Ruthless default so easy even the elderly can do it.

edit: thats what I get for trying to read it before commenting: second

,czar CR,

Please, stay on your soapbox.

We have ways of making you pay, old man.
YouTube - VIRAL VIDEO ALERT! Pittsburgh riot - military police take protester NAZI style!

Not only are credit cards bad for the consumeratti, but the issuers seem to be between and betwixt a rock and a hard place, squeezing their clientele, until they tell them, to go to hell.

Kristina (from thread)
I wonder how many bets have been made on these loans to fail?

As the will profit, you may be right. The entire mod program is just a way to show J6P that the lenders and gov are "really trying" to help. I call BS as well.

If they wanted the programs to work they would hire enough people, they would train them, they would have simple qualifying requirements. Either you qualify or you don't and get on with life. While the mod programs extend the debter in the current loan - more importantly it extends the loan on the lenders books. The loan may be noted as delinquent, but not writen down or off.

,rad munch,

It's eerie when you read back into the future, ain't it?

The difference in the payment this month is $10, and if he pays $500/month, it'll be another $10 next month. So he's going to consult a lawyer and declare bankruptcy over $20? That is stupid. I would imagine if I was choosing to take the action Mr. Rickman is taking, both my grandpas, around his age, would chew me out...and it has been a long time since they've chewed me out about anything.

How long will it take a lawyer to ring up $20 in charges? Just walking in the door or answering the phone?

This is grumpy old man looking for attention. He should also realize that 5.9% is abnormally low - a shade over gov't rates, and that his actions confirm BoA's suspicions. What is the risk loaning money to an 82 year old - he doesn't live to pay it off!

"Lower my rate, or I'll file bankruptcy," he told them.

"But sir, if you do, it will destroy your credit rating."

Customer service reps don't make this stuff up on the fly. They are trained what to say. I wonder what else is in the credit card companys' scripts to prevent strategic defaults.

CalculatedRisk wrote:
I think it would be better for the country to have educated consumers - and running large credit card balances for years is not a good sign
BBBbbbut... How can I live like a gangster, rock star or pro athlete on $35k/year gross?

The stats on credit cards are interesting, if you back out the people who who don't have them, and the people who do pay them off every month, and then set aside the people who use them for occasionally and carry less than $2,000 in debt, the average for the remaining households is well over $20,000.

I think some of it is using sole-proprietors using personal cards as credit lines for their businesses.

Credit card statistics, industry facts, debt statistics

CR,
The problem here is lack of retirement preparation and not understanding the credit card rules. Laws will not be effective. It amazes me that most people don't understand simple money matters or have the discipline to resist. They are a hazard to themselves.

Mr Rickman having a responsible credit history is paying for those that are irresponsible, I think it's the "rewards" program.

I think they should just re-instate the usury laws, say the most you can charge on a credit card is 10-11%. The banks would figure out very quickly who not to give them to.

"And I ain't gonna be treated this a-way."

Woody Gutherie

IMO there is something inherently wrong with a business that encourages customers to make bad financial decisions. (I'll get off my soapbox ...)

...Then you must be talking about the american academy or the us government that encourages potential students to go in huge amounts of debt with said academy, all the whike telling them they will get the high paying jobs. One can go bankrupt on credit card debt...try that with a student loan. Who is the bigger crook?

But routinely running large credit card balances is hazardous to the holder's financial health.

Only if you are paying interest on those balances. For me it's not the balance that is important, but the combination of balance and interest rate.

Gnome: I heard about that "making money when a stock goes down", and I still think it's not possible.

The proper response from the customer service rep:

"80 years old? Your almost dead and if your not sick now, wait until they starve Medicare of funding to ensure that my bank doesn't fail. Given that your nearly dead, please pay the balance in full immediately"

I noticed Morgan Stanley was included in that article. I wonder if it is more profitable for them to modify my loan or let it fail and collect on the default insurance? While of course collecting the HAMP money for the trial period. Not only that, extending ALL their trial period mods at one time as they did earlier this year. I think I'll ask them when I speak with them Monday.

HomeGnome wrote:

I said you could make money when a stock goes down.

When have stocks ever gone down?

(not that I am bitter).

my card went from 11.99% to 29.99% when I accidentally missed one payment this year.

Merry Xmas everyone, thank you CR for another great year of blogging and thanks to all for a year of great comments (many of them quite funny.)

Here is looking to 2010!

