Overseas Tax Holiday For Tech Giants May Come With A Catch

Even so, one worry is that the overseas tax holiday for tech firms may not turn out as the bonanza its made out to be. That depends on whether legislation puts conditions on how money could be spent and creates enforcement mechanisms.

Rather than see the money go toward company stock buybacks or acquisitions, Trump and Congress could steer money toward job creation and capital spending, says a UBS analyst.

If the (Trump administration) wants to really drive inward investments within the US there might have to be some sort of mandated use of cash, maybe to spend it on (capital expenditures). As yet, we do not know, UBS analyst Geoff Robinson said in a report.

Theres reason to think Robinson might be on the right track.

Theres trillions of dollars offshore. We want to get that back into America, Gary Cohn, Trumps chief economic advisor, said in a recent interview. We want the companies to bring the money back and put it back into the economy. We want them to create jobs.

Cash-rich tech companies like Apple,Microsoft (MSFT), Google-parent Alphabet (GOOGL) and Ciscocurrently would pay a 35% tax on so-called repatriated earnings. Rather than take the tax hit, theyve kept the money overseas.

President Trump has proposed a one-time tax of 10% on offshore earnings while the Republican-controlled House has proposed a lower 8.5% rate.

The overseas tax-break that Congress passed in 2004 was called the American Jobs Creation Act, but didnt do much to stimulate the economy, analysts say. The AJCA taxed repatriated earnings at a 5.25% rate.

The top five firms in bringing back cash in 2004 were drug companies Pfizer (PFE) and Merck (MRK), as well as Hewlett-Packard, Johnson amp; Johnson (JNJ) and IBM (IBM). According to the IRS, $312 billion was brought back in all.

However, only 10% of companies eligible to bring back cash in 2004 did so, says Richard Lane, an analyst at Moodys Investor Service. Many companies kept cash overseas because of AJCA requirements, he said.

The AJCA required companies to reinvest tax savings in worker hiring and training, infrastructure, research and development and capital projects. According to UBS, however, Funds in 2004s repatriation may have been earmarked for capital investment but ultimately were spent in large part on share repurchases.

UBS says that happened because the AJCA did not include a tracking mechanism so the government could audit companies and gauge compliance. The Trump administration could put better enforcement mechanisms in place.

Samp;P 500 companies have more than $2.6 trillion in overseas cash. Some of that may be needed to continue funding foreign operations.

The companies currently with the most overseas cash are Apple, Microsoft, Cisco, Google and Oracle (ORCL), Moodys says.

While Cisco has stated any cash brought back to the US could be used for reducing debt on its books, analysts have other ideas.

If a tax holiday is approved, BMO Capital Markets said in a report thatit expects Cisco and Hewlett Packard Enterprise (HPE) to focus more on acquisitions, while Apple and smaller companies would likely lean more toward capital return.

In the case of Apple and Cisco, some analysts envision enough cash being brought back to fund transformative deals. Apple has about $250 billion in cash, growing at about $50 billion a year. About 90% of Apples cash is overseas. A one-time, 10% repatriation tax would give Apple some $220 billion for acquisitions or buybacks, Citigroup analyst Jim Suva said in a report. Suva speculated that Apple could buy large companies such asNetflix (NFLX), Walt Disney (DIS) or Electronic Arts (EA).

Cisco, meanwhile, could bring back up to $56 billion in cash from overseas, analysts say. In a report, Credit Suisse speculates that enterprise software providers ServiceNow (NOW), Splunk (SPLK), or computer security firm Palo Alto Networks (PANW) could be on Ciscos shopping list. Pacific Crest Securities adds Red Hat (RHT) and Nutanix (NTNX) to the list of possible Cisco targets.

Intel (INTC) is among semiconductor companies with a cash hoard overseas. Intel could bring back about $12 billion, says BMO Capital Markets. Nvidia (NVDA) and Qualcomm (QCOM) also have significant overseas cash. But, BMO Capital does not expect a Trump tax holiday to spur an acquisition spree among chipmakers.

Household Debt Hits $12.7 Trillion: Here’s How You Can Handle Your Loans

According to the Federal Reserve Bank of New York, Americans have more debt than ever before.

Household debt has reached $12.7 trillion, an amount mainly spread out among mortgages, student loans, credit cards, and auto loans.

Many economistssee this uptick in debt as a sign of economic recovery. But for the individual borrower, debt can be a major burden.

