RE: Credit card crunch

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petdave -> RE: Credit card crunch (12/24/2007 5:13:06 AM)
quote: ORIGINAL: slaveluci I just don't know what has happened to common sense, though, when it comes to people buying so many things they cannot even afford. You play with fire, you're gonna get burned. Unfortunately, so many times they just file for bankruptcy and it's their creditors who probably get burned. If you can't pay for it (even over the long term), don't freakin' buy it....................luci Just wondering, are these the same "those people" that Republicans always seem to meet who ignore birth control in favor of weekly abortions? Most of the people i know who are in financial trouble ended up there either from a medical crisis or job loss (the "just go get a better job" lesson won't go over so well with former auto industry workers, btw). Changes to the personal Bankruptcy laws under Bush II have given credit card companies a lot of protection, and with most of them charging 20% APR or higher, i don't have much sympathy for them. i canceled one of my cards after getting a late payment charge of almost $50 one month when the bill was due earlier than i thought... a look back through my statements showed that they'd moved my payment date ahead by a eight days in the past year. Cute trick, and if i didn't pay off my balance every month, the huge jump in interest rate that accompanies a single late payment could have made them quite a bit of money over time.

LadyEllen -> RE: Credit card crunch (12/24/2007 5:49:28 AM)
One of, perhaps the only, worthwhile observations by one Adolf Hitler in his abysmally poor Mein Kampf, was regarding the poor. Working all hours and yet living in dreadful poverty, they tended to acquire and spend their wages on more or less the same day - the idea being that their lives were so poor that once money was in hand, they would tend to go out and enjoy themselves with it. Then they would have to pawn their meagre possessions to live until the next pay day, all the time steadily slipping further into poverty. Though most modern westerners would have no idea of the kind of poverty being observed in that instance, poverty is often a relative matter, and human nature does not change much across time and cultures. The poor where I live I observe doing the exact same thing - the unemployment payments and benefits arrive, and the pubs, betting shops, off licences and take aways are full. And it seems to be the same with the working classes and lower middle classes, who through access to ready credit can have good times more often. "Eat, drink and be merry - for tomorrow we may die". And as aspirations have risen in general, what comprises a good time has also increased - to have a good time now, we must have a four bedroom mock Tudor house, a German car, two overseas holidays a year, every gadget conceivable and of course the kids must have the latest Nike and toys and gadgets too. But its OK - there is more credit on the way to buy it all. But the most insidious part of it all is that there is such huge pressure on all of us to have the mock Tudor house, the German car and the rest. Those who dont have, dont belong with us - they must be poor (for which read "uncreditworthy"). We all try harder to get more and more and more, and yet someone else has more and we can never keep up. But the credit keeps rolling in, because we're so good that we deserve to at least try to keep up. And the kids must have the latest, if theyre not to be bullied at school, 'cause kids know who's good and who's not. We dig the hole deeper, month by month. Until we can no longer see the sky above us, just the walls of an inescapable pit which are subsiding towards us. Millions in the UK are now buying their weekly groceries on credit cards Millions in the UK are paying off one card with another Millions in the UK have not yet paid off their cards from spending last Christmas The solution? Nothing that is not unacceptable to most and so we will continue to career into the deepest pit imaginable. E

bipolarber -> RE: Credit card crunch (12/24/2007 8:01:54 AM)
The reason behind this is the same as the sup-prime real estate SNAFU: lending companies handing out credit cards to ANYBODY, regaurdless if they have the means or the experience to handle it responsibly. 14 year old kids have credit cards these days. Fer chrissakes! Add to this, the "linked credit" clauses within the shared lending contracts: If you miss or are late with a payment, not only does your credit card payment go up, so does your mortgage and car payments. Lenders are running around handing out money like a drunken Rush Limbaugh at a Dunkin' Doghnuts... and the American public are the ones to blame?

