Post #111,660
7/27/03 9:41:38 PM
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Credit card companies and their increasing power
Excerpts:
What's the most self-destructive thing that consumers carry around in their pockets? It's those little pieces of plastic -- credit cards -- that are becoming the greatest menace to the financial health of low-, moderate- and middle-income Americans.
There was a time when the "plastic money" was considered a convenience for consumers and a boon to the small merchants who couldn't afford to establish elaborate credit programs to compete with the national chains. Today, the credit-card industry has become a hungry monster that is devouring the hopes and dreams of families across the nation.
...
A 9.9 percent interest rate trumpeted prominently in the credit-card advertisements can become overnight a costly 28 percent on outstanding balances. When cardholders reach their borrowing limit, the companies frequently offer to increase the limit for an additional fee, all the while pushing the cardholder deeper in debt with increasing fees and interest charges.
...
Some of the offers that fill mailboxes would make a common pickpocket thief blush. The First Premier Bank of Sioux Falls, S.D., recently sent out a massive mailing, telling recipients that they had been pre-approved for a 9.9 percent fixed rate gold Master Card. In the fine print of the disclosure form, the bank revealed that the credit would be limited initially to $250. From that sum, the bank would deduct an annual fee of $48, a "program" fee of $95, account set-up fee of $29, and a monthly participation fee of $6. After the bank pockets these fees, the holder of the pre-approved card would have $72 available for credit.
Credit-card solicitations continue to grow. From 1997 to 2001, the mailings rose 66.7 percent from 3.5 billion in 1997 to 5 billion in 2001. Credit-card debt rose from $554 billion to $730 billion in the same period. Net revolving credit-card debt climbed from $51 billion in 1980 to more than $610 billion in 2002.
...
The credit-card industry has become increasingly concentrated. In 1977, the top 50 banks controlled more than 80 percent of the credit-card market. Today, only 10 banks control more than 80 percent of the market.
[link|http://www.chron.com/cs/CDA/story.hts/editorial/outlook/2012754|source] lincoln
"If you're on your deathbed and you haven't got a story to tell, then you haven't lived. - Asa Baber"
[link|http://users3.ev1.net/~bconnors/resume.htm|VB/SQL resume]
[link|http://users3.ev1.net/~bconnors/tandem_resume.htm|Tandem resume]
[link|mailto:bconnors@ev1.net|contact me]
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Post #111,668
7/27/03 11:53:50 PM
8/21/07 6:06:17 AM
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I don't use them
I have a visa check card. No credit. I get offered all the time - but last time I *needed* credit, I found they like to kick you when you're strapped. Fuck em. I'll pay my own way.
NO CREDIT.
Smalltalk is dangerous. It is a drug. My advice to you would be don't try it; it could ruin your life. Once you take the time to learn it (to REALLY learn it) you will see that there is nothing out there (yet) to touch it. Of course, like all drugs, how dangerous it is depends on your character. It may be that once you've got to this stage you'll find it difficult (if not impossible) to "go back" to other languages and, if you are forced to, you might become an embittered character constantly muttering ascerbic comments under your breath. Who knows, you may even have to quit the software industry altogether because nothing else lives up to your new expectations.
--AndyBower
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Post #111,669
7/28/03 12:01:09 AM
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How do you rent a car?
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Post #111,672
7/28/03 2:02:51 AM
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Many local branches will rent on a debit card
Budget and Enterprise, for example. The airport locations won't, but more "local" ones will.
I'm gonna go build my own theme park! With Blackjack! And hookers! In fact, forget the park!
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Post #111,701
7/28/03 10:32:34 AM
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AMEX
I only use American Express now - it must be paid in full each month.
Darrell Spice, Jr. [link|http://www.spiceware.org/cgi-bin/spa.pl?album=./Artistic%20Overpass|Artistic Overpass]\n[link|http://www.spiceware.org/|SpiceWare] - We don't do Windows, it's too much of a chore
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Post #111,712
7/28/03 11:20:19 AM
8/21/07 6:07:22 AM
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I'll never use them again
I have an AMEX horror story - it goes like this.
While a roadwarrior for Platinum Technology I was expected to front all expenses and get reimbursed.
This resulted in a routine rolling balance of about $10k.
Upon my resignation, Platinum decided to be nasty and denied my final expense report as "excessive".
Leaving me without the cash to pay the balance.
So I phone up AMEX immediately to let them know there is a problem and to arrange a payment schedule. We agree on a timetable and I agree not to use the card until payed off.