If you hold a share of this $12.7 trillion in household debt, here aresome tips for getting out of the red.

1. Find the best student loan repayment plan

Student loans play a big role in our current national debt. In fact, student debt increased from $500 billion in early 2007 to over $1.34 trillion today.

According to data from the Consumer Financial Protection Bureau, $8.2 billion of those loans belong to subprime borrowers with a credit score of 580 or lower. That level of subprime debt is 32 percent higher than it was a year ago.

So it’s no surprise that student loan default rates have also gone up.The New York Fed reported that 11 percentof student loan balances have been delinquent for 90 days or more.

If you borrowed money for college or graduate school, you know how burdensome student loans can be. But defaulting has a host of bad consequences that can hang over your head for the rest of your life. You need a plan of attack for your student loans.

Whether or not you’ve graduated yet, take time to write down the details of your repayment plan. If you can’t meet your payments, look intoincome-driven repayment plansor student loan refinancing.

Thanks to these options, you’re not stuck with your current terms, interest rates, or loan servicers forever. You can change your plan, make your payments more manageable, and avoid default.

And if your payments aren’t too high, consider paying your student loans off early. Throwing an extra payment at your loans here and there can help you overcomeyour debt faster.

2. Payoff high-interest credit card debt first

If you’re struggling with high balances on your credit cards, you’ll want to tackle that first. Credit card debt makes up $764 billionof the current total debt. The average interest rate on a credit cardis about 13%.

If you’re revolving a balance with such a high interest rate, consider whether paying off your credit cardsdeserves your primary focus. You might be able to transfer your balance to a new card to take advantage of 0% promotional APR.

It could also be a smart move to take out a low-interest personal loan to tackle your credit card debt. Whatever you choose, your goal is to reduce the money you waste on interest.

If you’re a new grad getting a credit cardfor the first time, strive to pay it off in full every month. There’s a persistent myth that carrying a balance helps build credit. But in reality, carrying a balance just costs you more money.

So, try your best not to spend more than you can pay off every month. By making on-time payments and reducing debt, you’ll build a strong credit score.

3. Balance mortgage payments with saving for retirement

Mortgages make up the greatest portion of our $12.7 trillion in debt. In fact, Americans owe $8.6 trillionin housing loans, even more than they did in 2008.

But economists aren’t too worried about another global financial crash. According to the New York Fed, lenders seem to have cleaned up their practices when it comes to assessing candidates.

The report showed that 61 percentof new mortgages went to borrowers with strong credit scores of 760 or greater. In 2008, only 36 percent of new homeowners had credit at this level.

Presumably, homeowners today are more equippedto handle their mortgage payments than those 10 years ago. Some may even strive to pay their mortgage off early.

But with the average interest ratefor a 30-year fixed mortgage around 4%, according to Wells Fargo, it might be smart to stick to the standard plan and put your extra cash elsewhere.

For instance, it could pay off to invest extra income in a retirement savings account instead. Or you could put it toward loans with higher interest rates.

By weighing your various responsibilities, you can put your monthly income where it will go the farthest.

Avoid taking on more debt than you can handle

While some economists hail the new debt stats as a sign of economic growth, you should still be cautious about taking on too much debt.

Before signing on the dotted line of any loan, learn the details of your repayment plan and make sure your payments fit withinyour monthly budget.

Loans can help you earn your degree, establish a career, or a buy a big-ticket item like a house or car. But if you’re looking to borrow, first put a plan in place to manage your financesso that you’re in control.

Interested in refinancing student loans?
Here are the top 6 lenders of 2017!

Why Student Loan Debt Is A Women’s Issue

Women working full time with college degrees make 26 percent less than their male counterparts, though the gap is somewhat smaller immediately after college, according to AAUW. Lower pay means less income to devote to debt repayment.

Making less money puts women at a financial disadvantage in a number of ways, from having less agency in their lives and relationships, to having more difficulty paying their bills, student loans among them. And because women working full time make less money than men — but still shoulder more responsibility when it comes to parenting — the difficulty they have paying off their bills, increasing their net worth, and building wealth to the same degree as men is compounded over time.

6. Thanks to student debt, women are more likely than men to experience financial difficulties.

According to the report, four years after graduation, women with bachelor’s degrees who had not pursued postbaccalaureate education were more likely than men to report that their education costs had influenced them to delay buying a house, and to take a less desirable job or a job outside of their field. These same women were also less likely than men to be contributing to a retirement plan or account, further increasing the likelihood that they will be financially insecure in their later years.

