Let’s see how this goes.
Quick Hits: The Real Shadow Banking System,
Courtesy of Minyanville Staff.
Business is booming for the business of pawn.
Forget claims the explosion of esoteric derivatives has led to the creation of a "shadow banking system" that operates outside the boundaries of the traditional market for financial services. Much more tangible is the shady world of hawking possessions to make ends meet.
First Cash Financial Services (FCFS) — an operator of pawn shops — reported strong first quarter earnings yesterday, matching analysts’ estimates and issuing positive statements about its growth prospects. Sales of pawned merchandise soared 17%, buoyed in part by high gold prices. Many of the company’s customers hawk gold, which it in turn can sell on the open market.
Struggling consumers, unable to tap traditional debt via credit cards from companies like Capital One (COF), Discover Financial Services (DFS) and JP Morgan Chase (JPM), are increasingly being forced to sell personal belongings to pay rent and buy groceries.
Toddo often asks what’s the other side of zero percent financing? Keep an eye on immediate sources of cash to find out.
