Our economy

If anyone could point me to a credit card company that extends credit at a reasonable rate (and not just a 6 month teaser rate) I would be happy to follow a link and educate myself.

"Reasonable" being the operative word here.
Click to expand...

Well, who defines "reasonable"? You?

None of our credit cards have APRs even close to 10%, let alone 30%.

But even if none of the credit card companies out there offered any cards at less than 30% APR--nobody's forcing you to borrow money from them.

It's not as if many people here are going to advocate taxing me more so that your neighbor can make his house payment; but it might be best (for them, and you) if banks weren't willing to loan them money for houses they can't actually afford and encourage them to do so by offering teaser rates even though they don't understand that in a couple short years they'll be in real trouble.
Click to expand...

And if banks actually stopped lending to the subprime market (which is where all those "predatory" APRs can be found--with borrowers that have proven through their consumer behavior that it's risky to loan them money), then people like you would be first in line to say how unfair it is that these folks are excluded from the real estate and consumer markets, and how we maybe need to make sure that banks need to loan cash to everyone at the same "reasonable" interest rate, regardless of whether they have history of paying their bills or defaulting on them.
 
None of our credit cards have APRs even close to 10%, let alone 30%.
Click to expand...

Considering that the average is well over 10% (closer to 13%-14% or so, depending where you get numbers from), I guess that makes your financial situation atypical.

It's not as if many people here are going to advocate taxing me more so that your neighbor can make his house payment; but it might be best (for them, and you) if banks weren't willing to loan them money for houses they can't actually afford and encourage them to do so by offering teaser rates even though they don't understand that in a couple short years they'll be in real trouble.
Click to expand...
And if banks actually stopped lending to the subprime market (which is where all those "predatory" APRs can be found--with borrowers that have proven through their consumer behavior that it's risky to loan them money), then people like you would be first in line to say how unfair it is that these folks are excluded from the real estate and consumer markets, and how we maybe need to make sure that banks need to loan cash to everyone at the same "reasonable" interest rate, regardless of whether they have history of paying their bills or defaulting on them.
Click to expand...
"People like me?" Maybe. Me? Not so much. Then again, I guess that would make them not "like" me. Hmmm....

Thanks, though.

EDIT: I would suggest that banks should have to apply the same criteria to all individuals when determining who to loan money to, though, to prevent practices like redlining. I can see how that might be confusing.
 
There is no doubt the credit card companies take advantage of the most unsophisticated among us.They are a great tool if you pay them off monthly, but if they are your finance system, you will soon find yourself in a hole to climb out of.

What I find disturbing is the steady stream of people that come in the store between 5 and 6 PM and buy $10 to 15 of beer and cigarettes every day of their life.

I wonder if they have any conception of how much money they would accumulate if they invested that $3000/year for 30 years.

No wait, the government is supposed to do that for you.
 
Have to agree with MK on this one - the American public, by and large, doesn't know how to manage their money and has little restraint when it comes to spending versus saving or simply cutting back on the things they really can't afford. Can't afford that big screen flat panel HDTV you want? put it on the card and worry about it later. If you carry a balance beyond a month or two, you're probably living beyond your means ...which is why the credit card companies are getting rich while you're getting soaked with a 20% APR on that balance. Blame the credit card companies if you want, but just like a gun, a credit card is only an inanimate tool which can be used for good or for ill. Pay your outstanding balance every month, don't live beyond your means, and it can be a good thing. Abuse your credit, maintain a balance, just make the minimum payments, and you're going to get hit with higher fees and build up a balance that you can't pay off so easily. FWIW, I have exactly one credit card, and to be honest I don't even know the rate on it - but thats because I never use it (its for emergencies only, otherwise I pay in cash).
 
You are neglecting the small fact that when your neighbors lose their houses, it will drive down the price of YOURS.
Click to expand...
Didn't hear much complaining when prices were rising at unsustainable rates. This is a correction, part of an economic cycle.
 
Marko Kloos said:
None of our credit cards have APRs even close to 10%, let alone 30%.
Click to expand...

May I ask which cards you have? I did some Googling around, trying to answer SecDef's question, and the best rates I could find were in the mid-high 7% range, 7.99% (the Advanta, for small businesses, and 7.25% for the Simmons First Platinum) - both for people with very good credit. Those are both very low, of course - the Advanta actually comes out ahead on account of its cashback (Simmons gives no rewards), but it's a little bit of a stretch to say they're "not even close to 10%".
 
