Third Party & Independents Archives

I agree we’re getting the shaft David, while the politicians were getting their pockets lined,on both sides. http://www.opensecrets.org/news/2008/09/wall-street-shakeup-connects-t.html now the country is mad as hell maybe someone will listen.

Dave, good post. The average student has four credit cards. We dealt with a B of A card holder that was one hour late on payment therefore their interest rate was maxed. The practices are horrible.

I work at a university based credit union. TCF Bank serves campus and students. By giving money to the university, this fee based banks rakes the kids over the coals. They hope that Mom or Dad will pay the fees and charges. The TCF model is bassed on punative fees, charges, and abuse. Then they share a portion of that income back with the University annually. Is this smart? Make money for the University using punative fees on students? Think of the drunk freshman at the ATM.

Credit unions continue to lend money at a record pace, and the vast majority of credit unions proivide simple rate and terms. Hard to beat. Problem is that we don’t always give consumers the credit they want. We always try and be reasonable with credit limits and loan balances. We realize consumers can go to other institutions, but for the most part credit unions have remained strong.

I don’t necessarily buy the “since republicans took over” arguement. Plenty of legislators have looked the other way as credit card companies became more aggresive. Dem Rep Other. And Glass Stegall became GLB, Bank Modernization Act, under Clinton. Allowing insurance, investment, and bank based institutions to play in the same space. There has been little value in that.

There is no part of the financial services industry that is untouched by the mark to market issues right now.

But there are those that attempt to balance credit, with character, with being reasonable.

I support any increased regulation and penalization here.

But as someone who is in the financial services industry, retail side, I am really fed up with regulation. It takes up a substantial amount of time and employes a lot of knuckleheads that have not prevented what they hoped to.

I think many of us are in agreement that the credit card companies are out of control, and the politicians are afraid to stand up to them because it probably means politicial suicide.

But there are a whole lot of us, and not that many of them.

If you want to make a difference, please join my credit card protest.

http://www.daily-protest.com

or check out http://www.changeinterms.com

just make a sign that says daily-protest.com and put it on a countertop, a bulletin board, or in a storefront window, it’s that easy to make a difference.

DR
There are outfits that can help negotiate fees down to help people stay solvent. Also from my own experience ,when trying to close an account I did need or want I was shifted to another dept. that offered a better rate to me to keep the account open. In other words the credit card companies will negotiate.
I do want to highjack your thread but we should look at the basic reason why credit cards have so much power. Why do we need them? I submit it is largely because prices are high and wages have been kept flat. Even the wisest of us keep a credit card or two for emergencies instead of cash.
And again, part of the solution to flat wages is to take the handcuffs off organized labor with measures like The Employee Free Choice Act and a NLRB not composed of union busting shills. This will help increase wages even for people that do not belong to unions. Its also high time to increase the minimum wage to something livable and index it to inflation. Just an administration actually willing to enforce existing labor laws, for a change, will help a great deal.

From AARP I’m a member Quote, “”“But that began changing in early 2008, and with last fall’s economic fallout, banks really started to tighten the credit reins—first, on customers with “black marks,” such as those who made late payments or those who perhaps used their plastic too freely. “When that didn’t raise enough revenue, they began to tighten the thumbscrews on everyone else,” treating good customers as if they were bad, says consumer advocate Ed Mierzwinski, who has tracked credit card practices for 20 years for U.S. PIRG, a federation of state Public Interest Research Groups.

It’s working. In 2009, credit card issuers—many of whom already received billions of dollars in federal bailout assistance—are expected to generate a record $20.5 billion in penalty fees. Last year, these fees, which also include late and over-the-limit penalties, produced $19 billion.”“”” http://bulletin.aarp.org/yourmoney/personalfinance/articles/credit_card_fees_up_credit_limits_down.html

I have two credit cards, that I rarely use. I carry no balances.

In Texas and other states with homestead laws, your best option, in my opinion, is to get revenge by running the card up to it’s maximum and then simply refuse to pay it off. Change bank accounts, change your phone number. Let them try to collect unsecured debt. As someone who managed a business that tried to collect some secured debt, it is a hassle. They will sell the debts off to collectors for a fraction of the debt. In Texas, the collectors are SOL, unless you respond. Don’t. Let them try to find a bank account to get a judgement on. If it ever gets to court (unlikely) they’ll likely settle for 15% of the debt, since they paid only about 10% of the debt.

It may ruin your credit score for a few years, and it may be considered unethical, but it sure will feel good and, in my opinion, is well deserved.:)

bills,

Oh, so you mean that we should allow the unions to act with impunity against the very ideals that Americans hold most dear just to get an end result that you want?

How very ‘liberal’ of you.

Credit card debt happens because banks lure people in with an unrealistic 2% monthly minimum payment.

If the monthly minimum payment were 8 to 10 percent a month, people would find their comfort zone a lot more realistically, plus they would have more buying power because more of the monthly payment would go towards the principle.

Instead, the banks are wanting to raise the monthly minimum on people already in debt, that is the wrong approach to take.

