Monthly Archives: September 2011

Corporate profits way up, why aren’t executives buying jets?

WICHITA — Corporate profits in the U.S. hit a new record in the second quarter, at $1.94 trillion (annualized). That is up 8.5 percent from the second quarter of 2010. Companies have done spectacularly well in the recovery – profits were up 9 percent in 2009 and up 32 percent 2010.

Profits in the past were one of the most important signals of future business for corporate jet sales. Why not this time? It could be a simple lag before executives feel comfortable with buying. It could be that executives still feel insecure financially and are stockpiling money for a future recession (profit growth is slowing). Or, it may mean executives are feeling a little embarrassed to be seen buying jets when they’re not hiring workers.

Any guesses?

Retailers say ‘don’t blame us’ for new bank fees

WICHITA — When Bank of America announced that it was going to slap a $5 a month charge to use its debit cards today, I was pretty ticked, as I’m sure were many, many other customers. Banks, of course, say they have to make up for money they lost when Congress this summer limited fees banks charged retailers. It was a lobbyist battle royal, with the giant banks fighting the giant retailers over who gets to keep $20 billion in swipe fees.  At the time, the banks warned that if they lost, somebody would have to pay. Now we know who Bank of America thinks it should be, and the National Retail Federation reacted today by saying, more or less, don’t blame us, it’s  another example of banker greed:

“Every time Congress takes a step to protect consumers, the banks use it as an excuse to raise fees. We’ve seen it when Congress limited late fees and overdraft fees and now we’re seeing it with swipe fees. Just as merchants and consumers are about to get some relief, they’re doing it again. That doesn’t mean Congress shouldn’t pass consumer protection laws. It speaks more to the nature of the card industry than to whether swipe fee reform should have been passed,” according to Senior Vice President and General Counsel Mallory Duncan.

Who do you think is to blame?

Foreclosures down 25 percent from last year

WICHITA — Foreclosures in Sedgwick County in August are down again compared to last year. So far, this year, there were 1,382 foreclosures filed, compared to 1,841 by Aug. 31 last year, according to figures from the office of Sedgwick County District Court Judge Timothy Lahey.  That’s a huge drop and puts the county on track to about equal the rate in 2007.

Theories differ as to what’s going on.  Some in the industry say it reflects a true drop in the distress levels among local homeowners — the theory is that it’s been two years since employment plunged and most of the marginal mortgage holders have already been through the system. Others say that the numbers are falling, partly or largely, because the banks (we’re generally talking big, out-of-town banks) have slowed down the processing of foreclosures because they were caught robo-signing, etc. and this is as fast as they can do it legally.