Every week they call to tell me I'm delinquent, send me threatening letters, and every week I ask if they have a record of the agreement. They do not. I fill in the latest goon on the situation and schedule and they say fine - no problem. Meanwhile I'm paying them as fast as I can. (Platinum came through with the cash about 3 months later).
But they still trashed my credit rating. Multiple derogetories.
So they don't honor their agreements and they screw you if they can.
Fuck em.
Smalltalk is dangerous. It is a drug. My advice to you would be don't try it; it could ruin your life. Once you take the time to learn it (to REALLY learn it) you will see that there is nothing out there (yet) to touch it. Of course, like all drugs, how dangerous it is depends on your character. It may be that once you've got to this stage you'll find it difficult (if not impossible) to "go back" to other languages and, if you are forced to, you might become an embittered character constantly muttering ascerbic comments under your breath. Who knows, you may even have to quit the software industry altogether because nothing else lives up to your new expectations.
--AndyBower
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Post #111,780
7/28/03 5:51:35 PM
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Get it in writing
Was the repayment schedule recorded in any document? --\r\n
Karsten M. Self [link|mailto:kmself@ix.netcom.com|kmself@ix.netcom.com]\r\n
[link|http://kmself.home.netcom.com/|http://kmself.home.netcom.com/]\r\n
What part of "gestalt" don't you understand?\r\n
[link|http://twiki.iwethey.org/twiki/bin/view/Main/|TWikIWETHEY] -- an experiment in collective intelligence. Stupidity. Whatever.\r\n
\r\n
Keep software free. Oppose the CBDTPA. Kill S.2048 dead.\r\n[link|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html]\r\n
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Post #111,790
7/28/03 7:05:28 PM
8/21/07 6:08:50 AM
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Tried that
But giant faceless corporation couldn't send me a letter, I sent them one but they ignored it.
You can't win. So I don't play.
As a result of this, I no longer loan money (front expenses) for employers. Its put off a fair number of bean counters but I just stand firm and say that if they want me to travel, they have to pay up front.
So far its caused grumbling and resulted in advance checks being cut.
Smalltalk is dangerous. It is a drug. My advice to you would be don't try it; it could ruin your life. Once you take the time to learn it (to REALLY learn it) you will see that there is nothing out there (yet) to touch it. Of course, like all drugs, how dangerous it is depends on your character. It may be that once you've got to this stage you'll find it difficult (if not impossible) to "go back" to other languages and, if you are forced to, you might become an embittered character constantly muttering ascerbic comments under your breath. Who knows, you may even have to quit the software industry altogether because nothing else lives up to your new expectations.
--AndyBower
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Post #111,988
7/30/03 3:51:16 AM
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Welcome brother
Made IBM cut a check for some samples of a (electrical) "contact enhancing" chemical. I wouldn't accept their PO with multi-week settle date. They paid.
Anonymity - I think that's what brings out the execrable BS buck passing, from a random phone line within the great Corporate womb.
Ashton
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Post #111,718
7/28/03 11:28:02 AM
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I like Discover
No annual fee, and since I pay off the entire balance every month, an effective negative interest rate. They're paying me to spend money I'm going to spend anyway, and that's fine with me.
Brian Bronson
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Post #111,759
7/28/03 4:09:02 PM
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But isn't that the only sane way to use any CC?
Then you get the use of their funds through the billing cycle (they still rake off from the merchants - so they don't dislike the fast-payers as much as some make out..)
All I know fershure is - anyone who maintains a rotating balance at 20+ percent with THIS Prime Rate - has failed the IQ test (or is living in perpetual Emergency, as.. only *sometimes* is unavoidable).
Ashton
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Post #111,785
7/28/03 6:27:58 PM
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Yessirree, but trying to convince some people of this
is harder than it should be! Like some of my friends and relatives.
Brian Bronson
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Post #111,670
7/28/03 12:05:51 AM
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I've cut back on my use of them
I used to live off of credit cards, had a lot of medical bills I paid with them, etc. Been paying them off, hope to one day have zero credit card debt. One card offered me a 5.99% fixed rate if I transfered over to their card and kept timely payments. So I juggled my credit card debt into that card. It is easy enough to spend $500USD or more a month on a credit card and not really notice it until the bill comes in. It all adds up. I now use credit cards like a loan, to borrow money to pay off later, instead of using them like cash. We too have a Visa check card, for those who don't take checks and debit cards. Plus the Visa check card doesn't need a credit check everytime you use it like a check does. They usually reject my check because I have too many checks I wrote not cashed yet, or too many credit checks on my account in a six month period (not my fault, so many companies check my credit before offering me stuff on the phone, etc, and I have no control over this) or some other lame reason. In 1996 when I got engaged, they rejected my check for the engagement ring, so I went to an ATM, and withdrew $500USD cash and put a downpayment for it with that. Made me so mad. But I never bounced a check, and always make my payments, yet I have endless problems with credit checking companies when I write a check. I only use checks to pay off house bills, which we have no problems with so far.