Credit card companies should be trying to increase the flow of money that is owed back to them by offering incentives rather than punishment.

http://www.Daily-Protest.com

It’s easy to participate in http://www.Daily-Protest.com, just put a sign up that says Daily-Protest.com on a bulletin board, storefront window, or countertop, and the rest will take care of itself.

Whenever you use a credit card, you are spending someone else’s money. Not your own. Therefore you get and deserve very little say in the matter.

Too many people think they’re entitled to not only spend other people’s money but dictate the rules to the people whose money they’re spending.

If you don’t like your interest rate, don’t use your credit card and get a different one. If you’re a good customer, your new lender will be glad to have you.

If you don’t qualify for a different one, however, then sorry to say it, but that means that you don’t qualify to spend money you didn’t earn from people who don’t want to lend it to you with the interest rates you want or think you deserve.

This is all very sad, but getting a credit card with a low interest rate so you can spend money you don’t have and can’t earn is not exactly a right enumerated in the Constitution.

I will meet the other side halfway, however. I do think that it should be illegal (except in the case of seriously delinquent accounts) to apply an increased interest rate to money loaned earlier under a lower interest rate.

These stories I’ve heard of interest rates jumping 20% or more overnight because somebody was a day or two late with a payment are ridiculous. I realize that those effected signed an agreement when they got their card which made them subject to these increases, so I suppose what i”m really saying is that such a stipulation should not be included on credit card applications.

David,
Why credit card companies have taken an unfair advantage of the system, I do believe that the best ethicallly way for Americans to stop the raping of the American Consumer and Small Business Owner is for Community Leaders to stop taking credit cards for purchases under $100.00.

Than let’s see the CEO’s of Today find out why The Elders of the 70’s got everybody to say “In God We Trust All Others pay Cash.” Since I do believe that a few months of having no new profits will surely get the Stockholders of such Businesses to look elsewhere.

Cold-hearted I know, but if the Idiots in Charge think their more important than We the Consumers than in all fairness and goodwill I do believe that it is up to the Individuals to do what is necessary seeing that Congress cannot or will not stop the Charlatans and Vagabonds who get Money for Nothing, but refuse to help their fellow Corporate Members enjoy the same profits. For “We the People” can see what happened to the Oil Companies when they took more than their fair share.

Credit card statistics, industry facts, debt statistics Enough statistics in here to even keep d.a.n. busy. LO , I tend to agree with you on the minimum purchase amount with a credit card should be $60-$100 . http://www.creditcards.com/credit-card-news/credit-card-industry-facts-personal-debt-statistics-1276.php

Sorry I meant Henry.

Loyal Opp,

Interesting of you to ignore the Contract between consumer and lender for credit card companies. It has evolved into a contract law that is NOT FOUND applicable in any other area of American commerce. All due to the Credit Card lender lobbying for unfair and unjust practices.

We understand Republican apologists want to defend their corporate buddies and unbridled greed as part of their trickle down supply side economic boneheaded theories, but, the American people have awakened and neither the GOP nor the Credit Card companies are going to rule the day again for a very, very, very long time. As in, till memory of disasters fade and are forgot.

Rodney and Henry,

That discriminates against frugal folks of lesser means. What you suggest would bar working folks of frugal means from eating out occasionally on their credit card, but, allow the wealthy to do so daily without consequence. Whole areas of commerce including gift giving on the internet would be denied folks who CAN afford only a $40 purchase.

The better answer is a national education standard wherein consumer finance and income budgeting is a required High School course for graduation. And educated consumer base is the best defender against corrupt legal lending practices like those found now in the credit card industry.

For that matter, an educated consumer base is the best defender against corrupt and ineffective government politicians and policies. Which is why our education system is in 26th place amongst modern industrialized nations. Whole states rely on inadequate education as a means to continued reelection.

I’ve closed one Citi card, one RBS card and am about to close one B of A card because they decided fleecing me with large APR rate changes was more important than keeping a good customer who pays his bill on time without fail. At this rate the only credit card in my wallet will be the none-APR Amex card.

BTW Loyal Opp,

I received notices from each of the cards that I have since closed that changed the terms based on their greed. I did nothing to warrant a change in terms. No late payments. No overdrafts. Nothing.

They increased my rates for no other reason than greed. In some cases my APR went from a FIXED 6.9% to a variable rate that was 12.9% PLUS the prime rate for a total rate of 19.9%. That’s why I closed the accounts.

Sure they are within their rights to change the terms. But what they are doing is predatory and unfair, especially when you take into consideration the fact that Citi and B of A have taken tax payer money to shore up their bottom lines.

To be fair with BofA, they were ‘pressured’ to take on ML in a very questionable manner, so while I am not willing to give them a ‘pass’ I do think they should be looked at a little differently…

Actually, Micheal, they are within their legal right to change the contract, but, you won’t find that legal right in any other area of commerce in our society. Those laws to allow the lender to change the terms of the contract on transactions retroactively were created exclusively for the Credit Card industry and their lobbyists, and runs contrary to all fundamental principles of America contract law.

