Business

How to Get the Most Bang for Your Buck

Published

3 years ago

June 14, 2022

For American vacationers heading overseas, the rising energy of the greenback is the upside of a risky economic system. Presently, the change price with the euro is about $1.04, which means every 100 euros will price about $104. One euro was price about $1.22 this time final 12 months. The current price is down considerably from its excessive in 2008, when every euro was price $1.58.

The greenback is up in opposition to different foreign currency, too, together with the British pound. Presently, $1 buys about 82 pence, making the price of 100 kilos about $122. Final June, the speed was 70 pence to the greenback, which means 100 kilos price about $143 then.

Which means that spending overseas is cheaper. A 5-euro glass of wine in Rome in 2008 might need price about $8, in comparison with $5.20 in the present day. A 100-euro rental house in Paris that’s $104 this summer time might need been $158 when the euro peaked. And a 60-pound ticket to London’s hit revival of “Cabaret” prices $73 now, whereas a equally priced present final summer time would have price $85.

However are you higher off, contemplating that accommodations and flights price extra now, too? And the way do you be sure you’re getting the very best price? Here’s what’s driving the market and easy methods to benefit from a robust greenback overseas.

Why is the greenback up, and for a way lengthy?

The greenback has gained notably in opposition to the euro and a few economists imagine it might attain parity — one thing not seen in 20 years — by 12 months finish.

Why is it going up? Because the Federal Reserve has raised rates of interest to deliver down inflation, the transfer has made investments right here extra interesting, which is without doubt one of the primary the explanation why the greenback is stronger, in response to Tom Smythe, a professor of finance at Florida Gulf Coast College in Fort Myers, Fla. Moreover, the Russian invasion of Ukraine has roiled world economies, sending traders seeking secure havens.

“When unhealthy issues begin to occur, individuals are likely to migrate again to U.S. investments and that can strengthen the greenback relative to different currencies,” Mr. Smythe stated.

All which means U.S. vacationers’ {dollars} will purchase extra in lots of abroad locations. And most consultants imagine the greenback will stay robust all year long.

Diana Hechler, the proprietor of D Excursions Journey, primarily based in Larchmont, N.Y., who focuses on European journey, calls the bettering charges a “sweetener” for shoppers contemplating Europe this summer time and will assist them overcome different issues.

However aren’t costs increased, too?

As at house, costs are up overseas, about 8 p.c among the many main buying and selling companions of the US, in response to Mr. Smythe.

“Costs are nonetheless going to be excessive, however relative to 6 months in the past you’ll be capable to purchase extra,” he stated.

It’s not simply inflation at work. Robust demand has pushed costs up.

At Vacationer Journey, a web based platform that enables vacationers to customise journey planning in 20 nations, prices for the everyday journey in Italy is 60 p.c increased than final summer time, when journey in Europe was depressed and charges particularly low.

“With many accommodations we collaborate with, it doesn’t matter what the price range is, there’s merely no availability,” wrote Ben Julius, the founding father of Vacationer Journey, in an electronic mail, noting that lodge rooms on the Amalfi Coast that went for $750 then at the moment are priced round $1,000.

Airfares, usually bought in U.S. {dollars}, are up, too. Spherical-trips to Europe are averaging $971, up 13 p.c, in response to the airfare reserving app Hopper, however lower than the 30 p.c enhance on home fares, which at the moment common $395 spherical journey.

The stronger change price takes a few of the sting out of lodging price will increase. The common each day price for a lodge room in Europe in April was 118 euros ($123 utilizing in the present day’s change price), in comparison with 109 euros ($114) in April 2019, a roughly 8 p.c enhance because the pandemic, in response to STR, a lodge benchmarking agency. By comparability, the common enhance at accommodations in the US in that interval was practically 14 p.c and the common price in April was about $150.

“Usually, lodge charges in Europe are extra cheap than home charges, and the change price solely helps that,” stated Keith Waldon, the founding father of Departure Lounge, a high-end journey company in Austin, Texas, who not too long ago spent two months in Florence. “Plus, restaurant pricing in lots of instances has gone down as eating places attempt to deliver again demand.”

