Current Events in July 2019

The cost of renting a home continued to rise in June even as home values appeared to level off. Rents have gone up nine months in a row.

The June Zillow Real Estate Market Report shows the median rent rose 3 percent over the last 12 months to $1,483. Rents rose in 49 of the nation’s top 50 housing markets, with only Milwaukee recording a decline.

Rents’ rate of increase hasn’t been this strong since 2016 when housing experts voiced concern that rents were becoming unaffordable for a growing number of consumers. That sparked a building boom in apartment construction, which was expected to saturate the market. That hasn’t happened.

"As much as record numbers of new apartments led many to believe that rental markets might have become over-saturated with new supply, the reality is that demographics and general economic health continue to keep the pressure on," said Zillow Director of Economic Research Skylar Olsen. "Yes, we saw rents fall in 2018, but that was driven by the concentration of supply in urban areas and large buildings at higher end price points competing against each other.”

Affordable apartments needed

What the market needs, Olsen says, are affordable rental units across many housing markets. She says the demand for that kind of rental housing is intense.

“Show me a three-bedroom apartment in a small building located near good schools and I'll show you an older millennial with kids ready to move in," Olsen said.

But contractors may not be building affordable apartments for the same reason they aren’t building as many affordable single-family homes. Costs of land, labor, and materials have gone up, squeezing margins on lower-priced homes.

Inventory declining again

There seems to be plenty of homes, both for sale and for rent, that many consumers can’t afford, but there are far fewer homes in an affordable price range. In June, inventory of all rental property fell 0.8 percent -- the fourth straight decline.

Home values, which can influence rental costs, were slightly higher in June after a slight dip during the spring home-buying season. Zillow pegs the value of the typical home at $227,700, up slightly from May. On a year-over-year basis, home values grew 5.2 percent in June, down from 7.6 percent in June 2018.

Home values increased the most in Salt Lake City, Indianapolis, and Charlotte, while typically expensive West Coast markets showed little change.

BMW of North America is recalling 16,641 model year 2009 328i & 328xi vehicles, model year 2009-2011 335d vehicles, model year 2008-2012 M3 Coupes & M3 Convertibles, and model year 2008-2011 M3 Sedans.

This is an expansion of an earlier recall.

The connection of the positive battery cable at the fuse box terminal may degrade, resulting in an intermittent loss of electrical power.

This can cause the vehicle to stall, increasing the risk of a crash.

What to do

BMW will notify owners, and dealers will replace and secure the positive battery cable connector free of charge.

The recall is expected to begin August 12, 2019.

Owners may contact BMW customer service at (800) 525-7417. 

Northfork Bison Distributions of St. Leonard, Quebec, Canada, is recalling its Bison Burgers and Bison Ground.

The products may be contaminated with E. coli: O121 and O103.

A number of illnesses have been reported and are currently under investigation.

The recalled products, with the production dates of February 22, 2019 – April 30, 2019, were distributed to institutions and retail outlets across the eastern and central U. S..

What to do

Consumers who have purchased the recalled products should return them to the place of purchase for a full refund.

Consumers with questions may contact the company at (888) 422-0623.

The Consumer Financial Protection Bureau (CFPB), the Federal Trade Commission (FTC), and 48 states (plus the District of Columbia and Puerto Rico) have announced a global settlement with Equifax that will provide up to $425 million in monetary relief to consumers as a result of Equifax’ massive 2017 data breach that exposed the personal data of 147 million consumers. In all, the company could pay up to $700 million in total relief due to other penalties.

There was speculation that the CFPB was backing off the pursuit of its Equifax probe, but -- to the advantage of the consumer -- the agency stuck to its guns and saw the issue all the way through to a successful end.

“Today’s announcement is not the end of our efforts to make sure consumers’ sensitive personal information is safe and secure,” said CFPB Director Kathleen L. Kraninger. “The incident at Equifax underscores the evolving cyber security threats confronting both private and government computer systems and actions they must take to shield the personal information of consumers. Too much is at stake for the financial security of the American people to make these protections anything less than a top priority.”

Making a claim

The agency’s proposed order requires Equifax to establish the agreed-to $425 million fund to provide impacted consumers with a host of remedies, including free credit monitoring and cash reimbursements. 