A recession is defined as two quarters of declining GDP.
You can't define a recession by saying "the price of eggs has gone up".
Click to expand...

The cost of basic human needs like food is a pretty important factor in the world economy.

One of my favorite sources of information is the weekly magazine "The Economist", which I read regularly. Luckily, it's available at my local library, so I don't have to subscribe to read it, but I am always a few weeks behind.
The Dec.8, 2007 issue features an in-depth article on the end of cheap food, subtitled:"rising incomes in Asia and ethanol subsidies in America have put an end to a long era of falling food prices." I was surprised to learn that in September, the world price of wheat rose to over $400 at ton, an all time high. In May it had been around $200 a ton. Federal ethanol subsidies and state use mandates have raised prices for corn and boosted the amount used to make fuel, making it more expensive to feed people and livestock. (In Mexico city, there were riots when the price of corn tortillas doubled.) Naturally, more and more farmland is being used to grow corn instead of other crops, driving up the cost of those crops due to shortages.

Wages in the US don't appear to be rising in line with higher living costs, which don't seem to be rising in a purely cyclical manner. Hence, I think we may be in for leaner times ahead.
 
Financial education...

People need to know it. I'll say that if it wasn't for a good friend of mine who's a finance major I would've never thought to have build my credit and learn to use a credit card wisely. I got one rather recently and held off for so long because I didn't want debt. Now I see that it is very useful in times I NEED something and am tight on cash for a temporary amount of time. All in all, I do agree with what shaggy said, credit cards are like guns, they are only tools and can be good or bad depending on who uses them. If more Americans were financially savvy, and not so impulsive to "keep up with the Joneses" or getting something because that's the popular trend, we wouldn't live in such an excessive lifestyle that is unsustainable.


Epyon
 
As for me I am paying off my cards and getting rid of them. If I cant buy it at one swipe I dont need it. If I want it I will save for it think about it while I am saving.

When I retire in a few years all I want to owe is property taxes, utilities, insurance, vehicle tags and my Tricare for Lifehealth Insurance.

I was listening to Paul Harvey on the radio. American Express is having a bad year as some of thier best customers have gone belly up.

Its gonna get a little ugly.
 
Well, I gotta say...

Eghad, while you'll be retiring I've still got some years to go before then. So until then I've taken a huge interest in business, investing, and finance as a second major. Once I get out into my field I won't be driving myself into debt, I figure since I can spend wisely on a measly dead end wage, the excess I make in my career field will be plenty of money for me to invest in to build more wealth. That's exactly what I love about this country.


Epyon
 
May I ask which cards you have? I did some Googling around, trying to answer SecDef's question, and the best rates I could find were in the mid-high 7% range, 7.99%
Click to expand...

Just looking at the Advanta terms and conditions though...(https://www.advanta.com/ADV/Apply/TandC.page?sourcecode=w34v)

Note that the Default rate is "The higher of the account APR plus 3%, or Prime plus a Default Margin of 22.24%."

Now, also note the terms that a default rate applies. One of them is exceeding the limit.

If you have $1000 limit and you buy a $400 item then a $601 item, the bank will NOT refuse it.. it will happily *not* reject the second charge. You've just tripped their happiness button because they can then impose the 22.24% rate on you -- or APR + 3% whichever is higher)

"In accordance with applicable law and the terms of your Card Agreement, we may change all of your account terms, including rates and fees, at any time for any reason. This means that your account rates, including any introductory or promotional rates offered, are not guaranteed; all account rates may be increased, fixed rates may change to variable rates, and variable rates may change to fixed rates. We may also change your account terms, including by increasing rates and promotional rates, if any Events of Default listed above or in your Card Agreement occur. Your Card Agreement also contains an arbitration provision, which replaces the right to have claims heard in court by a jury, and precludes participation in class actions."

That first sentence is a doozy: we can change your terms at any time for any reason. By Law.

Oh, and the explanation for non-rejection of charges that exceed your limit? "So you don't get embarrassed when purchasing dinner" I wish I remember where I saw that, but it was recently and made me laugh.

Yes, that's why I pay my credit cards off in full. Justifiably so, too. I am their least favorite type of customer.
 
Well, who defines "reasonable"? You?

None of our credit cards have APRs even close to 10%, let alone 30%.

