Investors to Snooping Banks: Back Off!
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What is the main topic discussed in this episode?
Your Money Briefing.
Money and market stories from The Wall Street Journal. I'm J.R. Whelan in New York. Some big investors are not happy that Wall Street can tell when they read emails and for how long. We'll explain in a moment. First, these money headlines. Americans boosted spending on cars, building supplies, sporting goods, health care products, clothing and other goods last month, excluding auto sales, which tend to fluctuate significantly from month to month.
What privacy concern opens the episode about investors and banks?
Retail spending grew 0.9% in May. That number far exceeded economists' expectations of a 0.4% increase in overall retail sales and a 0.5% rise in sales excluding autos. Meanwhile, rising inflation has eaten away at U.S. workers' recent pay gains. That's a potential threat to robust consumer spending that continues to anchor the nine-year-old economic expansion. Average hourly earnings were flat in May when accounting for rising prices for a variety of goods and services such as clothes, gas, and housing. The downbeat reading broke a 14-month stretch of growth in so-called real earnings, which helped show how much of their pay increases consumers are getting to keep.
What were the top consumer spending and economic headlines mentioned first?
And more than 50 current and former bankruptcy judges tell the Wall Street Journal they or their colleagues are warming up to the idea of considering reducing student loans and chipping away at the decades-old guidelines that determine how such debt is treated. For decades, bankruptcy judges refused to consider reducing student loans. That's now changing after many judges have become frustrated at seeing borrowers leave federal courtrooms with six-figure debts. Nearly 45 million people carry student debt in the U.S. The total amount has more than doubled over the past decade to $1.4 trillion, most backed by the federal government. It's eclipsed credit cards as the largest source of consumer debt after mortgages.
This is your money briefing from The Wall Street Journal. Welcome back, everybody. You ever get the feeling you're being watched? Well, some big investors do, and they think it's Wall Street over their shoulders. Their message? Cut it out. Wall Street Journal reporter Telus Demos is here to discuss. So, Telus, you wrote about this in the Wall Street Journal. Banks are always trying to find new ways to generate new revenue, and one way is to figure out what their clients are reading and when.
So when you think about a bank, you think about the usual things that a bank does. It lends money. You deposit money. It gives it financial advice on financial transactions. But one thing that people don't appreciate about Wall Street is that a big part of their business is the content business. It's the research notes they sell. It's the advice that they give. All of those things are content businesses in the same way that a newspaper or a social media company is. They're giving you information and a platform on which to consume it and share it. And so like other content businesses, Wall Street is facing some of the same pressures to figure out how to monetize that. And like newspapers, like social media companies do, they think, well, if we better track and understand what people are doing with our research, right, A, that they're not just taking it from us and then giving it to other people for free.
They want to make money from it. And number two, that they're giving people what they want to read.
You know, it isn't just trade literature or financial reports being tracked. The banks can now see in real time if someone has opened an email, who read it, for how long. I'm sure the investors don't see this as a joke, but it could be seen as a solution to loneliness. The banks are always there next to you.
Yeah. I mean, on the one hand, of course, investors want to see the bank as their partner. They want to talk about ideas with them. They want to get good ideas from the analysts or salespeople or traders at the bank they talk to. But on the other hand, of course, they don't want that person to then sort of figure out exactly what it is that they're up to.
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–0:28
2
What privacy concern opens the episode about investors and banks?
0:28–1:09
3
What were the top consumer spending and economic headlines mentioned first?
1:09–8:22
4
How did the hosts introduce the issue of banks tracking investor email behavior?
8:22–8:32
Speakers
2 identifiedMore from WSJ Your Money Briefing
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