Money Talk – Page 5

Banking, Business, Money Talk, Science & Technology News, security

Step-by-step guide to tokenizing real-world assets

January 6, 2020

Recent estimates place the current value of all real-world assets at around $256 trillion globally. While that jaw-dropping number is fairly stable, all of these assets keep changing owners on a regular basis.

Unfortunately, the processes used to trade these assets are completely outdated.

Ownership over a vast majority of real-world assets is still signified by pieces of paper. That’s why most transactions can take weeks or even months to complete. Asset trades are also plagued by extensive amounts of red tape, countless fees and various geographical restrictions. Furthermore, most assets are very difficult to subdivide, which makes their respective markets highly illiquid. Real estate, gold reserves and fine art are all great examples here.

Fortunately, with the recent development of tokenization, the way of owning and trading real-world assets might be on the brink of a true revolution.

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Economy, Latest Trend, Money Talk, Science & Technology News

The coming boom in Millennial wealth

December 31, 2019

Historically, much written on Millennials has focused on economic strife and crushing student loan debt. While, as with virtually every other generation in history, many Millennials have struggled financially during their youth, a new report from youth marketing experts YPulse makes four predictions that are suggestive of a significant turnaround being on the horizon.

Before getting to the predictions, it is important to take into account two key factors pertaining to Millennial wealth. First, the U.S. economy has been booming for a sustained period of time. Unemployment reached the point in 2018 where there are more open jobs than workers, the stock market is up, GDP has been growing at a healthy pace, and average real earnings have been increasing. In such an environment, those becoming established in jobs are in a better position to thrive. Moreover, many Millennials have been known to be careful spenders on many consumer products.

A second factor that bodes well for wealth growth is that student loans are not the albatross they are made out to be for most Millennials. While this does not mean that a significant number of individuals do not struggle with student debt, when one takes a macro view of the situation, it is not as bad as it has often been made out to be. One needs to remember that average level of $30,000 of student loan debt in 2019 would have translated to about $4650 in 1970 when an average aged Baby Boomer was taking out loans.

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Finance, Higher Education, Money Talk, Science & Technology News

How An Unlimited Supply Of Borrowed Cash Is Destroying Higher Education

December 31, 2019

Both of us grew up poor. College was our way out of poverty. Now, we see too many young people locked into poverty by a college education.

“You have to go to college” was an article of faith when we were growing up in poor families. Now we wonder if our ticket out of poverty still has the same value. Far too many of this generation are leaving college with substantial debt and few meaningful job opportunities.

Put a little differently, what is the value of a bachelor’s degree in women’s studies or sociology or any other fields that are not science, technology, engineering, mathematics, or business? Ask some of the young people working at your local coffee shop or favorite restaurant. They will probably tell you, “not much.”

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Housing, Money Talk, Science & Technology News

Startup plans to allow consumers to purchase homes without a mortgage. Innovative, or risky?

December 22, 2019

Innovative, or risky?

One new Los Angeles-based investor-backed startup is claiming it will get Americans into homes without requiring a mortgage.

Fleq will launch next month in Pittsburgh, and instead of originating mortgages, its plan is to simply buy the home a purchaser wants and sell it back to them, bit by bit, in shares. The buyer can choose the length of time that they want to pay for the home.

“We didn’t think that [mortgages] were the appropriate and fair approach to homeownership, and we didn’t think it resonated with Millennials and Gen Zers, who saw their parents wiped out by the financial crisis,” said founder and CEO Todd Sherer, whose background is in real estate finance.

Continue reading… “Startup plans to allow consumers to purchase homes without a mortgage. Innovative, or risky?”

Big Problems, Employment, Money Talk, Science & Technology News

The retirement crisis is real and frightening, as these six charts show

December 17, 2019

An uncertain retirement may be lurking just over that ridge.(Dennis Curran)

Is the “retirement crisis” just a scare story? That’s what conservatives would like you to believe as they rail against proposals from progressives in Congress to expand and increase Social Security.

Andrew Biggs, a former Social Security official, wrote recently in the conservative National Review that there’s no need to expand Social Security benefits because “Americans’ retirement incomes and retirement savings have never been stronger.”

That may be true, in the aggregate. But the question is: whose retirement incomes and savings? Monique Morrissey of the labor-supported Economic Policy Institute presents evidence that, just as income inequality for those in their working years has soared, so has inequality in the distribution of retirement resources.

The trends…paint a picture of increasingly inadequate retirement savings for successive generations of Americans—and large disparities by income, race, ethnicity, education, and marital status.

Continue reading… “The retirement crisis is real and frightening, as these six charts show”

government, Legal Issues, Money Talk, Science & Technology News

The great American tax haven: why the super-rich love South Dakota

November 24, 2019

Late last year, as the Chinese government prepared to enact tough new tax rules, the billionaire Sun Hongbin quietly transferred $4.5bn worth of shares in his Chinese real estate firm to a company on a street corner in Sioux Falls, South Dakota, one of the least populated and least known states in the US. Sioux Falls is a pleasant city of 180,000 people, situated where the Big Sioux River tumbles off a red granite cliff. It has some decent bars downtown, and a charming array of sculptures dotting the streets, but there doesn’t seem to be much to attract a Chinese multi-billionaire. It’s a town that even few Americans have been to.