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Post #111,671
7/28/03 1:25:59 AM
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CC advantages
A debit card is a pipeline straight into your checking account, with few if any stop-loss restrictions. This may be changing as I've not stayed on the issue. \r\n\r\n The best credit card is one from a reputable credit union which is owned by its members (depositors). Get one. I've finally initiated a transfer to a local CU after finding that residency in my county was sufficent for membership. \r\n\r\n As for payments -- I pay all day-to-day expenses cash, bills with checks (the two horrors of electronic billpay are guaranteed payment and discontinuing service). To the extent I can, big-ticket items are paid cash or check as well, though I'll CC a few and pay balance. \r\n\r\n Mainstream, megabank, unsecured consumer credit: yes, it's the hell you think it is. I've worked inside it. Twice. Run, don't walk. --\r\n
Karsten M. Self [link|mailto:kmself@ix.netcom.com|kmself@ix.netcom.com]\r\n
[link|http://kmself.home.netcom.com/|http://kmself.home.netcom.com/]\r\n
What part of "gestalt" don't you understand?\r\n
[link|http://twiki.iwethey.org/twiki/bin/view/Main/|TWikIWETHEY] -- an experiment in collective intelligence. Stupidity. Whatever.\r\n
\r\n
Keep software free. Oppose the CBDTPA. Kill S.2048 dead.\r\n[link|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html]\r\n
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Post #112,204
7/31/03 8:09:57 AM
7/31/03 8:23:06 AM
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Credit card is much better if used correctly
A credit card offers a number of advantages if you use it the same way you would use a check card or cash, i.e. don't use the credit aspect and carry a balance:
1. fraud protection - if someone steals your card or number and uses it you are not liable, to the best of my knowledge a check/debit card offers no such protection. Likewise if you buy something and it is defective, not delivered, etc. you can dispute the charge and not pay.
2. free credit - you get a months free credit until you actually have to pay the bill. In fact, I use 2 cards, 1 card has a billing date at the beginning of the month 1 on the 16th, from the 1st - 15th I use the first card, from the 16th - end of the month I use the second. This way I maximize the free credit that I get.
3. Money is not constantly draining from your checking account. You pay once or twice a month allowing you to keep the money invested somewhere else earning interest (I admit a pittance these days) during the month.
4. You can usually find a free credit card that gives you something back. For example, my parents have a Shoprite American Express card. They get 1% back (in the form of a Shoprite voucher) for general purposes and 3% back for Shoprite purchases. Since they shop in Shoprite anyway, the vouchers are as good as cash for them. They carry no balance and use the card for eveything that they can, so over a year it is a decent sized sum of money for free.
5. It is easy to keep track of your purchases every month. You get a bill itemizing every purchase. If you use cash it is easy to forget.
Edited by bluke
July 31, 2003, 08:16:10 AM EDT
Edited by bluke
July 31, 2003, 08:23:06 AM EDT
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Post #111,678
7/28/03 3:49:59 AM
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It's that penultimate sentence which is the Killer -
"revolving" - immediately reducing your income by 20ish%. (Yes emergencies occur - not everyone stuck with large balances got there by personal idiocy - but it seems that a large majority got there that way)
51 --> 610 $B tells a story surely more of of instant gratification - than 'emergencies'. (Hey! the Puritans didn't get *everything* wrong, just most things)
Ashton
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Post #111,722
7/28/03 11:55:17 AM
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Ahh, so it's not people's greed and impatience, it's credit
I have about 15 of them, 0 balance on all but one, pay that one in full every month. When you use them that way, it's a free service: double warranty, dispute resolution, convenience. When you use them any other way, it's your own damn choice.
--
Less Is More. In my book, About Face, I introduce over 50 powerful design axioms. This is one of them.
--Alan Cooper. The Inmates Are Running the Asylum
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Post #111,726
7/28/03 12:15:53 PM
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Agreed.
I have one Visa (via my Credit Union) and one Master card. The Master card is a "back-up" in case the Visa can't be used for some reason. On the Visa, I get "brownie points" worth almost 1% of what I spend exchangeable for merchandise or airline tickets. I never carry a month to month balance and pay on line with a (free) funds transfer. The Visa credit card is the payment method of choice for me. It works for me.
