Current Events in July 2012

DreamWorks Animation is renting out the lovable images of Alex the Lion, Marty the Zebra, and Melman the Giraffe to peddle nutritionally poor food choices to impressionable young children, the Center for Science in the Public Interest complains.

In a letter to DreamWorks CEO Jeffrey Katzenberg, the nonprofit nutrition watchdog group urged the studio to set nutrition standards for the foods for which it licenses its characters, much in the way Katzenberg’s former employer, Disney, did recently.

Disney said last month that it will stop advertising junk-food products on its TV programs, radio shows and websites, and promote healthier snack items to its young viewing audience. 

"Parents are faced with an enormous amount of advertising that's intended to change their children's dietary preferences," said CSPI director of nutrition policy Margo Wootan. "When a young child sees the Madagascar penguins on a package of junky crackers, they feel a powerful emotional connection—which is why companies do it in the first place. Entertainment companies like DreamWorks have a responsibility to wield that power in a way that doesn’t undermine kids’ health."

CSPI's letter pointed to the Madagascar 3: Europe's Most Wanted characters appearing on packages of Lance Sandwich Crackers and Nekot Cookies. The products exceed recommendations for the amounts of saturated fat or sodium appropriate in snacks marketed to children, according to draft guidelines from the Interagency Working Group on Food Marketed to Children, a federal taskforce composed of representatives from the FTC, CDC, FDA, and USDA.

Madagascar 3 characters also have tie-ins with McDonald’s, General Mills, and other companies.

The 800 million people who use Facebook don't pay anything, but that doesn't mean they aren't customers. And the social networking company's customer service rating -- as measured by the American Customer Satisfaction Index (ACSI) -- has taken another hit.

ACSI says Facebook was already the lowest-scoring e-business company that it measures. The drop in customer satisfaction, it says, was the largest so far.

Among the five lowest-scoring companies

Facebook dropped eight percent to 61 on a 100-point scale. That places it among the five lowest-scoring companies of more than 230 measured by ACSI.

Many of the recent user complaints about Facebook have to do with the company's friends policy.

"I get told I'm befriending people I don't know," Joanna, of West Creek, NJ, wrote in a ConsumerAffairs post. "Sometimes, people do it to me too. A lot times it's harmless and sometimes it's not and they want to block off my Facebook."

Too many friends

Customers are not happy when access to their accounts is blocked, and it appears there can be reasons other than "friending" too many people. Eleanor, of Erie, PA, writes that her Facebook account was locked because she requested a code reset too many times and her account has been hacked.

"When I called Facebook to ask if they can reset it for me, the guy wanted $100.," she writes. "I am contacting the attorney-general's office and the Better Business Bureau. I strongly believe that Facebook is the one who is hacking the accounts."

Darlene of Interlochen, MI, also complains that she has lost access to her account.

"I am a stroke survivor.," Darlene wrote. "I'm mad because Facebook puts me in time out and I cannot reach out to other stroke survivors! Also, I keep getting requests to play games and I cannot find a way to stop it. Most of all, my pictures keep disappearing from my timeline! Very upsetting!"

Google+ on the rise

If these examples are typical of the kinds of complaints Facebook receives, it is easy to see how its customer satisfaction could go down. With Facebook's decline Google+ did well with a score of 78 in its first appearance in the ACSI. According to the report, Google+’s strong showing is a result of an absence of traditional advertising and what is seen as a superior mobile product.

Google+’s strengths may be Facebook’s weaknesses, as users complain about ads and privacy concerns. However, the most frequent complaints about Facebook are changes to its user interface, most recently the introduction of the Timeline feature.

“Facebook and Google+ are competing on two critical fronts: customer experience and market penetration. Google+ handily wins the former, and Facebook handily wins the latter, for now,” said Larry Freed, President and CEO of ForeSee, a partner in the ACSI report. “It’s worth asking how much customer satisfaction matters for Facebook, given its unrivaled 800 million user base. But I expect Google to leverage its multiple properties and mobile capabilities to attract users at a rapid pace. If Facebook doesn’t feel the pressure to improve customer satisfaction now, that may soon change.”

Falling scores

Claes Fornell, ACSI Chairman and author of The Satisfied Customer, says the e-business sector overall has dropped 1.6 percent from a year ago to a score of 74.2, lower than the national ACSI score of 75.9. Fornell says that suggests these businesses need to do a better job responding to customers needs.

In the case of Facebook, however, that may prove difficult. With 800 million users in countries all over the world, it's difficult to respond to customers individually. And that appears to be the biggest source of complaints.

Agriculture Secretary Tom Vilsack has designated another 39 counties in eight states as primary natural disaster areas due to damage and losses caused by drought and excessive heat. 

During the 2012 crop year, the U.S. Department of Agriculture (USDA) has designated 1,297 counties across 29 states as disaster areas, making all qualified farm operators in the areas eligible for low-interest emergency loans. 

The most recently designated counties are in the states of Arkansas, Georgia, Indiana, Mississippi, New Mexico, Tennessee, Utah and Wyoming. The U.S. Drought Monitor currently reports that 61 percent of the continental United States is in a moderate to exceptional drought. 

"Our hearts go out to all of those affected by this drought," said Vilsack. "President Obama and I are committed to ensuring that agriculture remains a bright spot in our nation's economy by sustaining the successes of America's farmers, ranchers, and rural communities through these difficult times. That's why USDA officials are fanning out to affected areas, to let our farmers and ranchers know that we stand with you and your communities when severe weather and natural disasters threaten to disrupt your livelihood.” 

Earlier in the week, USDA designated the entire state of Missouri a disaster area due to drought in response to a request from the state's governor. 

Drought damage 

Increasingly hot and dry conditions from California to Delaware have damaged or slowed the maturation of crops such as corn and soybeans, as well as pasture- and range-land. Vilsack has instructed USDA subcabinet leaders to travel to affected areas to augment ongoing assistance from state-level USDA staff and provide guidance on the department's existing disaster resources. 

To deliver assistance to those who need it most, the Secretary last week effectively reduced the interest rate for emergency loans from 3.75 percent to 2.25 percent, while creating greater flexibility for ranchers within the Conservation Reserve Program (CRP) for emergency haying and grazing purposes. 

In addition, the disaster designations announced today fall under a new, streamlined process that simplifies Secretarial disaster designations and will result in a 40 percent reduction in processing time for most counties affected by disasters. 

