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Kit Menkin’s Leasing News www.leasingnews.org Monday, November 12 ,2001 Veteran’s Day. Flags at half mast until Noon to salute those who have died in the service of our country. Flags full mast at noon to salute those in service, who are defending our country. ---------------------------------------------------------------------------------------------------------- Headlines--- Equidity ( formerly Equalfooting)files BK Classified Section—Up Date Monday---Odds and Ends Be Wary of Those Zero Percent Loans/Not that Simple Comdex Show ( Leasing News Webmaster Carl Moberg will have a special report on the show ) Federal judge rejects HP's purchase of Comdisco unit/Sells to SunGard
Wholesale Prices Fall, Biggest Decline in More
than a Half-Century Credit Card Giant Providian Pays for Growth National Train System Not on Track Web site provides list of unclaimed IRS rebate checks Leasing News “The List” on Tuesday
Holga Storage Kit, I am curious why the filing/ storage system was offered for 8K but no leasing options were mentioned. (smile) If anyone is interested in the filing system from Textron, we would be happy to help them establish an affordable monthly investment plan and get that piece of equipment into their office. Brian Montgomery Express Funding Solutions ( Usually sellers on used equipment want cash, to make it a “clean sale” and get off their books. Perhaps Textron may lease it, but certainly Brian Montgomery will. editor ) For
Sale—Holga Filing System---Bargain Price, It is Reported----
I am the Manager of Collateral and Office Services for Vendor Finance, Textron Financial. We have a 1 1/2 year old Holga Filing
System we need to find a home for due to the closure of this division at the end of the year. The system will hold upwards of 40,000 letter size files.
It is in excellent condition. I have digital photos that I can forward to interested parties. The system is $8000.00 plus removal. If anyone is interested, they can contact me Monday thru Friday at 503-675-5463.\
Terri
Trout TTrout@TFC.Textron.com _______________________________________________________________- Monday Odds and Ends from: Bob Teichman: Another great example of the Menkin sense of humor. Who wrote this letter printed in today's Leasingnews? Quote... "I choose to sign my name..." I think you do an excellent job of weeding through the comments and printing pertinent stuff. I choose to sign my name to anything I put out on the airwaves. That's because I wouldn't hesitate to say what I say directly to their face. You already know how I feel about people who don't sign their name to their comments, especially the ones who want to criticize and nitpick. That's why you filter this comments. President LeaseNOW, Inc. drlease@leasenow.com www.leasenow.com 1-800-321-LEAS (5327)x 10 " Bob Teichman, CLP Teichman Financial Training 3030 Bridgeway, Suite 213 Sausalito, CA 94965 Tel: 415-331-6445 Fax: 415-331-6451 e-mail: BoTei@aol.com ( Hey, it was signed by: president, LeaseNow, with e-mail, address, telephone number. I think it was you who told me one of the questions on the Certified Lease Professional test is “Who is the president of LeaseNOW?” editor ). From Bob Rodi: I have two things for you. While I appreciate your use of my comments regarding signing my name to correspondence to Leasingnews, you actually failed to include my name at the end of my quote. Hopefully most of the seasoned followers of Leasingnews will recognize who I am from my title and company, but the new readers, I'm sure don't have any idea. Maybe you were giving a hint and readers were supposed to guess my name, was that it?
( Was only keeping the readers on their toes. editor ) Secondly, I have a follow-up to Archie Julian's comment about calling on Ikon sales people after the ruling in California. Ikon's credit department tightened up, as did nearly every other copier company who was pushing machines out the door the way Ikon was, as soon as that law suit was filed. They took it to court but I am fairly certain that management knew they weren't going to win some time ago.