But even if none of the credit card companies out there offered any cards at less than 30% APR--nobody's forcing you to borrow money from them.
Click to expand...

- I had intended to make that point that reasonable is a a very fungible term in this context.. maybe we can define reasonable to mean that it stays as published instead of magically being three times higher for no reason? (see my last post))

- None of your cards are even close to 10%? I don't know what to say.. except that I will need at least a bank name so I can confirm.. You must have access to amazing resources that I don't. One would think that these CC companies would advertise these rates, no?

- I would have no problem with published rates of 30% and direct competition, that would be transparent and allow the free market to work correctly. There are may reasons why owning a credit card is not only useful, but nearly required. Want to stay at a hotel? Sorry, need a credit card on file with them. Buy something over the Internet? Yeah, thanks for giving us your bank account number instead of your credit card, there aren't many rules to protect the consumer when any type of fraud occurs.


BTW, it isn't the home buyers that are up in arms about sub-prime, it is the companies that bought the loans, and the hedge funds that wrapped them up into nice packages to buy and sell to each other. And whether we like it or not, it will affect the economy as a whole. (http://www.morganstanley.com/views/gef/archive/2007/20070212-Mon.html was written in Feb 07)
 
Quoted by Sasquatch
What has been happening in the housing market is because of.............GREED. People are jumping into loans on houses they cannot afford, nor actually qualify for. The end result of that is the mortgage mess we now see. It is cyclical.....it has happened before and it will happen again.
And all of these idiots now want the gov't to bail them out.
Click to expand...

Sometimes the most complex of questions don't need complex answers...this hits the nail on the head. There are other driving factors, but this is a big reason why the economy is a bit shaky right now.

My quote on post #38
The number one key is the almighty consumer. No matter what products, employment, or benefits businesses or the govt. provides, it's the consumer that ultamately drives the economy.
Click to expand...

Quoted by nobody special
I must strongly disagree with this. The key is not how much is consumed, but how much is produced. And we don't manufacture much in this country anymore.
Click to expand...

Really? What good is producing something if there isn't a consumer to buy? Although it does hurt us to not buy a domestically made product, it doesn't stop the consumer from buying ANY product. If a consumer doesn't buy any product, ALL producers are toast. Look at it this way. When I (consumer)walk into a car dealership (producer of product, loosely represented) I don't HAVE to buy a car there. However, the dealer HAS to sell to the consumer in order to keep being a producer. I'm in the drivers seat, no pun intended...NOT the dealer...

Considering that the average is well over 10% (closer to 13%-14% or so, depending where you get numbers from), I guess that makes your financial situation atypical.
Click to expand...

Actually, our two cards that we have for online purchases and our emergency card is under 10%. One's through our credit union...

Have to agree with MK on this one - the American public, by and large, doesn't know how to manage their money and has little restraint when it comes to spending versus saving or simply cutting back on the things they really can't afford. Can't afford that big screen flat panel HDTV you want? put it on the card and worry about it later. If you carry a balance beyond a month or two, you're probably living beyond your means ...which is why the credit card companies are getting rich while you're getting soaked with a 20% APR on that balance. Blame the credit card companies if you want, but just like a gun, a credit card is only an inanimate tool which can be used for good or for ill.
Click to expand...

Exactly. If it was the case that most Americans are smart with their finances, it wouldn't be a boon to CC companies right now. Sure, there are people that are actually just getting by. I feel for them. I used to be there. But, the vast majority of people in this nation has a job to pay the bills. My wife has personally seen time and time again through her former job that people can pull themselves out of poverty. And, we're talking couples with kids along with medical bills. The help is there. Private sectors and govt. asisstance is there.

I find no pity for people that buy a $40,000 brand new truck to just have (not even using it for intended purposes) and gripe about not receiving enough overtime from work to "make ends meet".

I do believe that our economy is a bit shaky. Believe me, I'm not happy about the oil situation, housing market, CC companies, etc. But, I also consider the source. Bottom line is that we let ourselves get into this mess for the most part. American people (yes, myself included) are to blame for reelecting the govt officials in office. American people (me again included) are to blame to want cheaper goods instead of demanding quality product made here. All of the blame? No. But, we Americans for the most part are the biggest reason for the situation we are in today...

Somebody shut me up...:)
 
What is your Take on Minumum Wages? Do you really think it helps? If it helps, who does it help? Not Me!:D

Just contributes to inflation in my eys!
 