popeye1250 -> RE: Credit card crunch (12/24/2007 10:52:52 AM)
I had a Target Visa card until I realised that they were charging me 19% interest. I asked them twice to lower my rate but they wouldn't. And I have a good credit rating too, 714 "high" 685 "low." So, I "froze" the card, "no more purchases" and got a platnum Visa card from my bank at 11.90%. Now, Target Visa "wants to talk." I told them too bad, "I know guys in East Boston who don't charge that much on the vig." And there's a way around those new personal bankruptcy laws that the credit card companies had a part in writing too. Simply incorporate yourself. There's been way too much of that under Bush and Clinton, corporations writing our legislation and laws. It still says on paper currency "This note is legal tender for all debts public and private" so I don't know if a company can "refuse" to take cash.

ownedgirlie -> RE: Credit card crunch (12/24/2007 12:32:20 PM)
quote: ORIGINAL: popeye1250 "I know guys in East Boston who don't charge that much on the vig." [sm=biggrin.gif][sm=biggrin.gif][sm=biggrin.gif]

sambamanslilgirl -> RE: Credit card crunch (12/24/2007 12:53:28 PM)
quote: ORIGINAL: awmslave Above talk may attract sympathy but still we are talking living above their means. The fact is they are not forced to borrow. They need to get a better job, rent instead of buying house, give children for adoption, use public transportation etc.. i hoped you were joking however reading the other replies - i see you're not. you stressed the following: they need to get a better job - a better job is no guarantee these days that you'll receive the better pay. most companies are costing salaries as well as jobs rent instead of buying a house - rents here will kill ya especially if you have a family with UMs ...moving into a cramped apartment isn't ideal for most families. renting a house may not be a better option either give up children for adoption - you're being extremely cruel. as a mother of 2, i wouldn't give up mine because i'm in debt - you must be crazy! use public transportation - the way it's going here in Chicago, pubilc transportation is about to be cut if they don't get the money needed to keep it going. some cities especially in suburbialand, you need a car to get around if there's no public trans

NorthernGent -> RE: Credit card crunch (12/26/2007 2:02:20 AM)
quote: ORIGINAL: bipolarber Lenders are running around handing out money like a drunken Rush Limbaugh at a Dunkin' Doghnuts... and the American public are the ones to blame? My view lies somewhere between T and yourself. Yes, lenders are taking liberties; they're preying on insecurity, pride and fear. People, however, have to do themselves a favour; if you can't help yourself, no one else will in this world - it's like the wild west, only built on a scramble for money and possessions, with debt ruining lives. Maybe there's a grand plan that we can't see, as hinted at by T. Man needs a focus to dampen his passions. In England, god really is dead, so what's left to keep us in check? Property and possessons act as a focus through being the tools to target and satisfy aspirations. Consumerism is where most of us compete and achieve in our lives - maybe this is by design, to prevent us competing and achieving in war.

popeye1250 -> RE: Credit card crunch (12/26/2007 12:00:34 PM)
NG, I watched a show two nights ago about religions and the Archbishop of Canturbury Rowan Williams was on it and said that God is very much alive in England. But, he's the Archbishop of Canterbury so what else would we expect him to say? I wonder if he and the Archbishop of York ever get into it? "Is too!" "Is not!" I pretty much buy only what I need. I won't have my house filled with plastic junk from China bought at Walmart or other stores. On the News they mentioned that retailers, "May not make their numbers" this year. Who cares, unless you own stock in those companies? And even if we were to have a recession it's no big deal anyway because we wouldn't have a lot of people layed-off in the U.S. or England because all that junk that people buy is made overseas.

