Back to School Gets More Expensive
This year's back-to-school spending bills for many families will be more expensive than last year. The price pressure is not coming from stores but from schools, because of budget cuts in many districts. "We found that teachers are digging into their own pockets to supplement classroom supplies and then they're funneling some of those requests down to parents," says Trae Bodge of the shopping website RetailMeNot. "Almost 100 percent of parents that we surveyed anticipate having to spend additionally to supplement their children's classroom supplies."
Bodge says parents are "tightening back on the reigns and being much more conservative" about back-to-school spending than they were last year." Analysts are divided about the retail industry's second most important shopping season. The National Retail Federation predicts that back-to-school spending will be down this season as families with school-age children cut back following a record high total of $30.3 billion last year. Market research firm NPD in its retail forecast expects back-to-school spending to rise 5 percent compared with a year ago. Bodge says in her research "I'm finding that parents are encouraging their kids to re-use certain items."
Americans borrowed more in June to buy cars and go to college. The Federal Reserve says borrowing rose $13.8 billion in June from May to a seasonally adjusted $2.85 trillion, the highest ever. But the category that includes credit card use dropped $2.7 billion in June, indicating many consumers are still wary of taking on high-interest debt.
Imagine 65 percent unemployment. That was the official rate for 15 to 24-year-olds looking for a job in Greece. The government's statistics authority says the overall unemployment rate rose to a new record high of 27.6 percent in May, up from 23.8 percent in the same month last year. Greece has been depending on funds from international rescue loans since May 2010, after years of profligate spending and fiscal mismanagement left it with a massive budget deficit. Austerity measures are in place, including tax hikes and salary and pension cuts. Greece is currently in the sixth year of a deep recession.
America's largest bank says it's the subject of criminal and civil investigations on mortgage backed securities. JP Morgan Chase made the announcement in a public filing to regulators. This came one day after the Justice Department and SEC filed lawsuits against Bank of America. They claim the bank deliberately misled investors over how they sold mortgage-backed investments. The JP Morgan investigation covers the years leading up to the financial crisis: 2005 to 2007. In a separate investigation, "The Justice Department is targeting banks that service a broad range of what it considers questionable financial ventures, including online payday lenders," reports The Wall Street Journal. The government is reported to have issued subpoenas to banks and other companies that handle payments for an array of financial offerings.
Research firm IDC says Apple's iPhone continued to lose market share to Android phones in the second quarter. IDC says the iPhone remains No. 2 behind Android, even without new Apple products driving purchases. Its market share is expected to grow again when a new iPhone comes out, likely this fall. And Apple's profit margin on smartphone is much higher than other firms.
Richard Davies Business Correspondent ABC News Radio abcnews.com Twitter: daviesabc