The problem is that the copier sales reps are used to having "dumb money" financing their deals. They may be good prospects a year from now once they realize that they may actually have to "sell" the office equipment the way we did in the old days when I was in that business. We have actually been contacted by two of Ikon's offices to do their leasing as well as a very large Toshiba dealer. They still have unrealistic expectations of "office equipment" financing and it is difficult to explain to them that their current situation, has been caused by the fact that leasing and finance companies bought all of their deals at unrealistic rates and residuals. In the 80's I spent 6 years in that business while starting in leasing at the same time, leasing what I sold myself and later as a sales manager leasing what my salesmen sold. If you are going to spend time calling on them make sure you bring a crying towel and dry shoulder because a big part of getting their business is hearing how tough it is on them that nobody will buy their bankrupt, start-up, and 500 FICO score customers. If you want their business you have to be willing to do this. Oh and by the way, the first question out of their mouths is usually, "Are you a broker, or do you fund your own deals?"
Bob Rodi LeaseNOW, Inc www.leasenow.com <http://www.leasenow.com> ( I thought the first words out of the vendor salesman’s mouth was, “How many points are you going to build into the lease for me? editor ) Classified We will print them all this week. Score card. Three found jobs on the “job wanted” last week. One was through a colleague, but thanked us for the activity, one had an offer from our site, but took another, and the third gave us full credit. Hooray!!!! Help Wanted---Leasing News has more companies here, including American Express Business Finance. They have much to offer, lot of money, good leads, great benefits, strong company. This is not an endorsement, but they are not leaving any stone unturned—smart move. Outsourcing. This has not really changed much, and not much activity. Don’t know why. Still too new is a guess???? Classified
Ads Nine Jobs Wanted http://65.209.205.32/LeasingNews/JobPostings.htm Sixteen Help Wanted http://65.209.205.32/LeasingNews/JobPostingsWanted.htm Five Outsourcing http://65.209.205.32/LeasingNews/JobPostingsOutsourcing.htm ___________________________________________________________________ Be wary of those 0% loans/Not that Simple By KEVIN DeMARRAIS Staff Writer, New Jersey Record Zero percent financing is back. Big time. It helped automakers build sales last month, and we're seeing a variety of retailers turn to no-interest promotions as the holiday shopping season heats up. If handled correctly, zero-percent financing can save you a lot of money. But be careless or fail to understand all the terms and conditions, and you could end up paying heavily for what you thought was free. The concept is simple. To spur sales, merchants offer interest-free loans for periods of several months to several years. Zero-percent financing has been a popular holiday-season promotional tool for electronics and furniture retailers for years, and there are indications it will be so again this year as merchants seek to attract consumers who may be hesitant to spend as freely as they have in the past. No-interest loans also have become popular in the auto industry's attempt to rebound from slumping sales, and they seem to be working. The Big Three -- General Motors, Ford, and DaimlerChrysler -- turned to incentives after the Sept. 11 terrorist attacks, and they are credited with raising sales of cars and light trucks in October by 24 percent, to their highest monthly rate ever. "The response has been excellent at each place," said Gene Meyers, owner of Chevrolet dealerships in Paramus and Hawthorne and a Ford/Nissan dealership in Butler. "People who were leasing are now buying. It's very enticing. It takes people who were sitting on the fence, waiting to see what is going to happen, and puts them in the market." The reason is simple: Zero percent financing can save car buyers thousands of dollars. For example, the auto loan calculator at Bankrate.com (a good Web site to use) shows that someone financing $20,000 at 6 percent (around the low end of the going rate for new-car loans) over four years would pay about $53 a month in interest, or $2,545 over the course of the loan, more than the person with zero-percent financing. Who can resist? Unfortunately, it's not that simple. In many cases, the interest-free loans are limited to 36 months, and an increasing number of buyers are stretching payments for longer terms. In those cases, the manufacturers often offer rates of 2.9 percent for 48 months and 3.9 percent for 60 months. While attractive, and better than bank loans, they are not free. Using those rates in the calculator, the $20,000 loan will result in $1,206 in interest over four years, $2,045 over five years. The savings however, may not be as great as they seem. Some manufacturers offer a rebate as an alternative to no/low interest rates, and you can use it to