Primary counties and corresponding states designated as disaster areas: 

Arkansas:

Arkansas County 

Cleburn County 

Cleveland County 

Crittenden County 

Jefferson County 

Lee County 

Lonoke County 

Monroe County 

Phillips County 

Prairie County 

St. Francis County 

Georgia:

Douglas County, Georgia 

Indiana:

Bartholomew County 

Brown County 

Clay County 

Hamilton County 

Hancock County 

Hendricks County 

Johnson County 

Marion County 

Monroe County 

Morgan County 

Owen County 

Parke County 

Putnam County 

Shelby County 

Mississippi:

DeSoto County 

Panola County 

Tate County 

Tunica County 

New Mexico:

Cibola County 

Tennessee:

Shelby County 

Tipton County 

Utah:

Garfield County 

Kane County 

Wasatch County 

Wayne County 

Wyoming:

Fremont County 

Sublette County

The tried and true system of paying for mobile services by voice minutes appears to be going by the wayside. AT&T Wireless says it will discontinue voice minute plans and instead move to a "shared data" system, much like the one Verizon Wireless announced last month.

Starting in late August, new customers will get unlimited voice and texting. Right now there are caps on those services, with charges incurred if you go over your limit. Some consumers may consider that a plus.

Balancing that out, however, will be a limited data plan. Not only will the amount of data be limited per billing cycle, all the devices on the account -- smartphones and tablets -- will share the data, even if there are multiple users on the account. If you exceed the allotted data, where will be an overage charge.

With AT&T joining Verizon in this move, it appears this is where the industry is going. Carriers are finding the promise of unlimited data is a hard one to keep.

Data at a premium

Smartphones gobble up bandwidth at unforeseen rates. Now that tablets have been added to the mix, the pressure is mounting on providers to force consumers to keep track of their data usage. Industry executives say each year will likely bring more types of connected devices.

“Today we think of people’s smartphones and tablets sharing a bucket of data," said David Christopher, chief marketing officer, AT&T Mobility. "But in the future we’ll see health care monitors, connected cars, security systems and other devices in the home all connected to the mobile Internet,” said Christopher. “Our Mobile Share plans are simple, easy and a great value for individuals or families with multiple mobile Internet devices.”

Customers can select one of the new shared data plans or choose one of AT&T’s existing individual or family plans. Current customers are not required to switch to the new plans, but can choose to do so without a contract extension. There are no changes to AT&T’s device upgrade policy, which means customers eligible to upgrade to AT&T’s best device price are not required to switch plans. The new plans will also be available for business customers.

New price structure

Under the new data sharing system, customers choose the amount of data they want each month; one gigabyte for $40 -- plus $45 for each smartphone -- all the way up to 20 gigabytes for $200 -- plus $30 for each smartphone. Going over the allotment will cost $15 per extra gigabyte.

You can add basic and messaging phones to your account for $30 per device. Connect laptops to your data plan for an extra $20 per month. Add a tablet or gaming device for $10 per month.

A family of four with four smartphones, two tablets and a laptop -- using 15 gigabytes per month of data -- would cost $320 per month.

While both AT&T and Verizon have cast the change as a benefit for consumers, many don't see it that way. After Verizon announced its change last month, current customers lit up message boards, unaware that they could keep their present unlimited data plans for the time being. Verizon responded with a press release telling customers not to "freak out."

While existing customers at Verizon and AT&T may keep their current arrangements, both carriers eventually expert to have everyone on a measured data plan. Verizon customers currently receiving unlimited data will be pushed to a shared data plan when they purchase a new, subsidized smartphone. The only way to avoid losing unlimited data is to keep your old phone or pay the full retail price of the phone when you finally upgrade.

More than a million veterans and servicemembers -- 1.67 million, in fact -- have registered for the secure, joint Department of Veterans Affairs (VA)-Department of Defense (DoD), self-service Web portal, eBenefits, which provides online information and access to a wide variety of military and veteran benefits resources. 

“We know that 3 out of 4 veterans who use VA services want to connect online, so we must to be there for them with the information they need,” said Allison Hickey, Under Secretary for Benefits.  “eBenefits is clearly becoming the platform of choice for veterans seeking access.” 

The strong pace of registrations for the site since its launch in October 2009 has allowed VA to exceed its fiscal year 2012 agency priority goal of 1.65 million users, and puts it on track to meet the 2013 goal of 2.5 million users, as outlined for VA in Performance.gov. 

Helping hand for vets 

Veterans and servicemembers new to the Website are guided through the registration process to get a full-access account, called a premier account, which allows maximum ability to update personal information and learn about benefits without having to visit a VA facility. With the premier account, one password -- called a single sign-on -- lets veterans access multiple applications on the secure portion of the Website. 

A premier account also allows vets to check the status of compensation and pension claims that they have filed with VA.  This feature, the most popular within the eBenefits application, had over 700,000 visits in June alone. Overall, visits to the site have increased 60 percent over the previous year, approaching 2 million per month. 

On July 1, VA introduced its 11th consecutive quarterly release of improved functionalities to the eBenefits application that includes benefits eligibility email messages to servicemembers as they reach career milestones and a new Career Center page with employment self-assessment tools, a resume builder, and a translator that relates military expertise to civilian work skills.  

The Career Center, which received over 8,000 visits in its first week, has single sign-on connectivity to VA’s veteran hiring site, “VA for Vets.”  Another key function added is a single sign-on capability for veterans to transition securely between benefits information on eBenefits and health information on VA’s myHealtheVet Website without an additional log-on step.  

Going digital 

VA has completed a record-breaking 1 million claims per year the last two fiscal years, and is on target to complete another 1 million claims in FY2012.  Even so, too many veterans have to wait too long to get the benefits they have earned.  That is why VA is aggressively building a strong foundation for a paperless, digital disability claims system -- a lasting solution that will transform how VA operates and eliminate the backlog.  This plan will help VA achieve Secretary Shinseki’s goal: claim completion in less than 125 days with 98 percent accuracy in 2015 – delivering faster, better decisions for veterans. 

With the most recent release, there are now 46 self-service features enabling servicemembers and veterans the ability to download copies of their official VA and military correspondence, including veterans civil service preference, service verification, benefits verification letters, military records and VA home loan certificates of eligibility.  

Servicemembers and veterans can also access records that directly impact their family members, like the Post-9/11 GI Bill enrollment status, VA payment history, and DoD TRICARE health insurance status.

The Consumer Financial Protection Bureau (CFPB) announced its first public enforcement action today -- and it is a big one.  The new agency has ordered  Capital One Bank to refund approximately $140 million to two million customers and pay an additional $25 million penalty. And another agency hit the bank with an additional $35 million penalty.

The action results from a CFPB examination that identified deceptive marketing tactics used by Capital One’s vendors to pressure or mislead consumers into paying for “add-on products” such as payment protection and credit monitoring when they activated their credit cards.