Any prognostications on gold, oil, IR, stocks and the economy? My two cents: if IR go up and housing prices go down, the stimulus wears off and the election cycle brings full partisan rancor, double dip in 2H.

DaveInSV

you can't "make money" when stocks go down

You can have a 'capital gain' when stocks go down.

If they're already confused, you may sa well have fun and watch'em squirm.

as always, jus sayin

Bad Monkey.
NO banana for you.

When Soylent Green time comes around, I wonder what GS/MS will pay for a dead body to make into Soylent Green? $10.00?

The could bundle the SG signups, sell them as high interest growth CDOs, and short them in the market.

Squids will be ghouls very shortly.

Ye gawds, default- he is already a ward of the state. And the state will take the entire pension.

The regulations concerning how we pay for old folks homes would scare most of the folks here to death, and should terrify boomers who think they are going to inherit the folk's house. In short, go into a home and everything is taken, further, the spouse can live there until they leave, and the gummint then sells the home. What you end up with is a whole lot of nothing.

Someday this war's gonna end...

"In recent years, all they used the card for was gasoline, some groceries and the occasional doctor bill."

Gas and groceries? Does this guy drive a bulldozer and shop at Whole Foods? $1074 a MONTH?!?!

Rob Dawg,
I love this photo from your blog:
http://1.bp.blogspot.com/_zqzPMzXNGso/SyWU9w9KjrI/AAAAAAAAD3s/X4dS72aWpj0/s1600-h/tentacles.jpg
Note: may not be safe for work

The biggest problem for many seniors isn't that the interest rates on credit cards is going up.

It's that the yields on their savings, the money they've spent a lifetime accumulating, have dropped through the floor.

The Fed and Bernanke are basically stealing money that rightfully belong to the oldest, most prudent savers -- and giving it to banksters, Wall Street high-rollers, and other speculators.

Bernanke's warped mind and models tell him that this is the right thing to do to stimulate the economy.

But you've got several million seniors who have just stopped spending, because they no longer have much to spend.

I am telling all seniors that ask my opinion to stay liquid right now. Interest rates are moving up. Just look at long bond yields the last month. The Fed has shot their wad.

patientrenter wrote:

It may be a lost cause.

Yes. Nothing can be done about this. "There's a sucker born every minute", wasn't coined by GS.

Some arrive in poverty via bad luck, but many arrive via the stupidity express. SS is suppose to protect the teaming-masses from poverty in their "golden years". I personally think a government advertising program asking people, directly - up front: "Are YOU a stupid dumbass burdening society?" might go a long way toward shutting-up the old-fart complainers. Humiliate them a bit.

Juvenal Delinquent wrote:

The highest rate surveyed in the Beehive State?

Oregon in 2006 pretty much cleaned the clock on payday lenders:

Governor Ted Kulongoski signed Oregon’s new payday loan restrictions into law, setting an interest cap of 36 percent and a minimum term of 31 days.

States can stop this predetory lending pretty much anytime they want to. Oregon wanted to, and did.

actual headline "Credit-card squeeze stirs elderly couple's anger"
better headline: "Facing the music of a lifetime of finanical mistakes stirs regret in elderly couple".

rich wrote:

The biggest problem for many seniors isn't that the interest rates on credit cards is going up.
It's that the yields on their savings, the money they've spent a lifetime accumulating, have dropped through the floor.

Yea, Rich: the loss of low risk interest income for retirees has been a disaster. I feel it, month to month. But I'm cash liquid, waiting for something.

As I was walking down the main drag in Hurricane (pronounced Her-a-kin) and I saw that clipping in the window, I walked back 3 blocks to the car to get a camera...

The scene was dripping was irony~

Here is the truth about retirement in America

If you have more than a half million dollars per person, and have bought long term care, you are fine.
If you have less, you should begin to manage according to a die broke philosophy, because the odds favor that you will Die Broke.

Now, say one spouse gets Alzheimers at age 80- they eventually require care in an institution. You do not have long term care insurance, you have modest means, and the bill is $14,000 a month. How long until you are broke? 38 months. Now the state takes over paying for the long term care through a medicare based program. Your house is now liened by the state for that care. Meanwhile, your spouse goes on living without that extra social security, since the one with Alzhiemers is now being used for maintenance and support. This goes on for several years. The Alzheimers spouse passes on. Now, the surviving spouse is living in a government owned house that as soon as they leave will be sold by the government to pay the bills. Dead house walking.

In this case, a reverse mortgage would make absolute sense, because, guess what- they got to spend the money before the government came for it!!

