Discussion in 'Economy' started by Missourian, Mar 6, 2009.
Ever heard of anything like this before?
Rats scurrying off a sinking ship?
I read something similar not too long ago. This is actually a good sign. These credit card companies need to reduce risk, and people need to reduce debt. The only way to get this economy moving again is by reducing debt and increasing savings. There are signs this is already happening as more Americans are saving money. Once savings hit a certain point, people will feel more secure spending again, and they'll actually have some cash on hand to do it. This is when we'll begin to see a real turnaround, probably in about five years.
Our credit card rate has already increased by 5%. We're deadbeats who pay the bill off in its entirety when we use it. My husband's boss's credit card holder didn't like the fact that he pays his bill off in full so they cut his limit to $300.
I asked this on another thread. If living in debt is bad for an individual, why would it be good for a country?
We don't have any credit card debt, but we have an open line of home equity credit since we purchased our home several years ago. We never tapped into it, but it was part of the deal when we got our mortgage and the rate on this is locked at 5.75%. Around the holidays this year we received a form letter out of the blue, offering to pay us 2% to pay off the debt and close the account. I made a phone call to be sure they had it correct that we did not ever tap into it, and they confirmed that and then offered us 2% of the line of credit amount to close the line of credit. Hundreds of dollars just to close it! I did not bite. They are bound to give us that money at that rate any time we might need it and we're going keep our options open and hold them to it. I think the indication is that interest rates this low won't be around much longer. I'm sure many people took their offer and will find themselves looking for a different loan at a higher rate later on.
If the US were an export oriented economy like Japan and China, perhaps American workers could ratchet up savings and still have jobs to go to, but in the US household consumption accounts for about 70% of GDP - by contrast China's domestic consumption accounts for about 36% of GDP - so if we deleverage too much now, we might well be deepening and lengthening the recession.
Who says living in debt is bad for an individual? How many people would be able to go to college or own a house or a car without living in debt?
having debt isn't bad it's having debt to live is the bad thing.
I wish mine had offered me cash. Last year 3 days before Christmas (if you can believe that) I got a letter from Chase, my credit card company, well one of them. I had maintained the account as an emergency card just in case. My main card was from a credit union and I am only paying 8.5% on balance. But I had the Chase card just in case. Well, three days before Christmas I get a letter telling me that because I had not used the card in three years they were canceling my card and there was not a thing I could do about it. They couldn't even wait until after Christmas just in case!
The bastards did this three days before Christmas. I hope they are one financial institution that goes belly up and everyone of the bastards that work there end up on the unemployment line for at least a full year.
And you hope this happens three days before Christmas, right?
I usually have my shopping done three days before Christmas. /sarcasm
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