Some Common Cents for September 23rd, 2016

This week, I made a presentation to an estate planning group in Mobile. The speaker prior to me either wasn’t aware of his allotted time or didn’t care, as he went extremely long. So, I truncated my prepared remarks by about 10 minutes to keep the conference somewhat close to on schedule. No worries; when you make as many talks as I do, you learn to make adjustments on the fly.

Obviously, you can’t adequately cover every aspect of the $19 trillion US economy, let alone future scenarios, in what had become a 35 minute presentation, okay, maybe 40. As a result, I had a number of people ask me questions during the break which followed my remarks. While most people wanted to talk about the upcoming election, two wanted to know my thoughts on unfunded public sector projected benefit (pension) obligations (PBOs), and their potential negative impact on Gross Domestic Product (GDP).

Really? 2?

Of all the many challenges facing the US economy over the next 3 decades, unfunded public sector PBOs are certainly one of them. I suppose your vocation determines the importance of a particular issue, and there were a fair number of CPAs in attendance. So, perhaps I shouldn’t have been surprised by the interest. However, let me just say I don’t normally get a lot of questions on the subject, let alone 2 in less than 5 minutes.

Let me give you a paraphrased amalgam of my discussions, and my comments come first: …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees. 

Upcoming Industry Changes – Same Day ACH

Upcoming Industry Changes – Same Day ACH

On Friday, September 23rd, 2016, ACH payments in the U.S. will undergo a significant change with the introduction of Same Day ACH (Phase I).  The goal of Same Day ACH is to allow the U.S. payments system to accelerate certain types of ACH payments.  The process of implementing Same Day ACH will occur in three phases over the next three years.

  • What is Same Day ACH? Same Day ACH will allow U.S. financial institution to process certain ACH payments during the current day.  Eventually, both consumers and businesses will be able to send and receive ACH credits and debits to external accounts during the same day if submitted by 1:45 PM CST.
  • What is Same Day ACH (Phase I)? On September 23rd, Phase I will be implemented.  During this phase, financial institutions will be required to receive and post domestic ACH credits up to $25,000 if properly submitted.  Funds will be required to be available to the account holder by the end of the processing day.

Some financial institutions may allow ACH originators to submit Same Day ACH credit transactions during Phase I, while others may choose to opt out completely.

Most of the changes associated with Same Day ACH will be transparent to bank clients.  Phase I will begin laying the foundation for the subsequent phases.  We will communicate information about these upcoming phases as they occur.

  • How will Oakworth Capital Bank respond to Same Day ACH (Phase I)? Oakworth Capital will begin accepting Same Day ACH credits up to $25,000 as required.  These credits will be memo posted to the designated account during the day, with full credit being granted to the account holder by the end of the day.

Oakworth Capital will begin allowing certain ACH Originators the ability to initiate Same Day ACH transactions in 2017.  Details to follow!

Who do I contact if I have questions regarding Same Day ACH or Oakworth Capital’s plans surrounding Same Day ACH? Please contact your Oakworth Capital Client Advisor or Trent Green at (205)263-4711 / trent.green@oakworthcapital.com.

Some Common Cents for September 16th, 2016

Last Friday afternoon, I made a 3.5 hour long economic presentation to a group of CPAs who had waited until the last minute to get their continuing education credits for the year. You could say I was their penance, if not punishment. While I would like to think I am a decent public speaker, it is nigh impossible to keep everyone’s attention for that long on, admittedly, pretty dry stuff.

Unless someone asks an extremely direct question during the Q&A, I typically try to avoid discussing politics. However, with so much time to kill and it being an election year, I touched on the highlights of the primary candidates’ economic platforms. The devil is always in the details, and campaign promises are worth about as much as a box full of mosquitoes.

If you have read this newsletter for any length of time, you know my opinion(s) on simplifying the tax code and reducing the corporate income tax rate. If you haven’t, simply put, I am for both things. As a matter of fact, if I were running for President, they would be at the very top of my economic agenda, if not the only things on it.

On this one issue(s), Mr. Trump and I are in agreement. When I said as much, you would have thought I was spouting off heresy to a group of clerics, at least to a couple of folks near the back. Their sticking points? Wealth and income inequality.

At the break, one of the disgruntled approached the rostrum, and, brother, I could tell he wasn’t approaching to be congratulatory. Far from it. Let me give you a taste of our conversation: …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees. 

Introducing Business Bill Pay

Oakworth Capital now offers Business Bill Pay!  We are pleased to introduce Business Bill Pay to our Oakworth Online Suite of Services.  This multi-tiered service is designed to streamline the Accounts Payable payment and management process for commercial and business clients through a single sign-on application within Oakworth Online.