Understand the machine we have built to pay for the old folks requires all their money plus a ton of yours to work.

Someday this war's gonna end...

+10

Look at the 10 year zooming up today.

Citizen AllenM-

While I agree with your conclusion, he is not a ward of the state. He pays the board & care out of his SS and pension, and has about $150 left over each month.

So many people are out of touch with the elderly who try to still live at home. This man and his wife can go to the nurseing home, live in the same room and everything be picked up by our government. Face reality, we are now a nation of old people who must be taken care of, of which I had rather do than give my money to Goldman Sach.

(AP) MTV is getting more pressure to cancel its "Jersey Shore" reality show.

The latest criticism comes from the New Jersey Italian American Legislative Caucus, which says the show promotes derogatory ethnic stereotypes and is "wildly offensive."

---This is the type of political leadership we need.

yields on their savings

no where in this little world of ours is there a guarantee of hi rates on saved money.

Money is a commodity. You would'nt expect to gain interest on stored grains...yet we expect hi rates on stored dollars.

that's enititlement thinking...imo, wrong

HomeGnome wrote:

Dozens of the SWAT gang with automatic weapons for one guy, eh?
Overtime, baby!

In all fairness, it's probably policy to do that. Remember, whenever a 911 call comes in, they send out the police, the fire dept AND the paramedics, "just to be sure" they've got all the bases covered. If you call out the SWAT team, why on earth would you send out just 3 of them; all or none-

How long does he realistically have before he needs the next level of care? Because at that point he will be beyond caring.

Further, suing to take the pension from a person in that situation is a waste of time. Write a letter explaining that he will be transitioning to more intensive and expensive care, and that there will be no money anymore. They will write it off. Unless they want the worst PR possible.

At some point you cease to be a viable consumer, and the squids all know it, they just want as much blood out of you as possible before it happens.

Someday this war's gonna end...

Citizen AllenM wrote:

If you have less, you should beging to manage according to a die broke philosophy, because the odds favor that you will Die Broke.

That's been my belief (and action-planning). Its kinda tricky however, since pre-death contingencies are hard to game out. Even with semi-assisted death being legal in OR, the rules are strict and the number who can take advantage of death planning is very small.

HomeGnome wrote:

The latest criticism comes from the New Jersey Italian American Legislative Caucus, which says the show promotes derogatory ethnic stereotypes and is "wildly offensive."

I lived in Jersey for a bit (less than a year in total). I don;t think those are stereotypes. They're accurate portrayals.

actual headline "Credit-card squeeze stirs elderly couple's anger"
better headline: "Facing the music of a lifetime of finanical mistakes stirs regret in elderly couple".

How about "82 year old shows bank, if you can ruthless default so can I"

Cinco-X wrote:

If you call out the SWAT team, why on earth would you send out just 3 of them; all or none-

Not on this topic exactly, but it's interesting how the US's gun culture - and the fantasy the citizen militia doing battle with the "EEEEEEVIIILLLLLLLLLLE govment" - has resulted in even more heavily armed police forces.

Until his retirement more than 20 years ago, Lawrence Rickman was the streets superintendent for the city of Louisville.

Merry Christmas, Happy Hanuka, and Jovial Festivus and Solstice to all..........................

Cinco-X wrote:

Merry Christmas, Happy Hanuka, and Jovial Festivus and Solstice to all..........................

but no "Ho, Ho, Ho"?

Why can't they just eat Underwood deviled ham and watch tv, and not bother us with their taking it to the man, strong-arm tactics?

Population in July 2008: 8,282
---This is the population of Wytheville, VA.
WTF do they need a SWAT team for?

Disagree...the increase in armament of police forces is more due to marketing of military technology to civilian police forces and "WAR on xxx" rhetoric by various interest groups.

Cinco-X wrote:

I don;t think those are stereotypes. They're accurate portrayals.

I don't get it. It looks like a frat-boy/boob show. What's it got to do with Italians specifically.

AnnS wrote:

And if you don’t think retirees need credit, then you live in a fantasy land about Medicare copays (20-50%) and deductibles (over $1400 a year per person.) Do you think cars stop suddenly breaking down when you reach retirement? Or that water heaters and furnaces stop malfunctioning?

Ann, spending on credit means spending more than you have now, with the expectation of paying it off because you will be receiving more than you spend later. Retirees don't have any (earned) income sources, so by the time they reach retirement age they have to already have accumulated all the savings they are going to need. Borrowing on credit should be nothing more than a temporary convenience for most retirees. If you haven't reached that point, that just means you can't afford to retire yet.

