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Square to acquire Afterpay for $29B

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Re: Square to acquire Afterpay for $29B

#331

Post by 0xffff2 »

healsjnr1 wrote: post #259
hnick wrote: post #164

Earlier quoted context omitted.

Insurance, points, cashback, chargebacks. It's also a one month interest free float of your funds if you pay in full each month, meaning you earn some interest. I know some debit cards are getting closer to credit cards in these areas but at least when I first got one, they were just plastic cash. You spend it you lose it, the bank won't support you with clawing it back.

Points for most people are a zero sum or losing game. I worked for a points loyalty program, and the customer always pays. The bank knows their market well, they know the redemption rate of points for different demographics and they set the annual fees on points earning cards appropriately. For a small number of very diligent points hack customers, the bank loses money on this and the customer wins. For a larger prop…

In the US at least, no annual fee credit cards offering cash back or points are plentiful.

Re: Square to acquire Afterpay for $29B

#332

Post by systemvoltage »

elvinyung wrote: post #194
systemvoltage wrote: post #101

Earlier quoted context omitted.

The point is that if they're stretching payments over multiple weeks/months then they can't afford it.

Would you say the same about a house? A car? You might say that buying a house on credit isn't frivolous but a pair of shoes on credit is, but where do you draw the line in the middle? (Disclaimer: I work at Square, but I am otherwise completely uninvolved with this acquisition or product area.)

Great question and made me think. I think the difference may be that people that need to stretch payments for smaller purchases tend to build up credit card debt and fall into 18% APR for years and never get out of it.

Car loans and Houses have a very controlled lending market. Even more so with business loans.

I think there is big difference between monthly payments for a Go Pro camera and debt financing your new restaurant.

Re: Square to acquire Afterpay for $29B

#333

Post by ComputerGuru »

zizee wrote: post #294
ComputerGuru wrote: post #193

Earlier quoted context omitted.

That type of economy (powered by extreme consumerism beyond the customers’ means) isn’t unique to Australia. It’s only sustainable so long as the target population continues to increase (kind of like social security). The forecasted global population drop that will hit home in the next 15-20 years is going to completely destroy economies propped-up by fake money.

I agree that Australia's economy is propped up by continued ion growth, a giant pyramid scheme if you'll excuse the hyperbole. However Australia has such a large amount of land, and such a small population that forecasted worldwide population drop won't affect Australia so much. It's such a desirable place to live that immigration at the current rates will be sustainable regardless of the rest of the world's populati…

15-20 to start feeling it in the most developed nations, end of the century worldwide. Immigration can stall the former but current policies are not promising. Germany will sing songs of praise in Merkel’s name.

Re: Square to acquire Afterpay for $29B

#334

Post by ComputerGuru »

danielmarkbruce wrote: post #220
ComputerGuru wrote: post #193

Earlier quoted context omitted.

That type of economy (powered by extreme consumerism beyond the customers’ means) isn’t unique to Australia. It’s only sustainable so long as the target population continues to increase (kind of like social security). The forecasted global population drop that will hit home in the next 15-20 years is going to completely destroy economies propped-up by fake money.

It's not unique, but in the first world Australia has gone from being ranked one of the lowest in average household debt in 1990 to one of the very highest in 2021. It's not fake money. It's likely not even "beyond means". The debts can likely be paid back. But it seems quite unlikely the level of spending can continue to grow.

It’s fake money in the sense that, assuming people aren’t in over their heads with loans they shouldn’t have been approved for, everyone is fully leveraged at some multiple of their monthly salary. In that regard, the present is fully leveraged taking a debt that the future will have to pay back, and it can only be pushed out indefinitely so long as the economy continues to grow. That’s regardless of GDP: it can be - and this is what people futilely speculate when it’ll hit - because the economy took a turn south (GDP looking only at the working-aged population drops) or, as mentioned above, even if the economy is doing spectacular on a micro level and GDP (again calculated only against working-age population) is up, but there simply aren’t enough cogs in the machine to keep it spinning at the same rate it was before.

Re: Square to acquire Afterpay for $29B

#335

Post by vmception »

rossmohax wrote: post #302
vmception wrote: post #61

Earlier quoted context omitted.