With seven Parisian areas, Orso Resorts is averaging 85 p.c occupancy in June, which is excessive. Nonetheless, administration has raised its costs solely barely in response to demand. Its nightly charges for the Lodge Leopold within the Montparnesse district in 2019, when it had simply opened, was 150 to 200 euros. This June its common price is 216 euros.

“Whereas we may enhance our nightly charges after two distressed years, now we have determined to not take that threat as a result of we wish individuals to return to Paris and be proud of their journey and have it at a good worth,” stated Louis Solanet, the proprietor.

Along with his spouse, Danny Groner, a advertising and marketing director in New York Metropolis, determined to go to Copenhagen and London relatively than Panama this summer time once they heard in regards to the favorable change price with the euro. (Since Panama successfully makes use of the greenback, the price of touring there gained’t be altered by the greenback’s energy.) Most of their price range will go to airways and accommodations, however they anticipate to avoid wasting on museum admissions, excursions and meals.

“If it prices a little bit extra to get there and get settled, I really feel hopeful that each different buy might be a discount as compared,” Mr. Groner stated.

Ms. Hechler, the journey agent, not too long ago returned from a cruise on the Danube River the place she obtained a leap begin on Christmas buying.

“I used to be used to $1.45 to the euro,” she stated. “Why wouldn’t you buy groceries proper now?”

Find out how to benefit from the change price

There are three important monetary steps to making sure you’re getting the absolute best change price, in response to Leigh Rowan, the founding father of Savanti Journey, a journey administration firm primarily based in San Francisco: Pay with a bank card with no international transaction charges (decide this by calling your financial institution); withdraw money overseas, if wanted, through an A.T.M. within the native forex (and skip the forex exchanges at airports, which provide poorer charges); and all the time choose the native forex on a bank card buy if provided a alternative between it and U.S. {dollars}.

By dealing within the native forex, you’re avoiding what is named dynamic forex conversion, the place a service provider allows you to see the price in your nationwide forex and could also be buying and selling in your ignorance of the official conversion price.

“For those who pay a service provider in {dollars}, they’re marking up their very own price,” Mr. Rowan stated. “If 100 euros is about $108, they may provide $118 and also you’ll pay extra due to your confusion.”

A positive international change is only one incentive for a lot of present vacationers.

“Our vacationers have maximized their {dollars} most these previous three to 6 months, visiting nations akin to Argentina and South Africa,” wrote Kareem George, the proprietor of Tradition Traveler, a journey company in Franklin, Mich., in an electronic mail. “The motivation of a stronger greenback is compounded by the truth that many of those locations stay removed from their prepandemic visitation ranges. Vacationers are having fun with main sights with fewer crowds and are greeted warmly and attentively by locals eager to have tourism return.”

Elaine Glusac writes the Frugal Traveler column. Observe her on Instagram @eglusac.

Business

Cookies, Cocktails and Mushrooms on the Menu as Justices Hear Bank Fraud Case

Published

12 minutes ago

January 15, 2025

Press Room

Cookies, Cocktails and Mushrooms on the Menu as Justices Hear Bank Fraud Case

In a lively Supreme Court argument on Tuesday that included references to cookies, cocktails and toxic mushrooms, the justices tried to find the line between misleading statements and outright lies in the case of a Chicago politician convicted of making false statements to bank regulators.

The case concerned Patrick Daley Thompson, a former Chicago alderman who is the grandson of one former mayor, Richard J. Daley, and the nephew of another, Richard M. Daley. He conceded that he had misled the regulators but said his statements fell short of the outright falsehoods he said were required to make them criminal.

The justices peppered the lawyers with colorful questions that tried to tease out the difference between false and misleading statements.

Chief Justice John G. Roberts Jr. asked whether a motorist pulled over on suspicion of driving while impaired said something false by stating that he had had one cocktail while omitting that he had also drunk four glasses of wine.

Caroline A. Flynn, a lawyer for the federal government, said that a jury could find the statement to be false because “the officer was asking for a complete account of how much the person had had to drink.”

Justice Ketanji Brown Jackson asked about a child who admitted to eating three cookies when she had consumed 10.

