KeNo's Housing and Economic Portal: Thursday October 27 20916 Housing and Economic stories

Wednesday, October 26, 2016

Thursday October 27 20916 Housing and Economic stories

Subprime Credit Card Surge Pushing Up Missed Payments - (www.wsj.com) Credit-card lending to subprime borrowers is starting to backfire. Missed payments on credit cards that lenders issued recently are higher than on older cards, according to new data from credit bureau TransUnion. Nearly 3% of outstanding balances on credit cards issued in 2015 were at least 90 days behind on payments six months after they were originated. That compares with 2.2% for cards that were given out in 2014 and 1.5% for cards in 2013. The poorer performance on newer cards pushed up the 90-day or more delinquency rate for all credit cards to 1.53% on average nationwide in the third quarter. That’s the highest level since 2012.

Sputtering Startups Weigh on U.S. Economic Growth - (www.wsj.com) The U.S. economy is inching along, productivity is flagging and millions of Americans appear locked out of the labor market. One key factor intertwined with this loss of dynamism: The U.S. is creating startup businesses at historically low rates. The American economy has long relied on fast-growing young companies to fuel job growth and spread the latest innovations. As recently as the 1980s and 1990s, a small number of young firms disproportionately contributed to U.S. employment growth, helping allocate workers and resources to burgeoning segments of the economy. But government data shows a decadeslong slowdown in entrepreneurship.

Fake Divorce Is Path to Riches in China’s Hot Real Estate Market - (www.bloomberg.com) Earlier this year, Mr. and Mrs. Cai, a couple from Shanghai, decided to end their marriage. The rationale wasn’t irreconcilable differences; rather, it was a property market bubble. The pair, who operate a clothing shop, wanted to buy an apartment for 3.6 million yuan ($532,583), adding to three places they already own. But the local government had begun, among other bubble-fighting measures, to limit purchases by existing property holders. So in February, the couple divorced. “Why would we worry about divorce? We’ve been married for so long,” said Cai, the husband, who requested that the couple’s full names not be used to avoid potential legal trouble. “If we don’t buy this apartment, we’ll miss the chance to get rich.”

Santoli: Overcrowded ETF market headed for a shakeout - (www.cnbc.com) ETFs are the smartphone apps of the investing world. It's hard to imagine how we used to get by without them. They are remarkably cheap to create and own. A small handful of the most popular ones dominate usage. There are new ones arriving weekly targeting every narrow interest. And there are far, far too many of them. In a bit more than 20 years, exchange-traded funds have gone from an innovation no one was asking for ("Why would anyone want to trade a mutual fund in the middle of the day?") to the dominant new-product category in retail investment management.

Smartwatch is Dead, Market Implodes, Apple Watch Shipments Collapse - (www.wolfstreet.com) We have pooh-poohed the media love story about Apple Watch and similar devices when they first came out. We were particularly amused by how Apple was able to dominate entire front pages of the fawning financial press when it introduced the watch. At the time, nothing else mattered or happened. That was March 9, 2015. I took some screenshots, showing how great Apple really is in wrapping the media around its cordless Magic Trackpad… Apple Comes Out with a Watch, and Look What Happens: But even with all our cynicism about this sort of hype, we did not expect the market to just implode like this, and for Apple Watch shipments to just totally collapse. But they did. In the third quarter, according to International Data Corporation (IDC), global smartwatch shipments plunged 51.6% year-over-year. “A round of growing pains,” as IDC put it. Just 2.7 million of these devices were shipped, down from 5.6 million a year ago.

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