The only roadblock is that the court has to approve the settlement, but the overriding question appears to be “when”  that will happen and not “if.” Once that happens, affected consumers can file a monetary claim for up to $20,000 for “lost time and money,” including the following: 

• $25/hour for up to 20 hours for time spent protecting personal information or addressing identity theft after the breach;

• Money spent purchasing credit monitoring or identity theft protection after the breach;

• The cost of freezing or unfreezing credit reports at any consumer reporting agency after the breach;

• Reimbursement for up to 25 percent of the amount paid to Equifax for credit or identity monitoring subscription products between September 7, 2016 and September 7, 2017; 

• Any unreimbursed costs, expenses, losses, or charges incurred as a result of identity theft; and

• Miscellaneous expenses associated with any of the above, such as notary, fax, postage, mileage and telephone charges.

Any consumer whose data was breached would also be eligible to receive the following:

• At least 10 years of free credit-monitoring;

• At least seven years of free identity-restoration services;

• Starting on December 31, 2019 and going through December 31, 2026, all U.S. consumers may request up to six free copies of their Equifax credit report during any 12-month period. These free copies will be provided to requesting consumers in addition to any free reports to which they are entitled under federal law.

If a consumer decides to pass on the free credit monitoring option that’s offered as part of the settlement, they can apply for up to $125 as a reimbursement for the cost of a non-Equifax credit-monitoring product of their choice. 

The fine print

As always, there are stipulations, but as far as settlements go, this one seems to be pretty straightforward. 

The most important hoop a consumer has to jump through is that they must submit a claim to receive free credit monitoring or cash reimbursements; those claim requests won’t just magically show up in an email or a settlement check in your mailbox. 

Once the court approves the settlement, consumers can submit a claim online at www.EquifaxBreachSettlement.com, or by mail. As of now, the court settlement is not official, so it’s important for interested consumers to visit this website frequently to keep current with the deadlines for filing claims. 

Car insurance customers who purchase the bare minimum coverage required by their state pay a higher rate when they upgrade insurance policies.

That’s the conclusion of a Consumer Federation of America (CFA) analysis that compared  premium quotes from six companies in several cities for consumers who bought the least coverage and those who purchased more extensive coverage.

“Auto insurance is not just mandatory in most states, it is an important asset protection tool,” said J. Robert Hunter, CFA Director of Insurance and a former Texas Insurance Commissioner. “As folks’ financial situations improve and they opt to buy more coverage, they should expect equal access to the products and services available to others. Pricing auto insurance based on drivers’ prior purchases is both actuarially unwarranted and an entirely unfair tax for being poor.”

A la carte

Getting the best rate on car insurance, it seems, is based on a lot more than just a driving record. In all but a handful of states, carriers often use a consumers’ zip code or credit score to assign risk. Fabio Faschi,  Property and Casualty Team Lead at Policygenius, says that’s why consumers need to understand how car insurance works and what it is they’re buying.

“Auto insurance, compared to some other types of insurance, is very ala carte in terms of choosing the types of coverages you might or might not want, and how much of that coverage you want,” Faschi told ConsumerAffairs.

And that, unfortunately, leaves a lot of room for confusion. Auto insurance has two functions: it protects a consumer’s property and it also protects them from being held responsible for the damage they cause to other people’s property.

Liability coverage

The minimum coverage states require drivers to have is liability insurance. It pays the other driver if you cause an accident. 

“This is what most consumers should be most concerned about because liability coverage is what’s going to protect you if you cause damage to others,” Faschi said.

Collision insurance pays you if you damage your car in a single-vehicle accident. If you’re financing your vehicle, the lender will likely require some collision coverage, as well as what’s known as comprehensive insurance.

“Comprehensive is essentially going to protect your car from other types of damage, such as weather-related damage,” Faschi said.

All three types of coverage add to the cost of the monthly premium. If you have all three, your cost will be higher than if you only have liability coverage.

Deductibles

Deductibles are another feature that can add to or reduce the cost of insurance. In the event of a claim, the deductible is the amount you have agreed to pay out-of-pocket before the insurance company starts to pay. 

Deductibles generally range from a low of $100 to a high of $1,000 or $1,500. The higher your deductible, the lower your premium because the insurance company is shifting more of the risk to you.