reduce your purchase price and the amount you need to borrow. Many rebates are modest, in the $500 range, but one North Jersey Chrysler-Plymouth dealer advertised factory rebates "up to $2,500" last week. Even a $1,000 rebate would make a difference, because total payments on $19,000 (purchase price, less rebate) at 6 percent are not much more than $20,000 at 2.9 percent. Get a higher rebate, reduce the number of monthly payments, or get a lower interest rate, and a rebate along with bank financing might actually be the better deal. You'll only know if you do the math. The same is true if you are considering a lease, as some manufacturers offer higher rebates for leases than they do for purchases. Consumers can take the rebate and "buy down" the lease, thereby saving money, Meyers said. Another potential problem with no- or low-interest financing is that not everyone can get it, and it may not apply to all of a manufacturer's models. The ads say "for qualified buyers," and as is so often the case with attractive offers, people with shaky records -- those most in need of financial help -- may be shut out. Manufacturers have been quite liberal in who they approve, "but they're not going to give 0.0 if you have a poor credit rating," Meyers said. If you are thinking of buying or leasing a car, shop around at local banks before you go kicking tires so you have a basis from which to judge the dealers' offers. Also, to make sure you are doing an apples-to-apples comparison, don't include talk about financing and rebates until after you have negotiated a final price for the vehicle. Fortunately, zero-percent auto financing, which is due to expire Nov. 20 -- but might be extended or replaced by another incentive -- is pretty straightforward. As Meyers said, "There's no fine print." With other retailers, there are significant differences from one plan to another, and almost all the key points are in the fine print. As a result, consumers need to get out a magnifying glass and read the details. The promotions are a little easier to understand than they were several years ago, thanks to several high-profile fraud prosecutions of major retailers by the New Jersey Division of Consumer Affairs, but they can still be confusing. So ask these key questions: Is the offer for "no interest" only, or is it "no interest and no payments" until some time in the future? In either case, you end up paying the same amount (unless you default and get hit with penalties). But with the first you need to make monthly payments, albeit, interest free; with the second, you pay nothing (except maybe shipping) for months. Does the interest accrue during the zero-percent financing period? With almost every offer -- a notable exception being Sears -- the interest is calculated from the day of purchase (or delivery). Pay the full bill before the end of the promotional period, and you've enjoyed an interest-free loan. But have any balance remaining, even $1, and you'll be charged interest on the entire purchase price, not just the balance due, retroactive to the purchase date. What is the interest rate? All these promotions require using the store's own credit card, not your regular Visa or MasterCard. Despite all the interest rate cuts this year by the Federal Reserve, most store-issued cards charge interest at nearly double the going rate, often 24 percent or more. Again, if you pay in full, it's no big deal. Be late, however, and you'll regret it. On a $2,000 purchase, 24 percent means upward of $480 in interest in a year. What are the penalties? In many cases, a single late or missed payment can push the interest rate to a penalty level of more than 25 percent. These terms and conditions are included in store circulars, but they are usually buried on the bottom of the next-to-last or last page, along with a variety of other unrelated warranties and conditions, and they are printed in small, hard-to-read type. Do yourself a favor and read it, and if you don't understand some conditions, ask. It could save you hundreds of dollars. ___________________________________________________________________ Comdex scaled back, but still focus of high tech BY SAM DIAZ San Jose Mercury News Not so long ago, when technology ruled the business world and Americans were feeling safe in their homeland, Comdex was considered the tech trade show, a place to discuss business deals, find new partners and show off the latest gadgets and innovations. Comdex remains one of the premier trade shows in the country, but the mood and atmosphere of this year's show, which opens tonight in Las Vegas, won't be nearly as care-free or extravagant as in years past. To some extent, the terrorist attacks of Sept. 11 and the increased security at the Las Vegas Convention Center will leave some attendees feeling uneasy as they arrive for the four-day event. Likewise, a down economy has forced some companies to scale back. Some are sending fewer people to save on travel expenses. Others have chosen to conduct meetings and showcase their products in quiet hotel suites on the Las Vegas Strip instead of noisy booths