Kind of? If you follow monetary policy circles, you would know that we are only close to the predicted level of fantastic market distortions that should be expected. It is fantastic to see it play out, such as valuations much larger than before, as well as the unexpected areas of speculation and shifts in market tolerances for worse deals. But we aren't even done yet! And this comes with a pretty clear agreement on t…

What would you recommend to read/watch to understand better this kind of things?

hmmm, not sure, at this point I think you would be better off using what I wrote as a summary and hopping in to current events

Matt Levine’s writings on Bloomberg occasionally go into macroeconomic territory, he has a facetious and satirical approach to current events in capital markets

There are a few other sensational editorial publications about macroeconomics and credit markets, but I wouldn't recommend them for actually learning

Sadly, I think this leaves a void between dry material, and sensational disinformation sites

Re: Square to acquire Afterpay for $29B

#337

Post by bruce_one »

omniscient_oce wrote: post #301
Khaine wrote: post #132

In Australia millennials, are allergic to credit cards. Credit card usage in that demographic is really low. Instead they prefer BNPL services as a credit mechanism. Banks have also responded and offer credit cards that don’t act like normal credit cards[1] [1] https://www.commbank.com.au/credit-cards/commbank-neo.html

Myself and most people I know (early twenties) use what the banks give by default which is a "Debit Mastercard/Visa" which lets you shop online like a credit card, perform chargebacks, or pay in-store, but the money just comes out of your savings account like a debit card - not on credit (they get declined if your account is empty too AFAIK but haven't tested it ;P). Are these common overseas? I rarely see reference…

> they get declined if your account is empty too AFAIK but haven't tested it ;P

Not always, at least some banks will allow you to go into overdraft and then charge a fee (e.g. $15 for Commbank) - so it's worth being cautious about running out.

I remember miscalculating and going into overdraft by a very small amount (e.g. a dollar or two) and then being slugged the overdraft fee - I would've much preferred the transaction to be declined, but that isn't/wasn't the default behaviour.

For example: https://www.commbank.com.au/support.banking.explain-account-... -> `CommBank may allow you to overdraw transaction accounts for the following payment types... Spend using your linked CommBank card`

(It used to be enabled by default with Commbank, not sure if that's still the case; but I'd kinda guess "yes"...)

Re: Square to acquire Afterpay for $29B

#338

Post by leppr »

dna_polymerase wrote: post #297
osrec wrote: post #205

Earlier quoted context omitted.

Is that massive jump covid related?

No, it's a change in methodology. The "money printer goes brr"-crowd is just unable to digest information.

No, that "crowd" is talking about the 30% increase in a year of M2 money supply, which is unprecedented in US history. The gymnastics going on with the M1 curve don't change that underlying fact, although it does provide a convenient strawman deflection in arguments so less informed people stop at this rebuttal and believe the whole "huge money supply increase" narrative is a hoax.

Re: Square to acquire Afterpay for $29B

#339

Post by AussieWog93 »

roenxi wrote: post #258
AussieWog93 wrote: post #122

Earlier quoted context omitted.

>The fee is paid by the customer. No it isn't. It's literally against their TOS for merchants to add on a surcharge for using Afterpay.

And yet, magically and by the power of the market, the fee will still be paid for by customers. It isn't like the merchant has a non-customer source of income. The money has to be coming from them. If you don't want to pay the surcharge, shop somewhere that doesn't offer Afterpay. Or somewhere that doesn't honour the TOS, I once got an extra egg in my soup for paying cash.

>And yet, magically and by the power of the market, the fee will still be paid for by customers.

Yes, by all the customers, including those that don't use Afterpay.

Re: Square to acquire Afterpay for $29B

#340

Post by omniscient_oce »

bruce_one wrote: post #337
omniscient_oce wrote: post #301

Earlier quoted context omitted.

Myself and most people I know (early twenties) use what the banks give by default which is a "Debit Mastercard/Visa" which lets you shop online like a credit card, perform chargebacks, or pay in-store, but the money just comes out of your savings account like a debit card - not on credit (they get declined if your account is empty too AFAIK but haven't tested it ;P). Are these common overseas? I rarely see reference…

> they get declined if your account is empty too AFAIK but haven't tested it ;P Not always, at least some banks will allow you to go into overdraft and then charge a fee (e.g. $15 for Commbank) - so it's worth being cautious about running out. I remember miscalculating and going into overdraft by a very small amount (e.g. a dollar or two) and then being slugged the overdraft fee - I would've much preferred the transa…

Thanks for the info. I'll keep that in mind
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