Termyn8or -> RE: Credit card crunch (12/26/2007 1:24:03 PM)
First of all I would like to apologize, not the groveling lick your shoe kind, but a real apology. My post was disjointed, jumped around alot, reason being that sometimes my mind moves so fast I don't realize that I have outstripped my ability to keep up on the expressive end of my ideas. And indeed there is alot to this. And indeed more to come. I believe it was NG said something about people being hypnotized, could've been someone else, but I think it was pretty spot on. Fact of the matter is that nothing is in my name anymore. Not even my car. One day I am just going to tell them to take a hike. Honest ? no. Necessary ? yes. Or perhaps I will die in debt, what do they do then ? I admit my stupidity, it is a load, but eventually they are not getting paid off. It is all unsecured. They are so stupid to give me $50,000 worth of unsecured credit. I am actually paying it down these days, but doing the math if I kept it up I might be paid off when I am 70. Well I am paying it down a bit faster than that, but not by much. Luckily my interest rates are pretty reasonable, but they are variable and tied to LIBOR, so anything could happen. But if it does, they can't take my stuff. I have no kids, so dying in debt is a viable option for me. And actually they have technically been paid back, but not the interest. Then they have these plans, mortgage your house to pay all this off and save $$$. That is dangerous. And there is something people do not realize, if you get a viariable rate on real property you have been had. In the US the government is actually stepping in, forestalling certain endings of introductory rates and the subsequent "accelerations" provided for in the UCC. I think I should touch on accelerations for a moment. We bought this house in 89, and there have alays been offers to refi, as we were paying 10.8%. Seems high now for real property but back then it wasn't. But in 1991 the UCC was amended with the "option to accelerate at will" clause. The clause states that any loan in the US can be called in on demand if the lender has any reason to believe the the debtor's ability to pay has been compromised. This not only means that they can foreclose on your house if you default on any loan you have outstanding, it means they can call the note due and payable anytime they want. There is no provision to prove their evidence of the debtor's insolvency at all. That means if you owe alot of money on your house you better have that amount in your matress. But then it is obvious that if you had that you would not owe money on your house. So every loan written after 1991 is subject to this. Being the UCC this is an underlying clause in every contract written, as the UCC is mainly contract law. This acceleration clause needs not be written into the contract. It applies because it is the law of the land. The same type of law that has made the US population fair game for any scam imaginable, expensive products with planned obsolesence and no service or replacement parts available, ever. Then we have litigation. When someone does actually win a lawsuit against big money, which is rare due to obvious reasons, they don't get the money. The idiots take an annuity. After thinking about it they want all their money now, like to buy a house or something. Well many companies have sprouted up to loan them their own money. They sell the annuity to the company for a lump sum. So the people who lost the lawsuit never gave up the money, they just gave up the interest on the money. And now you sell that interest payment for a lump sum, which is not going to be that imaginary number of dollars you supposedly won. All nice and legal. But the fact of the matter in the end is that people are stupid. No matter how much the law refuses to protect us, we should not fall for it. If I sue you I want all my money now, that because I will invest it as I see fit. Don't feign concern over my future, all you would care about is getting off as cheaply as possible. The reverse would be true if you had sued me and won. Fact of the matter is, since big money owns the government here, it is open season on the consumer. But the thing is, when it is deer season don't the deer run when they see the hunter ? Years ago, over a few beers in a discussion my buddy said "Americans are like cattle", I retorted "I don't think so, you put cattle in a field they will eat the grass, they don't try to eat the fence". Look around. It's not just credit cards. I see Women going into the store, they get a bunch of bags of chips, perhaps some balogna and some white bread. A bunch of wierd juices that are blue, something I would not drink at gunpoint. And then, after they spend a whopping eleven bucks to feed their kids, they mosey on over to the lottery counter and plunk down about thirty bucks on tickets. Now folks, the lottery is nothing but a money toilet. Anybody who knows the first thing about gambling does not play the lottery, except rarely, and in a definively planned and contrived way, and this does not happen very often. People who play the lottery are simply wasting their money. But they keep doing it. But they keep doing it. So the credit crunch is to be expected. Now for the meat. I believe that the commercialization of Christmas and birthdays has led to this. It teaches children to be materialistic, and as expected they grow up to be materialistic. Know how much an Xbox costs ? Oh wait, you get your kid an Xbox now and they will disown you and run away from home. It is so obsolete ! They need the new game, and of course a host of disks to go with it. They got the economy running like a lab rat in a jar full of pure oxygen. And nobody realizes that someday, someday soon, the oxygen will run out. Push push push, we need new products fast fast. Sooner or later the rat is going to die, because we have no more oxygen for him. And I think that a pretty good analogy. I am not thinking about natural resouces running out, I am talking about the money running out. Right now China is laughing all the way to the bank, but when we go down, they go down. I wonder how long we will have to wait to see that. The US is by far the biggest consuming nation on the Earth, but a time is going to come when we simply have no money. What happens then ? Take the Citibank situation. Chinese investors bailed Citibank out because of too many defaults, they were in trouble. They would do that because their economy is dependent on ours. But Citibank has no way to pay it back. Think about it, how do they make their money ? Off interest of course. They can't sell much off, and raising their rates would make them less competitive and surely cause more defaults. This is a lose lose situation all the way around, it's just a matter of how much and when. T