“Today’s action puts $140 million back in the pockets of two million Capital One customers who were pressured or misled into buying credit card products they didn’t understand, didn’t want, or in some cases, couldn’t even use,” said CFPB Director Richard Cordray. “We are putting companies on notice that these deceptive practices are against the law and will not be tolerated.”

Meanwhile, the Office of the Comptroller of the Currency announced a $35 million penalty against Capital One for violations of section 5 of the Federal Trade Commission (FTC) Act,

Deceptive tactics

CFPB said that through its supervision process, CFPB’s examiners discovered Capital One’s call-center vendors engaged in deceptive tactics to sell the company’s credit card add-on products.  

These products included “payment protection,” which allows consumers to request that the bank cancel up to 12 months of minimum payments – roughly one percent of their credit card balance – if they encounter certain life events like unemployment and temporary disability.  It also provides debt forgiveness in the event of death or permanent disability. 

Another product was “credit monitoring,” with services such as identity-theft protection, access to “credit education specialists,” and, in some cases, daily monitoring and notification.

Consumers with low credit scores or low credit limits were offered these products by Capital One’s call-center vendors when they called to have their new credit cards activated.  As part of the high-pressure tactics Capital One representatives used to sell these add-on products, consumers were:

• Misled about the benefits of the products: Consumers were sometimes led to believe that the product would improve their credit scores and help them increase the credit limit on their Capital One credit card.
  
• Deceived about the nature of the products: Consumers were not always told that buying the products was optional.  In other cases, consumers were wrongly told they were required to purchase the product in order to receive full information about it, but that they could cancel the product if they were not satisfied. Many of these consumers later had difficulty canceling when they called to do so. 
  
• Misled about eligibility: Although most of the payment protection benefits kicked in when consumers became disabled or lost a job, some call center representatives marketed and sold the product to ineligible unemployed and disabled consumers.  Despite paying the full fees, they could not get all the benefits of payment protection; some later filed claims that were denied because their “loss” (e.g. loss of job or onset of disability) occurred prior to enrollment

• Misinformed about cost of the products: Consumers were sometimes led to believe that they would be enrolling in a free product rather than making a purchase.

• Enrolled without their consent:Some call center vendors processed the add-on product purchases without the consumer’s consent.  Consumers were then automatically billed for the product and often had trouble cancelling the product when they called to do so. 

Enforcement Action

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to issue Consent Orders and take action against institutions engaging in unfair, deceptive, or abusive practices. To ensure that all affected consumers are repaid and that consumers are no longer subject to these misleading and high-pressure tactics, Capital One has agreed to:

• End deceptive marketing: Capital One has ceased all marketing of these products, and will not resume doing so until Capital One submits a compliance plan, acceptable to the Bureau, which helps ensure these unlawful acts do not occur in the future.  

• Complete repayment, plus interest, to two million consumers: Capital One will pay approximately $140 million to all of the estimated two million consumers who either initially enrolled in a product on or after August 1, 2010, or who tried to cancel a product on or after August 1, 2010, but were persuaded to keep the product after speaking with a call-center representative.  In addition to the amount paid for the product, cardmembers will receive a refund of the associated finance charges, any over-the-limit fees resulting from the charge for the product, and interest. 

• Pay claims denied based on ineligibility at enrollment: For any of these eligible consumers whose payment protection claims were previously denied because their loss occurred prior to enrollment (because of unemployment, disability, etc.), Capital One will pay their claims as if they had been eligible, if that amount is greater than the refund for that consumer. 

• Convenient repayment for consumers: If the consumers are still Capital One customers, they will receive a credit to their accounts.  If they are no longer a Capital One credit card holder, they will receive a check in the mail.  Consumers are not required to take any action to receive their credit or check.
  
• Independent audit: Compliance with the terms of this agreement will be assured through the work of an independent auditor, who will determine if Capital One has complied with the CFPB’s Consent Order.

• $25 million penalty: Capital One will make a $25 million penalty payment to the CFPB’s Civil Penalty Fund.

Other banks warned 

Complaints received by the CFPB indicate – and the Bureau’s supervisory experience confirms – that other consumers have been misled by the marketing and sales practices associated with credit card add-on products. 

To further protect consumers, the Bureau is issuing a compliance bulletin that puts other institutions on notice that the CFPB will not tolerate deceptive marketing practices, and institutions will be held responsible for the actions of their third-party vendors.  Companies engaging in deceptive practices will be expected to refund fees paid by consumers and, particularly where practices are widespread, pay an appropriate penalty.

Consumers have a new set of federal eyes to look over their finances.

Starting this fall, the Consumer Financial Protection Bureau (CFPB) will begin to watchdog 30 credit reporting companies, including Equifax, Solutions Inc., and Experian Information, which account for nearly 94 percent of the industry's annual receipts.

This should create some indigestion in the executive suite, as the credit honchos observe the $140 million in refunds the CFPB has ordered Capital One to shell out to consumers.

"Supervising this market will help ensure that it works properly for consumers, lenders and the wider economy said Richard Cordray, bureau director of CFPB. "There is much at stake in making sure it is both fair and effective."

Beginning Sept 30, 2012 CFPB will have the authority to write new rules for credit reporting agencies to follow under the Dodd-Frank and the Fair Credit Reporting Act, and have the power to conduct on-site audits at credit sites.

CFPB's says it will examine the agencies level of compliance with federal laws, while also looking for any holes in policy or practice that would be potentially harmful to the consumer.

The federal agency's monitoring will also be coupled with an educational component, as it plans to teach consumers about credit reporting laws and how to fully understand and utilize these laws to maximum benefit.

Q&A

CFPB also will release a series of informational questions and answers that could potentially be helpful for those seeking an auto loan, home loan or other lines of credit.

According to a report released by CFPB, the U.S. has about 400 credit reporting agencies, which account for over $4 billion in yearly receipts. In addition, the three biggest consumer reporting agencies have credit files on over 200 million Americans, thus having a large say in the  credit and financial destiny of every consumer.

According to the Consumer Data Industry Association, 3 billion consumer reports are dispensed and 36 billion updates are made to consumer's credit files.

The sheer influence that credit companies possess and the potential harm they can do if unsupervised, is what made CFPB initially announce its plans to monitor credit agencies back in February of 2012.

"Credit reporting is at the heart of our lending systems and enables many of us to get credit, afford a home or get an education," said Cordray. "Up to this point, no single federal government agency could access all the information necessary to generate a complete picture of what was happening inside these companies."

Inattention and error

This new effort is an added piece of supervision from a 2003 amendment by Congress that allowed consumers to receive their credit reports from national agencies upon request, once a year.