Italian frat-boys have boobs? What's the name of this show?

Nevermind, nevermind. I don't want to know.

The most important story within this story is that the MSM are writing sympathetic articles of this type.

It spreads the word about anger against banks and helps to promote the "just walk away" mantra.

Guys like this become urban folk heroes.

That's one of the things Ben's models somehow missed.

It's what happens when you live your life in an academic bubble and listen only to your own mind.

AnnS wrote:

HE WOULD HAVE STILL BEEN WORKING!!

Please read the article: "Until his retirement more than 20 years ago,"

The $20 I referred to was what the interest difference would be on a $1000 balance for two months. To create a $1000 difference based solely on the interest, taking a 26% rate for two months would be a $30k balance (A $30k balance and a $1k balance are very different - I was mistaken assuming a $1k balance). That is a loan. Someone who is 82 should not be taking out $30k loans. A loan is a means to buy today what you want to pay for tomorrow. Why even talk about saving for retirement when you just plan on using credit during then?

hoibosch polloi thinks the stuff is delish, a bit salty perhaps, but a treat on Ritz crackers.

edit: snobbosch won't go near it.

A bit of humor

"
CREATIVE PUNS 

1. The roundest knight at King Arthur's round table was Sir Cumference.  He acquired his size from too much pi.
    
2. I thought I saw an eye doctor on an Alaskan island, but it turned out to be an optical Aleutian.
    
3. She was only a whiskey maker, but he loved her still.
    
4. A rubber band pistol was confiscated from algebra class because it was a weapon of math disruption.
    
5. The butcher backed into the meat grinder and got a little behind in his work.
    
6. No matter how much you push the envelope, it'll still be stationery.
    
7. A dog gave birth to puppies near the road and was cited for littering.
    
8. A grenade thrown into a kitchen in France would result in Linoleum Blownapart.
    
9. Two silk worms had a race.  They ended up in a tie.
    
10. Time flies like an arrow.  Fruit flies like a banana.
     
11. A hole has been found in the nudist camp wall.  The police are looking into it.
     
12. Atheism is a non-prophet organization.
     
13. Two hats were hanging on a hat rack in the hallway.  One hat said to the other, 'You stay here; I'll go on a head.'
     
14. I wondered why the baseball kept getting bigger.  Then it hit me.
     
15. A sign on the lawn at a drug rehab center said: 'Keep off the Grass.'
     
16. A small boy swallowed some coins and was taken to a hospital.  When his grandmother telephoned to ask how he was, a nurse said, 'No change yet.'
     
17. A chicken crossing the road is poultry in motion.
     
18. The short fortune-teller who escaped from prison was a small medium at large.
     
19. The man who survived mustard gas and pepper spray is now a seasoned veteran.
     
20. A backward poet writes inverse.
     
21. In democracy it's your vote that counts.  In feudalism it's your count that votes.
     
22. When cannibals ate a missionary, they got a taste of religion.
     
23. Don't join dangerous cults: Practice safe sects!
    "

Citizen AllenM wrote:

People should realize that dealing with it early and well is truly a blessing to the folks who have to pick up afterwards

I totally agree with your point. It is hard to 'clear the decks'. I've done that, emptying the closets and storage (Goodwill Luvs Jim).

What you can't plan for (IMO): senility or alzheimers (or stroke, coma, etc) that make you not legally act on your own final behalf, and asking anyone to make the decisions (family, friends, trustee) in this situation is very hard, and unfair. Because of this, I've thought for years that the Soylent Green alternative should be a legal option: a voluntary decision to be assisted to death by a neutral party while you are still able to make legal choices.

They needed a swat team to get him out of his wheel chair.

I just opened an account so I can rant at you all. I'm sure you're quaking in your boots!

There is an awful lot of ageist bullshit in this thread. Well, guess what? You're all going to get old. Or maybe not... Actually, this is the main rant. (I'm 64.)

Personally, I owe $12K on two credit cards. Working furiously to pay them off, but the new health care mandate "providing" me with the insurance I had to cancel five years ago will really slow this down. For everyone mocking the 81-year-old gentleman who has a large rolling balance, let me just say that you have no idea how real people live in this country. My gross adjusted income last year was under $20K, but I have these cards from an earlier life. I have no equity and less than $700 in savings. The debts arose from necessary medical expenses, mainly dental: over $7K last year for just two teeth.