To bring credit card law inline with all other contract law, the lenders would have the right to change the APR on ANY FUTURE PURCHASES provided ample notice is given, BUT NOT ON PREVIOUS BALANCES incurred under a lower interest rate agreement or offer. That is like selling a person a car for cash at $1000.00, and a month after the purchase telling the buyer the lender increased the price to $1500 and begins charging them interest on the new $500 balance owed. It is totally and completely unfair, unjust, and in violation with all principles of fair trade and contract law.

And to add, I suppose, I don’t use a credit card, except for a non-interest one though my work for work related expenses. All other used of a credit card is done though my debit card. If I don’t have the money for it, I can’t afford it…

Rhinehold,

That’s certainly a sound policy but just remember; most debit cards offer no protections against fraudulent charges. And since fraudulent charges on debit cards come right out of your bank account, you are S.O.L. when some dishonest waiter chooses to scan your card for illegal purposes.

David,
Which is worse? Do I deny you the ability to put a $15.00 meal on your credit card which will cost me (the Small Business Owner) 2-5% or help you out by offering you a package deal of 7 meals at $100.00?

Yes, some Americans and Businesses have got so use to using their credit cards in place of money. But with credit both expensive and tight while Cash King, I do believe for those of us old enough to remember the 70’s. The dening of credit cards and bank checks help keep the cost of doing business.

In fact, RBC trys to charge its customers employees $5.00 to cash their payroll check unless they can charge them for having a checking account. So in turn I told the people I contract with that payments have to be made in cash which is My Civil Right.

Care to tell me what would happen if All Employees decided to stop taking checks from their Employers and start demanding cash for their pay? Talk about a nightmare for the banks and the Federal Reserve. Not to include the Police having to provide protection from the bank to the plant.

So please, why I realize the banks and credit cards have to make a profit. Seeing that “We the people” had nothing to do with their failure, I don’t see a problem with “We the Consumers” doing what is necessary to bring these bad business ideas to a peaceful end even if it means that B of A and others have to close their doors forever.

Henry, credit has never been cheaper. The CC companies are engaging in price gouging their consumers with high interest rates.

I will not accept double standards of consumer access for the wealthy and less wealthy. If the wealthy can put a single meal on their credit card for $150, a janitor should be able to put a $15 dollar meal on their credit card as well. To legislate otherwise participates in unequal law discriminately applied. Our form of government loathes such legal prescriptions.

Interesting of you to ignore the Contract between consumer and lender for credit card companies. It has evolved into a contract law that is NOT FOUND applicable in any other area of American commerce. All due to the Credit Card lender lobbying for unfair and unjust practices.

We understand Republican apologists want to defend their corporate buddies and unbridled greed as part of their trickle down supply side economic boneheaded theories, but, the American people have awakened and neither the GOP nor the Credit Card companies are going to rule the day again for a very, very, very long time. As in, till memory of disasters fade and are forgot.

Such repetitive recitations of the left wing script about greedy Republicans and their corporate buddies is not only tedious, it’s downright absurd.

Who is shoveling billions of taxpayer dollars to bail out these banks? Barack Obama and the Democrats, over the almost uniform objection of the current crop of Republican legislators.

How nice of the Democrats to shovel taxpayer cash to take care of these “Republican buddies” while Republicans themselves are saying “Let these banks fail.”

These are the facts. But as usual the facts make no impression on the left wing talking points.

David, In a nutshell yes their ripping off the lower and middle class the very rich tend to pay off the balances every month so they get an almost free lunch and advantages that we the people don’t get. so i agree can’t they IE the CCC see the Errors of Their Ways it’s going to backfire like housing and all the other greed bubbles have.

If the wealthy can put a single meal on their credit card for $150, a janitor should be able to put a $15 dollar meal on their credit card as well.

Yes, and the janitor can. So long as the credit card company—whose money the janitor is spending—agrees.

If, however, the janitor doesn’t HAVE 15 dollars, isn’t going to be able to pay it back, and doesn’t like the interest rate on his credit card, then he needs to pack a lunch.

Tuna sandwiches are quite nice, as are peanut butter and jelly sandwiches. Carrot and celery sticks are not only cheap but delicious and healthy.

Nobody has the right to spend other people’s money and then dictate the terms on which they’re going to do so. Liberals believe otherwise, I realize, and can be quite generous with other peoples’ money.

David, In a nutshell yes their ripping off the lower and middle class the very rich tend to pay off the balances every month so they get an almost free lunch and advantages that we the people don’t get…

This is delicious liberal logic (though not as delicious as a tuna sandwich).

Paying off the money you owe is “getting a free lunch.” Prop me up. I think I’m going to fall over. You’d think I’d get used to this kind of liberal thinking, having voluntarily exposed myself to it for so long, but I never really have gotten used to it.

And “we the people” consists of those who can’t pay their bills. Does this mean that people who only spend money that they repay are not “people.” What are they are?