Cordray also explains that inattention and common error can harm the consumer’s future in various ways, and this new type of policing will force credit agencies to be more mindful of its transactions, and be held more accountable when errors are made.

"The wrong information may cause them to be denied a loan, to be charged a much higher interest rate or to be passed over for a job, causing them serious economic hardship," he said. And inaccurate credit reports also deprive lenders of essential information they need to assess credit risk properly."

 Earlier this month the consumer protection agency created a website that allows credit card users to file and track complaints, whether it be a charge dispute, a complaint about a credit decision, or unfair interest rates.

The site will also grow to include complaints or questions about other types of loans whether personal, auto or student.

Creators of the site say having the ability for complaints to be seen and publicly known will better empower the consumer, as they can compare complaints and not feel isolated in their particular credit or financial challenge.

CFPB also says that most consumer issues and complaints should be remedied within 60 day’s time.

Between the website and the watchdog group's new authority of supervision, CFPB believes consumers now have the proper tools to make better credit decisions, and have a safety net if they make a mistake or if they're wronged by a financial institution.

"Our country's credit system is a resource in which we all have much at stake," said Cordray. "Both directly and indirectly, and we need this system to operate effectively in order for the credit markets to work properly and fairly."

Summer is moving fast and while there's still a good amount of sun, beaches and barbecues left, autumn lingers just over the horizon and is almost ready to make its appearance.

And that means a new school year for kids, and back-to-school shopping for parents.

In a recent report conducted by the cost comparison site PriceGrabber, it was found that 63 percent of consumers plan on spending up to $500 on back-to-school items, which is up from 48 percent in 2011.

ConsumerAffairs spoke with PriceGrabber to get a sense of why back-to-school spending is up, even though many Americans are still digging themselves out of a financial hole.

"We noticed a dramatic increase in our survey respondents that said they planned to spend more money on back-to-school shopping this year compared to 2011," said PriceGrabber’s General Manager Graham Jones. "Forty-six percent indicated that they plan to spend more in 2012 compared to 12 percent that said they would purchase more in 2011 versus the previous year."

"Although this number is only an indication of anticipated spending, it does offer some insight into the high levels of consumer confidence present in current back-to-school shoppers. This data is a hopeful sign that the economic recovery is gaining some traction and this year's back-to-school season will be more positive for retailers," he said.

Do they need it?

But do returning students always need brand-new back-to-school items, especially when it comes to clothes? Assuming kids haven't outgrown some of last year’s apparel, couldn't they wear some of those same duds again?

We asked PriceGrabber if new clothes each school year was just a tradition, or if there is some sort of academic or social benefit to having new attire from head to toe on the first school day.

"Purchasing new back-to-school clothes has been a popular tradition for the last several years," said Jones. "In both 2010 and 2011, we saw a similar number of survey respondents that cited clothing as a top item on their back-to-school shopping lists."

And, "We suspect that if shoppers are going to spring for one splurge this season, it may very be a nice piece of clothing. While general school supplies rank at the top of consumers back-to-school shopping lists, according to our survey data, new clothing purchases came in a close second with 79 percent of parents planning to send their kids to school in the latest fashions, he stated."

Confidence down

What may be surprising is that many previously released reports suggest that consumer confidence has been on the steady decline since the start of 2012.

According to a seperate survey conducted by Thomson Reuters and the University of Michigan, consumer confidence dropped to 72 in the month of July, down from 73.2 in June of this year. The survey indicates that confidence numbers continue to be on a consistent downward slope.

So if 63 of respondents say they're just fine with spending at least $500 before the first day of school, are consumers overspending?

"It is hard to say whether or not parents are overspending on back-to-school items," explained Jones. ”Our survey data certainly supports the idea that parents are willing to spend money to prepare their kids for the new school season, but the numbers for this year do not indicate a dramatic difference compared to 2011 or 2010."

The PriceGrabber report also shows that 40 percent of consumers will buy electronics for their children, 50 percent said they will purchase new laptops, 49 percent will plunk down funds for a tablet computer, 28 percent said they'll be buying new smartphones, and 10 percent will bring a new desktop computer home for their child student.

But that doesn’t mean electronic gadgetry has replaced the need to buy traditional school staples, as 83 percent of respondents said they will purchase general school supplies like rulers and binders, and 51 percent of consumers said they'll spend their back-to-school dollars on books over other items.

Where to go

And where are the best places for parents to save money this school year?

"Many savvy consumers are utilizing the Internet to take advantage of the latest and greatest back-to-school shopping deals coupled with in-store purchases," said Jones.

”We suspect that given the large amount of back-to-school shoppers who said they will shop online (79 percent), many are planning to do so in order to comparison shop, set price alerts, find coupons, and take advantage of last-minute discounts, free shipping and price drops."

With the buying public using their tablets and smartphones for just about every facet of their purchasing decisions, back-to-school shopping has also gone electronic, as parents will use both physical and digital stores to find the best deals.

According to Jones, the majority of back-to-school shopping will be conducted online, as people are eager to avoid crowded stores and heavily picked-over school supplies.

"Seventy-nine percent of PriceGrabber survey respondents indicated they will be doing their back-to-school shopping online," Jones said. "The rise in frequency and popularity with online shopping is proving to have a significant impact in bottom line revenue for brick and mortar retailers."

"These retailers are going to have to adjust to this evolving pattern of purchasing or lose the battle to obtain the consumer's dollar. Mobile shopping has also proven to be an increasingly strong method of shopping."

And of course parents will be using their smartphones and tablets to price compare among the various locations, instead of doing the traditional summer's end store-hopping from location to location.

"Thirty seven percent of shoppers indicated that they will compare back-to-school prices via their mobile device while shopping in brick and mortar stores this year," detailed Jones.

Smart smartphone shopping

"Consumer's use of smartphones to find the best deals while shopping continues to grow in popularity. Consumers are utilizing their smartphones to: 1) access coupons; 2) read customer reviews; 3) check price comparison sites online to see the best deals; and 4) scan the barcode of a specific product to find the best price on a shopping comparison website."

So although parents are doing their best to seek out sales and discounts for their children's school supplies, the current state of the economy doesn't seem to be scaring them away from spending hundreds of dollars on each child going back to school, despite reports of low consumer confidence.

But as plenty of consumers already know, when it comes to cutting back on spending for new items, many parents choose to cut back on themselves and not on their children, which may give a slight indication as to the high percentages of parents spending at least $500 this back-to-school year.

However parents should still keep in mind that it isn't truly necessary to buy everything at once and spending hundreds of dollars per child before the first day of school isn't a requirement.