Ms. Flynn said context mattered.

“If the mom had said, ‘Did you eat all the cookies,’ or ‘how many cookies did you eat,’ and the child says, ‘I ate three cookies’ when she ate 10, that’s a false statement,” Ms. Flynn said. “But, if the mom says, ‘Did you eat any cookies,’ and the child says three, that’s not an understatement in response to a specific numerical inquiry.”

Justice Sonia Sotomayor asked whether it was false to label toxic mushrooms as “a hundred percent natural.” Ms. Flynn did not give a direct response.

The case before the court, Thompson v. United States, No. 23-1095, started when Mr. Thompson took out three loans from Washington Federal Bank for Savings between 2011 and 2014. He used the first, for $110,000, to finance a law firm. He used the next loan, for $20,000, to pay a tax bill. He used the third, for $89,000, to repay a debt to another bank.

He made a single payment on the loans, for $390 in 2012. The bank, which did not press him for further payments, went under in 2017.

When the Federal Deposit Insurance Corporation and a loan servicer it had hired sought repayment of the loans plus interest, amounting to about $270,000, Mr. Thompson told them he had borrowed $110,000, which was true in a narrow sense but incomplete.

After negotiations, Mr. Thompson in 2018 paid back the principal but not the interest. More than two years later, federal prosecutors charged him with violating a law making it a crime to give “any false statement or report” to influence the F.D.I.C.

He was convicted and ordered to repay the interest, amounting to about $50,000. He served four months in prison.

Chris C. Gair, a lawyer for Mr. Thompson, said his client’s statements were accurate in context, an assertion that met with skepticism. Justice Elena Kagan noted that the jury had found the statements were false and that a ruling in Mr. Thompson’s favor would require a court to rule that no reasonable juror could have come to that conclusion.

Justices Neil M. Gorsuch and Brett M. Kavanaugh said that issue was not before the court, which had agreed to decide the legal question of whether the federal law, as a general matter, covered misleading statements. Lower courts, they said, could decide whether Mr. Thompson had been properly convicted.

Justice Samuel A. Alito Jr. asked for an example of a misleading statement that was not false. Mr. Gair, who was presenting his first Supreme Court argument, responded by talking about himself.

“If I go back and change my website and say ‘40 years of litigation experience’ and then in bold caps say ‘Supreme Court advocate,’” he said, “that would be, after today, a true statement. It would be misleading to anybody who was thinking about whether to hire me.”

Justice Alito said such a statement was, at most, mildly misleading. But Justice Kagan was impressed.

“Well, it is, though, the humblest answer I’ve ever heard from the Supreme Court podium,” she said, to laughter. “So good show on that one.”

Business

SEC probes B. Riley loan to founder, deals with franchise group

Published

1 hour ago

January 14, 2025

Press Room

SEC probes B. Riley loan to founder, deals with franchise group

B. Riley Financial Inc. received more demands for information from federal regulators about its dealings with now-bankrupt Franchise Group as well as a personal loan for Chairman and co-founder Bryant Riley.

The Los Angeles-based investment firm and Riley each received additional subpoenas in November from the U.S. Securities and Exchange Commission seeking documents and information about Franchise Group, or FRG, the retail company that was once one of its biggest investments before its collapse last year, according to a long-delayed quarterly filing. The agency also wants to know more about Riley’s pledge of B. Riley shares as collateral for a personal loan, the filing shows.

B. Riley previously received SEC subpoenas in July for information about its dealings with ex-FRG chief executive Brian Kahn, part of a long-running probe that has rocked B. Riley and helped push its shares to their lowest in more than a decade. Bryant Riley, who founded the company in 1997 and built it into one of the biggest U.S. investment firms beyond Wall Street, has been forced to sell assets and raise cash to ease creditors’ concerns.

The firm and Riley “are responding to the subpoenas and are fully cooperating with the SEC,” according to the filing. The company said the subpoenas don’t mean the SEC has determined any violations of law have occurred.

