What's Important in the Financial World (1/28/2013)
A New Credit Card Surcharge
Beginning this week, merchants may charge a 4% premium for people who use credit cards for their purchases. A settlement in a legal action between card companies and merchants has triggered that fee. Now, merchants will have to decide whether to take the risk of trying to collect it, or possibly drive customers to competitors who do not. Consumer advocates have advised shoppers to use debit cards or cash to get around the fee. That is inconvenient for people who do not have them. The trigger to the fees becoming widespread probably will be whether America's largest merchants charge them. If Wal-Mart Stores Inc. (NYSE: WMT) and Target Corp. (NYSE: TGT) waive the option, smaller retailers will face the loss of customers if they charge the fee. According to TIME:
Ultimately, though, consumer awareness will be the strongest deterrent against widespread credit-card surcharges. Stores have to let you know with a sign on the door if they're going to add a surcharge — although they don't have to tell you how much it is until point of sale, when you're already at the cash register. And today's retail landscape is hypercompetitive, so many stores will be hesitant to risk alienating customers by charging extra for using plastic.
World's Top Business Schools
The Financial Times has released its annual ranking of business schools from around the world. Readers may be stunned to find that the Harvard Business School, a wing of the huge university that is considered to be the top one in the world, ranked number one. Two other U.S. schools took second and third places - the Stamford Graduate School of Business and University of Pennsylvania's Wharton. The University of London ranked next. The Financial Times is a U.K.-based paper, so it would be embarrassing if the country did not have an entry in the top five. Although the United States does dominant the top 10 of the rankings, schools from Singapore/France, Spain and Hong Kong make it as well. Notably absent are schools from the People's Republic, Russia, Brazil and other huge developing markets. The BRICs have to send their students abroad, unless they want those students to get third-rate educations.
More Troubles for the 787 Dreamliner
A shocking development in the Boeing Co. (NYSE: BA) Dreamliner catastrophe: Japanese officials may have been lax in their safety tests of the plane. And U.S. regulators may have ignored suggestions from an important firm that works with the Federal Aviation Administration. According to Reuters:
Japan's government stepped in to give Boeing Co's now-grounded 787 Dreamliner and its made-in-Japan technology a boost in 2008 by easing safety regulations, fast-tracking the rollout of the groundbreaking jet for Japan's biggest airlines, according to records and participants in the process
And the Wall Street Journal reports:
Shortly after the Federal Aviation Administration issued safety rules in 2007 for using lithium-ion batteries on Boeing Co. 787 Dreamliner jets, an industry standards-setting group called for stricter testing to prevent battery fires on aircraft.
Boeing and FAA officials decided that since design and testing of the plane was so far along, mandating the tougher standards would disrupt years of joint safety work and unfairly delay production of the cutting-edge Dreamliners, said people familiar with the details.
Filed under: 24/7 Wall St. Wire, Market Open Tagged: BA, TGT, WMT