Items like new school clothes and electronics can be bought gradually throughout the year.

Later in the fall months, parents are likely to see reduced prices, as back-to-school items will be marked up at the start of the school year, only to drop in the following months.

Wall Street listened to Federal Reserve Chairman Ben Bernanke's testimony to Congress Tuesday and didn't like what it heard.

The Chairman said the Fed was ready to step in to support the U.S. economy if it began to slide back toward recession but gave no indication there was any plan to do that right away. The Street was hopeful the Fed would unleash a new round of stimulus. It was disappointed.

Motorists, meanwhile, can be happy with Benanke's answer because it's short term effect is likely to prevent gasoline prices from rising again. Each time the Fed has launched a round of “Quantitative Easing,” the dollar has plunged in value and oil prices have skyrocketed, pulling up gasoline prices with them.

The Bernanke effect

Right on cue Tuesday, oil prices fell sharply, reversing days of gains in anticipation that the Fed was going to embrace a new round of stimulus. While supply and demand considerations play heavily in oil traders' strategy, the value of the dollar is also a key element.

When traders believe the dollar will lose value, that makes commodities priced in dollars -- like oil and gold -- more expensive. They are willing to pay more because the dollars they are using aren't worth as much.

Currently, Brent crude -- mostly from the Middle East -- is trading around $103 a barrel on the futures market. U.S. crude is much cheaper, around $88 a barrel. The national average price of gasoline, as measured by AAA's daily Fuel Gauge Survey, is $3.40 a gallon, up about seven cents from its recent low, achieved earlier this month.

If gasoline prices follow the pattern set last year -- and so far they have -- prices may rise a bit more before beginning to fall once against at the end of summer driving season. Should the economic slowdown continue, they might even fall lower than they did last year.

Target and the LGBT community are entangled in debate once again.

The first round of back-and-fourth was in 2011, when the mega-store donated $150,000 to political action group MN Forward, helping the group back Republican Tom Emmer in his bid for the 2010 Minnesota governor’s seat. Emmer was and is opposed to same-sex marriage.

This current round of debate began when Target announced it would not sell the new album by R&B singer Frank Ocean, who recently announced he was bisexual.

Ocean's recently released CD "Channel Orange" has been a Top Twitter Trend for the past few days, and is currently the most-talked-about album in popular music at the moment.

Target says the CD ban is because Ocean released his highly anticipated album through iTunes a week earlier than it was supposed to be released in stores.

This took away the opportunity for Target to cash in on the album's first week's sales, as the digital release opened at number one in 10 different countries around the globe.

Really?

However many attribute the ban of Channel Orange to Ocean opening up about his sexual orientation.

"Target has refused to carry Frank's album because of iTunes exclusive, tweeted Christian Clancy, Ocean's manager. Interesting since they also donate to non-equal rights organizations."

It didn't take long for Target to fire back in a written statement saying it has a record of supporting a diverse group of artists regardless of sexual orientation.

"The claims made about Target's decision to not carry the Frank Ocean album are absolutely false. Target supports inclusivity and diversity in every aspect of our business. Our assortment decisions are based on a number of factors, including guest demand," the company said in a statement."

Clancy later removed his tweet and apologized. "I apologize for my comments about Target. They are not carrying Frank's album because it went digital first. Not for any other reason. My response was simply an emotional knee jerk reaction."

Back in 2010 Lady Gaga decided not to release her anticipated CD "Born This Way," after Target helped fund Emmer’s failed gubernatorial bid, making Target miss out on huge sales from the album which went on to sell 2 million copies in the United States.

In an effort to repair its image with the LGBT community, Target announced it would be selling pride t-shirts during June's LGBT pride month.

Deciding to partner with pop star Gwen Stefani, the retailer said it would donate up to $120,000 to the Washington D.C. LGBT advocacy group the Family Equality Council.

Half-hearted

But many considered Target's gesture as a half-hearted one, as the company only sold the shirts online, thus being accused of not wanting the gay pride message to be viewable in its stores.

Target again denied the claim while pointing out its history of support for gay pride festivities, especially in its home state of Minneapolis.

"Target is not anti-gay said Michael Francis, the company's executive vice president and CEO."It's important to set the record straight and provide some context."

In the case of Frank Ocean's album, Target continues to say the ban is solely related to the early exclusive iTunes release and nothing else.

"We focus on offering our guests a wide assortment of physical CDs, so our selection of new releases is dedicated to physical CDs rather than titles that are released digitally in advance of the date," the store said in a statement.

However there's a bit of inconsistency in that statement, as many artists have released their albums through early iTunes exclusives, but their physical releases are still being offered at Target.

Take the Minnesota based electronica group Owl City for example, who released their first major label debut through iTunes in an early digital release in 2009, but their album is still being sold at Target stores to this very day.

That certainly doesn't mean that Target is being discriminatory, but the retailers should maybe provide a stronger level of consistency when deciding not to sell CDs because of exclusive iTunes releases.

Once upon a time, back in the Great Depression, people used to rent out spare rooms in their house to make a few spare dollars. Now, in the shadow of the Great Recession, you can rent out the spare hours on your car if it's equipped with OnStar.

General Motors says it is working with RelayRides, an online car-sharing site that brings car owners together with people who need a car for a few hours or a few days, part of a trend more fully described by ConsumerAffairs' Daryl Nelson in a story a few weeks ago.

You don't need OnStar to enroll in RelayRides but it makes it a little bit easier. For one thing, OnStar will let the renter unlock the doors of your car using their smart phone. Without OnStar, you'll have to meet up with the renter and give them the keys.

"Individuals who forgo car ownership can conveniently access affordable and reliable transportation in a Chevrolet, Buick, GMC, or Cadillac," GM said in a statement. "Owners of these OnStar-enabled GM vehicles rent out their cars and turn their idle vehicles into an income source without the hassle of installing expensive aftermarket hardware or having to meet a renter to hand off keys."

Studies show that each shared car results in up to 13 fewer cars on the road, leading to less-congested roads and less pollution, GM said.

“Using the OnStar API to access GM vehicles empowers RelayRides to make car sharing even safer and more convenient,” said Shelby Clark, RelayRides founder and Chief Community Officer. “The sheer number of vehicles eligible for the program allows us to greatly expand across the U.S. and introduce the economic, environmental and community benefits of car sharing to regions that car sharing services have previously been unable to serve.”

OnStar is primarily known for its ability to summon help if you're involved in an accident but GM has lately been working to establish OnStar as an independent profit center by tapping into its many other capabilities.

GM, it just so happens, is an investor in RelayRides, as is Google Ventures, Google's venture capital arm.

You want it, we got it -- you pay.

