The decision was mainly due to a poor May jobs report as well as an economic growth forecast dropping from 2.2% to 2.0%.  This is the second time this year that the FED has lowered its expectations for the growth of the US economy.

Click here to read the full article from CNN.

The next possible action for an interest rate increase is in July when the Fed meets next.

So what does this mean for businesses?  It means it’s time to take advantage of the historically low rates before they’re gone.  It is important to lock in rates now while they are still low. We’re seeing a surge in equipment financing due to the realization that the economic and financial landscape may soon be changing.  The opportune time to buy and finance equipment is now.

About TEQlease
TEQlease Capital provides equipment lease financing solutions for businesses and educational institutions in the United States. TEQlease Capital also offers equipment vendor lease finance programs across all industries. To learn more about TEQlease Capital, visit our website at www.TEQlease.com.

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Despite the declining confidence index, demand for capital equipment is remaining steady.  This coupled with relatively low interest rates makes it a good time to acquire equipment.  Financing remains the best option for business owners who need to purchase equipment yet do not have or want to use existing capital.  It allows businesses to preserve cash in this relatively unstable economic time.

“The demand for capital equipment financing has been strong through the first two quarters of the year, and we only expect it to continue to grow moving forward,” said Mike Lockwood, President of TEQlease Capital.  “Equipment lease financing offers the perfect solution to business owners needing to expand yet that are uncomfortable paying up front the full cost of equipment during this uncertain economic time.”

Want to find out if lease financing is right for you?  Call us at (818) 222-1006 to learn more or to receive a free quote on your next equipment purchase.

About TEQlease
TEQlease Capital provides equipment lease financing solutions for businesses and educational institutions in the United States. TEQlease Capital also offers equipment vendor lease finance programs across all industries. To learn more about TEQlease Capital, visit our website at www.TEQlease.com.

The post Demand for Equipment Remains High Despite Low Consumer Confidence appeared first on TEQlease Capital.

will continue to raise interest rates.  However, the economy is also clearly improving.  With interest rates remaining low, business leaders are looking to lock in rates in anticipation of needed capital expenditures.”  This is based on the recent survey conducted by Pepperdine University, which states that almost 75% of small and medium-sized businesses expect to increase their revenue in 2016.  Reflecting this, a large number of companies are planning on pursuing financing as a means to acquire equipment and expand.

If your company is thinking about purchasing equipment to grow your business in 2016, now is the time to purchase.  As evidenced by the December interest rate increase, we are now officially in an economic environment with rising interest rates.  The longer you wait to buy, the more expensive financing becomes.  It is important to lock in your rate before they increase again.

If you are a vendor who sells equipment, now is the time to focus on using financing as a competitive tool.  As evidenced by the Pepperdine University study, businesses are looking to buy equipment in the coming year.  So why not make it easier for them to do so?  If used correctly, financing will increase your sales and your potential customers.

At TEQlease, we provide lease and financing options for all types of equipment.  We can get your business the equipment it needs to succeed or the increase in sales you desire.  Make 2016 a great year!

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According to CNBC, the economic conditions and the financial markets are prepared for a rate increase.  According to Dennis Lockhart, a voting member on the Federal Open Market Committee, the economy is on a “solid, moderate path,” warranting the Fed action.

Lockhart, who stated the economy is growing at about 2 percent, said that he expects a gradual path of rate increases once the initial hike happens.  Another factor that is likely to influence the Fed’s decision is job growth in the US.  Since the end of the recession, America has added 12 million jobs and unemployment has fallen from a peak of 10%, down to 5%.

So how is the rate increase going to affect businesses looking to purchase new equipment?  What is important to remember, is that rates are being increased, but that doesn’t mean they are going to be high.  If what Lockhart says is accurate, in that the rates will be increased on a gradual path, you still have a chance to secure a relatively low rate once the initial hike happens.   Based on this information and that equipment investments are expected to grow by over 4% next year, late December or early 2016 still make for ideal times to purchase equipment for your business.

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Industry professionals agree that owners should take advantage of their prosperity as soon as possible to ensure the growth of their business.  The question is, what is the best investment a business can make?  What is the best way to stretch their budget to meet all of their needs?

Here are two aspects of your business that might require updating.

Information Technology (IT)

IT is a vital aspect to the success of a business.  This is why owners have to make sure they have all the equipment that their business needs and that it is up to date.  Whether it’s computers, phone systems, or servers…. don’t let your company’s IT cripple your business.

Marketing

Marketing is moving digital, and recent studies show that video marketing is growing by 43% annually.  In order to stay up to date with the most successful marketing methods, many businesses are investing in video and camera equipment.

With increased profits and an historically low cost of funds, most companies agree that now is the right time for a business to consider leasing as a viable option to obtain the equipment they need.  Businesses can stretch their budget and get more of what they need by making affordable monthly payments instead of paying the full price for equipment using today’s dollars.

Here at TEQlease, we provide lease and financing options for all types of equipment and we can get your business the equipment it needs to succeed.