Shares in B. Riley jumped more than 25% in New York trading after the company’s overdue quarterly filing gave investors their first formal look at the firm’s performance in more than half a year. The data included a net loss of more than $435 million for the three months ended June 30. The shares through Monday had plunged more than 80% in the past 12 months, trading for less than $4 each.

B. Riley and Kahn — a longstanding client and friend of Riley’s — teamed up in 2023 to take FRG private in a $2.8-billion deal. The transaction soon came under pressure when Kahn was tagged as an unindicted co-conspirator by authorities in the collapse of an unrelated hedge fund called Prophecy Asset Management, which led to a fraud conviction for one of the fund’s executives.

Kahn has said he didn’t do anything wrong, that he wasn’t aware of any fraud at Prophecy and that he was among those who lost money in the collapse. But federal investigations into his role have spilled over into his dealings with B. Riley and its chairman, who have said internal probes found they “had no involvement with, or knowledge of, any alleged misconduct concerning Mr. Kahn or any of his affiliates.”

FRG filed for Chapter 11 bankruptcy in November, a move that led to hundreds of millions of dollars of losses for B. Riley. The collapse made Riley “personally sick,” he said at the time.

One of the biggest financial problems to arise from the FRG deal was a loan that B. Riley made to Kahn for about $200 million, which was secured against FRG shares. With that company’s collapse into bankruptcy in November wiping out equity holders, the value of the remaining collateral for this debt has now dwindled to only about $2 million, the filing shows.

Griffin writes for Bloomberg.

Business

Starbucks Reverses Its Open-Door Policy for Bathroom Use and Lounging

Published

8 hours ago

January 14, 2025

Press Room

Starbucks Reverses Its Open-Door Policy for Bathroom Use and Lounging

Starbucks will require people visiting its coffee shops to buy something in order to stay or to use its bathrooms, the company announced in a letter sent to store managers on Monday.

The new policy, outlined in a Code of Conduct, will be enacted later this month and applies to the company’s cafes, patios and bathrooms.

“Implementing a Coffeehouse Code of Conduct is something most retailers already have and is a practical step that helps us prioritize our paying customers who want to sit and enjoy our cafes or need to use the restroom during their visit,” Jaci Anderson, a Starbucks spokeswoman, said in an emailed statement.

Ms. Anderson said that by outlining expectations for customers the company “can create a better environment for everyone.”

The Code of Conduct will be displayed in every store and prohibit behaviors including discrimination, harassment, smoking and panhandling.

People who violate the rules will be asked to leave the store, and employees may call law enforcement, the policy says.

Before implementation of the new policy begins on Jan. 27, store managers will be given 40 hours to prepare stores and workers, according to the company. There will also be training sessions for staff.

This training time will be used to prepare for other new practices, too, including asking customers if they want their drink to stay or to go and offering unlimited free refills of hot or iced coffee to customers who order a drink to stay.

The changes are part of an attempt by the company to prioritize customers and make the stores more inviting, Sara Trilling, the president of Starbucks North America, said in a letter to store managers.

“We know from customers that access to comfortable seating and a clean, safe environment is critical to the Starbucks experience they love,” she wrote. “We’ve also heard from you, our partners, that there is a need to reset expectations for how our spaces should be used, and who uses them.”

The changes come as the company responds to declining sales, falling stock prices and grumbling from activist investors. In August, the company appointed a new chief executive, Brian Niccol.

Mr. Niccol outlined changes the company needed to make in a video in October. “We will simplify our overly complex menu, fix our pricing architecture and ensure that every customer feels Starbucks is worth it every single time they visit,” he said.

The new purchase requirement reverses a policy Starbucks instituted in 2018 that said people could use its cafes and bathrooms even if they had not bought something.

The earlier policy was introduced a month after two Black men were arrested in a Philadelphia Starbucks while waiting to meet another man for a business meeting.

Officials said that the men had asked to use the bathroom, but that an employee had refused the request because they had not purchased anything. An employee then called the police, and part of the ensuing encounter was recorded on video and viewed by millions of people online, prompting boycotts and protests.

In 2022, Howard Schultz, the Starbucks chief executive at the time, said that the company was reconsidering the open-bathroom policy.