The money of the world’s mega-wealthy, though, is heading there in ever-larger volumes. In the past decade, hundreds of billions of dollars have poured out of traditional offshore jurisdictions such as Switzerland and Jersey, and into a small number of American states: Delaware, Nevada, Wyoming – and, above all, South Dakota. “To some, South Dakota is a ‘fly-over’ state,” the chief justice of the state’s supreme court said in a speech to the legislature in January. “While many people may find a way to ‘fly over’ South Dakota, somehow their dollars find a way to land here.”

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Analysis, Big Problems, government, Money Talk, Science & Technology News

$69 trillion of world debt in one infographic

November 23, 2019

Two decades ago, total government debt was estimated to sit at $20 trillion.

Since then, according to the latest figures by the IMF, the number has ballooned to $69.3 trillion with a debt to GDP ratio of 82% — the highest totals in human history.

Which countries owe the most money, and how do these figures compare?

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Banking, Latest Trend, Money Talk, Science & Technology News

The invisible company powers almost the entire finance industry

November 21, 2019

The days of going to a bank are coming to an end.

In the past 10 years, 15,000 bank branches have shut their doors for good. And foot traffic to banks has fallen by 50%. Bank branches are shutting down left and right for a simple reason… They’re useless!

These days, you can deposit a check by taking a photo with your phone. You can open a bank account or order a new credit card in five minutes over the internet. You can even take out a mortgage without ever seeing a human banker, thanks to disruptive services like Quicken Loans.

And it’s not just banks. Digital disruption is eating away at every “old” business model in finance. Everyone from stockbrokers to financial planners is under assault.

Continue reading… “The invisible company powers almost the entire finance industry”

Banking, Google, Money Talk, Science & Technology News

Google to offer checking accounts in partnership with banks starting next year

November 21, 2019

Google is the latest big tech company to make a move into banking and personal financial services: The company is gearing up to offer checking accounts to consumers, as first reported by The Wall Street Journal, starting as early as next year. Google is calling the project “Cache,” and it’ll partner with banks and credit unions to offer the checking accounts, with the banks handling all financial and compliance activities related to the accounts.

Google’s Caesar Sengupta spoke to the WSJ about the new initiative, and Sengupta made clear that Google will be seeking to put its financial institution partners much more front-and-center for its customers than other tech companies have perhaps done with their financial products. Apple works with Goldman Sachs on its Apple Card credit product, for instance, but the credit card is definitely presented primarily as an Apple product.

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Banking, Money Talk, Science & Technology News

“The Deadly Trifecta” is among threats putting $88 billion in banks’ payments revenue at risk

November 8, 2019

While fintechs and other nonbank payments providers continue to carve out more market share for themselves, banks could face losing up to $88 billion in payments revenue to them. That’s the assessment from Accenture, the consulting firm that on Wednesday released its latest report, “5 Big Bets in Retail Payments in North America.”

Of that $88 billion, $82 billion is attributable to U.S. banks and $6 billion to Canadian institutions.

Payments revenue among U.S. and Canadian banks is slowing. According to Accenture, retail-payments revenue will likely grow at a compound annual rate of 4% over the next six years, going from $322 billion in 2019 to $405 billion in 2025. To ensure getting a share of that growth, banks and other payment-industry incumbents need to shift strategies, Accenture says.

Continue reading… ““The Deadly Trifecta” is among threats putting $88 billion in banks’ payments revenue at risk”

Big Problems, Housing, Money Talk, Science & Technology News

Earning $100,000 used to mean something. Now you can barely afford to buy a home- Here’s the big problem

October 27, 2019

For many people, when we were starting out in our careers, earning a six-figure salary was the ultimate goal. If you made $100,000 or more, you were considered relatively successful. The compensation would afford you the opportunity to fulfill the American dream—owning a home with a white picket fence in a lovely neighborhood with good schools for when you have children. Fast-forward to today and that has all changed.

According to the Wall Street Journal, there is a growing trend of $100k-earning professionals electing to rent instead of purchasing homes. Almost 20% of households earning $100k or more are bucking historical norms and renting apartments. A $100k income is still considered a comfortable living, dependent upon the city. To put things into perspective, the median U.S. household income, according to the Census Bureau, was $63,179 in 2018.

Here’s why this trend is an issue. The reasons for renting—compared to buying a home—are complex. Due to exceedingly high student-loan debt, burdensome personal expenses (such as insurance and health care costs), leased cars, credit card debt, smartphones, utility bills and other expenses have made it difficult for potential buyers to save enough for the down payment on a home.

Continue reading… “Earning $100,000 used to mean something. Now you can barely afford to buy a home- Here’s the big problem”

Banking, Business, Money Talk, Science & Technology News

Venmo to launch its first credit card in 2020

October 27, 2019

Venmo announced today its plans to launch its first-ever credit card. The card is being issued in partnership with Synchrony, already the issuer behind Venmo parent company PayPal’s Extras Mastercard and Cashback Mastercard. The move is meant to help Venmo, a still unprofitable arm of PayPal’s larger business, generate more revenue.

PayPal’s plans in this space were reported in April of this year by The WSJ, which said the company had been taking meetings with various banks since late 2018 to discuss a Venmo-branded credit card. The report said PayPal was then close to selecting Synchrony as its issuer and would likely announce the card sometime later in 2019, as it now has.

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