on the main show floor. It's unfortunate, but not surprising, that the show will have more of a somber feel to it, said Fred Rosen, chief executive of Key 3 Media, the company that produces Comdex. ``Comdex as a show, as any trade show does, mirrors the industry it represents,'' Rosen said. ``If the client is going through difficult times, it's not illogical that we would face those same issues.'' Back in August, well before Sept. 11 left Americans worrying about air travel and being among large crowds, Rosen was already anticipating a drop in attendance. A slipping economy almost ensured a smaller show this year. He was right. Last year, about 2,400 companies exhibited at Comdex. This year, the figure is down by more than 15 percent, closer to 2,000. The number of attendees is expected to be down about 25 percent, from 200,000 last year to about 150,000 this year. But those are still strong numbers, Rosen said. And they show that technology, although down now, remains an important part of the American economy. It also helps that the key players in the tech field remain committed. Big names -- from Sony to Palm to Hewlett-Packard -- will maintain high visibility throughout much of the week. Industry titans Bill Gates, Larry Ellison and John Chambers, among others, will deliver keynote speeches. And the list of attendees -- from investors to top executives -- remains impressive. Sticking with Comdex That's what convinced Cambridge Silicon Radio, a Texas start-up that's offering its chip product to makers of wireless products, to invest in a chunk of real estate on the Las Vegas Convention Center show floor. It wasn't a clear-cut decision, said company vice president Eric Janson. The company was forced to scrap the Consumer Electronics Show in January so they could attend Comdex. ``Naturally, what we're doing is conserving our cash,'' Janson said. ``We stuck with Comdex because we think it's more PC centric and there are more people with the influence to get our design into their products. We'll cross our fingers and hope we made the right choice. Based on the customers we saw at both shows last year, I think we did.'' Rosen is optimistic that Janson and others will make the right contacts -- despite the increase in security and the decrease in attendees. ``We're flattered that they picked up our show,'' Rosen said. ``It tells you that they believe their buyers will be at our event. Trade shows will only work if you can match the audience to the exhibitors.'' But not all exhibitors want to be found inside the convention center. Maxtor, the San Jose disk drive maker, is skipping the convention center floor but will be shuttling a handful of pre-selected guests to their suite at the Bellagio Hotel. It's not a reactive move for Maxtor, but rather a strategic one that was finalized well before terrorists struck and forced Rosen to re-evaluate security for his show. ``We're not looking for mass market appeal right now,'' said Mike Cordano, Maxtor's executive vice president of worldwide sales and marketing. ``We've targeted about 40 specific engagements at the customer level.'' Comdex again is attracting a good number of international business executives -- and that's what appeals most to Maxtor right now, especially as personal computer sales remain sluggish and the United States economy continues to slide. ``International people use Comdex as a venue to make contact with us and our competitors and suppliers,'' Cordano said. Security measures Viewsonic, a Southern California digital imaging company, also decided against a convention center booth, opting instead for a suite at the Venetian Hotel. ``It was a strategic decision that we felt would bring the best return on our investment,'' said Jeff Volpe, the company's vice president of sales. ``I think the people who show up to Comdex this year are the ones who really want to be there. There are a lot of new technologies and there's always going to be companies launching new products and ideas. There will always be a need for a medium to get this kind of information.'' Rosen knows his show will be a bit more somber than previous years and realizes that the extra security measures -- which include a ban on knapsacks and laptop bags -- will bother some people. But he is also confident that the attendees will see past the inconveniences and will focus on the business at-hand. ``We all recognize what's happened in the last 60 days but as our president has said, we have to try to return to normalcy,'' Rosen said. Contact Sam Diaz at sdiaz@sjmercury.com or (408) 920-5021. ________________________________________________________________
Federal judge rejects HP's purchase of Comdisco unit/Sells
to SunGard
Mercury News Wire Services CHICAGO -- A federal
judge Friday rejected Hewlett-Packard's proposed $750 million purchase
of Comdisco's disaster-recovery business, accusing the Palo Alto computer
maker of seeking to subvert the bankruptcy process. After a three-day trial,
U.S. Bankruptcy Judge Ronald Barliant in Chicago instead approved
an $825 million offer by SunGard Data Systems for the Comdisco unit.
