just heard this,
Any of you guys watch the news today? some talks about new credit card rules? that are in effect today! thought i would start this since i know there was some talk in an earlyer post!
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just heard this,
Any of you guys watch the news today? some talks about new credit card rules? that are in effect today! thought i would start this since i know there was some talk in an earlyer post!
We invite you to come out of your cave.
http://www.creditcards.com/credit-ca...ences-1282.php ...updated 08/20/09
wow how did i miss this, oh i know cause im in college and to busy to notice!!!
Great i should just go back into my cave! [Peep] anyone care to join me!!!!!![ROFL2]
Some of these rule changes were long overdue. My biggest complaint was the huge time lag in implementing them. This just gave the credit card companies time to abuse a whole group of people who were targeted because they don't understand how credit works and why you should pay it off every month. In the short run I'd love to talk to some of those people and find out just what the credit card companies did.
These changes should have been implemented in weeks if not days after the bill was signed into law.
You know the .gov only works fast when it is on something that us regular folk DON'T want....Quote:
Originally Posted by al_g
[Mad]
Yes because when government interferes in private business transactions, there's no chance they'll make things worse [Bang]Quote:
Originally Posted by al_g
In this case it wasn't that the government acted slowly, it's that they gave industry a long window to begin compliance.
I can understand why the industry would have a shit fit if it was a few days -- there are a bunch of programs that need to be changed, and some changes to customer service and legalese.
But the many months that they were given allowed them to come up with new and more inventive ways to raep anyone who doesn't pay on time every time.
Someone said of the 10 major rules that were passed in the CARD act, the industry has found ways to get around 8 of them already.
Ehn, it's not like the credit card industry was operating in a legal vaccuum silently obeying the invisible hand of the markets. They basically had free reign to write the usury laws in states like South Dakota and Delaware. Handing credit cards to college students to lock them into a debt-slave mentality was certainly good for their profitability. I would have preferred to see more consumer education about credit cards -- but let's face it, some of these aspects of credit cards were just slimy. Like universal default... if you miss a payment on another credit card, all the others would jump your APR? That's some BS. Or how about, reordering all of your transactions that happened during the weekend, so that all of your charges go out, largest first, before any deposits are processed. This way they can get the most number of overdraft charges on your account.Quote:
Originally Posted by Zundfolge
I don't buy that. This idea that the great Obama will protect your from the evil credit card company is crap. Government regulation of the CC companies is another example of big government screwing with the market.
How can we be advocates of self determination in regard to taxation and firearms ownership but decide that the government regulating consumer credit because we are too stupid to educate ourselves or have fiscal discipline.Quote:
Originally Posted by Hoosier
Obama and congress did nothing to protect the consumer if anything they have worked to perpetuate the "government protected" use of, and addiction to consumer credit.
The only parties that should have input into the terms and conditions of a credit card should be the creditor and the debtor.
Cameron
Well, there are probably a bunch of things in the contracts saying that you need to be notified a certain number of days before certain changes take place. That could be part of the reason for the long window.
I'm in agreement with Cameron. I have a credit card that was giving me trouble acting shady (might have just been my view of the situation) so I picked up the phone and called them...all the time. They were pulling shady shit like every single time I was charged the interest fee, it would put me over by one cent. Just enough for them to charge me their fees. I called and called. Usually, after knocking off a fee or two, most companies will stiff arm you and tell you no after that. My card company tried that, and I still got them to take off almost another $130 in additional fees. For them to drop that much in fees tells me that it wasn't soley my fault. After that whole mess, I got my act together and cleaned that card up tremendously.
The point I'm making is that this credit card rule change has only made things worse for me on ALL of my cards. I was handling the situation nicely on my own, now I have to continue, but at an unjustified rate hike all across the board.
I paid off two credit cards a VISA and a Master Card in mid 2005, I didn't really need the cards and called to get a balance and pay them off. I then told the two companies to close the accounts. They protested saying it would damage my credit scores to payoff and close those two accounts. I closed them anyway!
I haven't had a credit card since May of 2005, in fact I have only one "debt" and that is a car lease, because I believe we should rent or lease a depreciating item and invest in appreciating items.
An absolutely clean credit report with no debt or credit cards and I still was able to get the best tier 1 money factor for the car lease.
Worse still, and for full disclosure, my company facilitates commercial real estate financing...
Cameron
I simplify the whole credit card issue by choosing not to have one. I get one in the mail i just melt it. If i cant pay cash, i dont need it. On the other hand this does "damage" my credit. But i counter that with my car payments. Not the most ideal situation but it works for me.
So do you think the government has a role in protecting consumers? I mean, the credit card companies have a lot of lawyers who can write their contract. Whoever writes the contract owns the agreement.
In a situation without regulation do you think they would make it more conducive to the consumer or less? If there were no usury laws, what do you think the APR would be?
Although in a marketplace free of regulation, companies would theoretically compete and the consumer would win. However we also know that companies will buy each other until they reduce the number of offerings to the points where the can collude to fix prices (or APR) -- with or without government involvement.
We know the situations in which capitalism works, but we also know that once a company achieves a position of power in the marketplace, it will use that power to prevent others from being able to compete. My view of the market is that it's like a machine which needs to occasionally be pushed back towards the center.
I think my biggest problem with a lot of government legislation, especially stuff like this and healthcare, is that the industries that need to be regulated are the ones writing the legislation, and they're doing to their own benefit, not ours.
TL;DR -- if the market is really laissez faire companies will become monopolies and it's bad; if the market is centrally planned, the government becomes the monopoly and it's bad. Somewhere inbetween the two is the correct solution, and it's neither constant nor simple.
