American Express’ Double Whammy
Things just went from bad to worse for American Express (AXP). The company is still reeling after losing its cushy position as the only card accepted at Costco (COST), from which they may lose $80 billion in card spending. And this week, AmEx took a second blow in the court system.
You might have noticed you get a better deal if you pay cash for some things. That’s because every time you swipe your card, the store has to pay a small fee to your credit card company. AmEx has one of the highest fees in the industry, so some small businesses will ask you to use Visa or Mastercard instead. American Express had been telling retailers it’s illegal to show preferential credit card treatment, but a court just ruled that shops can ask customers to use whichever card they want. Sorry AmEx.
Wal-Mart: Can’t Buy Me Love
This was a good news, bad news week for Wal-Mart. The company’s earnings report yesterday was a letdown, with a revenue miss for the quarter and income down year over year. However, Wal-Mart announced a big move; it’s raising minimum wage for all employees to $9 this year, and $10 in 2016.
It’s a step in the right direction for Wal-Mart, but many workers still don’t think it’s enough. A few states already feature a $9 minimum wage, and there’s a push to move federal minimum wage to $10.10 an hour anyways. Not to mention, it’s still far below Costco’s wages.
Greece Just Can’t Get it Together
Greece has become the Lindsay Lohan (c. 2010) of countries recently. The county’s economic woes have been at the forefront of news ever since the new leftist government decided that it didn’t want to play by the budget rules that came with its bailout money (this post has a simple explanation of Greece’s bailout crisis).
Greece’s bailout deal expires at the end of month, and if it can’t secure additional money, it’s likely to have a serious bill-paying issue and may leave the Euro currency. On Monday, Greece rejected a plan for additional money from the European Union, because it doesn’t think it needs to agree to spending cutbacks in exchange for money (note: you can’t do this in real life). Then Greece proposed a six-month loan extension while it worked out a permanent deal, but Germany quickly nipped that in the bud. Now time is ticking to see if the parties can reach an agreement before February 28th.
Samsung Gets Back in the Game
Watch out Apple (AAPL); Samsung’s coming for you. Apple made waves last year with its unveiling of Apple Pay, which allows users to upload credit card information to their phones, and swipe their phones as payment at participating retailers. Now, Samsung joined the mobile payment game by acquiring startup LoopPay.
Unlike Apple Pay, which requires retailers to install a near-field communications (NFC) device, LoopPay is compatible with existing credit card readers and doesn’t need any extra equipment. That could give it a major leg up over Apple Pay.
My New Haven TDT Talk
I wanted to say a big thank you to the New Haven JCC and the New Haven Jewish Business League for inviting me to speak last night, as well as a thank you to everyone who braved the cold and came out to Mory’s! I had a great time chatting about investing, how to budget better, simple ways to save, and my #1 piece of financial advice (hint: it doesn’t involve the stock market).
I’m hoping to have more speaking events soon so I can chat with even more of you! Please shoot me an email if you have an upcoming finance event you’d like me to be involved with.