“Insurance is generally all about risk tolerance and the trade off between what you would be guaranteed to pay (through higher premiums) or between what you might potentially have to pay (out of pocket) in the event of an incident,” Faschi said.

But the best way to make sure you are getting the best car insurance rate is to shop your policy around to other companies. And Faschi says, it’s a good idea to do that often -- even once a year.

“The market does shift, though it’s not going to shift drastically from year to year. It’s really just a matter of covering your bases and making sure there weren’t any shifts that create a better deal.”

The proposed merger between Sprint and T-Mobile has a week to go before it runs up against a July 29 deadline. Despite a lot of opposition, the deal could be close to approval.

Fox Business reports the Justice Department has informed all parties that barring any last minute issues the U.S. government will likely give its approval before the deadline. But the situation apparently remains fluid.

The network reports negotiators made significant progress last week in resolving some of the issues that thus far have prevented approval. While the two smaller wireless companies have made what some say is a compelling case for their merger, the fact remains there are powerful  groups opposing it.

Democratic lawmakers, joined by labor unions and consumer groups, have urged the Justice Department to block the deal. They point out that the merger would reduce the number of major wireless companies from four to three.

They also maintain that Sprint and T-Mobile tend to be the carriers of choice for low-income consumers because of their lower rates. They worry that if the two smaller companies become one bigger one, those rates will go up.

A new fourth carrier

To ease those concerns the parties have worked toward helping Dish Network create a fourth wireless provider, utilizing assets from both Sprint and T-Mobile. Earlier this month the Justice Department pressed the merger partners to make additional concessions to help Dish’s wireless service get up and running.

Specifically, German telecom company Deutsche Telekom, which would control the two merged wireless providers, was reportedly asked to give up more spectrum for Dish’s new service. More recent negotiations have reportedly been aimed at making sure Dish’s wireless service would be a strong competitor in the U.S. market.

Attorneys general

Democratic state attorneys general are other opponents who must be won over. While they don’t play a regulatory role in approving the merger they have the legal resources to go to court to try to block it. 

At this point, simply delaying the merger might be the same as blocking it. In April, Sprint and T-Mobile announced a July 29 deadline for completing their merger. If that deadline is missed, both parties might simply walk away.

Meeting that deadline now hinges of gaining Justice Department approval. The Federal Communications Commission has already signed off on the deal.

Microsoft, which has promised to be more transparent about Windows 10 updates and services, has confirmed another issue that will affect a large number of Windows 10 users. 

The company has confirmed that support for version 1803 (an April 2018 Windows 10 update) will be ending November 12. As that date nears, Microsoft is pushing users to install the latest version of the operating system -- version 1903, which has been problematic.

Microsoft said it’s starting the update process for Home and Pro editions immediately to ensure a “smooth update process.” 

“We are initiating the Windows 10 May 2019 Update for customers with devices that are at or nearing end of service and have not yet updated their device,” the company said in a support document.  “Keeping these devices both supported and receiving monthly updates is critical to device security and ecosystem health.” 

“Based on the large number of devices running the April 2018 Update, that will reach the end of 18 months of service on November 12, 2019, we are starting the update process now for Home and Pro editions to help ensure adequate time for a smooth update process,” Microsoft said. 

Issues with version 1903 

Microsoft released version 1903 in early June while promising increased transparency regarding the Windows 10 update experience, but software reviewers were quick to spot the presence of some troubling features. 

“It's a classic anxiety dream,” wrote Ed Bott for ZDNet. ”You're in math class. You didn't study for the test. You watch as the professor scratches out what appear to be hieroglyphics on the chalkboard, and you have absolutely no idea how all those symbols and variables fit together. And then she calls on you.”

“That's how I felt last week as I tried to make sense of what's going on with Microsoft's rules for deferring updates in Windows 10.”

Just a few weeks ago, the company said its latest update for version 1903 included more than 20 improvements and fixes. However, the tech giant also warned that the update could break the system’s RASAM (Remote Access Connection Manager). 

Last month, another issue came to light when the Cybersecurity and Infrastructure Security Agency (CISA) issued a warning for Windows users to patch their operating system to prevent attackers from taking advantage of a vulnerability known as BlueKeep.

A new study has brought to light an interesting development regarding women’s rights. 

When leaders make women’s rights a priority in their countries, they see a wide range of benefits, which is not true of countries that aren’t prioritizing women’s rights. 

