Monday, March 17, 2008

Still Waiting For Those Interest Rate Cuts To Trickle Down?

Bonus Econonic News Tidbit

Your Demon thinks she should take this opportunity to compare and contrast the recent hububs and rescue operations carried out by the Fed of "riverboat gamblers," banks and other assorted operations, the attendant bailouts and interest rate cuts, while noting belatedly that in Bushco's notion of the free market, the ordinary consumers don't really rate ~ you know, those of us in our little houses driving little cars and paying down our little credit cards ~ er, trying to pay down our little credit cards, more like.

Were you aware that there was (or is) such a thing as a credit-card holders' Bill of Rights movement afoot? Did you know legislation has been drafted, and hearings held?

Yes, it was a great idea ~ until the last minute when the credit card companies decided not to let consumers testify about unilateral contracts whereby an issuer can raise rates, fees, and penalties, without notice or consent, such that you'll NEVER be able to pay off that balance.

Read about it on the Mother Jones blog:

A NYT op-ed titled "Plastic Card Tricks" picked up the issue from there:

.."The Federal Reserve is focused mainly on making it easier for consumers to understand credit card contracts — some go as high as 30 pages of nearly unreadable fine print. Clarity, however, is not enough. One bank contract stated baldly: 'We reserve the right to change the terms at any time for any reason.'

"Congress needs to address numerous unfair practices, including interest rates that skyrocket for no apparent reason and due dates that suddenly shift — forward — so that an unwary consumer pays late. Late fees are a big profit center in some banks. Some raise interest rates when consumers get close to their credit limits. In other cases, a late payment on one company’s card raises the rates on other cards in your wallet." [...]

And how 'bout the credit scoring industry itself? Any "little person" who's had any experience with any of the 3 titans in that field know how impossible it is to get errors of "derogatory" credit reporting removed or explained.

Never mind that a derogatory credit report can tank your little-people ability to get a job, the rates you pay for insurance (I've never understood the logic behind why that should be so ~ your auto and home insurer can say, in effect ~ yeah we'll write ya, but for reasons totally unrelated to your actual insurance risk, we're docking you and forcing you to pay MORE, when it appears to us you've already had some problems), or the rates you pay for a whole host of other necessaries.

There is a penalty for being poor in America (even temporarily) after all! Don't like it? Nobody's keeping you from moving!



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