One of my cards, the "good" one (USAA), has a balance of over $8K. The bad one (Capital One) has a balance of just under $4K. On that one I had a rate for years of 5.9% and never missed a payment, even paid off an earlier balance of over $5K, but the bastards are raising my rate to 16% in April. With any luck I'll have that paid off before then with a couple of major Web site jobs, but still.

The point is that people get into debt for all kinds of reasons that have nada to do with "making bad decisions" for which some of you would laugh and kick them into the gutter. This is truly pathetic, especially as it relates to this cruel clusterf*ck of a country. Snark won't serve you well when you find yourself gnawing on those coins with bleeding gums. Have a heart, dammit, and grow up.

Thank you.

patientrenter wrote:

If you haven't reached that point, that just means you can't afford to retire yet.

What about people who are no longer physicaly capable of working? Or women who never worked and when the hubby dies the widows benifits are nill to tiny? Or people who spent working years waiting tables and never had co retirement or enough earnings for a 401k?

As we progress medically, many more people will outlive whatever savings they have, or inflation will eat away the buying power they once had.

JimPortlandOR wrote:

a voluntary decision to be assisted to death by a neutral party while you are still able to make legal choices.

Yeah, I agree. Beats having to jump off a bridge and causing a big mess for those that have to clean it up. I don't think even the Europeans have gotten this rational yet, tho.

MrM wrote:

At the same time, the credit card business model requires that the interest is aligned with the risk, just like any other loan.

You sure about that?

By jacking interest rates so high the banks have put millions of people in a hole they can never escape.

Look at me, for example. My credit cards added up to roughly 20K. Most of that was for things like tires for the car, dental work, and a slow creep of extra expenses during the years that I was paying child support. Back when the interest rates on the various cards were in the 6% to 10% range I could easily make the monthly and usually pay a little extra. Now that I'm done with child support, my plan was to start paying the balance down next year when our car payment ends.

But then the bad times hit. A few weeks of mandatory leave without pay. Overtime eliminated. Finally word that the factory where I work will close early next year. So the credit cards zoomed up to 30k as the interest rates jumped up to 16 - 20%. Now, it's impossible for me to pay off. A huge chunk of my disposable income goes to covering just the interest.

In retrospect, I wish I had been more frugal and never built up a balance. But that's not so easy when the wife leaves you and suddenly you are stuck with alimony and child support and have to find an apartment of your own. Once I'm off work I'll probably have to declare a bankruptcy since I won't even be able to cover interest payments.

Sure, I made some bad decisions. But what the banks are doing now is the worst form of profiteering. Back when they, the banks, could borrow money for 3% they charged good customers 8% or so. Now they borrow at 1% and charge 20%. So my sympathy for the banks is pretty much zilch.

My guess is that there are millions of Americans in a position similar to mine. This holiday season will be the last blowout. When the new year arrives there will be a Tidal Wave of credit card defaults. The decision to gouge good customers probably paid off with a surge of short term gains. But, long term, it will hit the idiot banking system with devastating losses.

Ahhh, but look where you get to live!

Welcome, and your comments will be fun here.

Believe it or not, your situation is common, and will soon be experienced by many of you fellow boomers as they get there. You will soon get into the medicare maw, and have an easier time with some of it. That said, keeping ones teeth in good shape is a top priority, as dental health is far more important than most ascribe, until it is time for big dental bills.

Someday this war's gonna end...

The yin and the yang of America & China couldn't be illustrated any better than the average credit card debt for adults here, and the average wage for adults there.

rb wrote:

At the same time, the credit card business model requires that the interest is aligned with the risk, just like any other loan.
You sure about that?

Of course. Losses on loans is a component of the overall cost structure. Higher costs require higher prices.

Binko wrote:

But, long term, it will hit the idiot banking system with devastating losses.

Actually, it will hit the taxpayers with devastating losses, but Hu's counting anymore.

if the banks know exactly what they're doing, you should be buying bank stocks hand over fist.

Citizen AllenM wrote:

The regulations concerning how we pay for old folks homes would scare most of the folks here to death, and should terrify boomers who think they are going to inherit the folk's house. In short, go into a home and everything is taken, further, the spouse can live there until they leave, and the gummint then sells the home. What you end up with is a whole lot of nothing."

This does suggest that boomers should also look to themselves and if their employer offers long term care insurance take it. LTC can avoid having to go on medicaid. If bought in ones early 50s it is not that expensive, and at least on some policies if you were to die without needing it before 65 your estate gets the premiums refunded.

HomeGnome wrote:

Lawrence Rickman was the streets superintendent for the city of Louisville.

I wonder how much his pension is and what the current streets superintendent of Louisville will get for a pension. I'd guess at bit better pension now.

One thing i've noticed about the hoi ploy, is they are all copy cats, with nary an original thought in their minds, cerebral cortex was wasted on them.

Once the heard makes up their mind to stampede, nothing is gonna stop em'

MrM wrote:

Of course. Losses on loans is a component of the overall cost structure. Higher costs require higher prices.

That old guy was in the credit card company sweet spot. Paying the minimum payment every month for years, the most profitable of holders. It wasn't that he was a risk - on the contrary, it was because he wasn't a statistical risk that they were able to raise his rate. Higher cost structure!? Guys like this are gold mines.

josap wrote:

What about people who are no longer physicaly capable of working? Or women who never worked and when the hubby dies the widows benifits are nill to tiny? Or people who spent working years waiting tables and never had co retirement or enough earnings for a 401k?

Those who didn't save must continue working. If they cannot, then they must rely on social security or social welfare. Credit cards should not be used for social welfare.

but I have these cards from an earlier life

were you re-born? resurrected?

these are the clues im' after...

for everything else...just walk away

SNAFU wrote:

it already exists, about a hundred of them, in Pakistaan.

Pakistaan is our buddy. Iran is eeeeeeeeevilllllllllllle. Do you need something more complex?

Let me add to Citizen AllenM. You should have a durable power of attorney and a medical power of attorney set up so that if you can not make decisions someone can. I had an aunt who got disabled in her 90s the state appointed a guardian who disappeared, and it seems that its difficult to set up a guardian who lives out of state. Also discuss with this person your wishes if you get into a state where you need them to make decisions.

Further when someone passes if they have no assets and the bill collectors call about credit card balances tell them to stuff it where the sun does not shine, the turnip has no more blood, and you have absolutely no legal obligation to pay the balance. If there is money in the estate, tell them to contact the executor or the estates lawyer.

Once the herd makes up its mind to stampede, nothing is gonna stop it.

And (coincidentally) from the Pedantry of the Day calendar:

Two geezers went to the store and charged too much.

necessary medical expenses

define necessary....

sounds like a $25 blender at walmart was the cheaper solution.

I learnt this from the
's

JimPortlandOR wrote:

What you can't plan for (IMO): senility or alzheimers (or stroke, coma, etc) that make you not legally act on your own final behalf, and asking anyone to make the decisions (family, friends, trustee) in this situation is very hard, and unfair."

If you have discussed the issues with them, it is less unfair. If a paid trustee it is not fair because they are being paid for it. For family it is and always has been part of being in a family. For married folks it is the second one this happens to that is the harder issue the first is actually a part of the marriage vows "in sickness and health"

Shouldn't the stock market be a little wary of the meteoric rise of long term bond yields this week?

rb wrote:

Guys like this are gold mines.

Guys like this are gold mine so long as they keep making their minimum payments, until one fine month when they stop paying and the bank loses the whole amount. They are precisely statistical risk - if the likelihood of loss is 20% a year, that means that 4 out of 5 people will be paying on time and yet the fifth one will take down everybody, hence the interest rate has to be at least 20% a year.

Good for him. Screw the credit card banksters.

Google "debtors revolt" and you'll get youtube videos of an angry woman doing the same thing.

Me? I don't have a balance so I can't stiff the banks that way. So I fill up the reply envelopes from credit cards with rocks and mail them back.

Lobbyist Ben Dover wrote:

The problem here is lack of retirement preparation and not understanding the credit card rules. Laws will not be effective. It amazes me that most people don't understand simple money matters or have the discipline to resist. They are a hazard to themselves.

Lack of understanding is not just limited to credit cards or even finance but extends to a whole variety of products. It is the reason that we have the Consumer Protection Agency , FDS etc. If we have learned nothing else from this crisis it is that the wrong financial decision can be just as painful as the wrong drug or toy. In some perfect Randian /Libertarian universe we might all be capable of making all decisions for ourselves and bear the consequences thereof- unfortunately it is not the universe we inhabit- were 50% of the population below. If financial products are barely understood by the top 5% clearly those below average have no chance.

Need a last-minute gift idea?

Super o-matic 2010

YouTube - Bass-o-Matic tribute!

Damnit.
I wanted Bag-o-Glass.

Didja ever get over that last thread? ,rad Dawgma

Haven't seen you schooled like that, recently.