I would hate to keep track of 15 credit cards. :)
Alex
A government which robs Peter to pay Paul can always depend on the support of Paul. -- George Bernard Shaw
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Post #111,742
7/28/03 2:11:12 PM
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Bingo
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Post #111,760
7/28/03 4:12:09 PM
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Good reminder : also dispute resolution, leverage on returns
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Post #111,781
7/28/03 5:55:11 PM
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The problem is if you trip....
The moment your creditworthiness becomes something less than stellar, your rate goes from 4.9% to 21%, and it suddenly becomes very, very difficult to dig yourself back out. \r\n\r\n It's sort of like one of those computer games where the behinder you get the faster they come. Except that the computer doesn't have the full force of the US legal system behind it, or implications on future home ownership. --\r\n
Karsten M. Self [link|mailto:kmself@ix.netcom.com|kmself@ix.netcom.com]\r\n
[link|http://kmself.home.netcom.com/|http://kmself.home.netcom.com/]\r\n
What part of "gestalt" don't you understand?\r\n
[link|http://twiki.iwethey.org/twiki/bin/view/Main/|TWikIWETHEY] -- an experiment in collective intelligence. Stupidity. Whatever.\r\n
\r\n
Keep software free. Oppose the CBDTPA. Kill S.2048 dead.\r\n[link|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html]\r\n
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Post #111,867
7/29/03 1:08:25 PM
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The problem happens when you don't pay
repeatedly.
They don't raise your rate just because your "creditwothiness" chnaged (at least I haven't seen it in my agrements). They raise it when you default on payments. If some crds actually base the rate on some kind of credit score, I'd call it a fraud.
--
Less Is More. In my book, About Face, I introduce over 50 powerful design axioms. This is one of them.
--Alan Cooper. The Inmates Are Running the Asylum
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Post #111,740
7/28/03 1:53:50 PM
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Re: Credit card companies and their increasing power
Well, John has a few credit cards, (lost count) and for the most part he pays the balance on them every month. I think we had one that we couldn't, so he gets these checks for lines of credit, with really nice low interest rates from some of the credit card companies. He used one of those to put the computer on, (mine) and he's paying that off a designated amount at a time.
He won't have a debit card, and neither will I. I have a Schnucks Check Cashing Card but ONLY use it to rent videos from Schnucks sometimes.
I have one credit card that is shared with his, but I never use it unless he tells me to or it's a dire emergency. For the most part I use cash, and he uses cash and credit for shopping, and checks for bills.
Nightowl >8#
"I learned to be the door, instead of the mat!"
Comment by Nightowl
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Post #111,789
7/28/03 6:55:27 PM
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Forget credit card debt, student loans will sink the U.S.
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Post #111,801
7/29/03 12:09:14 AM
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don't remind me.
We're currently in denial wrt student loans. Hopefully, we'll have mine paid off before my wife finishes her master's and we have to start paying on those.
-----
Steve
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Post #111,875
7/29/03 2:04:25 PM
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Difference between credit card debt and student loans...
You can get out of credit card debt via Chapter 11. Student loan debt is with you for life.
Even if the career you chose suddenly decides to move all the jobs in the field to India, and the only thing you can get is flipping burgers... They'll come take it out of your paycheck.
If the "leaders" of our economy want to get some stimulus that will help - student debt relief for those who's jobs have moved overseas is probably a *GREAT* start.
And though you hold the keys to ruin of everything I see/With every prison blown to dust, my enemies walk free/Though all the kingdoms turn to sand and fall into the sea/ I'm mad about you I'm mad about you
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Post #111,919
7/29/03 6:19:28 PM
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Neoconmen are Incapable of subtle thought; could care less..
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Post #111,922
7/29/03 7:35:32 PM
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Canada too
I took on a bunch back in the early nineties. Big mistake; looking back at what they were offering now that I have more experience, it looks like a great way for the banks to have a long string of people in perpetual indebtedness.
Simply put, the amounts handed out are not supportable by the jobs people can get after graduation; you have to be making 60K plus per year on a moderate debt load, and there simply aren't that enough jobs to go around to the grads that pay that well.
--\n-------------------------------------------------------------------\n* Jack Troughton jake at consultron.ca *\n* [link|http://consultron.ca|http://consultron.ca] [link|irc://irc.ecomstation.ca|irc://irc.ecomstation.ca] *\n* Kingston Ontario Canada [link|news://news.consultron.ca|news://news.consultron.ca] *\n-------------------------------------------------------------------
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