  • Issue  payments directly from an account via check
  • Singular or Dual Control options
  • Direct integration with certain accounting systems, including Quickbooks
  • Import, create, manage and pay invoices
  • No need to maintain check stock, stamps or envelopes

To get started, contact your Client Advisor, or contact us

Some Common Cents for September 2nd, 2016

tunaThis week, the European Commission (EU) ordered Apple, Inc., to pay the Irish government $14.6 billion in back taxes it claimed the company owed. Interestingly, the Irish weren’t asking for the money, quite the opposite. They were actively arguing otherwise. However, the powers that be, and in Europe there are a lot of them, determined a tax deal the country made with Apple amounted to an illegal state subsidy, and, therefore, was anti-competitive.

Make no bones about it, the whole thing was a tax avoidance scheme from the get go. No one can sensibly argue otherwise. Apple wanted to sell products in Europe, and didn’t want to pay significant US taxes on profits it made overseas. While they were at it, why not get a little something out of the Irish who wanted the company to set up shop in Cork?

We can debate the ethics or morality of this until the cows come home, but it won’t change the following: a deal with a sovereign entity is a deal with a sovereign entity. A contract is a contract, and one of the best ways to foster economic growth is the adequate enforcement of contracts and property laws. If the Irish government can’t hold up its end of a deal, good or bad for the Irish people, is it really sovereign? So, are any EU nations truly sovereign if a commissioner in Brussels can invalidate their contracts?

That is the real issue here, and not whether Apple swipes a check for roughly $15 billion. It can do so tomorrow, and not be that much worse for the wear. But what type of precedent does this set in Europe? …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees. 

Column: Is Alabama letting money go?

About a decade ago, I made an evening presentation to a surprisingly large crowd in Guin, Alabama, about the potential economic impact Interstate 22 would have on Marion County. It was one the easiest talks I have ever done. After all, having access to the interstate system is better than not having it when it comes to attracting business.

As I was leaving, a county commissioner grabbed me by the arm, and led me to a quiet room off the auditorium. While this was not the norm, I figured they wanted to ask me something “off the record,” and I was right.  (Read the full article as previously published in the Montgomery Advertiser August 31st, 2016)

Some Common Cents for August 26th, 2016

Risk-Reward-DiceGambling is a word with a lot with a lot of connotations, but only one real meaning: taking some measure of risk in order to achieve some sort of return. You can define risk and return any number of different ways, and at many different levels. Obviously, you want to make sure the risk you take is less than the reward you expect. This is called playing the odds, and we do just that in virtually everything we do.

However, no one really considers crossing the street as gambling, although it technically is. Gambling is what you do at the track, when you buy a lottery ticket, with a bookie, or in a casino. Right? However, that isn’t gambling as much as losing. Why? Because there wouldn’t be tracks, lotteries, bookies, or casinos if the odds were in the your favor. To that end, there isn’t a single game in a casino where the house won’t eventually take all of your money if only you play long enough.

I mean, why do you think they give you free booze? To make sure you have a good time or to make sure it dulls your senses enough you sit at the table longer …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees. 

Some Common Cents for August 19th, 2016

rio olympicsI have watched the Olympics with some regularity over the last two weeks, and will be sorry when they are over this weekend. It has been a nice break from what passes as prime time entertainment these days, even if NBC makes it a nightly habit of serving up heaping helpings of schmaltz. However, you can’t please everyone.

One of the things that fascinates me is the individual economic impact of winning a medal. For certain sports, an American athlete almost has to win a gold to reap any sort of significant endorsement deals. I mean Justin Gatlin probably isn’t going to get an eight figure contract with Nike for winning the silver in the 100 meter dash. However, there are some sports where the right athlete standing on the podium, in any position, can make a little bank. …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees. 

Column: Cost of blanket policies

Clock-CA-overtime-article-3I am on the board of directors of an organization that promotes adult literacy in the Birmingham area. We are blessed to have an energetic executive director and a wonderful staff. However, it is unfortunate we have to be in the business of educating adults, but that is a discussion for another time.

At a recent board meeting, the director brought up the upcoming changes to the overtime rules, which will take effect in December. Understandably, she is very worried about the potential impact this could have on the budget. After all, the goal is to eradicate as much illiteracy as we can with the resources we have. It isn’t punching the clock. (Read the full article as previously published in the Montgomery Advertiser August 15th, 2016)

Some Common Cents for August 12th 2016

Obviously, I haven’t gotten out a newsletter in a few weeks. I was physically out of the office on two of those Fridays, and last week? After getting about halfway through with Common Cents, I decided to actually read what I had written. I will make a long story short, and tell you I decided it best not to send it out; it wasn’t worthy of anything other than wrapping fish. As it was very late in the day, I didn’t have time to start and complete another.

There are no two ways about it: the biggest story in the world is the US Presidential election. While I have long maintained US Presidents receive either too much blame or too much credit for the economy under their watch, the buck has to stop somewhere. With that said, whoever inherits the White House in January will inherit an economy with arguably more headwinds than tailwinds, but one that doesn’t appear to be falling apart either. The last two Presidents didn’t have the same luxury …Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees.