S.-China trade dispute.

Uncertainty looms over the Chinese growth outlook, said Capital Economics analysts on Monday.

“Global demand looks set to weaken further and a long-overdue pull-back in property construction is getting under way,” they wrote in a note following the PMI data release.

“The fiscal support currently in the pipeline is unlikely to fully offset these headwinds and we think authorities will have little choice but to roll out further policy easing measures in the coming months,” added Julian Evans-Pritchard and Martin Lynge Rasmussen.

— CNBC’s Yen Nee Lee and Reuters contributed to this report.


Company: cnbc, Activity: cnbc, Date: 2019-09-02  Authors: huileng tan
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Americans overwhelmingly support free trade as concern grows about Trump’s economy: NBC/WSJ poll

That erosion comes in tandem with rising public support for free trade as the Trump administration’s tariff conflict with China rattles financial markets and business confidence. By a narrow 49%-46% margin, Americans still approve of Trump’s handling of the economy. At the same time, Americans now say they approve of free trade by 64%-27%, a margin of better than two to one. But even Trump’s fellow Republicans have turned positive toward free trade, 52%-39%, after viewing it more skeptically ear


That erosion comes in tandem with rising public support for free trade as the Trump administration’s tariff conflict with China rattles financial markets and business confidence. By a narrow 49%-46% margin, Americans still approve of Trump’s handling of the economy. At the same time, Americans now say they approve of free trade by 64%-27%, a margin of better than two to one. But even Trump’s fellow Republicans have turned positive toward free trade, 52%-39%, after viewing it more skeptically ear
Americans overwhelmingly support free trade as concern grows about Trump’s economy: NBC/WSJ poll Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-08-18  Authors: john harwood
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Americans overwhelmingly support free trade as concern grows about Trump's economy: NBC/WSJ poll

China’s President Xi Jinping (L) and US President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on November 9, 2017.

Add President Trump to the list of those hurt by his trade war.

A new NBC News/Wall Street Journal poll shows Americans growing more uneasy about Trump’s handling of the economy, which has been one of his principal strengths. That erosion comes in tandem with rising public support for free trade as the Trump administration’s tariff conflict with China rattles financial markets and business confidence.

By a narrow 49%-46% margin, Americans still approve of Trump’s handling of the economy. But that’s down from 51%-41% approval in early May and an even more robust 50%-34% in July 2018.

At the same time, Americans now say they approve of free trade by 64%-27%, a margin of better than two to one. That’s up from 57%-37% early in Trump’s presidency, and 51%-41% near the end of President Obama’s tenure.

That more positive assessment was driven most sharply by political independents, who now embrace free trade by a 77%-15% margin; among Democrats, the margin is 73%-20%. But even Trump’s fellow Republicans have turned positive toward free trade, 52%-39%, after viewing it more skeptically early in his administration.

Trump’s overall approval ticked down slightly in the survey to 43% from 45% in July. That remains within the range of earlier results for a president whose ratings with a sharply-polarized electorate have stayed remarkably stable.

Public sentiment about Trump’s re-election campaign remains similarly stable. Just 40% of Americans say they plan to vote for him in 2020, up two points from last December. The proportion planning to vote against him stayed at 52%.

The survey found modestly increased support for a ban on military-style assault weapons in the wake of recent mass shootings. A 62% majority now express support for a ban, up from 51% in June 2016.

Large majorities also back expanded background checks for gun purchasers, “red flag” laws to identify dangerous individuals, and a voluntary program in which the government would buy back firearms from current owners. But the poll also showed the limits of the public’s appetite for pressuring Congress to act.

Nearly half of Americans, 45%, said they worried the government will go too far in restricting gun rights, while 50% worry the government may not go far enough. Meantime, the survey showed the proportion of Americans who say someone in their household owns a gun has risen to 46%, up from 42% in previous surveys.

Americans have not been impressed by Trump’s response to recent mass shootings in Dayton and El Paso. By 52%-36%, the poll shows they disapprove of how he has handled the aftermath of those tragedies. A 54% majority says that the language the president uses in his speeches and on Twitter bears significant responsibility for the shootings.

The telephone survey of 1,000 adults, conducted Aug. 10-14, carries a margin for error of 3.1 percentage points.


Company: cnbc, Activity: cnbc, Date: 2019-08-18  Authors: john harwood
Keywords: news, cnbc, companies, president, trump, say, concern, poll, nbcwsj, trumps, trade, support, margin, overwhelmingly, economy, americans, survey, grows, free


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More consumers using credit cards for purchases under $10, though cash is still king

While about half of consumers still use cash for small purchases, many are turning to credit cards. Among U.S. adults, 16% say they usually pay with credit cards for totals under $10, according to new survey data from CreditCards.com. Among people who have credit cards that come with rewards — i.e., cash back, miles or points — the share is 26%, up from 23% last year. Among those with rewards credit cards, the share is 43%. The average interest rate on credit cards is close to 18%, although cons


While about half of consumers still use cash for small purchases, many are turning to credit cards. Among U.S. adults, 16% say they usually pay with credit cards for totals under $10, according to new survey data from CreditCards.com. Among people who have credit cards that come with rewards — i.e., cash back, miles or points — the share is 26%, up from 23% last year. Among those with rewards credit cards, the share is 43%. The average interest rate on credit cards is close to 18%, although cons
More consumers using credit cards for purchases under $10, though cash is still king Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-08-15  Authors: sarah obrien
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More consumers using credit cards for purchases under $10, though cash is still king

While about half of consumers still use cash for small purchases, many are turning to credit cards. Among U.S. adults, 16% say they usually pay with credit cards for totals under $10, according to new survey data from CreditCards.com. That’s up from 12% who said the same in 2018. Among people who have credit cards that come with rewards — i.e., cash back, miles or points — the share is 26%, up from 23% last year. “We’ve seen a steady decrease in cash and an increase in credit card use for small purchases since 2014,” said Ted Rossman, industry analyst for CreditCards.com.

Mlenny | iStock | Getty Images

The data are based on an online survey done in July of more than 2,500 U.S. adults. From 2014 through 2017, when the annual poll defined a “small purchase” as one under $5, the share of consumers preferring a credit card for those buys also rose to 17%, from 11%. Roughly half of all survey respondents (49%) prefer cash for purchases under $10. Among those with rewards credit cards, the share is 43%. About a third of both groups — 35% and 31%, respectively — report using a debit card as their go-to choice for covering those small buys. Collectively, U.S. households owe $1.07 trillion in credit card debt, according to June data from the Federal Reserve. While the amount edged down slightly from May, it has been trending upward since 2011. “Unfortunately, not enough people are paying their bills in full,” Rossman said. “Sixty percent carry a balance month to month. “That’s expensive debt.”

The average interest rate on credit cards is close to 18%, although consumers with poor credit might pay more in the neighborhood of 25%, Rossman said. Among survey respondents, 57% said they have rewards credit cards. While using them for small purchases can help rack up cash back, miles or points, not paying the balance in full each month can cancel out the benefit of the rewards due to the interest tacked on to your balance. “The most important thing is to pay the balance in full before interest accrues,” Rossman said. “If you can do that, then by all means go for the rewards. “But if you carry a balance, forget about rewards and think about the interest rate first,” he added.

If you carry a balance, forget about rewards and think about the interest rate first. Ted Rossman Industry analyst at CreditCards.com


Company: cnbc, Activity: cnbc, Date: 2019-08-15  Authors: sarah obrien
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Teens still like cash, despite the rise of financial technology

A credit card or mobile app, on the other hand, allows parents to see their kids’ spending. If you get them in the habit of using a credit card when there is a limit, when they are adults they won’t go crazy. That’s one reason he doesn’t advise using cash as a tool to help teach your children about money. Instead, he gives his college-aged son an allowance in the form of a credit card with a spending limit. “When you are spending money in a manner where you get monthly statements, that makes [bu


A credit card or mobile app, on the other hand, allows parents to see their kids’ spending. If you get them in the habit of using a credit card when there is a limit, when they are adults they won’t go crazy. That’s one reason he doesn’t advise using cash as a tool to help teach your children about money. Instead, he gives his college-aged son an allowance in the form of a credit card with a spending limit. “When you are spending money in a manner where you get monthly statements, that makes [bu
Teens still like cash, despite the rise of financial technology Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-08-14  Authors: michelle fox
Keywords: news, cnbc, companies, despite, money, card, start, teens, technology, kids, spending, rise, financial, using, credit, survey, parents, cash


Teens still like cash, despite the rise of financial technology

For one, cash isn’t traceable, he said. A credit card or mobile app, on the other hand, allows parents to see their kids’ spending.

According to a new survey by Junior Achievement USA and data-marking firm Alliance Data, 75% of the teens polled have made purchases in cash and 80% of those who receive money from parents or caregivers get it in the form of cash. The survey, conducted by Wakefield Research between in July, polled 1,000 teenagers between the ages of 13 and 18.

American teenagers may spend a lot of time on their smartphones but when it comes to getting paid and spending their money, they prefer cash.

If you get them in the habit of using a credit card when there is a limit, when they are adults they won’t go crazy.

That’s one reason he doesn’t advise using cash as a tool to help teach your children about money. It’s also unlikely to be the way they spend as adults, said Ivory, founder of Delancey Wealth Management and a member of the CNBC Digital Financial Advisor Council.

Instead, he gives his college-aged son an allowance in the form of a credit card with a spending limit. This way, he knows how much money he has to spend every month.

“You are starting to build habits,” he said.

“If you get them in the habit of using a credit card when there is a limit, when they are adults they won’t go crazy because they are accustomed to having a limit.”

According to the survey, nearly 23% used their parent or caregiver’s credit card for online purchases. Additionally, 48% of teens said they use online or mobile apps to manage and budget their money.

Budgeting is the first thing kids should learn — and using a credit card could help, said Junior Achievement USA CEO Jack Kosakowski.

“When you are spending money in a manner where you get monthly statements, that makes [budgeting] a little bit easier,” he said.

However, parents need to play a role and remember that their kids look to them for guidance, he added.

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In fact, in a recent Invest In You Savings Survey, over a third of respondents said their financial role model was their parent.

“If they are using tools like credit cards, I certainly would … encourage parents to be going through the statement with their kids on a monthly basis and use it as an opportunity to educate them,” he said.

As your kids grow older, Johnson suggests to start financially “weaning” your kids off of you.

Now that his son is entering his senior year of college, he’ll start getting some things in his own name — like car insurance and the credit card. By the time he graduates, everything will be in his name and he’ll be accustomed to paying bills, Ivory explained.


Company: cnbc, Activity: cnbc, Date: 2019-08-14  Authors: michelle fox
Keywords: news, cnbc, companies, despite, money, card, start, teens, technology, kids, spending, rise, financial, using, credit, survey, parents, cash


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Survey finds that student debt holders spend 20% of their take-home pay on loans

But for the millions of Americans with student debt, a significant portion of those wages go straight back into paying off loans. In the second quarter of 2019, the amount of student debt held by Americans surpassed $1.6 trillion for the first time. The results of the Student Debt Impact Survey highlight the ways in which student debt is holding borrowers — and the economy — back. The average debt payment was $579 a month and the average monthly take-home pay was $2,689. This means that these bo


But for the millions of Americans with student debt, a significant portion of those wages go straight back into paying off loans. In the second quarter of 2019, the amount of student debt held by Americans surpassed $1.6 trillion for the first time. The results of the Student Debt Impact Survey highlight the ways in which student debt is holding borrowers — and the economy — back. The average debt payment was $579 a month and the average monthly take-home pay was $2,689. This means that these bo
Survey finds that student debt holders spend 20% of their take-home pay on loans Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-08-08  Authors: abigail hess
Keywords: news, cnbc, companies, finds, spending, theyre, borrowers, holders, debt, respondents, 20, kinane, average, student, pay, spend, survey, loans, takehome


Survey finds that student debt holders spend 20% of their take-home pay on loans

In 2018, college graduates earned weekly wages that were 80% higher than those of high school graduates.

But for the millions of Americans with student debt, a significant portion of those wages go straight back into paying off loans. In the second quarter of 2019, the amount of student debt held by Americans surpassed $1.6 trillion for the first time. This massive total is having an impact on how borrowers live their lives.

A study released today by TD Bank of more than 1,000 Americans between the ages of 18 and 39 who paid off or are currently repaying student loan debt found that on average, borrowers are spending 20% of their take-home pay each month on student debt.

The results of the Student Debt Impact Survey highlight the ways in which student debt is holding borrowers — and the economy — back. But the survey also indicates the ways in which borrowers may be becoming more responsible.

Today 45 million borrowers owe student debt in the U.S. Among respondents to the survey, the average student debt total was $26,495. The average debt payment was $579 a month and the average monthly take-home pay was $2,689. This means that these borrowers are allocating more than 20% of their take-home pay to repaying student debt.

Just over 60% of respondents said they expect to repay their student loans in four or more years and 24% said they expect to repay their loans after 10 or more years. Sixty-one percent of respondents said they save 10% or less of their income each month and 20% say they are not saving anything each month.

As a result, these borrowers are forced to delay long-term savings. Over 40% of respondents said they do not contribute to a 401(k) plan because of student debt and 43% say they do not contribute to a rainy day fund.

“Any slight bump in the road for some of these folks, even well into their 30s, is going to be troublesome for them and that’s a major, major concern,” Mike Kinane, head of U.S. Bankcard at TD Bank, tells CNBC Make It.

TD Bank’s survey also echoes previous reporting that student debt is forcing borrowers to delay traditional markers of adulthood. Respondents say that because of student loans they have delayed buying a home (36%), getting married (21%) and having kids (26%).

Delaying these milestones also impacts the wider economy, says Kinane. “If you’re not buying a home, you’re also not buying all of the things that come with a home, so economic impact is a fairly large.”

While the inability of these borrowers to save is troubling, Kinane also points out that millennials with student debt may be more responsible in their spending than previous generations — even if they are still spending money on lattes. He notes that about a fifth of respondents said they were trying not to spend on coffee, but 62% said they were putting off vacations.

“They’re shopping less, they’re going on vacations less, they’re splurging on gifts less, they’re dining out a lot less,” says Kinane. “There’s this perception about millennials but we’re finding they may be a little bit smarter than people think — especially folks that have this kind of debt. They are college educated and they appear to be more careful about how they’re spending their money and they’re careful about what they think they can do and more importantly, what they can’t do.”

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Company: cnbc, Activity: cnbc, Date: 2019-08-08  Authors: abigail hess
Keywords: news, cnbc, companies, finds, spending, theyre, borrowers, holders, debt, respondents, 20, kinane, average, student, pay, spend, survey, loans, takehome


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You’re not alone if you spend more time planning your vacation than working on your finances

One in 5 American adults spend more time planning their vacations than managing their finances, according to an online survey of about 1,000 people from MyBankTracker.com. “It could be because they are comfortable and have automated finances,” Reposa said. He said how people prioritize their vacation and financial planning could be based on family needs, marital status and careers. But one thing is clear, he said: Planning a vacation will be easier if you manage your finances well. “Vacation pla


One in 5 American adults spend more time planning their vacations than managing their finances, according to an online survey of about 1,000 people from MyBankTracker.com. “It could be because they are comfortable and have automated finances,” Reposa said. He said how people prioritize their vacation and financial planning could be based on family needs, marital status and careers. But one thing is clear, he said: Planning a vacation will be easier if you manage your finances well. “Vacation pla
You’re not alone if you spend more time planning your vacation than working on your finances Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-08-02  Authors: mallika mitra, jill cornfield
Keywords: news, cnbc, companies, spend, vacation, lot, youre, reposa, financial, survey, planning, finances, managing, working


You're not alone if you spend more time planning your vacation than working on your finances

Managing finances is important, but it’s not how a lot people are using their time.

One in 5 American adults spend more time planning their vacations than managing their finances, according to an online survey of about 1,000 people from MyBankTracker.com.

There could be several reasons why people dedicate more time to planning trips than figuring out finances, said Jason Reposa, CEO and co-founder of MyBankTracker.com.

“It could be because they are comfortable and have automated finances,” Reposa said. “A cruise-control situation.”

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The survey found that the demographic most likely to spend more time on vacation planning than finances — five times more, in fact — was the 25 to 34 age group. Reposa said that could be because they want to get their traveling in before having children.

He said how people prioritize their vacation and financial planning could be based on family needs, marital status and careers.

But one thing is clear, he said: Planning a vacation will be easier if you manage your finances well.

“Unless you’re in the top 1% of income earners in the U.S., it almost always comes down to budgeting,” Reposa said. “Vacation planning becomes a lot less stressful if you understand fully your financial situation.”


Company: cnbc, Activity: cnbc, Date: 2019-08-02  Authors: mallika mitra, jill cornfield
Keywords: news, cnbc, companies, spend, vacation, lot, youre, reposa, financial, survey, planning, finances, managing, working


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