A sharp decline in the supply of luxury brand used cars and light trucks will result in higher prices this year, according to Jonathan Banks, senior analyst with the National Automobile Dealers Association (NADA) Used Car Guide. 

NADA predicts the supply of luxury used vehicles up to five-years-old will decline by 13% in 2012 from a year ago -- resulting in an average price increase of 1.9% this year. Prices in the overall used-vehicle market are expected to increase 2.9% in 2012.  

“The falling used supply will raise used-vehicle luxury prices again this year, but overall appreciation will be mild by recent standards,” said Banks, in the NADA Used Car Guide’s latest report, 2012 Special Analysis: Luxury Brand Trends and Used Price Forecast. Prices for luxury brand used vehicles increased 9% in 2011. 

NADA’s price forecast for the following luxury brands in 2012, include: Acura (up 4.8%), Audi (up 3.3%), BMW (down 0.2%), Cadillac (up 0.5%), Infiniti (up 1.5%), Lexus (up 1.6%), Lincoln (up 2.6%), Mercedes-Benz (up 0.7%) and Volvo (down 3.1%). 

Supply decline 

The decline in used-vehicle supply was caused by the 2007-2009 economic recession when fewer new vehicles were purchased or leased, resulting in a drastic drop in trade-ins and off-lease vehicles returning to the market. In 2011, mainstream (non-luxury brands) and luxury brand sales grew by 11% and 4%, respectively, compared to 2010. 

In the luxury sector alone from 2009 to 2011, prices for used vehicles up to five-years-old grew by about 22%, with appreciation across brands ranging from a low of 14.7% for Volvo to a high of 29% for Mercedes-Benz, according to the NADA Used Car Guide. Prices for luxury used vehicles are still at historic high levels. 

“Used-vehicle prices have risen over the past couple of years because of economic conditions that lowered supply and increased demand,” Banks added. 

Supply turnaround expected 

NADA anticipates another year and a half of losses before the supply of luxury used vehicles swings back up again. Although the upturn in overall supply is still some ways off, shorter-term off-lease supply is set to improve much sooner, Banks said. 

In fact, NADA estimates that 36-month off-lease supply is already on the rise, and that supply for these units will be 9% higher in the second half of the year than it was in the first. 

“This means that for the first time in years, downside price risk is on the horizon in 2013 and even more so farther out into 2014,” Banks said. 

Fewer people died or needed expensive long-term care when their physicians focused on the top risk factors for stroke and dementia, according to research reported in the Journal of the American Heart Association (JAHA). 

The primary care doctors in the German study focused on high blood pressure, smoking, high cholesterol, diabetes, irregular heartbeat (atrial fibrillation) and depression. The researchers found that during a five-year period, the need for long-term care was cut 10 percent in women and 9.6 percent in men. 

Based on data collected in a comparison district, 2,112 deaths were expected in the intervention group, but only 1,939 patients died. 

An ounce of prevention 

"Primary prevention pays off," said Horst Bickel, Ph.D., lead author of the study and senior researcher at the Department of Psychiatry at the Technical University of Munich in Germany. "Prevention measures have a potential for improving health in old age which has up to now not been satisfactorily exploited." 

He described these as "relatively simple" interventions, such as encouraging patients to: 

• be more physically active;
• eat healthier foods;
• quit smoking;
• reduce high blood pressure and high cholesterol. 

The study included nearly 4,000 people age 55 and older in rural Upper Bavaria, Germany. Their family doctors were given a brochure summarizing the recommendations, treatment guidelines and goals. Those patients were compared with 13,000 people in a nearby area who received the usual care without the focus on preventing stroke and dementia. 

"We found that not only the risk of long-term care dependence was lower, but also that death rates decreased," Bickel said. "In addition, the cost of inpatient treatment was reduced in the intervention region." 

Wider application 

Bickel said he's confident the results can be applied in the United States and other Western populations that suffer from similar sedentary lifestyle-related illnesses. He points to smoking, lack of exercise and obesity as the main culprits. 

"At the population level, even simple measures can lead to substantial achievements," he said. "Our results are only one example for how health risks can be reduced through uncomplicated, routine treatment of risk factors in the framework of a real-world setting."

Most retirement planners place stong emphasis on the income you will receive in retirement. It's in their interest, after all, for you to save and invest a large amount of money.

While there is no question that having a sizable nest egg will make retirement more pleasant, the expense side plays an important role as well. The less money you have to spend each month, the less money you need to retire.

Retirees willing to relocate during their golden years can find many great places to live that probably cost a lot less than their current locations, especially if they live in northeastern metros. AARPrecently surveyed the most inexpensive, yet desirable cities and came up with ten where you can live for $100 a day or less:

1. Eau Claire, Wisc.: The upper Midwest might not seem like retirement country but AARP notes Eau Claire is a city of “family-friendly values with a progressive twist.”

   • Median home price: $121,100
   • Sunny days per year: 200

2. Gainesville, Florida: The country's sixth largest college — The University of Florida — fuels an economy more durable than most Southern cities.

   • Median home price: $125,500
   • Sunny days per year: 205

3. Grand Junction, Colorado: Grand Junction has plenty of Western charm but is also home for a strong arts community. And the view's pretty nice too.

   • Median home price: $159,800
   • Sunny days per year: 214

4. Las Cruces, New Mexico: Las Cruces is a favorite destination for people who love casual living.

   • Median home price: $148,000
   • Sunny days per year: 287

5. Morgantown, West Virginia: Morgantown is a small college city, giving it a sophisticated flavor in the heart of the Appalachians.

   • Median home price: $168,900
   • Sunny days per year: 185
6. Omaha, Nebraska: Omaha is not just farm country. In recent years it's earned the nickname “Silicon Prairie,” for its large number of start-up companies.
   • Median home price: $123,500
   • Sunny days per year: 193

7. Pittsburgh, Pennsylvania: This industrial city is a lot “greener” than in the past and it's 88 distinct neighborhoods create a European atmosphere.

   • Median home price: $106,500
   • Sunny days per year: 194

8. Roanoke, Virginia: A bustling small city, amid the magic of the Blue Ridge Mountains.

   • Median home price: $151,500
   • Sunny days per year: 217

9. San Antonio, Texas: San Antonio offers an Old West urban flair

   • Median home price: $135,000
   • Sunny days per year: 263

10. Spokane, Washington: Lush green beauty meets smart urban planning. Impress friends and family with the city's stunning Riverfront Park and its historic downtown.