“Since the promotion and protection of women’s rights play a fundamental role for progress for states as they unite health, human rights and development, nations that have the ability to promote [women’s social and economic rights]...are missing a crucial component in positive health outcomes,” the authors wrote. 

Spotting the differences

The researchers analyzed data from 158 countries to see how putting a spotlight on women’s rights affected issues like healthcare improvements, economic benefits, and sustainability. 

Each nation was divided into a group based on its support of women, ranging from high support to medium and poor support. The majority of countries (63) fell into the “poor” category, while 44 were high supporters and 51 were moderate supporters. 

With that information, the researchers were able to see that granting women social and political rights had an overwhelmingly positive impact, even in statistically lower-income countries. That same impact wasn’t seen in countries with low support of women’s rights. 

Healthcare was one area where women’s rights made a massive improvement, as the countries that fell into the “high” support category were more likely to have better life expectancies. There was also better access to vaccines and more information available about reproductive health and disease prevention.

“The results confirm that even with a lack of resources, if a country has a strong human rights structure, the health outcomes are better,” the researchers write. “Today, the value of human rights has often been questioned from an economic standpoint; however, our data find that rather than limit progress, human rights, and [women’s economic and social rights] in particular, can only benefit them.”

Despite its recent record highs, many on Wall Street worry that a recession looms ahead. Economists agree that there are signs of an economic slowdown. But the latest University of Michigan (UM) Consumer Sentiment survey shows consumers are just as bullish as ever. Spending during last week’s Prime Day underscores that fact.

Perhaps the most remarkable feature of the latest UM survey is how little it has changed from the past few surveys, except to record even more optimism. The consumer sentiment index moved to 98.4, up slightly from 98.2 in June. 

The consensus among economists is that it would go down. Much to their surprise, it didn’t.

“Consumers seem to have a better handle on the economy than many analysts, who fixate on factors such as the inflation rate and on the perceived necessity of rate cuts, even with the stock market near record highs and the domestic economy doing well,” Robert Frick, corporate economist at Navy Federal Credit Union, told ConsumerAffairs. “And consumers don't seem fazed now by the specter of an escalated trade war. This is reflected not only in the Consumer Sentiment numbers, but in retail spending.”

Record spending at Amazon

Amazon blew out previous records last week, recording a 53 percent increase in sales over its 2018 Prime Day promotion. Sales at competing retailers were also higher last week. If the economy is slowing, consumers have yet to feel it.

“Perhaps the most interesting change in the July survey was in inflation expectations, with the year-ahead rate slightly lower and the longer term rate moving to the top of the narrow range it has traveled in the past few years,” said Richard Curtin, UM surveys of consumers chief economist.

This week’s Federal Reserve meeting could increase the feeling of economic optimism since it is widely expected that the Fed will cut interest rates. Should that happen, the record-high interest rates on credit card balances will go down slightly. It should also make new and used car loans less expensive.

But as is often the case, consumers can be the last to know when things start to head south. The Conference Board reported last week that the Index of Leading Economic Indicators (LEI) declined in June for the first time since last December. 

The index measured weakness in new orders for manufacturing, housing permits, and unemployment insurance claims.

Chrysler (FCA US LLC) is recalling 41,169 model year 2019 Jeep Cherokees.

The impact and acceleration sensors may fail and reduce the airbag system's ability to properly detect certain crash events.

The inability to properly detect a crash may result in improper air bag deployment, increasing the risk of injury.

What to do

Chrysler will notify owners, and dealers will replace the affected sensors free of charge.

The recall is expected to begin August 2, 2019.

Owners may contact Chrysler customer service at (800) 853-1403. Chrysler's number for this recall is V63.

Pita Pal Foods of Houston, Texas, is recalling various hummus products made between May 30, 2019, and June 25, 2019.

The products may be contaminated with Listeria monocytogenes.

No illnesses have been reported to date.

The products have been distributed nationwide and to United Arab Emirates. Consumers who have purchased products listed below with these use by dates are urged to return them to the place of purchase for a full refund. Consumers with questions may contact the company at 888- 671-8858.

A full list of affected products can be viewed on the FDA's website here. The recalled products were distributed nationwide and to United Arab Emirates.

What to do

Customers who purchased the recalled products should return them to the place of purchase for a full refund.