7. Pell Grants for low-income students are really important.

One of AAUWs key policy recommendations to reducing debt-based financial aid is safeguarding and strengthening the Federal Pell Grant program for low-income undergraduate students. The grants are predominantly issued to students whose families earn less than $20,000 per year and, unlike student loans, they do not always require repayment.

President Trumps recent budget proposal would eliminate $3.9 billion in Pell funding (somehow leaving the Pell program on sound footing for the next decade).

However, as Mitchell explains, the Pell Grant supports low-income students who are less likely to have family help them along, and low-income students are disproportionately women.

Even for people who arent eligible, we strongly support making income-driven repayment plans more accessible for women of all incomes, he says.

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Nearly $55 Billion of European Junk Bonds Are Ready for an Upgrade

The trend marks the beginning of a recovery for corporate bond markets after more than $220 billion of global debt was downgraded to junk during the 2015 oil-price crash. European corporates are in a particularly strong position because they have been reducing debt loads to account for sluggish growth and increased uncertainty, the Bank of America analysts said.

So-called rising stars, or bonds that are upgraded to investment grade, present buying opportunities because the debt becomes eligible for purchase by a wider pool of investors. High-yield bonds of about 25 European companies are currently on the verge of being upgraded, a number not seen since before the global financial crisis, according to the report.

Yields typically start tightening when bonds that are rated one notch below investment grade are given a positive outlook by a credit-ratings agency, and then fall as much as 10 percent more in the days following the move, the Bank of America analysts said.

“The earlier the better, but if you miss the pre-positive announcement, the post-positive announcement and even the post-upgrade still offer decent relative value,” they said.

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Debt Consolidation, Negotiation, or Elimination: Which Should You Choose?

As of the first quarter in 2017, American household debt topped $12 trillion. The main contributors to this debt are home mortgages, auto and student loans, plus credit card debt. With mounting debt and the lowest savings rate since 2005 of only 1.9%, many consumers are desperately searching for relief.

Ads, emails, robo-calls and online pop-ups bombard consumers with debt negotiation, consolidation, and elimination plans, often giving conflicting advice. So what is the difference between these three types of debt management plans?

Debt Negotiation/Settlement

Debt negotiation companies claim that they will negotiate with a consumer’s lenders to lower the total amount of debt owed for an upfront fee. Unfortunately, some consumers who paid for debt negotiation services found out that the company never contacted their lenders, but instead, took their money and ran.

Because the debt negotiation company made it sound like they had everything under control, the consumer stopped talking directly with their lenders and ended up slipping deeper into debt.

Also, in certain situations, debt negotiation may damage your credit further.

According to DaveRamsey.com, “When you use one of these companies and then try to get a Conventional, FHA, or VA loan, you will be treated the same as if you had filed Chapter 13 bankruptcy. Mortgage underwriting guidelines for traditional mortgages will consider your credit trashed, so don’t do it. Real debt help is found only in changing your behavior.”

Debt Consolidation

Debt consolidation companies offer to roll up various debts allowing the debtor to make one lower payment to the company, rather than many payments to the different lenders.

While debt consolidation can make paying monthly bills more manageable, some companies tack on high fees and charge exorbitant interest rates, which means the consumer is paying much more in the long run.

Debt Elimination

Companies that offer debt elimination rely on many different schemes but they all hinge on the notion that credit lines are illegal. Debt elimination companies typically provide, for an upfront fee, a document for the lender that supposedly absolves the consumer of the debt.

Unfortunately, the document has no bearing whatsoever on the debt owed and consumers paying for such services have found that they’ve wasted money on a debt elimination scheme that would have been better spent on actually paying back their debts.

Consider the following tips, before contacting a debt management company:

  • Stay in contact with lenders and try to work out a plan with them first before enlisting outside help.
  • Always check the company out first with BBB. BBB Business Profiles on debt negotiation, consolidation, and elimination companies are available online for free at bbb.org.
  • Best practice: Start with a bona fide credit counseling service. Credit counseling services are often nonprofits that offer financial guidance for a small fee, or even for free. Reputable credit counseling services will help you create a budget plus provide coaching and training on how to manage your finances.
  • There is no easy fix for reducing debt and any company that makes huge claims and guarantees, probably can’t deliver. Sources: BBB North Alabama, bbb.org

For more details on consumer debt and advice on dealing with debt including how to manage a budget, go to Avoiding Debt-Relief Scams, The Truth about Debt Management, Microeconomic Data: Household Debt and Credit Report, Debt.com’s Personal Finance Statistics.

