Coming up on today’s episode, Capital One has started their process for a take-over bid on Discover Financials, tensions rise as South Africans head for the poll after high employment figures were recorded for 2023 and Donald Trump launches his own sneakers line a day after he was ordered to pay $354M by the courts.
After months of high interest rates, high inflation and a Biden Administration that has focused on competition, Capital One has announced their bid to take over Discover Finance in a US$35B all stock takeover. This would make them the 6th largest bank in America due to asset size, loans and credit card transactions and be the 5th largest banking takeover in US history and third since the 21 century behind JP Morgan’s acquisition of Bank One in 2004 and Bank of America’s purchase of FleetBoston of that same year. So the deal with Capital One would boost their usage and increase the competition between the big credit card networks. To add to that, Capital One is said to charge consumers the most with their card as stated by the Consumer Financial Protection Bureau survey, with interest rates passing 30%. Senator Elizabeth Warren has cautioned regulators that they should block this deal from happening. Research suggested that Senator Warren suggested that having Capital One take over Discover would hurt consumers, create an even bigger problem for the financial stability of America and ultimately lead to higher costs and fees for cardholders. Jeremy Kress, Professor of Business Law at the University of Michigan, stated that this deal would be the first major test of the Biden Administration since they announced in 2021 of their plans to boost competition.
South Africans are currently experiencing high levels of employment just a few weeks before their next general election. The Statistics Agency had shared a presentation that sectors including construction, agriculture and trade just to name a few have contributed to the rise in unemployment for the country. This fourth quarter rise in unemployment follows eight straight quarter of job gains. Due to the fact that unemployment has been so bad in South Africa and economic growths have been far below par, these have been major issues at the polls and the governing party, African National Congress (ANC) has been losing a lot of supporters while opposition parties inadvertently started gaining. Many analysts believe that the ANC will lose power for the first time in over 3 decades when they first came into power and elected Nelson Mandela as president at the end of the apartheid.
US former president and now president elected Donald Trump was recently slapped with a US$354M sanction for financial frauds which the courts ruled the former president lied about his assets, property values and other things that would influence his net worth in the past. However a day later, president candidate Trump, made a candid appearance at Sneaker Con in Philadelphia to launch and promote his new brand “Trump Sneakers.” Trump could be seen entering where he received simultaneous cheering and booing from the crowd as he walked on stage with a golden pair of sneakers with the American flag at the top and a T to the side, which was available for pre order at US$399 and will be called “Never Surrender High Top Sneakers”. There will only be 1,000 of the golden sneakers sold and it has already been sold out on the website.