Or is this just the usual Marxist gambit of saying that “the rich” (defined here as those who pay their bills) are the enemy and the “real” people are the long-suffering proletariat laboring under the yoke of the bourgeois capitalist system of… (yawn). How does the rest of it go?

I’m not that Liberal just a click or two to the left LO, can you justify the 30% interest rate and fees i’m trying to be Practile The janitor has to eat to and if you noticed the cans of tuna are smaller today and a can of good tuna is about 4 bucks for one sandwich and bread is 3-4 bucks a loaf and the other drinks and veges and a bag of chips and prep time i’d rather they eat the tuna than the fast food. The janitor is getting the shaft one way or another.

Rodney, if somebody is paying four bucks for one can of tuna, another four bucks for a loaf of bread, and only making ONE sandwich out of it, then that person is doing something seriously wrong.

You ask if I can justify the 30% interest rate and fees? No I can’t. Just like I can’t justify eating all of my meals at Chez Panisse or buying that Maserati that I so richly deserve.

The fact is that if somebody can’t afford something, then they shouldn’t get it.

I happen to think that credit card companies are sleazy. Kind of like how I think Nancy Pelosi and Barney Frank are sleazy. But that does not mean that I think I have the right to spend THEIR money and then dictate to them the terms of repayment. If you don’t like credit card companies, then don’t use a credit card and spend money you don’t have.

Lo, I agree try to live within your means check out this link on food prices Let’s talk about education and better paying jobs so the janitor does not have to pull the card out so much to buy food or other Necessities like car repairs house repairs and even for electric and natural gas and ect ect ect. http://siteresources.worldbank.org/DEC/Images/84796-1179761045903/food-prices-lg.gif Maserati no way to much money and high end Maintenance look at the new corvette buy American keep our companies and workers alive.

Loyal Opp said: “The fact is that if somebody can’t afford something, then they shouldn’t get it. “

Doesn’t apply to the lower tiers of Maslow’s hierarchy of needs, LO. Not a fact, at all. When confronted with life sustaining needs, should and shouldn’t become meaningless. Choosing between creditors and feeding one’s children and driving them to school, is a no brainer. And many people caught in this position today, were NOT in that position prior to the financial and mortgage industry COSTING THEM THEIR JOBS, which was entirely unpredictable for most Americans.

Your rules don’t apply universally; never have, and never will. Your comments states a fact which isn’t a fact. Which is apparently why your comments tend to be apologetic for the traditional minority party who also don’t understand that this world doesn’t run on black and white rules of should and shouldn’t, set in some GOP tablets of commandments, leaving them unable to govern in the real world when given the opportunity based on their world of expertise, the rhetorical.

“But that does not mean that I think I have the right to spend THEIR money and then dictate to them the terms of repayment. If you don’t like credit card companies, then don’t use a credit card and spend money you don’t have.”

If everyone did as you said LO the credit card companies would not exist. Because they don’t do as you recommend that makes them subject to corporate loansharking and bait and switch interest rates? Those that have used credit cards to live on while out of work, to cover unexpected major expenses say on a vehicle or a person etc. cannot pay off the cards and are trapped in a market made debtors prison. It is only the rich (as you nonsensically define it “the rich” (defined here as those who pay their bills)) that have the option to cancel their cards.

Free market types everywhere should be up in arms against these corporate loansharks as this is an excellent example of why we need an ever growing government to police this type of bankster. Should we ever get to the point in this country where our representatives cannot be bought by corporations the laws will change to make these acts criminal as they should be, hopefully as retroactive as the rate increases they are now enjoying.

http://jeffreyhill.typepad.com/english/2009/02/banker-gangster-bankster.html

which was entirely unpredictable for most Americans.

So, you find yourself and many of the people on here extraordinary? We were talking about the housing bubble since 2006 at least, I’m still not sure what the average person couldn’t see coming… I for one was backing out of any real estate dealings in early 2007 except to purchase a house this last October (when this all hit) due to a death in the family.

Most people knew there were trouble, but what you are saying is that people shouldn’t learn how to better utilize their investment dollar with some actual knowledge of how the markets work, they should just be able to make the same killing as those who have degrees in finance without giving it a thought?

I don’t normally plug things but this is a good cause. Thanks WB. Letter Carriers Annual Food Drive Set for May 9 Throughout Nation

http://www.nalc.org/commun/foodrive/

Rhinehold, it’s interesting, isn’t it, that the left will make contradictory arguments from day to day—all depending on the leftist talking point du jour.

On one hand, the economic meltdown was unpredictable. On the other, it was entirely predictable because of “deregulation” and a lack of government oversight.

In summary: the more power we give the government, the better they’ll be at preventing problems that nobody can see coming.

The disturbing thing is that ideological blindness and partisanship prevents a clear-eyed recognition of flawed leftist logic.

Another good one is the 24hr banking sceme which is a lot of bull. I made a deposit through an atm which my bank owned made a $3.24 purchase, the next thing I know I’m getting overdraft charges i8n the tune of $66.00. Talk about a ripoff.