Alsocheck out BBB Tips on Budgeting and Credit Counseling – BBB Tip: Create a Budget and Stick to It! and BBB Tip: Overwhelmed with Debt? Understand Your Options.

BBB New Release:Debt Consolidation, Negotiation, or Elimination: Which Should You Choose?

If you would like to report a scam, call your BBB at 256-533-1640 or go to the BBB Scam Tracker. To find trustworthy businesses, visit bbb.org.

Japan’s Disco to pay off interest-bearing debt

In 2009, the company issued 10 billion yen in convertible bonds that were completely converted into stock by 2014, and thus do not require repayment.

Disco will fund working capital and capital investments using cash on hand and operating cash flow, allowing it pay off its debt within the fiscal year. Thiswill mark the first time since going public in 1989 that the company will have no debt. Itscash deposits have ballooned to 77.7 billion yen, one-third of total assets, thanks to brisk sales of cutting equipment for semiconductors.

In fiscal 2017, Disco will make about 10 billion yen in capital investments such as further enlarging its Kuwabata plant in Hiroshima Prefecture. It will also spend about 15 billion yen on research and development. These outlays will be covered by cash on hand and cash flow.

The company already has enough cash to cover its debts, but by reducing debt to zero it will be easier for Disco to borrow money the next time funds are needed.


Budget 2017: Paying down debt and rationing lollies

Joyce reiterated a target of reducing net debt to between 10 and 15 per cent of GDP by 2025, saying that would ensure the Government had the capacity and the resilience to respondto our next economic shock or natural disaster.

If the country wasnt reducing debt at this stage of the economic cycle, you would have to ask when it would, Joyce said.

If the Kaikoura earthquake had happened under this city [Wellington] last year, rather than further south, we would be having a very different kind of conversation.

China’s reforms not enough to arrest mounting debt: Moody’s

In announcing the downgrade, Moodys Investors Service also changed its outlook on China from negative to stable, suggesting no further ratings changes for some time.

China has strongly criticized the downgrade, asserting it was based on inappropriate methodology, exaggerating difficulties facing the economy and underestimating the governments reform efforts.

In response, senior Moodys official Marie Diron said on Friday that the ratings agency has been encouraged by the vast reform agenda undertaken by the Chinese authorities to contain risks from the rapid rise in debt.

However, while Moodys believes the reforms may slow the pace at which debt is rising, they will not be enough to arrest the trend and levels will not drop dramatically, Diron said.

Diron said Chinas economic recovery since late last year was mainly thanks to policy stimulus, and expects Beijing will continue to rely on pump-priming to meet its official economic growth targets, adding to the debt overhang.


Moodys also is waiting to see how some of the announced measures, such as reining in local government finances, are actually implemented, Diron, associate managing director of Moodys Sovereign Risk Group, told reporters in a webcast.

China may no longer get an A1 rating if there are signs that debt is growing at a pace that exceeds Moodys expectations, Li Xiujun, vice president of credit strategy and standards at the ratings agency, said in the same webcast

If in the future Chinas structural reforms can prevent its leverage from rising more effectively without increasing risks in the banking and shadow banking sector, then it will have a positive impact on Chinas rating, Li said.

But Li added: If there are signs that Chinas debt will keep rising and the rate of growth is beyond our expectations, leading to serious capital misallocation, then it will continue to weigh on economic growth in the medium term and impact the sovereign rating negatively.

China may no longer suit the requirement of A1 rating.

Li did not give a specific target for debt levels nor a timeframe for further assessments.

Moodys expects Chinas growth to slow to around 5 percent in coming years, from 6.7 percent last year, compounding the difficulty of reducing debt. But Diron said the economy will remain robust, and the likelihood of a hard landing is slim.

After Moodys downgrade, its rating for China is on the same level as that on Fitch Ratings, with Standard amp; Poors still one notch above, with a negative outlook.

On Friday, Fitch said it is maintaining its A+ rating. Andrew Fennel, its direct of sovereign ratings, noted Chinas strong macroeconomic track record, but said that its growth has been accompanied by a build-up of imbalances and vulnerabilities that poses risks to its basic economic and financial stability.


Government-led stimulus has been a major driver of Chinas economic growth over recent years, but has also been accompanied by runaway credit growth that has created a mountain of debt – now at nearly 300 percent of gross domestic product (GDP).