    • Median home price: $145,000
    • Sunny days per year: 176

"Each year we strive to highlight lively, low-cost cities that offer rewarding environments, and that specifically appeal to the 50+ audience," said Nancy Perry Graham, Editor-in-Chief of AARP The Magazine. "There are quite a few really wonderful cities where $100 a day goes a long way and buys not just a spacious home in a thriving neighborhood, but loads of culture, lively entertainment, and recreational opportunities."

In compiling its list AARP said it looked first at at affordability, in particular housing, cost of living, taxes, and economic stability. Other criteria include access to parks and recreation, arts and culture, health care, and local flavor.

Pfizer Consumer Healthcare will remove claims related to breast and colon health on advertising and labeling for certain Centrum brand multivitamin supplements, as part of an agreement negotiated with the nonprofit Center for Science in the Public Interest (CSPI). 

The agreement means CSPI will not move ahead with a lawsuit it had planned to file against the company over those and other claims on Centrum supplements. 

Unfounded claims 

Labels for Centrum Ultra Women's and Centrum Silver Women's multivitamin supplements stated those products supported "breast health," while labels for Centrum Ultra Men's and Centrum Silver Ultra Men's stated those products supported "colon health." 

In CSPI's view, those claims of breast and colon health implied that the supplements would prevent breast and colon cancer -- disease prevention claims that supplement manufacturers can't legally make. 

Centrum relied, in part, on the presence of vitamin D in all of those products to base those claims. In fact, there is limited and inconsistent evidence on vitamin D’s relationship to breast cancer, and inconclusive evidence on vitamin D's relationship to colon cancer. 

"For many consumers, a daily multivitamin is an inexpensive insurance policy to make sure that one's getting the recommended daily amounts of important vitamins and minerals," said CSPI litigation director Steve Gardner. "But supplement manufacturers must not mislead consumers into thinking that these pills will help ward off cancer." 

Clarifying language 

On labels and advertising for Centrum products that bear a claim for "heart health," Pfizer Consumer Healthcare will add clarifying language that the products are "not a replacement for cholesterol-lowering drugs." On labels and advertising for Centrum products that bear an energy claim, Pfizer Consumer Healthcare will add language clarifying that the products do not directly provide an energy boost, but rather help support metabolic function. 

The changes negotiated with CSPI will be made on product labels over the next six months as supplies of packaging are depleted. 

"Although Pfizer disagrees with our position, we are pleased with the collaborative spirit with which Pfizer was willing to discuss our concerns and resolve them without resorting to litigation," Gardner said. 

CSPI's litigation unit has helped achieve other improvements for consumers on supplement advertising and labeling. CSPI sued Bayer in 2009 over false claims that the selenium in its One A Day men's multivitamins reduce the risk of prostate cancer. Eventually a group of three state Attorneys General announced a settlement agreement  with Bayer that ended those claims. 

In 2008, CSPI joined litigation that returned approximately $12 million in refunds to consumers who purchased the dietary supplement Airborne; labels and ads falsely claimed the product would cure and prevent colds.

If you own a home with a mortgage, the lender requires you to have a homeowners insurance policy. While some landlords require tenants to take out renters insurance, most don't.

Should you have renters insurance? It depends. In some cases it could provide protection and peace of mind at a fairly reasonable cost. The average renters insurance policy cost only $184 per year in 2009, ccording to the National Association of Insurance Commissioners.

But according to the Insurance Information Institute(III) only 31 percent of renters buy renters insurance, according to an survey conducted in May, 2012.

Assess your needs

For those considering renters insurance, a good place to start is a needs assessment, comparing that to what a policy actually covers.

"Renters insurance provides financial protection against the loss or destruction of your possessions when you rent a house or apartment," said Jeanne M. Salvatore, III's senior vice president for Public Affairs. "While your landlord may be sympathetic if you experience a burglary or a fire, your possessions are not covered by your landlord's insurance.”

Under most renters insurance policies your belongings are covered against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and water damage, not including floods. But if your upstairs neighbor's bathtub overflows, ruining items in your apartment, you're covered.

Another argument for renters insurance is its liability coverage. Just as a homeowners policy protects the homeowner from damages when someone is injured, renters insurance covers your responsibility to other people injured at your home or elsewhere by you, a family member or your pet and pays legal defense costs if you are taken to court.

Additional living expenses

Most policies cover your additional living expenses (ALE) if you are unable to live in your home because of a fire or other covered peril. ALE pays for hotel bills, temporary rentals, restaurant meals and other expenses you incur while your home is being repaired or rebuilt. However, not all coverage is the same and there are limits.

Probably the biggest consideration in deciding on renters insurance is risk. What do you have to lose?

For example, if you're a college student with limited possessions, protecting those possessions may be less critical than if you are a professional with nice furniture, a big screen TV and an extensive wardrobe.

If you have expensive jewelry, furs, sports or musical equipment, or collectibles, the need for insurance is obviously greater. But keep in mind you may have to add what's called a “floater” to your policy to cover these items.

Most standard renters policies offer only a limited dollar amount for items of extra value. A floater is a separate policy that provides additional insurance for your valuables and even covers them if they are accidentally lost.

People fighting the Battle of the Bulge have a new weapon in their arsenal with the U.S. Food and Drug Administration’s (FDA) approval of Qsymia (phentermine and topiramate extended-release) as an addition to a reduced-calorie diet and exercise for chronic weight management. 

The drug is approved for use in adults with a body mass index (BMI) of 30 or greater (obese) or a BMI of 27 or greater (overweight), who have at least one weight-related condition such as high blood pressure (hypertension), type 2 diabetes, or high cholesterol (dyslipidemia). 

BMI, which measures body fat based on an individual’s weight and height, is used to define the obesity and overweight categories. According to the Centers for Disease Control and Prevention (CDC), more than one-third of adults in the United States are obese. 

“Obesity threatens the overall well being of patients and is a major public health concern,” said Janet Woodcock, M.D., director of the FDA’s Center for Drug Evaluation and Research. “Qsymia, used responsibly in combination with a healthy lifestyle that includes a reduced-calorie diet and exercise, provides another treatment option for chronic weight management in Americans who are obese or are overweight and have at least one weight-related comorbid condition.” 

Drug combo 

Qsymia is a combination of two FDA-approved drugs, phentermine and topiramate, in an extended-release formulation. 

Phentermine is indicated for short-term weight loss in overweight or obese adults who are exercising and eating a reduced calorie diet. 

Topiramate is indicated to treat certain types of seizures in people who have epilepsy and to prevent migraine headaches. 

Limited use 

Qsymia must not be used during pregnancy because it can cause harm to a fetus. Data show that a fetus exposed to topiramate, a component of Qsymia, in the first trimester of pregnancy has an increased risk of oral clefts (cleft lip with or without cleft palate). 