David,
Welcome to the Real World. For to say that there are not Double Standards for the Rich and Poor is for Man to turn a Blind Eye to what is known to be Right Regardless.

Since who gets the lower interest rates? Or pampered by society. Ever see a poor homeless man served a meal on a silver plater? So please spare us the cry that America has not have a Double Standarded of Living since President Regan signed such Stupidity into Law in the 1980’s.

No, if you want Equal Rights than both the Poor Man and the Rich Man should both be able to enjoy the $150.00 meal and IMHO until the Conservative Movement in America gets that through their thick head than groups like Al Qaeda are always going to be able to win the War for the Hearts and Mind of the People. Because what is the difference between one who is born into wealth and one born into poverty if Society as a Whole are going to consider both to be Humans with certain Unalienable Rights.

Henry, what’s Going On with the Capitalization of Words and the Syntax there? My reading comprehension is second to none. I got perfect verbal scores on both the SAT and GRE (not to brag or anything). I’ve been praised by even the liberal media for my erudition, style, and good looks, and even I am having a little trouble following you. Okay, a lot of trouble.

But let’s pause for a minute here.

There was a “double standard” regarding rich and poor long before Reagan. This was not, believe it or not, a Republican innovation. As much as we’d like to take credit for it, this wasn’t part of the “Stupidity” that was signed into “Law” by Reagan in the 1980s. The lack of equality between rich and poor was already ancient when they were building the pyramids.

Liberals who actually believe in such notions of what is meant by “equality” ought to show up at the Pelosi or Kennedy mansions sometime and ask for the “equality” that you deserve as a fellow liberal. Perhaps they’ll let you mop the imported Italian tiles in their bathrooms (or not), but they’re not going to give you “equality.” You’ll be lucky to get a hot dog with mustard prepared by one of their non-union servants.

We Republicans, however, want you to shatter the ceiling that has been placed over you. We’d like nothing more for you to succeed beyond your wildest dreams and get filthy rich as a result of your own hard work and innate human genius.

Sadly, however, too many liberals are still metaphorically if not literally mopping the bathroom floors of their Democratic overlords.

Loyal Opposition,
Sorry you have such a problem following the Old World English; nevertheless, it does come in handy when standing between the Learned and Unlearned of Society.

For example; the words Double Standard and double standard can mean the same thing or they can represent the Ignorance of the so-called Elite Learned of Society over that of the Unlearned of Society. Since I can show with the use of a steak and Davids’ $150.00 meal the Pure Ignorance of an Individual. Because why I can go the store and pay about $7.00 for a 16 oz. steak or go to the local resturant and pay $12-15.00 for a 12 oz. steak. However, why is it when I give the same piece of meat to a chief I get 2-4 oz. steaks and have to cough up $150.00 a plate? Stupid, but Reality nonetheless is it not.

Yes, before the 1980’s the divide between the Ultra Rich and Labor/Management did exist; however, it was not until President Regan and Congress selected to build a wall between Skilled and Unskilled Labor that allowed the Ultra Rich of America to get more people on their side. Yet, I would like to see Society survive for a year without using the Unskilled Labor of Man. For that $150.00 4 oz. steak would cost about $1,500.00 and thus limit the Business Owner to even less customers. Would it not?

So why I may have to eat hotdogs in order to survive, I wonder what the so-called Rich would do if they had no dishwasher, waiter, cook, host, etc. to fix those meals. Or better yet pay the Actual Cost of a Society of Humans.

For why the Right may want me to become filthy rich provided that I walk in Lock Step with their programs and the Left believe that it is ok to exploit the services of others just as long as they can enjoy the High Life. As an Independent American, I believe that both sides need to learn what it means to be Self Sufficient and stop following the Old World of Kings and Queens. Since I doubt very seriously if there is One Man or One Woman who can prove to the World that they could do Anything without the Collective Knowledge and Wisdom of the Human Race over the last 15,000 years.

RH
You pretty much have to use a credit card for international travel,these days, as a security measure. Car rentals require one also as do internet porn sites(so I am told).

All
This is the green column and the subject,as most have been recently, is financial. Seems a good place to vent my disapointment with the BHO administration and much of the Democratic Party. Just the other day 12 Dems joined 39 Reps to block a vote on an amendment that would have empowered bankruptcy judges to re-negotiate mortgages. That would have been a definet prod to lenders to ease up,extend loans or whatever. The Whitehouse did not even issue a statement of regret,let alone put any pressure on congress to get it done.
The so called “stress test” for banks is a joke, not an audit. Terms of the test were worked out with the very banks being tested. It looks like they just pecked around for a plausable number.Apparently the administration is largly just going to let banks recover on their own. They should be able to, seeing as how they are charging high interest for nearly free money courtesy of the taxpayers but it will take years. That means a slow economy for our tuna eating janitor for years also. It also means that if they succeed bankers will get richer but if they fail us taxpayers suffer with yet another bailout.
Same with health care reform. Single payer is not even on the table. Same with re-regulation of the financial industry to return it back into a responsible,needed but boring institution in society instead of a viper in the sleeping bag.Don’t hold your breath waiting for real reform of the credit card racket.Probably won’t get farther than a few speeches. The Administrations responses have been lily livered and the Dems in congress have not been much better.Where is that trumpeted audacity we heard so much about. I just might have to join DR if this keeps up.