Barliant ruled that SunGard
was the winner in a court-supervised auction and should be allowed
to go ahead with the purchase. He said HP's attempt to snatch the
Comdisco unit away from SunGard for $750 million violated the auction
rules established by the court. All proceedings in that case were also completed
today, and the parties are awaiting the District Court's ruling, which
is expected by November 15, 2001.
SunGard, based in Wayne,
Pa., makes software that automates stock and bond trades and operates
a disaster-recovery business. Purchasing the Comdisco unit would make
SunGard the second-largest provider of disaster-recovery services
after IBM, which has raised concerns with regulators. Arguments in the federal
antitrust case concluded Friday before a federal judge in Washington,
and a ruling in the matter is expected next week. Oct. 23, well after the
bankruptcy auction closed, HP said it would pay $750 million for the
unit. Comdisco accepted HP's new offer after a committee representing
creditors owed more than $4.5 billion switched positions on the HP
bid. Since it expressed an
interest in the summer in buying the Comdisco unit, HP has made various
offers that Norman Blake, Comdisco's chief executive, labeled ``blue-light
specials.'' The deals, Blake said, were made as take-it-or-leave-it
proposals with a short time frame for acceptance. While ruling against
the HP deal, Barliant praised the handling of the matter by Comdisco's
management, which he said was working to maximize the amount of money
it can obtain for its assets. The judge announced his
decision after U.S. stock markets had closed for the day. Earlier,
Hewlett-Packard shares rose 64 cents to $18.99. SunGard shares fell
23 cents to $26.14. ______________________________________________________-
___________________________________________________________________ Wholesale
Prices Fall, Biggest Decline in More than a Half-Century by
Martin Crutsinger, Associated Press WASHINGTON (AP) Wholesale
prices, helped by sharp decreases for energy and new cars, plunged
1.6 percent last month in the biggest decline in more than a half-century
of record keeping. Analysts said recession in the United States would
keep the lid on inflation for many months to come. The bigger-than-expected
drop Friday in the Labor Department's Producer Price Index highlighted
one of the few benefits a weakening economy can provide. ''The worsening downturn
in industrial activity has spilled over into a general recession that
is driving down prices,'' said Jerry Jasinowski, president of the
National Association of Manufacturers. Wall Street was encouraged.
The Dow Jones industrial average closed up 20.48 points at 9,608.00,
just above its close on Sept. 10, the day before the terrorist attacks.
Economists said the report
showed an absence of price pressures not only at factories, farms
and other producers of finished goods but also at earlier stages in
the production pipeline, with costs dropping by 1.5 percent for intermediate
goods and a steep 9.1 percent for crude goods. ''There's absolutely
no pressure in the pipeline,'' said Oscar Gonzalez, an economist at
John Hancock in Boston. ''Producers have no pricing power at all.
For consumers and the broader economy, that is good news.'' Analysts said consumers
should find plenty of bargains as the holiday shopping season opens
and for months to come if demand slumps. Even before the Sept.