sexyred1 -> RE: Credit card crunch (12/26/2007 1:56:32 PM)
Everyone has made great points here, except for the person who advised giving up your kids for adoption (yikes). One thing I wanted to touch on was the psychology of overspending. I am in advertising and am faced with this daily. It has been discussed that we are an aspirational society, and frankly, all human beings are aspirational about something. Much of that translates into material things, thus, overspending to achieve either the actuality of what your aspiration is, or the semblance of it (the person who cannot afford the large home but wants to look good to the neighbors, or the person who has a low paying job but a very expensive car). That person is using spending to achieve a goal, whether or not it makes sense to us, it does to them. That goal of aspiration is what American advertising and marketing is founded upon. Without that aspirational goal, no advertising would work. Also, overspending can take the place of facing feelings. It can be as much of an addiction as alcohol, drugs, food, gambling. That is why they have Debtors Anonymous, etc. You can be highly educated, a brilliant person and still have a need for spending money, I have seen it over and over especially in people in the NY area and LA. There is a need to fit it with the "element" you are surrounded by. And then we have what others have spoken about, lack of good jobs, raises non-existent, rising cost of living, unemployment, young people starting off adulthood under debt, etc. All of it is a huge problem that will only spiral more out of control and I, for one, do not have an answer. I only know that if you have this particular issue of overspending, you need to dig deep to overcome it as does anyone else who has an addiction. You cannot expect the government or credit card companies or really anyone else to help.

Lashra -> RE: Credit card crunch (12/26/2007 2:12:19 PM)
I am wierd, I do not possess a personal credit card. I pay cash for everything and if I don't have the cash, I do not buy it. A lesson taught to me by my parents. I saw many people over the holidays whipping out one credit card after another because the first or second was declined because they'd reached their limit. It makes no sense, only spend what you can afford. But people keep doing it until they have no money for emergencies or extras then many want to declare bankruptcy..[:'(] No thanks, I will just keep paying cash. ~Lashra

thornhappy -> RE: Credit card crunch (12/26/2007 2:12:49 PM)
quote: ORIGINAL: ownedgirlie quote: ORIGINAL: LuckyAlbatross Well I've done all of those things with my debit card, but it can be trickier sometimes and I do agree that in today's world, having a credit card is a good and sometimes necessary thing. The risky thing about using a debit card for that, is if the number gets swiped or there is a mischarged - you're out that money right then & there, whereas if you use a credit card, you don't pay the charge while the company investigates. Having had my credit card swiped to the tune of $2,000 earlier this year, I'd much rather that money stay IN my bank account and have good ol' Visa just delete the charge, then fight for however long it takes to try to get my money back. Be careful with those things... Another problems is that you're still hosed trying to rent a car. Few, if any, car rental agencies accept debit cards. thornhappy

