David Fuller and Eoin Treacy's Comment of the Day
Category - General

    KKR Agrees to Buy Up to $40 Billion of PayPal's Pay-Later Loans

    This article from Bloomberg may be of interest. Here is a section: 

    Buy-now-pay-later loans have become increasingly popular, especially among younger consumers, as a way to split up larger purchases and pay them off in instalments. PayPal joined the fray in 2020 and has since issued more than 200 million of the loans to more than 30 million customers around the world. 

    With the new deal, KKR’s private credit funds and accounts will acquire “substantially” all of PayPal’s existing European buy-now-pay-later loan portfolio and eligible future loans, according to the statement. PayPal will remain responsible for customer-facing activities such as underwriting and servicing. 

    PayPal has said for months that it’s been looking to offload a significant portion of its receivables. The deal allows the company to continue offering buy-now-pay-later loans, which it has said entice users to use its services more, without using up large portions of its balance sheet.

    Credit has become KKR’s biggest business by assets. The firm just last month elevated Dan Pietrzak to become global head of private credit as it looks to compete in the increasingly heated market where rivals have doubled down.

    “Having the ability to work exclusively with a scaled and high-quality strategic partner like PayPal is a testament to the strength and maturity of our asset-based finance business,” Pietrzak said in the statement. 

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    Airbus Lands Record-Breaking Order From Indigo

    This article from Bloomberg may be of interest. Here is a section: 

    Airbus secured the biggest aircraft order in aviation history, notching a 500-plane deal with India’s dominant airline, IndiGo. The mammoth accord for Airbus’s top-selling A320 family of single-aisle jets brings IndiGo’s order backlog to close to 1,000 planes as extends its lead in the world’s fastest-growing large market for aviation.

    “No one has ever ordered an order of this magnitude,” IndiGo Chief Executive Officer Pieter Elbers said from the podium. “It speaks to the potential of Indian aviation and the ambitions which Indigo is having.”

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    Drought risk keeps US soybeans, corn farmers jittery amid supply cut possibilities

    This article from S&P may be of interest. Here is a section: 

    The three-month outlook hints toward an extended period of warm and dry weather across major parts of the Midwest, the US Climate Prediction Center said June 15.

    June to August is usually a critical development period for corn and soybeans crops in the US, market analysts said. So, while June was relatively dry, the Midwest will need sufficient rainfall in the upcoming months for crop development.

    The current situation across major soybean and corn producing states does not look promising.

    According to the US Drought Monitor report released June 15, about 49% of Iowa was suffering from drought in the week ended June 17, while 65% of Illinois and 75% of Nebraska were also under drought conditions.

    Commodity analysts see sharp cuts in output potential for both corn and soybeans if the dryness persists in the upper Midwest and eastern Corn Belt, and to some extent in the southern plains.

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    Xi Tells Blinken 'Very Good' That Progress Made on US-China Ties

    This article from Bloomberg may be of interest. Here is a section: 

    Chinese President Xi Jinping told Secretary of State Antony Blinken it was “very good” the two sides had made progress in steadying ties between the world’s two largest economies during his trip to China.

    “I hope that through this visit, Mr. Secretary, you will make more positive contributions to stabilizing China-US relations,” Xi told the US diplomat in Beijing on Monday, according to a Chinese Foreign Ministry statement. 

    “The two sides have also made progress and reached agreements on some specific issues. This is very good,” he said in a video clip of the meeting posted by state broadcaster China Central Television, without elaborating.

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    Rising UK Mortgages, Yields Pinch Homeowners and Sunak Alike

    This article from Bloomberg may be of interest. Here is a section: 

    The UK housing market is under particular pressure from a triple whammy of pricey borrowing, economic uncertainty and high inflation. While the average two-year fixed-rate home loan surpassed 6%, the five-year fixed-rate deal climbed to 5.67% after breaching 5.5% for the first time since January last week.

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    Please note - server outage on Chart Library

    Over the weekend we lost connection with the server that runs the Chart Library. We are doing everything possible to get it back up an running as soon as possible. 

    Meta scientist Yann LeCun says AI won't destroy jobs forever

    This article from the BBC may be of interest. Here is a section: 

    "Will AI take over the world? No, this is a projection of human nature on machines" he said. It would be a huge mistake to keep AI research "under lock and key", he added.

    What is AI and what risks does it pose?
    Warning using AI for loans and mortgages is big risk

    People who worried that AI might pose a risk to humans did so because they couldn't imagine how it could be made safe, Prof LeCun argued.

    "It's as if you asked in 1930 to someone how are you going to make a turbo-jet safe? Turbo-jets were not invented yet in 1930, same as human level AI has not been invented yet."

    "Turbo jets were eventually made incredibly reliable and safe," and the same would happen with AI he said.

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