SecDef, I'm pretty sure all credit cards have egregious default rates (defaulting is failing to pay even your minimum, so the penalties are of course high) and the "change our terms at any time" clause. They do give you notice of the changes some time (I believe one billing cycle) in advance, so if you read your statements you're not likely to get blindsided.

I'm not saying that any credit card is a good idea for someone who doesn't manage money well, but low-rate reward cards like the Advanta aren't bad for people who carry no balances (or only very occasional ones when emergencies come up).

Actually, on a partially related note, I'd like to see us start issuing war bonds again. One of the reasons we're suffering so much from the economic cycle is that people don't have any savings to fall on - I remember reading a few years back the average savings rate was negative. People spend more than they make, gambling on better times that never come.

War bonds would give people a very real, very tangible way to support the troops (better than made-in-China magna-stickers, certainly), help repair the savings rate, and tamp down inflation by taking money out of circulation for a few years. It would slow down the plasma-TVs-and-iPods consumer-luxuries part of the economy a bit, but I think it would be very good for us in the long term.
 
But we can't have that...

We must spend spend spend. Who cares what's going on around the world as long as we can drive our guzzlers, watch the Sunday game, and rot in front of the TV for American Idol. Entertainment makes for excellent distraction while liberty slips away, it's our modern day Colusieum.


Epyon
 
i remember reading a funny newspaper clipping about a year ago. it was of an American auto maker executive board meeting and it went kind of like this.....

well, ladies and gentlemen....we're finally able to produce an automobile that the average American worker can afford to buy....unfortunately, we laid them all off.

not exact but i think a reasonable facsimile of the strip.
 
Minume Wage!

So ! No Response! You like paying more for goods Worth? You like paying $2.00 for the thing that should have cost .50?

Raise the Minimum wage some more. Pretty soon you will be like the Germans and carrying your money in wheelbarrows!

$1000.00 dollar bills? The Dollar will be worth what? .2 ????


Who to hell wants the minimum wage raised??:eek:

It gives you nothing! It takes away what you have if you make more then the minimum! Hello?

I was making $9,50 They jump up the minimum to 7.50 from 6 and some. I loose ! I don't get a raise to commensurate the difference. My buying power just fell by about $1.00!

ANOTHER FORM OF SOCIALIZUM?
 
You hit it on the head Homefries. I've heard you claim before not to be the smartest, most educated and so on, but this is at least the third time you've wisely reduced all the hard blowing to it's base and done so with ease and clarity.

Minimum wage wasn't ever to help the poor. Anyone smart enough to be elected to national office knows better. It only REDUCES buying power and the value of the dollar globally. Made the lowest wage earners feel better but didn't help them buy more, only made everyone ABOVE minimum wage able to buy less.

The pundits are pushing the recession button to sway public opinion as Iraq is no longer the 'quagmire' so much talked about. We are not in a recession. Even the news reports listed before admit that there hasn't yet been one, let alone 2, quarters that qualify as a recession.

The market (stock market) always swings to the cautious in a general election year because they are waiting to see what a new administration is going to be like before their fears (stock market revolves around the fear factor) are calmed.

Unemployment and inflation are the only indicators turning amber, still not red, and those, along with CPI are all direct results of the new minimum wage. Higher mandatory rates means fewer employees are affordable. The employees remaining cost more, overhead is increased for MULTIPLE reasons (wage dollars, Social Security and Medicare matching, workers comp., unemployment, and more) to maintain margins so operations can continue prices will have to go up and with less production due to fewer employees, supply goes down and prices go up. Bottom line, prices go UP. That's called inflation.

Now who the heck was screaming for this minimum wage increase and who the heck is screaming about the economy slowing?

Now would you expect a party willing to do that to their own country to genuinely be looking out for 'the people' or for their own power?

If it actually becomes a condition of American culture that the principles of rugged individualism and self reliance are replaced with Government being the EXPECTED to provide for our wants and needs and WANT more taxes then complex problems like INFLATION won't be a concern. Just a tiny tax increase will cover the 'Provider's' increased costs.

No problem.
 
Last edited:
Corporate profits are at all-time highs
Click to expand...
.

And this helps workers how? Especially when it is mostly at their expense
Click to expand...

I just want to point out that most corporations are owned largely by investors, including millions of little old ladies' 401K mutual funds. Increased corporate profits benefit EVERYONE.
 
You must log in or register to reply here.
Back
Top