You pretty much have to use a credit card for international travel,these days, as a security measure. Car rentals require one also as do internet porn sites(so I am told).

Yes, which is why one should carry a no balance carrying card, like an American Express, for those purposes. Pay it off each month and incur no interest fees.

Interest fees are just you paying someone else to use their money, don’t use their money, use your own and save that money for yourself.

It’s a real simple concept, the idea of ‘free money’ by using a credit card is whacked out.

Rhinehold said: “Yes, which is why one should carry a no balance carrying card, like an American Express, for those purposes. Pay it off each month and incur no interest fees.”

Which is fine if one has so much cash reserves that one can cover unanticipated and unbudgeted events like catastrophic medical costs above and beyond what insurance covers, or, the loss of one or both breadwinner’s jobs. Most of middle class working America is not in that position. Hell, too many of them were not even prepared for the ARM rate changes coming to maturity as their housing value dropped below the mortgage amount owed. Many such folks have remained solvent using credit cards, until the lenders closed down their credit lines and doubled and tripled their interest rate which double or tripled the amount they had to shell out for credit card payments each month, busting their otherwise sound budget, all to hell.

It is a complex world, Rhinehold, and such simplified maxims like “Everyone should just carry a no balance AmEx card” don’t even begin to address the real world. Again, the difference between ideological and real world views. The former wanting in objectivity and the latter ever reaching for the complex exceptions to the ideological rules in order to fashion effective solutions to the real world, not one viewing a single color through an ideological prism.

Again, the difference between ideological and real world views.

That’s pretty funny. The “real world” approach is to not spend money you don’t have or assume that it’s the job of a private entity to pay your bills for you.

The “ideological approach” is this misguided notion of fairness and class warfare rhetoric which holds that the if you can’t pay your bills and want to keep spending money it’s the job of somebody wealthier than you to cover your bills. THAT is the ideological position.

There’s no reason to put “medical costs above and beyond what insurance covers” onto a credit card. You can go into debt directly to the health care provider, and if you need a payment plan you’ll get a far better deal than you will from Visa or Mastercard.

Which is fine if one has so much cash reserves that one can cover unanticipated and unbudgeted events

If they don’t, they are living beyond their means and I don’t feel that sorry for them. Everyone else has to give up things in order to put themselves in good financial order, we are supposed to take from our hard work and sacrifice to help those who are unable to do that? You specifically mention people with APR refi’s, they were greedy people trying to get something for nothing without the understanding of what was going to happen when the finance charges tripled.

Sorry David, but I think it is past time when people stop being greedy and expect others to bail them out. My parents and their parents would have puked had they been told that they should not have financial reserves in place to handle emergencies while going out and buying the latest commerical products. Priorities anyone?

Loyal Op. offered a loyal ooops when saying: “The “real world” approach is to not spend money you don’t have…”

Laughable given the estimated $4 trillion dollars of leveraging, borrowing, for which there are no assets to on corporation’s balance sheets to collateralize that leveraging with. The real world is ALL about leveraging, i.e., borrowing. I repeat, your comments continue to demonstrate “the difference between ideological and real world views”. In the Real World, people DO borrow and spend trillions they don’t have today, promissing to pay tomorrow with they hope they will have then.

“or assume that it’s the job of a private entity to pay your bills for you.”

Again, completely out of touch with the real world. AIG is an insurance company. They DO PAY YOUR BILLS FOR YOU, if your collateralized assets come up short on real market value. That is PRECISELY the kind of insurance they sold in the form of Credit Default Swaps. Continuing to reject reality in lieu of your ideology just continues to win this debate for me. And I thank you.

Rhinehold opposes borrowing saying: “If they don’t, they are living beyond their means and I don’t feel that sorry for them.”

Whether you feel sorry for them or not, is irrelevant. The REAL WORLD fact is, from rich to poor, borrowing and spending money one doesn’t have or, wish to part with today, underwrites the global economy, as well as our own domestic economy. You think the Sears Tower was built on cash reserves? You think Donald Trump paid cash for his towers out of his own pocket? You think buying a share of preferred stock isn’t a loan and a way of growing a business beyond one’s means? No different than buying a suit on credit because one can’t afford it out of cash, in order to look their best for job interviews.

Now, there are nonsensical ways to exercise borrowing, and there are responsible ways to borrow. But, taking a patent view that borrowing is living beyond one’s means, contradicts the entire concept of economic growth. Without investment in growth, there is no growth. Without borrowing against the future, there is no investment. Ideological vs. Reality. Reality kicks consensus butt again. The vast majority in America live beyond their current available disposable cash. That is reality. That they shouldn’t is an ideology. And an anti-progress, counterprodutive one at that, if universally applied.