UtopianRanger -> RE: Credit card crunch (12/27/2007 7:49:20 PM)
quote: ORIGINAL: Arpig I am an oddity...I pay cash up front for everything...if I ain't got the cash, I don't buy I would say an oddity in this instance, reigns supreme [;)] In the last five years, I have used a credit/debit card less than seven times. I'd say what we're seeing with the credit card crunch right now, is the populace still with a great desire to purchase gadgets and consumer goods. But now they've lost their ability to use the appreciated book value in their homes as an ATM machine. The scary thing is that after they've fully exhausted their capacity to borrow....they won't be able to purchase anymore. And almost all of our GDP growth is derived from that borrowing capacity, not production. People need to suck it up....and learn to never fall prey to the ''Jones mentality.'' quote: From where I'm standing, the media - television, magazines, tabloids - explicitly and tacitly approve rampant consumerism, and actually beam this lifestyle into homes every hour of every day through the television. No alternative argument exists, and therein lies the problem. Yes. These passive mediums you've mentioned are like unregulated drugs flowing into/through the subconscious. Non-reality is now reality....what was once transparent is now opaque…. Go figure..... quote: Answer? To make more money, and they don't have much to lose. Now that they've gotten Congress to pass very favorable laws, there's not much holding back lenders anymore. They've eliminated risk. All this in the name of the "free market." One thing the next administration is going to have to do is scrap all the sweetheart legislation and re-introduce risk and responsibility to industries across the board--you might say, to RESTORE some semblance of a free market. Most definitely the free market at work. But a more nuanced terminology would be : ''Deregulation of the Banking Industry''---Industry insiders make all the rules, with no oversight or accountability. Ever thought about how much better shape the banks would be in right now if they weren't allowed to invest in hedge funds or purchase securities? You can thank all the unregulated free market sycophants from the administrations of Regan to Bush to Clinton and back to Bush. - R

NorthernGent -> RE: Credit card crunch (12/28/2007 9:43:48 AM)
quote: ORIGINAL: sexyred1 all human beings are aspirational about something. Much of that translates into material things, thus, overspending to achieve either the actuality of what your aspiration is, or the semblance of it (the person who cannot afford the large home but wants to look good to the neighbors, or the person who has a low paying job but a very expensive car). You cannot expect the government or credit card companies or really anyone else to help. I agree with the above sentiments, but will add that the situation is underpinned by limited knowledge: knowledge of what we are; knowledge of what we need. Governments evolve to solve the problems of the day. The last 400 years have been concerned with political freedom, on the back of religious strife, civil wars, absolute monarchies, a lack of enfranchisement etc, and by and large political freedom is yesterday's cause. New problems exist today, which political freedom alone can't resolve; yeah, people have the freedom to chase their individual business initiatives and property/materialistic/possessions based lifestyle, but we're seeing how destructive this is through various measures a) debt/self-harm etc b) political disenfranchisement because it doesn't matter who you vote for at the next election, you'll get the same government: the consumer lifestyle reigns supreme. A few enlightened minds tend to change the course of history, and it will happen again; humans adapt to their climate/environment and governments adapt to knowledge. An economic recession or protracted war will edge people towards considering an alternative way of life. Of course, authoritarians will emerge who will claim the answer is authoritarianism and order, but I can see the next progress in history being intellectual freedom. The education system is geared towards the material lifestyle, an alternative way of life may include philosophy, psychology, art, literature, history, music etc usurping maths and science as the core of the education system, as understanding human behaviour/needs becomes a more important pursuit than wealth creation.

popeye1250 -> RE: Credit card crunch (12/28/2007 12:53:39 PM)
Sexyred, I have "an answer." We need to end this "global economy." There are about 20 thousand people in the U.S. who benefit greatly from it.