11 terrorist attacks, the economy had endured a yearlong economic
slowdown. But signs of weakness have grown dramatically since the
attacks, with 415,000 Americans laid off in October alone, the biggest
one-month drop in payroll employment in 21 years. While many analysts believe
the economy will begin to show signs of life by the spring, Michael
Evans, chief economist at American Economics Group in Washington,
said he was looking for the downturn to last through the first six
months of next year, with economic growth declining this quarter and
the next two at annual rates of about 2 percent. The economy turned
negative with a 0.4 percent drop in activity in the July-September
quarter. Evans said he believed
the recession and a sluggish rebound would keep consumer prices rising
by just 2 percent through next year and probably 2003. That would
compare with a 3.4 percent increase in consumer prices last year.
Declining inflation pressures
will give the Federal Reserve more room to cut interest rates to jump-start
economic growth, analysts said. The Fed cut rates for a 10th time
on Tuesday and many economists are predicting an 11th rate cut at
the Fed's final meeting of this year on Dec. 11. The 1.6 percent plunge
in the PPI for October, four times what analysts had been expecting,
was the largest drop since the government began tracking wholesale
inflation in 1947. Prices had been up 0.4 percent in both August and
September. So far this year, prices
at the wholesale level have been declining at an annual rate of 0.8
percent, a turnaround from the 3.6 percent increase last year. The big drop in wholesale
prices in October was led by a 7.7 percent plunge in energy prices,
the biggest decrease in 12 years. Gasoline prices fell 21.2 percent,
the biggest one-month drop in 15 years. With many Americans cutting
back on their travel plans in the wake of the terrorist attacks and
the anthrax threats, the average price of a gallon of gasoline is
$1.24 down by about 30 cents from a year ago and has fallen below
$1 in some parts of the country. The PPI report showed
that natural gas prices, which had soared because of short supplies
last winter, fell by a record 6 percent in October. Analysts are predicting
that natural gas will be about one-third cheaper this winter than
last, good news for the 55 percent of Americans who heat with natural
gas. Home heating oil prices
also fell dramatically, dropping 20.9 percent, the biggest decline
since February 1990, when the country was in the depths of the last
recession. The Labor Department
said food prices were also down last month at the wholesale level,
dropping 0.4 percent, with widespread declines in most food groups.
Inflation at the wholesale
level, excluding food and energy, was down by 0.5 percent. This drop
reflected a 4.7 percent plunge in new car prices, the biggest one-month
decline in 29 years, reflecting heavy discounting last month to move
a backlog of unsold cars. On the Net: Producer Price Index:
http://www.bls.gov/ppi National
Train System Not on Track WASHINGTON
(AP) A federal panel ordered Amtrak to come up with a liquidation
plan for itself on Friday, concluding that one more year won't be
enough for the national railway to end 30 years of operating deficits.
The
Amtrak Reform Council voted 6-5 to declare that Amtrak will not meet
a congressional deadline of Dec. 2, 2002, for covering its operating
costs without government help. The
ruling does not mean any immediate changes in train service. Amtrak
has 90 days to draw up a liquidation plan, and the council will use
that time to plan a restructuring of passenger rail in America. Congress
and the White House ultimately will review both plans and make a final
decision about the future of Amtrak and rail service. The name Amtrak is a
combination of ''American'' and ''Track.'' Other facts and figures
on the national railway: Official name is the
National Railroad Passenger Corp. 25,000 employees. Began service May 1,
1971, with 184 trains serving 314 stations. Today, an average of 260
trains serve 512 stations daily. Took over the passenger
operations of all but three railroads: the Rock Island Railroad, Southern
Railway and Denver & Rio Grande Western Railroad. All three ceased
passenger service by 1984. Serves 45 states. Those
without service: Alaska, Hawaii, Maine, South Dakota and Wyoming.
Operates more than 22,000
route miles. Most are owned by freight railroads; Amtrak owns 730
miles of track, mostly between Boston and Washington and in Michigan.
Busiest stations: New
York, 8.4 million boardings last year; Philadelphia (3.9 million);
Washington (3.4 million); Chicago (2.2 million); and Newark, N.J.,
(1.4 million). Carried a record 22.5
million riders in 2000. | ||||||