Borrowing to pay for something that depreciates is idiotic. There are times and places for borrowing, most often to purchase something that will APPRECIATE in value.

You are talking about paying for consumption items with borrowed money and there is no way to defend that. People do it, yes. They are wrong to do so and they will pay the price for doing so, that is their decision to make. But I will not assent to bailing out those individuals for their bad decision making.

What sense does it make for me to sacrifice when I could be buying a bigger house than I can afford, the latest TVs, etc? I mean, the way it seems to me I should be just going crazy like others and then expect the poor saps who didn’t overspend what they earned in order to buy those things on credit to come and bail me out when I inevitably lose it…

I have more respect for my fellow citizens than to allow myself to get into a position that I can’t get myself out of. Apparently eveyrone else are just greedy bastards.

Rhinehold goes off again making blanket indefensible statements like: “Borrowing to pay for something that depreciates is idiotic.”

Do houses and cars depreciate? Of course they do. Yet, the majority of Americans could afford neither as a total cash upon purchase arrangement. Which would have dramatically curtailed economic growth for the last 79 years. And no, Rhinehold, the majority of Americans are not idiotic about their borrowing to purchase a home or car. That is just your ideological opinion, and far, far from being anything close to factual.

You must be one of those who believed Housing was going to appreciate forever. Thanks, now we know the kind of person to blame for the housing valuation bubble. You are in good company with Alan Greenspan, before he had his change of heart on the matter, along with the most of the real estate industry who WRONGLY believed as you do by your own admission.

Everything physically made depreciates, Rhinehold. Even the human body and mind. Great series on NGC or History channels about the world after man. Excellent study in the depreciation of everything man made after humans are no longer around to continually replace it.

Rine, sometimes what they refer to as, ’ A labor of love’ “”productive work performed voluntarily without material reward or compensation”” I remember when people paid off their houses in their golden years just to say it’s ours and if it was worth a little more than when they bought it that was a bonus!

Loyal Opposition,
The “Real World” for the last 30 years has said “Charge It” and let your Children figure out how to pay for it. However, the Ideology of the Left and Right has been to find more ways to get more “Credit for the Consumer” while not doing anything to figure out how to get Individuals more incme to pay for the Bling-Bling produced by Corporation.

For if Private Business and Political Leaders really want to solve the latest credit problem than solve the problem of every American Consumer and Small Business Owner having to come up with the extra $500.00/mth to cover the mistake made by the so-called Learned of Society over the last 30 years without increasing the cost of Labor and Management.

While I applaud Obama’s first steps in doing the right thing for the economy, doing the opposite of Republican cavetching, he is making a mistake, in my opinion.

What Roosevelt failed to do was do enough stimulus spending to intiate a recovery, until the build up for WWII. He did properly re-regulate banks and investment banks and the markets, but he also started conservation and “participation” for the nation. In tin drives they collected pots and pans, limited sugar and gasoline purchases. Americans everywhere could participate in the recovery and war effort. Depressions are more than a financial meltdown, they are a psychological meltdown. The tin drives were completely fictitious. They did nothing tangible to help the war drive. While the sugar and gas restriction were somewhat more tangible, they were likely not decisive. Getting America involved through buying bonds campaigns, etc. is something I am hoping Obama will catch on to.

I am doing things to reduce my carbon footprint, not because I want to save the world, I’m just sick of being victimized by power companies, etc. I live in Houston. I’m going to try to live without AC this summer. I built a screened in back porch, and have created brown water recovery systems, an outdoor solar heated(passive)shower. Fortunately my privacy fence allows me to be naked or nearly so. 90 dgrees doesn’t feel so bad naked:)

While I haven’t yet bought solar panels, I’m planning on working towards that. I have some doubts about their efficacy and the resources they diminish. I’ve thought a stationary bycycle generator coupled with batteries might make a better electricity supply, if you can reduce your power needs. Batteries create lots of toxic waste, however.

I still drive a truck (I need it for the work I do), but I rarely make unnecessary trips and incorporate store trips into my work routes.

If Americans changed their lives in similar ways, through encouragement of the President, that will have significant impact on several fronts. The ethos of excess consumerism for shear comfort should begin to wain, along with phony elitism.

The same ethos needs to return to banking. Small banks, local banking, local credit. There is still a place for larger banks, but no need for go-go greed.

RH
Don’t be too hard on people. Emergencies do come up. Even things like school cloths can put a strain many peoples budget. Sure its better to pay cash, but that is not always possible. Certainly there were people that bought homes they could not afford. They took a shot. There are plenty of folks that did so and cashed out in time. Fortunate capitalist. What was the alternative?Homelessness? Rent, where there was not even a slight chance of building equity?