Females of reproductive potential must not be pregnant when starting Qsymia therapy or become pregnant while taking Qsymia. They should also have a negative pregnancy test before starting Qsymia and every month while using the drug, and should use effective contraception consistently while taking Qsymia. 

The safety and efficacy of Qsymia were evaluated in two randomized, placebo-controlled trials that included approximately 3,700 obese and overweight patients with and without significant weight-related conditions treated for one year. All patients received lifestyle modification that consisted of a reduced calorie diet and regular physical activity. 

Trial results 

Results from the two trials show that after one year of treatment with the recommended and highest daily dose of Qsymia, patients had an average weight loss of 6.7 percent and 8.9 percent, respectively, over treatment with placebo. 

Approximately 62 percent and 69 percent of patients lost at least five percent of their body weight with the recommended dose and highest dose of Qsymia, respectively, compared with about 20 percent of patients treated with placebo. 

Patients who did not lose at least three percent of their body weight by week 12 of treatment with Qsymia were unlikely to achieve and sustain weight loss with continued treatment at this dose. Therefore, response to therapy with the recommended daily dose of Qsymia should be evaluated by 12 weeks to determine, based on the amount of weight loss, whether to discontinue Qsymia or increase to the higher dose.  

If after 12 weeks on the higher dose of Qsymia, a patient does not lose at least five percent of body weight, then Qsymia should be discontinued, as these patients are unlikely to achieve clinically meaningful weight loss with continued treatment. 

Qsymia must not be used in patients with glaucoma or hyperthyroidism. Qsymia can increase heart rate; this drug’s effect on heart rate in patients at high risk for heart attack or stroke is not known. Therefore, the use of Qsymia in patients with recent (within the last six months) or unstable heart disease or stroke is not recommended. Regular monitoring of heart rate is recommended for all patients taking Qsymia, especially when starting Qsymia or increasing the dose. 

The most common side effects of Qsymia are tingling of hands and feet (paresthesia), dizziness, altered taste sensation, insomnia, constipation, and dry mouth. 

Qsymia is marketed by Vivus Inc. in Mountain View, Calif.

In recent years car rental companies have become more aggressive in nicking customers for minor damage to vehicles discovered long after the car has been turned in.

Consumers can protect themselves to accepting the company's damage waiver, but that adds a fee to the daily rental. That can be very expensive protection.

Depending on the credit card you use to pay for the rental car, you can acquire some extra insurance coverage. It turns out most credit card companies offer some measure of insurance protecting to their customers. The trick, however, is knowing which card protects you the most and which cards can leave you exposed.

Visa provides best coverage

Odysseas Papadimitriou, CEO of CardHub, has analyzed credit cards for their car rental insurance coverage. He said Visa's rental insurance is the best, with a high score of 87 percent, followed by Discover, American Express and MasterCard.

“We evaluated the networks in a number of different categories, ranging from which cardholders are eligible to how claims must be filed, and compared their policies to our subjective definition of the ‘ideal’ policy -- one where you’d know what you were getting based on common sense, without having to read the fine print,” Papadimitriou said.

It's important, he says because far too few credit card users read their cardmember agreements.

“In the end, Visa’s policy won out, largely due to the ubiquity of coverage on network cards and the fact that it covers towing charges and a rental company’s loss of use,” he said.

Limits

But consumers should understand there are limits to what credit cards offer and it might not be prudent to rely on this coverage. David, of Ashland, OR, reports a tree limb fell on his Hertz rental last summer, a car he had paid for his his Visa card.

“Within the hour, we had notified our insurance company, Hertz and Visa, which was supposed to cover the damage since we had used the Visa card for rental,” David wrote in a ConsumerAffairs post. The car was repaired three weeks later. "In spite of calls to Hertz, we next heard from them on seven months after the accident. Since we had been unable to provide Visa with the paperwork they required within 45 days, Visa refused to honor our claim with them. We ended up paying the deductible not covered by our insurance.”

And in the case where a rental car company charges you for damage discovered after you turned in the vehicle, these credit card policies may be of little or no value. According to CardHub, Discover and American Express both require that cardholders submit a police report when filing a claim; Visa asks for one, when available, and MasterCard requests one in cases of vandalism, multi-car collisions and when a vehicle is no longer driveable.

The best way for consumers to avoid being charged for minor damage that is not of their doing is to photograph the car before you drive it off the lot and then again when you return it. At the very least you then have evidence to present to your credit card company and they might be able to persuade the rental agency to drop the claim.

But sadly, the only sure way to avoid being charged for “after the fact” damage is to take the rental car company's expensive damage waiver.

Consumers appear to be making progress in handling their debts. Data from S&P Dow Jones Indices and Experian show another decline in consumer credit defaults.

For some loan types, it was the sixth straight month the default rate has declined.

The default rate on first mortgages fell nine basis points to 1.41 percent in June, bringing it back to its May 2007 level, before the housing market collapse. It reached a high of 5.67 percent in May 2009.

The second mortgage rate also fell during the month, by 15 basis points, and is at an eight year historic low.

The default rate on credit cards fell by 38 basis points to its lowest level since the end of 2007.

Auto loan defaults up slightly

There was a slight increase last month on auto loan defaults but a closer look at the numbers puts it in perspective. The May default rate was the lowest on record.

"June 2012 data continued a positive trend in consumer credit quality," said David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Dow Jones Indices. "Consumer default rates are falling and we are approaching new lows across most loan types. In the last recession most default rates peaked in the spring of 2009; since then the decline has been bumpy but consistent.”

The Indices track default rates in five U.S. cities and in June, the rate was down in four of them. In Chicago, the rate fell from 2.84 percent back in December to 1.84 percent in June, it's lowest reading since August 2007.

The default rate in Miami fell for the fifth consecutive month -- dropping 11 basis points from May's 2.55 percent to June's 2.44 percent. It's the lowest rate for Miami since October 2006. To show just how much the credit climate has improved in Miami, the high -- reached in June 2009 -- was nearly 19 percent.

Meanwhile, Dallas recorded its lowest rate in its eight year history, moving down by seven basis points to 0.87 percent. Los Angeles' default rate fell by a quarter point.

New York the exception

Only New York saw the default rate rise, gaining three basis points over the month, from 1.61% in May to 1.64% in June.

After years of depressing statistics, the latest report on consumer's credit habits can only be described as encouraging.

"There is only positive news in June's numbers,” Blitzer said. “In the past three years, households have come a long way in repairing their balance sheets.”

Across the 10 headline indices, only one -- bank cards -- shows default rates above 2.5 percent and even those are close to their eight year historic low, Blitzer said.