Consumer Confidential: Free checking, lower prices, needy CalPERS
Here's your thrill-ride Thursday roundup of consumer news from around the Web:
--I told you months ago that banks would respond to tighter regulation by throwing new fees at customers. So say adios to free checking. Looks like the banking industry is moving in lockstep to require minimum balances or use of other services if customers want to avoid checking-account fees. Otherwise, they'll pay for a service that's traditionally been free. Anyone want to vote on which industry is cheaper, banks or airlines?
--Was your shopping a little cheaper last month? Mine neither. But the Labor Department says consumer prices in May posted their biggest decline in nearly 1 1/2 years. The main driver was a drop in energy prices. Aside from a possible break at the cash register -- again, I haven't seen any -- this means inflation remains a distant prospect, which means the Fed should keep interest rates at bargain-basement lows. That'll keep money cheap, which should make Wall Street happy. The fiscal Circle of Life.
--Your tax money at work: The $202-billion California Public Employees' Retirement System -- a.k.a. CalPERS -- is asking our friends in Sacramento for an additional $600 million a year in funding to ensure that retired state workers get their full pension payments. CalPERS also wants school districts to cough up more than $100 million more each year. Not only is it kind of awkward to go hitting up taxpayers for extra cash (the state faces a budget gap of $19 billion), but the request highlights the challenge that public-sector pension plans everywhere face in meeting obligations. At what point, I wonder, will lawmakers find the wherewithal to address this particular issue?
-- David Lazarus