Seems a stretch to me to try and turn this into an idealogical polarized arguement. Credit companies are parasites. They do not make anything. They do not produce supply. Economies can support a given level of parasites but the parasites have been getting out of hand and its time to bring them under control.These are loan shark rates.
IMO the root reason for the rise of credit schemes was and is because wages have not kept up with cost and aspirations. We’re Americans. We are allowed aspirations. Normally wages at least reflect production rates. The production rates for American workers have been astounding but wage increases have been flat. Now there is even more downward pressures. This has been on purpose. Corrective influences have been suppressed by a variety of means. Until there are fundemental changes in the direction of wages the recovery will be very slow if it happens at all.

gergle, it took years and years for the government, even to spend what it did in the 1930’s and 40’s to reclaim a health economy. The government could print 10 trillion dollars in the next few months, but, if it threw that money into circulation, it would not rescue the economy, but, bury it.

The government has to convert such economic stimulus and recovery dollars into jobs, new technologies resulting in new export industry, and cost saving (not time saving) innovations. That takes time, planning, investment, research and development and deployment.

I think Obama is on the right track with health care delivery cost reductions planning, energy technology and innovation, and infrastructure maintenance, expansion, and improvement. These are very huge policy direction items that require time and investment of years to begin to produce results for working Americans.

Remember, it wasn’t until the Post WWII years, especially the 1950’s, that our economy really took off and produced increases in real wages and cost of living drops for the middle class. Getting everyone to work for it had to come first. And that took over 15 years to accomplish in full. Hopefully, Obama will be able to accomplish the same or similar in 8 years. He doesn’t exactly have to reinvent the wheel, here, just the spoke angles and hub. :-)

Greed, greed, and more greed.

At any rate, the voters have the government that the voters elect (and re-elect, and re-elect, and re-elect , … , at least until that finally becomes too painful).

Thank you for this column. I found it just after I had emailed Senator Boxer, Senator Feinstein, Governor Schwarzenegger and President Obama. (I wonder if emailing Oprah would yield better results.)

Imagine my heart attack when opening today’s mail.

Advanta has upped the APR to 34.99%! (I’ve never missed a payment and have a fantastic FICO score.) This almost 35% APR is tantamount to Mafia loan sharks.

Then I open my Chase mail. My savings account yields a whopping 0.84%… yet a changes in terms pamphlet reveals my APR is jumping from 10.9% to 13.24% on July 1. In order to not accept this, I must write them to let them know… I must then close the card, which means my FICO will tank.

(Last year, this diligent consumer paid a card down to zero and closed the account as a good little girl. I saw my FICO plummet 100 points as a result of that move.)

Capital One is jumping to 17.9%, also on July 1.

State usury laws do not apply to banks. Heck, it seems NO laws apply to banks.

So let’s understand: OUR tax dollars bail out these idiots. Then said idiots get to rape us in return. And the government has pulled our pants to our knees, forcing us to bend over and take it.

ENOUGH IS ENOUGH. Tell me where to write letters. Tell me whom to call. Tell me which doors to knock on. Tell me whose doorstep to camp out on.

I am barely keeping my head above water as it is. Thank you President Obama for pouring one more bucket of water over my head, ensuring I will drown.

Oh, and thanks for making sure I won’t have social security when it’s time to retire.

Honest Taxpayer,

The legislation which passed the House and Senate is a sham, and does NOTHING to address those abused by the Credit Card companies and Banks, to date. No retroactive action to be taken against abusers.

This means the companies are screwing ALL their customers NOW before the Pres. Obama signs this weak and watered down compromise of a bill which does little to protect consumers from continued abusive practices going forward.

The best thing at this point is to go to Obama’s site and ask him to veto this legislation in favor of stronger protections and redress of abusive past practices. Then contact friends and ask them to do the same. This is what I have done.

Honest Taxpayer,

This is what I sent to Pres. Obama:

From everything I am hearing on the news regarding the legislation purportedly to rein in the abuses of the credit card companies, the legislation is a joke and offense toward consumers hoping for relief from past abuses and fairer treatment for themselves and their children going forward.

Evidence abounds that the Credit Card companies are abusing card holders rampantly before the legislation passes while they still can. I also understand the legislation does not force the companies to roll back usurious rates already put in place on reputable card holders, some as high as 34%.

I want to urge Pres. Obama to veto this legislation and force the Congress to revisit this issue and address the grossest abuses in a retroactive fashion, and cap interest rates at a non-usurious level, again, retroactively. Consumers are caught in a vice here with excellent credit histories paying rates and losing credit purchasing power as if they were repetitive delinquents. This is not fair or right.

Please, Pres. Obama, veto this credit card legislation and force the Congress to take a more pro-consumer position in protecting them from these Shylocks in the Credit Card industry.

David - Well said. That is a wonderful and articulate email. If it is ok, I’m going to send the same thing to Obama, along with Senators Feinstein & Boxer.

Good discussion here. Credit card issuers have been so focused on preventing major losses since the economic downturn that customer care seems to have gone out the window. Hopefully consumer abuse will be better in 2010 as credit card companies start to have to compete for customers again as the economy rebounds. Most issuers were profitable in 2009, although very marginally, with a big exception of Bank of America which lost $5.56 billion http://education.cardhub.com/statistics/market-share-by-credit-card-issuer/
So, David, I guess it’s satisfying to see that what goes around comes around.