Some analysts are more worried about the speed at which the debt has accumulated than its absolute level, noting much of the debt and the banking system is controlled by the central government.

UBS estimates that government debt, including explicit and quasi-government debt, rose to 68 percent of GDP in 2016 from 62 percent in 2015, while corporate debt climbed to 164 percent of GDP in 2016 from 153 percent the previous year.

5 Zombie Stocks Coming Back From the Dead

Approach Resources stock also plunged more than 90% at one point in the oil market downturn. However, the company managed to stay afloat by cutting spending and reducing debt, which put it in the position to receive a lifeline late last year after agreeing to a strategic alliance and deleveraging transaction. That agreement enabled the company to pay off a significant amount of debt, which slashed interest expenses. Because of that, Approach Resources can reallocate that cash flow toward drilling high return wells in the Permian Basin instead of sending it to creditors, which should start creating value for investors.

Alliance Creative Group (ACGX) Reduces Another $100000 of Debt Since End of Q1’17

CHICAGO, IL–(Marketwired – May 24, 2017) – Alliance Creative Group, Inc. (AllianceCreativeGroup.com) (OTC PINK: ACGX) is pleased to announce that it has reduced another $100,000 of debt since the end of the 1st quarter (March 31, 2017) and continues to negotiate with debt holders to reduce more by the end of the 2nd Quarter (June 30, 2017).

Paul Sorkin, COO and General Counsel, said, Now that we have achieved certain internal goals we have to continue and increase our aggressive pursuit of executing our business plans, reducing debt, and increasing overall shareholder value for everyone.We understand the OTC Markets are very volatile and unpredictable and come with a lot of potential risks and rewards so we will continue to focus on building a solid company while reducing our debt to position the Company for continued growth and let the market determine our value.We are also still in discussions with multiple parties about potential mergers and/or acquisitions and hope to find another good fit to help accelerate our growth.We will continue to share news via social media and by press releases as things progress.

About Alliance Creative Group, Inc.

Alliance Creative Group, Inc. (Stock Symbol: ACGX) is a full-service product-development agency that since 1997 has been helping clients connect their products and services to their customers. ACG focuses on creative and design services, printing and packaging, brand and product development, fulfillment, logistics and transportation, strategic consulting, digital marketing and engagement, and software development. For more information, visit www.AllianceCreativeGroup.com or www.ACGX.us.

About PeopleVine

PeopleVine is a software platform combining CRM, marketing, CMS, and sales into a single, seamless customer engagement suite.PeopleVine was started in 2014 with the vision of providing a consolidated platform for businesses to better connect and engage their customers.

PeopleVine is a turn-key platform providing 60+ out-of-the-box pages and experiences to further engage with consumers.PeopleVine users can either leverage the out-of-the-box experience or customize it by making a few design tweaks to building their own experience on the same APIs we used.Flexibility is key to ensuring a consistent and unique branded experience, but also saves developers time by not having to start from scratch.

Together with our fully integrated marketing and automation engine PeopleVine is able to ensure continuous engagement all tracked and managed from a single platform.To date over 200 companies across 15 industries have used PeopleVine to power their websites, text campaigns, ecommerce, memberships, and more. Whether launching a loyalty program or your entire website, our tools make it easy to get going — and growing — quicker.For more information www.PeopleVine.com

About Primary Trucking

Primary Trucking is an asset based carrier located in Chicago, IL.We specialize in truckload freight outbound from Chicago.We have over 30 years of experience in the transportation industry and we have the tools to be your primary source for transportation. We customize transportation solutions based on our customers needs.If you need to move your freight locally or coast to coast, we have you covered.No job is too big or too small. We can handle anything, from moving a few pallets to moving an entire warehouse.Primary Trucking is your Primary source for transportation needs.

For more information go to www.PrimaryTrucking.com

About Rapid Freight Solutions

Rapid Freight Solutions (Rapid) provides domestic shipping services nationwide, quickly and safely moving products across the country. Rapid specializes in LTL, air freight, hot shot, trade-show, flatbed, intermodal, over-dimensional, step-deck, and refrigerated trucking. Thanks to our teams 30 years of experience, we have relationships with more than 140 carriers nationwide, helping ensure our customers quality service with competitive pricing. For more information, go to www.RapidFreightSolutions.com

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks described in statements filed from time to time with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the Company, are expressly qualified by the cautionary statements that may accompany the forward-looking statements. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.