Griswold -> RE: Credit card crunch (12/28/2007 8:58:49 PM)
quote: ORIGINAL: Level quote: Americans are falling behind on their credit card payments at an alarming rate, sending delinquencies and defaults surging by double-digit percentages in the last year and prompting warnings of worse to come. An Associated Press analysis of financial data from the country's largest card issuers also found that the greatest rise was among accounts more than 90 days in arrears. Experts say these signs of the deterioration of finances of many households are partly a byproduct of the subprime mortgage crisis and could spell more trouble ahead for an already sputtering economy. "Debt eventually leaks into other areas, whether it starts with the mortgage and goes to the credit card or vice versa," said Cliff Tan, a visiting scholar at Stanford University and an expert on credit risk. "We're starting to see leaks now." http://news.yahoo.com/s/ap/20071223/ap_on_bi_ge/credit_card_crunch It's real. I told my brother (a financial geek) about 10 months ago (March, 2007)....before the big freak on financials...."the next gig (after the mortgage crunch) is credit cards...and it's gonna get fucking ugly", and he said...."nawwww....it'll be contained in the housing gig..." It's here. Yeah.

KnOcala -> RE: Credit card crunch (12/28/2007 9:03:51 PM)
I am your average American. I work a good job and I have debt. more then i would like but never a problem and always manageable. There are times (like recently when there was a death in the family) when waiting for the cash wasn't an option. Plane Tickets, Rental Car, etc was charged and I would do it again in a heartbeat. Last November, trip to Key West, Hotel, Some drinks and food charged, paid off and I would do it again. I'm living today.

UtopianRanger -> RE: Credit card crunch (12/29/2007 12:16:55 AM)
quote: ORIGINAL: KnOcala I am your average American. I work a good job and I have debt. more then i would like but never a problem and always manageable. There are times (like recently when there was a death in the family) when waiting for the cash wasn't an option. Plane Tickets, Rental Car, etc was charged and I would do it again in a heartbeat. Last November, trip to Key West, Hotel, Some drinks and food charged, paid off and I would do it again. I'm living today. I truly hope it stays manageable for you - because I promise you... it's not going to stay manageable for everyone. [sm=flying.gif] http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/12/23/cccrisis123.xml&CMP=ILC-mostviewedbox http://business.theage.com.au/americans-walk-from-loans/20071223-1iqr.html http://money.aol.com/news/articles/_a/home-prices-post-record-decline/20071226092309990001?ncid=NWS00010000000001 http://www.foxnews.com/story/0%2C2933%2C318132%2C00.html The silver lining..... Debt always fairs well in a financial crisis of this magnitude. - R

Gardenista -> RE: Credit card crunch (12/29/2007 7:28:40 AM)
quote: ORIGINAL: MissMagnolia I tried to give my kid up for adoption because I was in debt this year. They refused to take him. 22 is apparently too old and they rarely are able to place them. I threaten mine with renting them out to an Amish farm for the summer... does that count?

bipolarber -> RE: Credit card crunch (12/29/2007 8:00:24 AM)
awmslave, Gosh, such easy solutions to the problem of living! I should just go out and get a better job, eh? Well, that's true, that WOULD be the solution to the credit card problems... too bad that jobs that could pay that kind of money are so few and far between. (I have such problems walking down the street, employers trying to drag me into their businesses, demanding to pay me 20% more than my current job. It's annoying!) Of course, you also make a good point about giving up my house. I should immediately sell it in this soft market, and instead pay the same money to a landlord for the privlidge of staying in one of his properties, instead of putting that money into my own pocket by purchasing my own. Not to mention, over the long run, the equity in a house can actually end up being the biggest savings account I'll ever have. With an apartment, the money is pissed out the door and never seen by the renter again. GIVE UP KIDS FOR ADOPTION? WTF ARE YOU SMOKING?! And public transportation? Yeah, that would be a great idea... if it existed. At best, there is the bus. (Unless you happen to live in NYC, Frisco or Chicago the only major cities in the US with fair inter city rail.) So, there are better jobs within walking/bicycle distance of my home... I should start throwing my money away instead of investing it in my home. I should throw my family away to strangers. Your profile says you're 46... hard to believe. You sound more like an 18 year old with "all the answers."

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