Today’s bits: Planes, trains, and automobiles

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Interest Rates

The Fed is embarking on a path that usually ends with a recession

On Friday, Fed Chair Janet Yellen signaled that a March rate hike is on the table and said the pace of the Fed raising rates in 2017 would likely exceed that seen in 2015 and 2016.

And while an accomodative Fed has been seen as a backstop for markets during the post-crisis bull run higher, a tighter Fed is bad news for stocks because when rates begin to rise, the end of the bull market has already been signaled.

Image credit: Yahoo

10 out of 13 times, it ended badly

Rosenberg added that, “there have been 13 Fed rate hike cycles in the post-WWII era, and 10 landed the economy in recession. Soft landing are rare and when they have occurred, they have come in the third year of the expansion, not the eighth.” (Yahoo)

Personal loans from Goldman Sachs?

It looks like Marcus, a Goldman Sachs company, is offering short term personal loans. They’re potentially quite pricey:

Rates range from 5.99% to 22.99% APR and loan terms range from 24 to 72 months. Only the most creditworthy applicants qualify for the lowest rates, longest loan terms and largest loan amounts. Rates will generally be higher for longer-term loans.

They are noting that these loans come with no fees. “Get a personal loan with no fees. Ever.” Why is that fees have become the most important aspect of securing a loan of late? The most important aspect of a loan is the interest rate that they are charging. If someone offered you a loan for 4 percent, but charged you a one percent loan initiation fee, that would be cheaper than a 6 percent loan without any fees.

Seriously, 23 percent for a loan? The only people who could afford 23 percent interest on a $30K loan would never need a loan for $30K in the first place.

Netflix for cars

A while back, I mentioned that you could rent a monthly interest in Cadillacs. I haven’t tried this, but here’s the findings from someone who has. (BI)

Netflix for fitness

Stationary at-home bikes, and streams 12 hours of live cycling classes a day. Connects riders with more than 4,000 on-demand classes. This company has no competition… yet

Don’t buy a used car

I have been a proponent of buying used cars vs. new cars. I’ve often suggested that it makes more cent$ so let someone else pay full price for the car and they you buy the car two or three years later at a much lower price. Here’s a counter argument suggesting that used cars are more expensive than new cars. It’s essentially arguing the devil you know (the expensive new car) offers more peace of mind than the devil you don’t know (the cheaper used car.) (Outside)

Boarding a plane is about to get easier?!

My wife and I love to travel, well we love to visit other lands, the traveling part stinks. I mentioned to her yesterday that my least favorite part of traveling is boarding the plane. Flying is fine, landing is fine. Even going through the security check point is fine. My bugaboo is boarding the plane; it’s stressful — seemingly unnecessarily stressful. It ruins the trip for me. I’ve always felt that Southwest Airlines’ approach is better than most. While you can’t pick your seats in advance, the queuing process is organized and relatively stress free.

All the other domestic carriers have you select your seats in advance and board according to some seemingly random approach; no longer do you board from the rear of the plane. One airline — American Airlines — is claiming to be streamlining the process. While this sounds interesting in theory, reading this article made my skin start to crawl a bit and my stress level began to increase as well. For instance, they are suggesting that the people in coach who board first are the fifth group to board the plane. Maybe we’ll plan a stay-cation this year instead. (WSJ)

Making tracks

After years of prep work, California has decided that the $64 billion high-speed rail project is ready to lay some track. Start laying tracks. A spending budget of $2.6 billion has been approved, but don’t expect much anytime soon. The first 29-mile segment of track isn’t expected to be completed until at least August 2019.

Vegas wants a bullet train too

Would you pay $115 for a round-trip high-speed train trip from LA to Vegas? (Well, not LA, but Palmdale, a near-by community.) This could be a reality.

A high-speed train system linking Las Vegas and Southern California would attract about 11 million round-trip riders and generate roughly $1 billion in annual revenue by full buildout in 2035, according to a report released Thursday. (Review Journal)

$550 a year for a credit card?!

American Express announced Thursday it’s amping up rewards for its Platinum credit card. With that, it’s also increasing its annual fee by 22% to $550 from $450, the first time the fee has increased since 2007. Is it worthwhile? (Marketwatch)


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