"AnnS wrote:

Can you read? Can you basic arithmetic????"

Is there any reason not to be civil? Why not try; make an effort to improve yourself.

"WASHINGTON, Dec 24 (Reuters) - The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.

Treasury also said it would not require, nor expect, the two agencies to reduce the size of their mortgage-related investment portfolios next year, as they had previously been required to do."

I'd like to order the extend and pretend on the menu.
Sir would you like to super-size that order?

Definitely change you can believe in.

And "gonna" passed muster?

Yes. It's almost a figure of speech, not a colloquialism, but a derivative of "going" that denotes informal, casual, slangy speech.

And with this, I'm sure my next 1000 words are going to be parsed without mercy.

(Just having fun.)

MrM wrote:

They are precisely statistical risk - if the likelihood of loss is 20% a year, that means that 4 out of 5 people will be paying on time and yet the fifth one will take down everybody, hence the interest rate has to be at least 20% a year.

When you start getting some real figures and not pulling them out of the air, then I'll consider your argument.

Outsider wrote:

Those who didn't save must continue working.
10% to 20% of the population no longer has that option. And for them?

Next sentence in my post: "If they cannot, then they must rely on social security or social welfare. "

The elderly are having a much more difficult time getting by than most people realize. This is irrigardless of how much they managed to save during their lifetimes. Both of our parents are in their mid 80's. My father diligently manages his mutual funds weekly. They have very little money left. The major inpact on their savings and the difference in lifestyle between parents has been whether or not they had retiree health benefits and in particular perscription drug plans. My father who worked for a quasi government agency as an engineer did not have a retiree drug plan. My mother who has had a major heart illness for almost 25 years spends nearly $12000/yearly on perscription drugs. He spends hours with complex spread sheets trying to keep them out of the Medicare Donut hole. He bought drugs from Canada for years because it was cheaper. My husbands father who is also an engineer worked a lifetime for Martin Marietta. Has great drug benefits and a little bit better pension. You can do a lot with $1000 per month.

SNAFU wrote:

OT
We had this conversation earlier this week? This guy is in Christmas spirits; part of UT Austin no less. I do not know why we are so worried about the 'Islamic bomb' ; it already exists, about a hundred of them, in Pakistaan.

Every time I hear somebody connecting Iran's support of terrorists groups as a reason for them not having a bomb- I tune them out. This is clearly somebody who has a political agenda.

It is absolutely ludicrous to think that a sovereign state will work hard to develop a nuclear capability pay the price in terms of sanctions and global ostracism and then turn it over to somebody that they have limited control over. Give me a break nuclear states don't even turn over their nuclear weapons to their own people without elaborate controls and checks and balances.

I think there are sufficient examples in that part of the world of terrorist organization coming back to bite the hand that fed them. BTW Pakistan supports terrorist groups why no call to bomb their nuclear facilities. Or is only terrorist groups that threaten Israel that count?

81 years old and playing with snakes? Now he thinks he got bit.

or the 81 year old is the one that's biting.

rb wrote:

When you start getting some real figures and not pulling them out of the air, then I'll consider your argument.

And what makes you think these numbers are pulled out of the air? Do you happen to know what the industry average charge-off rate is nowadays?

"Well, there's no half-measures here. I guess Timmy and Ben don't want to lose money on those million-dollar homes they have. "

Hey no problem we made 16B off of TARP so far.

Sometimes I think Jaas was right with his American born and bred dopes spiel.

anonymoustoo wrote:

This is irrigardless of how much they managed to save during their lifetimes

The correct lesson from your stories is that some people didn't save enough for any contingencies. If someone running out of money had saved an extra $500,000, then they'd have about $500,000 more, instead of nearly zero. It's not that hard to figure out. It's just hard to do, and most people don't want to do it.

MrM wrote:

And what makes you think these numbers are pulled out of the air?

Here's the statement. Call it a hunch.

They are precisely statistical risk - if the likelihood of loss is 20% a year, that means that 4 out of 5 people will be paying on time and yet the fifth one will take down everybody, hence the interest rate has to be at least 20% a year.

WASHINGTON (Reuters) - The Obama administration pledged on Thursday to back beleaguered mortgage finance giants Fannie Mae and Freddie Mac no matter how big their losses may be in the next three years.
Treasury uncaps credit line for Fannie, Freddie
| Reuters

---Looks like we're going to need to raise the debt ceiling again!
Tear the roof off the motherf*cker!

Juvenal Delinquent wrote:

Haven't seen you schooled like that, recently.