H.
Quote:
Originally Posted by kidicarus13
[ROFL1][ROFL2] Those were my thoughts exactly.
Consumers don't have to get credit cards though, and they don't have to choose the shady contracts.
I feel like there is a connection between shady contracts and consumer knowledge though. Might make a good thesis for someone to do a study on. Credit card companies shouldn't have to do shady stuff like moving due dates, then pressing late fees when the uninformed customer doesn't pay on time, to make money if people are as credit stupid as we all think they are.
Well said Hoosier, and I agree. I think the free market is quite different in practise than in theory. I do think some regulation is necessary for most large industries. I know some people will counter that regulation is "bad for business", but I find what is good for business is frequently not so good for the rest of us.Quote:
Originally Posted by Hoosier
I don't trust the government, but I trust big business even less.
If that makes me a liberal/Dem/whatever, so be it. Flame away.[Coffee]
How did you come to the conclusion that letting the people do as they choose will lead to monopolies?Quote:
Originally Posted by Hoosier
It is the argument of the proponents of government control that capitalism and free enterprise mean companies will become monopolies. When in fact it is government interference in the market, typically barriers to entry, that cause the evolution on a monopoly or monopolistic competition.
The banks in the US have the hold they do over the American people because of the regulation and protection of the government. It is the governments "protection" of the consumer that causes the problem, think of the housing bubble, sub-prime mortgage debacle and the consequences to the people of government interference in the lending from banks to home owners.
A private company lending money to a private individual should not be regulated by the government in ANY way.
Cameron
In my opinion, the problems that arise are do not stem from lack of regulation in a free market, so much as they stem from companies thinking that a "long term plan" is 9 months in the future.
If anyone had kept the actual long term of the business in mind, the housing bubble never would have happened. Most bubbles probably wouldn't happen. Maybe.
If the Clinton administration hadn't expanded the scope of the Carter administration's ill-conceived Community Reinvestment Act in 1995 then we wouldn't have had the housing bubble. It is amazing to me that so many people believe it was the bank's greed the precipitated the mortgage backed securities collapse. Politicians blame the banks greed when they passed legislation mandating that the lenders make bad loans, and sued them when they didn't.Quote:
Originally Posted by Stuart
If you dig deep enough into any market "crisis" or lack of competition, you will find the hand of the government throwing a wrench into the cogs of the market.
Cameron
Yes, that is very very true.
I too have no credit cards. They skirt the edge of loan sharking laws, but this gets overlooked as they are legitimate companies. Their terms are unacceptable IMO. There are honest loans and then loans with explosives attached under the surface.
I just don't know enough about the act (other than it's the same act that now allows all of us to carry in national parks if legal in the state) to comment on it's validity. I agree with the sentiment of the act in this case.
The pendulum swings... Regardless of your political stance, there is good and bad in both approaches. If there wasn't there wouldn't be a need for both Govt and the political parties (that should stir the pot...).
I have one credit card that I pay off at the end of the month. I cant get myself to buy anything I don't have the cash for, it seems illogical to me.
That is where i am as well i only have one card that i dont spend more than what i have and i pay it off in full every month. not to many college students do this they get cought in only paying the min!Quote:
Originally Posted by cowboykjohnson
I've seen it, and so have you. RIAA was convicted of collusion and price fixing on CD's. Microsoft moved aggressively against the Netscape, Linux, and the internet at large in the 90's.Quote:
Originally Posted by Cameron
More to the point, it is (for some subsets of logic) the correct course of action. If they can use their monopoly on some aspect to force competition out, then they're able to charge what the market will bear -- without the market having an alternative. This means more profit for them, so if profit is your sole metric of achievement, you've just justified a lot of nasty behavior.
This is true, however it's hardly the only problem. And I would argue that a lot of that interference, where it causes barriers to entry for competitors, is lobbied for, and written by, the affected industry. A major recurring theme is the amount of influence companies wield in government, at least for me.Quote:
Originally Posted by Cameron
I do not believe that this is the sole cause of the housing bubble. It is a contributing factor, but only one of many. In fact, this isn't even the only government induced factor in it. Setting prime interest to 0% after 9/11, the repeal of Glass Steagall allowing investment banks to become vastly over leveraged. The derivative documents which created various stanches being given much better credit scores than they should have been. The trillions of dollars in new money world wide that was seeking out investments. The mortgage brokers, the realtors, the list of contributing factors goes on for a while.Quote:
Originally Posted by Cameron
I don't think you even mean this -- I mean, you believe in contract law? And that the government should be able to enforce a contract? The process of lawsuits should a contract be breached are all government services.Quote:
Originally Posted by Cameron
Beyond that, should we allow loan sharking? Is it illegal to loan someone money at 200% APR? At what point does it transition from being "Taking advantage of a gullible fool" and "theft".
I don't have clear answers to those last questions myself, but I think they have to factor into the debate.
Cheers o7
People also get terribly confused about their credit scores, because they think it's a measure of their fiscal responsibility as opposed to their likelihood of actually paying their bills and generating interest payments for the lender. They don't want you to pay your bills off. They want you to continue paying the bill, which isn't at all the same thing.
I have a couple cards, pay them off every month and reap the rewards they offer which in turn buy me guns!
as to credit scores...that is just bass ackwards to me. buying a house made me realize this. people who have a lot of debt on cards and on students loans and such but pay at least the minimum payments and on time always have the best credit scores. Myself, I always try to save up, pay for something right then and there so I don't have a pay a cent on interest and be done with it.