YouTube no longer pre-installed on Apple products
Google and Apple failed to renew a five year licensing agreement due to the growing hostility between the two companies, according to the Associated Press. YouTube is being bumped from the menu of pre-installed apps in the next version of Apple’s operating system, which could be unveiled on Wednesday. Google has already created an enhanced app for iPhone and iPad users. The new app will allow YouTube to show advertisements along with the video clips which is currently not allowed by Apple and therefore will be a moneymaker for Google.
Burberry cuts forecast causing a slide in luxury stocks
Burberry cut is third quarter forecast today, indicating it would be at the lower end of its forecast, due to lower sales in its retail shops. This caused the stock to slide 18 percent, according to CNBC. Other luxury brands, including LVMH, Gucci and Hermes also fell in European markets this morning. The Dow was down 52 points on Monday closing at 13,254. Asian and European stocks are mostly down on Tuesday.
Treasury sells AIG stock
The US Treasury Department sold a large amount of American International Group shares on Monday, ending the government’s majority ownership of the company. According to the Wall Street Journal, the sale is a turning point for AIG which has recovered since its bailout from the government in 2008. The Treasury sold 554 million shares at $32.50 apiece for $18 billion. It was the fifth sale of AIG stock and reduced the government’s ownership to 22 percent, down from 92 percent in 2011. The price was above the $28.73 per share taxpayer cost basis. This means the government has fully recovered its $182 billion commitment to AIG.
Americans cut back on credit card use
Total consumer borrowing dipped $3.3 billion in July from June to $2.705 trillion according to the Federal Reserve. USA Today reports that consumer debt declined even though spending increased in July. The financial crisis has caused consumers to pare down their debt. Household debt has declined for 16 straight quarters. Four years ago Americans had $1.03 trillion in credit card debt. Than number is now 17 percent lower at $850.7 billion.
iPhone 5 sales could add half a point to GDP
Underscoring the importance of Apple to the US economy, sales of Apple’s iPhone 5 could add as much as half a percentage point to the US fourth quarter annualized GDP, according to JP Morgan analysts. CNBC reports that Apple estimates it will sell 8 million units in the fourth quarter. The units are expected to sell for $600 apiece. JP Morgan estimates that the sales of iPhone 5 could boost fourth quarter GDP by $3.2 billion, or $12.8 billion at an annual rate.
Federal tax hike reduces tobacco consumption
A tax hike enacted by President Obama has helped to reduce tobacco consumption, according to USAToday. The tax caused the federal cigarette tax to jump from 39 cents per pack to $1.01 on April 1, 2009. Since then the tax has brought in $30 billion in new tax revenue. The tax caused an immediate increase in the cost of cigarettes of 22 percent. Studies by the Centers for Disease Control and Prevention indicate that about 3 million fewer people smoked last year. Tobacco use is down to 18.9 percent of the population, the lowest level on record. In 1990, 1 of every 20 teenagers smoked. That number is now down to one in every 71 students.
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.