Got several LoLs and no one bothered so much as to take your point seriously nor even get upset over the "hard reich" thread ender. Your made silly attempt at OT provocation and it was dismissed as silly and provocative. Yawn. Try to stay on topic.

HomeGnome wrote:

Have any of you ever thought that health INSURANCE might be the problem?

It absolutely is the problem- and that would be true whether it was private or public. The great advantage of single payer systems is that they force all the spending on budget. This does two things- results in better decision on spending i.e. cost efficiency and secondly it forces politicians to raise taxes to pay for the benefits.

In our system politicians can force insurance companies to cover anything that a powerful and well connected interest group wants- claim to be sticking it to the insurance companies when in fact all that happens is that insurance companies raise their premiums. The only reason that they fight any of mandates is because they realize that every time they increase premiums they lose customers. An insurance company would much rather sell a cheap policy (lower benefits) to everybody than a high benefits policy to a few customers.

If we believe that mammograms are cost effective medicine and all women should routine get them ( substitute prostrate exams if you wish) then the logical way to deal with that if for the government to give everybody a voucher for a specific amount that can be redeemed at any qualified provider. That is exactly what they did with the digital switch over.

Bingo. You win the prize.

poic wrote:

Sometimes I think Jaas was right with his American born and bred dopes spiel.

Mericans haven't been humiliated enough to be required to think. And schools discourage it.

This is a good article if you can hold of it (subscription only): http://www.harpers.org/archive/2009/09/0082640

Dehumanized:
When math and science rule the school

Collateral damage from Ben's support the program.

If "we" are going to have Health INSURANCE reform; why not form the 1st National US Insurance Co instead of handing it to the current insurance companies?

I Will Bear Witness: a Diary of the Nazi Years 1933-41, by Victor Klemperer, is a critical thinker's diary of events as they transpired. It's full of interesting things about economics, all while being a Jewish Professor, in the midst of having most of his rights taken away from him...

Which is then covered by Uncle Sugar at 20%.
No Problem.
Pay at the first window.

Take the bankrupsy while you still have the right, and go with chapter seven, thirteen is a perpetual time in hell and I have never seen one where any consumer came out ahead.

Patient renter.... Are you wifeless and kidless. Because you sure sound like a hardass. Happy Holidays to you sir.

poic wrote:

BTW for anyone counting the SPX needs to close roughly 2.5% higher next week or this will be the worst 10 year stock market return in the last 200 years. 1930 thru 1939 had a return of 0.2%. We are at roughly -2.5% right now decade to date. "

If you believe in reversion to the mean, recall that based upon the SPX growth was 15.58% 1980-1990 in real terms and 15.50% 1990-2000. So we had to have a slow period to get back to the mean growth of 8.7% which is 1871-2008. 1980-2008 is 10.18% so we are getting closer but reversion to the mean implies a couple of slow years. Looking at the annual figures one sees that 1995-1999 were 5 straight years of 20% plus gains, so they had to be corrected for.

TaosJohn, it seems unfair that people not in your situation aren't considered real people.

My income is under $15K and has been for several years now (just finished AmeriCorps, now working part time). Thanks to good health (which most people experience for a good long time in their youth) and no family to support, this means I've actually been accumulating savings for when I lack these advantages. Your health costs are unfortunate and probably not your fault, but you seem to be disclaiming responsibility for your earlier life as well. We all had earlier lives, albeit of varying lengths. Mine has been frugal enough that $15K/yr built up a modest savings (though, again, being young and healthy helps a whole lot).

Yes, people get into debt for good reasons, but once the national average savings rate dropped below 0% it became pretty obvious that way too many people were doing so without adequate reason, and while I certainly don't want them to be completely screwed over, I also don't think they're completely free of blame or that it's reasonable or responsible to respond by simply declaring bankruptcy.

Mostly, though, I don't like the implication that we're not real people just because we're doing all right. Yeah, some 'real people' live by building up lots of debt. Some real people don't, and very few really need to.

If you are 64, then you will qualify for Medicare before the law kicks in (2014), so you will have part B and part D to pay. All that kicks in in 2010 is the high risk pool and the requirement for no preexisting conditions for children. Now Part B and D will cost you 140 a month likely. If as you describe it your net worth is only 700 and 20k annual gross income with only clothes and misc assets you would likely qualify for chapter 7 bankruptcy. And would loose very little in the bankruptcy. In particular if you are getting Social Security it would not be attached for payment in this area.