Consumers with questions may contact the company at (888) 671-8858.

Audi is recalling 28 model year 2019 Q5s and SQ5s.

In the event of a crash deploying the passenger's front airbag, the instrument panel carrier may break due to incorrect welding.

If the carrier breaks, damage to the airbag may not provide adequate protection, increasing the risk of an injury.

What to do

Audi will notify owners, and dealers will replace the instrument panel and the passenger front airbag free of charge.

The recall is expected to begin August 18, 2019.

Owners may contact Volkswagen customer service at (800) 253-2834. Volkswagen's number for this recall is 90N1.

In recent years, automotive news seems to have been dominated by battery-powered cars and vehicles that drive themselves.

But General Motors still makes a sports car for people who love to be behind the wheel and who value speed and performance. To prove it, the automaker has just taken the wraps off the 2020 Chevrolet Corvette.

“Radical” is how many industry analysts describe the changes to Chevy’s premier sports car it has been making since 1953. The new model places the engine in the middle of the car, behind the seats. It not only changes how the car looks but also how it feels behind the wheel.

The placement of the engine -- referred to in the industry as a rear mid-engined layout -- alters the center of gravity. The heaviest part of the vehicle is now closer to the driver, who is positioned forward in the car and closer to the front wheels.

Pushing boundaries

“Corvette has always represented the pinnacle of innovation and boundary-pushing at GM. The traditional front-engine vehicle reached its limits of performance, necessitating the new layout,” said GM President Mark Reuss. “In terms of comfort and fun, it still looks and feels like a Corvette, but drives better than any vehicle in Corvette history.

The engine itself is pretty impressive but fuel economy won’t be its strong suit. The base trim model sports a 495 horsepower 6.2-liter V8 with an eight-speed automatic transmission with paddle shifters. 

Like previous Corvettes, the new model will get from point A to point B in a hurry, going from zero to 60 miles per hour in fewer than three seconds. At first glance at least, automotive experts are impressed.

‘Incredible bang for the buck’

“Corvette has again delivered an incredible bang for your performance buck,” Karl Brauer, executive editor of Kelley Blue Book, said in an email to ConsumerAffairs.”That’s its key trademark, and GM didn’t lose it with the switch to a mid-engine design. Some of the styling elements, both inside and out, may or may not work for everyone. But in terms of American performance at a great price, this new car nails it.”

In fact, the 2020 Corvette doesn’t look much like the models that came before. The new version has a distinctly Italian style as opposed to the classic American one.

One thing that hasn’t changed is the price. Despite all of the engineering work that went into the new model the 2020 Corvette will sell for around $60,000 -- nearly the same as the 2019 version. GM said it wanted to make sure consumers who bought previous models could afford the new one.

Airlines currently partner with services like Gogo to offer Wi-Fi connectivity to passengers who are willing to pay a fee. However, airlines could soon start offering Wi-Fi for free. 

Carriers who make in-flight Wi-Fi possible say the service will likely become free on most flights in about two years, according to a Wall Street Journal report. 

If in-flight internet connectivity were to become free, the Journal notes that the current percentage of passengers who choose to purchase access would rise significantly, from 6-7 percent to about 40-60 percent. 

High demand for Wi-Fi on planes

Airlines are increasingly looking to use satellite systems, which offer a larger coverage area and more consistent connectivity, to provide internet access to passengers. 

Just last month, American Airlines finished equipping its fleet of more than 700 narrowbody aircraft with faster and more consistent satellite-based internet access  The faster service will either be provided by Gogo 2Ku or ViaSat Ka depending on where passengers are traveling. 

“Satellite-based Wi-Fi allows customers to stream video without buffering or interruptions; upload and download les with ease; and stay connected from gate to gate,” the airline said in a statement. “Upgraded bandwidth capacity ensures customers won’t compromise on connection quality or speed, even if every customer chooses to access inflight internet at the same time.” 

Many passengers surveyed have said having a reliable internet connection while flying is more important to them than food or even comfort. For this reason, airlines making it a priority to deploy faster satellite-based Wi-Fi.

“We did a good job of training people that the Internet was slow and expensive on a plane,” says John Wade, president of commercial aviation at Gogo, told the Washington Post. “We now need them to realize that they’re in a different world today.”