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In what amounted to a tactical retreat, Fed Chair Janet Yellen said in a press conference that developments in a tightly linked global economy had, in effect, forced the U.S. central bank’s hand. The U.S. economy has been performing well enough to perhaps justify a rate hike “and we expect it to continue to do so,” Yellen said shortly after the Fed’s policy-setting committee released its latest statement following a two-day meeting. But Yellen added that “the outlook abroad appears to have become less certain,” driving down U.S. equity prices, pushing up the dollar, and tightening financial conditions in a way that may slow U.S. growth regardless of what the Fed does. However, the Fed maintained its bias towards a rate hike sometime this year, while lowering its long-term outlook for the economy.

For charter schools this is good news, because it means historically low interest rates continue to be available, at least in the short term.  By using a lease finance solution to acquire school equipment,interest rates are locked in at the now low rates for the entire term of the lease – usually 3 to 5 years.  This enables the equipment lessee to benefit from the predictability of stable monthly payments and cash flow over the term of the lease.  The consensus also seems to be that the Fed will soon start raising rates, probably gradually.  This means that acquiring needed equipment now or before the anticipated rate hike makes sense for schools that are looking to acquire equipment within the next year.

How long do you think the low rates will last?  How will your school take advantage of the rates?  Leave your thoughts below.

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According to an American Express Survey, the vast majority of these companies (defined as companies with revenue between $10 million and $1 billion annually) are expecting the economy to either grow or have a positive effect on their business.

The survey further said that most of these companies, in addition to having more employees than they did a year ago, are planning to continue to hire even more full time employees.  They report seeing new customers and plan to expand to support those new customers.

“Middle market companies have an optimistic view on the economy and their business prospects.  We can already see this having an impact in terms of job numbers, with current employment numbers up and robust plans for future hiring.” 

–Tom Tierney, Senior Vice President, U.S. Middle Market, American Express Global Corporate Payments

With the prediction of future smooth economic sailing, there also comes with it the debate on which growth path is the best for companies to take.  Many believe that the best way to ensure growth is customer acquisition, while others believe that securing necessary infrastructure is the optimal way. 

A very high percentage (91%) report that while they believe they have the necessary capital in place to support their growth, cash flow will be a primary concern going forward.

As one of the country’s leading equipment financing companies, we have found that the availability of capital for equipment acquisition purposes continues to grow, which should mitigate the concern over cash flow.

How is your company planning on growing this upcoming year?  Are you planning on hiring and/or making investments in infrastructure?  What do you think the best way to grow a business is?  We welcome and encourage your comments below. 

Read the article here

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Experian Automotive announced that the automotive loan market showed continued improvement, with interest rates for new and used vehicle loans reaching the lowest levels since 2008. In Q4 2011, average credit scores for new and used vehicle loans also dropped, the percentage of loans to customers with nonprime, subprime or deep subprime credit scores increased, and lenders increased their willingness to make loans between six and seven years long.

Here are some highlights for Q4 2011 in auto finance.

Consumers continued to do a better job of repaying loans in Q4 2011, as loan delinquencies fell. The 30-day delinquency rate fell 6.57 percent from Q4 2010 to Q4 2011 (2.98 percent to 2.79 percent). The 60-day delinquency rate fell 9.51 percent.

Another positive sign for the lending market is that the overall dollar volume of loans at risk dropped to $18.5 billion, a $1.862 billion drop from Q4 2010. Average interest rates for new vehicle loans fell to 4.52 percent. Average rates for used vehicle loans fell to 8.68 percent. Average credit scores for new vehicle loans dropped six points to 767. Average credit scores for used vehicle loans dropped nine points to 679. New vehicle loans to nonprime, subprime and deep subprime customers increased by 13.8 percent.

Overall, more encouraging signs that our economy is indeed on the mend.

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For United Rentals Inc., it means that the “world’s largest equipment rental company’ is increasing its spending by nearly a third in 2012 as more of its customers in construction and industrial choose to rent instead of purchasing their own equipment. For Carlisle Companies it means they are opening new plants in the U.S. and moving their tire production back from China.

For Union Pacific it means that the locomotive giant plans to “buy twice as many locomotives this year, spending upward of $400 million.”

United Rentals CFO William Plummer told the WSJ, “It is an environment that feels like it is building momentum. We are coming out of the depth of the recession and are starting to build momentum on the upside.”

U.S. manufacturers’ investing at home is more encouraging news for the U.S. economy.

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Is this the beginning of real improvement in the economy?

Several signs point to modest improvements, and on many fronts.  U.S. consumer credit increased significantly just before the holidays, offering a ray of hope for the economy.  Bloomberg reported that consumer borrowing in the U.S. surged in November by the most in ten years, showing households are optimistic enough to take on debt and banks are willing to lend.  According to Federal Reserve figures, consumer credit increased by $20.4 billion, the biggest jump since November 2001, to $2.48 trillion. The advance was almost twice as big as the highest forecast of 31 surveyed economists.

Increasing borrowing usually signals that a drop in unemployment is giving households the courage to take advantage of holiday discounts, buy cars and finance higher education. At the same time, dependence on credit means the job market has yet to improve enough to provide the incomes needed to sustain consumer purchases, which account for about 70% of the economy. The thawing in employment comes as other reports indicate firings have eased, highlighting an improvement in the labor market that is contributing to a rebound in consumer confidence and spending.  Meanwhile, the stock market hit a five month high yesterday, and apparently, Europe’s problems are momentarily forgotten.

While this is good news, most of us are looking for sustained positive news before investing and hiring.  We are noticing that some of our clients are expanding which is very good news indeed. Stay tuned!

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