Retailers sue Visa and MasterCard over fees
A group of retailers including Macy’s and Target, sued Visa and MasterCard and broke away from a $7.2 billion settlement reached last year regarding the processing fees for credit card transactions. CNBC is reporting that the lawsuit came prior to a May 28 deadline for millions of merchants to decide whether to forgo receiving damages agreed to under the pact or pursue their own legal action. The proposed settlement was announced in July 2012. The plaintiffs claim that the interchange or swipe fee rates charged by Visa and Mastercard are inflated. They also believe that the proposed settlement is an anti-trust violation giving too much power to Visa and Mastercard. JC Penney, Kohl’s and TJX are included in the suit. Walmart and 18 others are also anticipating separate legal actions.
AT & T imposes new wireless fee
The Wall Street Journal is reporting that AT&T has added a new monthly administrative fee of 61 cents to the bills of all of its contract holders of wireless lines, effective May1. Other carriers also have “below the line” fees. These fees are called such because they frequently appear at the bottom of the phone bill. The new fee will bring in more than half a billion dollars of revenue to AT&T. Spokespeople for AT&T said accountholders were given 30 days notice. Verizon Wireless charges an administrative fee of 90 cents.
The Gap is back in style
Gap Inc., which owns Old Navy, The Gap and Banana Republic, reported a 43 percent jump in first quarter net income, according to the Associated Press. This is good news to customers and investors who have watched the company struggle in recent years. Revenue at stores open at least a year rose 2 percent for the chain. Global businesses for The Gap and Old Navy rose 3 percent while Banana Republic remained flat. Online sales rose 27 percent.The Gap has been struggling with safety provisions and the pact being formed to improve conditions in Bangladesh. For that reason and others, its overall outlook remains down.
US lags in paid vacation and holidays
USA Today is reporting that nearly one in four Americans (23 percent) has no paid holidays, according to a report by the Center for Economic and Policy Research in Washington, DC. The report analyzed national and international data on 21 democracies in the Organisation for Economic Cooperation and Development. The European Union requires employers to grant at least 20 paid vacation days a year. Canada and Japan require at least 10. The US does not require any paid holidays. US private sector employees average 10 paid vacation days and six paid holidays a year. It does not meet the minimum requirements of 19 other countries. Additionally, high wage workers are more likely to have paid holidays than low paid workers.
P and G CEO steps down unexpectedly
Procter and Gamble’s chief executive, Bob McDonald, is stepping down and will be replaced by his predecessor, A.G. Lafley. According to the Financial Times, McDonald announced that he will retire at the end of June after four years in the position. Lafley was CEO from 2000 to 2009. Lafley took over P and G in a time of crisis and spearheaded a turnaround by the acquisition of Gillette and a focus on emerging markets. Critics of McDonald said he was slow to adjust to the penny-pinching of consumers during the Recession and failed to understand the growing middle class in emerging markets.
Why are Midwest gas prices soaring?
Gas prices are increasing across the US but the Midwest has been particularly hard hit. According to USA Today, gas prices in Minnesota were the highest of any state this past week averaging $4.22 per gallon. The government’s Energy Information Administration says the refineries are to blame. The Midwest has seen a number of planned and unplanned shut-downs in recent months depleting supplies. Gas prices are expected to decrease after the Memorial Day holiday.
House passes bill to speed Keystone approval
House Republicans passed a bill on Thursday that would circumvent the need for a special permit from the Obama administration in order to speed the process of the Keystone pipeline. The Wall Street Journal indicates that the bill is largely symbolic and is unlikely to become law because the Senate Democrats are expected to oppose any measure that disrupts the ongoing review of Keystone. The Keystone XL pipeline would stretch from Alberta to Nebraska where it would link up with other networks and allow Canadian oil to reach refineries on the US Gulf Coast. Republicans believe it would create hundreds of thousands of jobs. The Obama administration has rejected the Keystone initiative in the past.
Diners underestimate calories in fast food meals
USA Todayis reporting that a survey of 3400 adults, teens and parents of small children, who visited 89 fast food restaurants, vastly underestimated the calories in the meals they were eating. One fourth underestimated by at least 500 calories. Teens’ choices averaged 756 calories but they underestimated by an average of 259 calories. Adult meals averaged 836 calories but they underestimated by 175 calories. Children’s meals averaged 733 calories but parents underestimated by 175 calories. Diners at Subway underestimated more frequently than McDonald’s, Burger King, KFC, Wendy’s or Dunkin Donuts. Guess those Subway commercials promoting their good nutrition are working.
Catherine S. McBreen is President of Millionaire Corner. McBreen plans and develops content for Millionaire Corner. Catherine balances editorial content to meet the informational needs of both new and seasoned investors. She designs special monthly surveys on topical issues affecting the economic environment.
McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law. She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.
Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences. She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth. Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.
McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)
Catherine is the mother of four and is involved in many school and community events.