Private student-loan market grows to 1.4M borrowers

Although the private market for student loan debt is just a sliver of the $1.6 trillion in outstanding student loans, it has grown to more than $100 billion with 1.4 million borrowers, according to a report by Lendedu.

Federal student loans, funded by the U.S. Department of Education, don’t require a credit check, proof of income or a co-signer. The loans typically charge a lower interest rate than what private lenders offer.

Private student loans are offered by private lenders seeking a profit. Typically, interest rates are higher, and a good credit score is needed to qualify. Private loans are by no means guaranteed. Only about a third of loans were approved with a cosigner this year, based on a Lendedu database of about 200,000 applicants for private student loans. Fewer than one in 10 applicants was approved without a co-signer.

The average interest rate charged by a private lender in both 2018 and 2019 was 10.2% — about double the average prime interest rate during that time. Over a 10-year loan, that in effect turns a $25,000 tuition bill into $40,000.

Jpmorgan Chase’s profit rises, beating forecasts

Banking giant Jpmorgan Chase & Co. said Tuesday that its second quarter profit grew by 16% from a year earlier, helped by lower taxes and the ability to charge businesses and consumers more to borrow money.

The nation’s largest bank by assets said it earned $9.65 billion, or $2.82 per share, up from $8.32 billion, or $2.29 per share, a year earlier. The results beat the forecasts of analysts, who were expecting $2.50 a share, according to Factset.

Jpmorgan is one of a trio of big banks that reported their results Tuesday, the others being Wells Fargo and Goldman Sachs. Both reported profits that beat analysts’ expectations. Citigroup reported results on Monday that disappointed investors.

Retail sales increase for 4th month in a row

U.S. retail sales rose at a solid pace last month, providing crucial support to the economy at a time when other drivers of growth have faded.

The Commerce Department said Tuesday that retail sales rose 0.4% in June, the fourth straight month for an increase. Sales at online retailers, grocery stores, home and garden stores, and restaurants and bars increased at a healthy pace.

June’s figures underscore the importance of consumer spending to the U.S. economy. Business investment has weakened, factory output has faltered, and slower global growth is weighing on exports. But measures of consumer confidence remain historically high, and June’s retail sales figures suggest that consumer spending, which drives two-thirds of the economy, remains strong.

Boeing 737 Max’s woes hurt European budget airline Ryanair

Europe’s biggest airline, budget carrier Ryanair, will cut flights and close some of its bases beginning this winter because of the delay in deliveries of the Boeing 737 Max plane, which has been grounded globally after two fatal crashes.

The airline also warned Tuesday that its growth in European summer traffic in 2020 will be lower than expected because of the slowed deliveries.

Brown wants ban on cocoa imports over child labor

Cocoa products imported into the U.S. that rely on forced child labor should be stopped at the border, Democratic U.S. Sens. Sherrod Brown of Ohio and Ron Wyden of Oregon wrote in a letter Tuesday to the Department of Homeland Security.

U.S. law gives customs officials the authority to block the importation of goods produced by forced laborers, and the senators wrote that there is “overwhelming evidence” to justify the use of that authority with regard to cocoa from Ivory Coast, the world’s leading producer.

Blocking cocoa from the Ivory Coast, as well as the chocolate produced from it, would have broad effects on the U.S. chocolate and cocoa industry. The West African nation produces roughly a third of the world’s supply.