Trivial Pursuit III

Welcome to another edition of trivial pursuit via The City Wire — an irregular feature meant to provide info that is likely entertaining and only accidentally informative in a useful manner. Enjoy.

CREDIT DELINQUENCIES
Delinquent receivables in U.S. credit card portfolios receded from their month-earlier levels for the first time this year, according to the latest Credit Card Index results from Fitch Ratings.

“At this point, any sign of a pullback from the rate of acceleration in delinquencies is welcome news,” said Managing Director Michael Dean. “Whether it develops into a trend remains to be seen and since it will take time to work through, we expect continued increases in chargeoffs over the next few months.”

Despite declining for the first time in five months, delinquencies remain elevated near record levels and nearly 40% above year earlier rates. For the month, Fitch’s delinquency index, which measures receivables more than 60 days past due declined 7 basis points (bps) to 4.37%.

IT’S GREEN THEY SAY
NextGen Research says the market for green building materials will grow to $571 billion by 2013.

According to NextGen, buildings account for 38% of all CO2 emissions, use 13.6% of all potable water, and consume 72% of all electrical power generation in the U.S.

Commercial office buildings will be the largest non-residential target sector for green building products over the forecast period, according to the study. Also, new residential building and home improvement sectors present significant opportunities for green building products manufacturers.

BUYING BANKRUPT BRANDS
Kelley Blue Book, a provider of new car and used car information, reports that in-market new-car shoppers’ likelihood to buy a car from a bankrupt company improved in May 2009 versus April 2009. In May, 52% said they were likely to buy from General Motors if GM were going through bankruptcy versus 47% in April. Also, 31% said they were likely to buy from Chrysler if it were going through bankruptcy in May versus 29% in April.

TRUE INCENTIVES
Edmunds.com, a leading online resource for automotive information, estimates that the average automotive manufacturer incentive in the U.S. was $2,946 per vehicle sold in May 2009, down $111, or 3.6%, from April 2009, but up $622, or 26.8%, from May 2008.

Combined incentives spending for domestic manufacturers averaged $3,766 per vehicle sold in May 2009, down from $3,990 in April 2009. From April 2009 to May 2009, European automakers increased incentives spending by $214 to $3,823 per vehicle sold; Japanese automakers increased incentives spending by $171 to $1,907 per vehicle sold – a record high; and Korean automakers decreased incentives spending by $533 to $2,894 per vehicle sold.
 
In May 2009, the industry’s aggregate incentive spending is estimated to have totaled approximately $2.6 billion, up 4.9% from April 2009. Chrysler, Ford and General Motors spent an aggregate of $1.4 billion, or 55.2% of the total; Japanese manufacturers spent $695 million, or 26.5%; European manufacturers spent $296 million, or 11.3%; and Korean manufacturers spent $183 million, or 6.9%.

Among vehicle segments, premium sport cars had the highest average incentives, $6,865 per vehicle sold, followed by large SUVs at $4,267. Subcompact cars had the lowest average incentives per vehicle sold, $1,096, followed by compact cars at $2,117.

BROADBAND EXPANSION
Despite a challenging economic environment and contracting household budgets, U.S. broadband subscriptions will continue to grow in 2009, according to analyst firm Strategy Analytics. The company says U.S. Broadband Service Providers (BSPs) will add 5 million new subscribers in 2009.

Although more than 50% of Americans receive broadband through their cable provider, the role of fiber-optic cable is becoming increasingly important, and will account for 13% of all broadband connections in 2013, according to Strategy Analytics. Broadband household penetration in the US will exceed 80% in the next five years, according to the report.

RETIREMENT VIEWS
Seven in ten Germans (71%) and majorities of French (54%) and Spanish (53%) adults would oppose the idea of working beyond the current state pension/social security age to receive a larger pension while two-thirds of Americans (66%), three in five Britons (61%) and Italians (59%) would support such this idea.

These are some of the findings of a Financial Times/Harris Poll conducted among 6,332 adults aged 16-64 within France, Germany, Great Britain, Spain, and the United States and adults aged 18-64 in Italy between April 29 and May 6, 2009.

One question is who should be responsible for providing a secure income for individuals during retirement. Seven in ten Spaniards (69%) and 51% of Italians say the state/government should have the main responsibility. Majorities of Americans (54%), French (53%), and half of British adults (50%) as well as a plurality of Germans (46%) believe that the state, employers and individuals should all have equal responsibility for providing a secure income during retirement.

Two possible ways of boosting pensions would be to pay higher taxes and/or for people to accept lower pay now. Strong majorities (between 73% and 89%) in all six countries are opposed to the idea of paying higher taxes and even stronger majorities (between 78% and 92%) are opposed to the idea of having less pay in order to receive a bigger pension when they retire.

WASTE NOT
The faltering economy – not the fragile environment – is the biggest motivator for frequent travelers who have become “more conscious of waste” according to a survey commissioned by Element Hotels, which is launching The Element Eco-Travel Index.

According to the index, nearly 78% of respondents said they are paying more attention to wasteful habits like “leaving the lights on, leaving the TV on, [or] leaving the faucet running.” But more than 41% say their vigilance about squandering resources is “due to the economy, while just 28% claim it’s “due to the environment.”

Though nearly half (46%) of frequent travelers say they “always” recycle glass and plastic at home, that number dips to 36% on the road. Conserving water matters at home – more than 34% say they limit shower time or lawn-watering – but only 20% watch water consumption while traveling.

More than 65% of respondents said they’re more likely to change sheets and towels daily in a hotel versus in their home. At home, just under 35% of travelers said they always conserve energy by lowering the thermostat, but just 25% say they do the same on the road.

COLLEGE SAVINGS
Despite the ailing economy, more than half (52%) of parents are saving the same amount or more for college, according to a national study of parents from Sallie Mae and Gallup on “How America Saves for College.” Also, parents overwhelmingly expect their children to pursue higher education (92%) and half (48%) plan to pay for most or all of the cost. The nationally representative telephone survey was conducted in March/April 2009 among 1,200 parents of children under age 18.

In fact, 62% of parents of college-bound children are saving for education, trailing only retirement as a savings priority. Fourteen percent of parents reported saving the most for their children’s college, second to 27% who save the most for retirement. For nearly half (46%) of parents, saving for college ranks in their top three savings priorities.

Although the nation’s personal savings rate has risen to the highest it’s been in six years, only 5% of families have increased their college savings, compared to 18% who have increased their general savings and 12% who have increased retirement savings.

Nearly four out of 10 parents of college-bound children are not putting any money aside for college. Among the reasons they gave for not saving were that they don’t have enough money (62%), they are focusing on other savings priorities (49%), they expect their child to qualify for scholarships (35%), or they haven’t gotten around to starting a savings plan (34%).