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Monday, April 28, 2008

Monday musings

Well, on the way into work this morning I heard that three of the major credit card companies have announced that they are raising rates. Not just a little, but double in some cases. Normally I don't pay too much attention to morning radio, but this one was of interest as we typically have a balance on our cards. So I looked into it. Sad but true...

USA Today article

What does this mean? I would imagine it means that banks are a bit fed up with losing money on low mortgage rates. The credit card lending is largely free of the government meddling. So they are in a position to make real money by increasing these rates astronomically.

Who will suffer? The people who are already in trouble. This is scary stuff. They may have been juggling multiple accounts and putting necessities on the cards for a while as items like food and gas have been steadily increasing in cost. Now the banks are going to really give it to them with increased rates and penalties. What is worse, thanks to G.W. they no longer have the ability to declare bankruptcy. If they do it isn't a fresh start they get, but rather a repayment plan that is worse that the original burden they were under. This is the sort of thing that will take a chunk out of the middle class.

What can people do about this?
Not much.
Write to your elected officials. Plea that they take up the torch for the middle class.
First off, pay off any credit card balances you have and get the heck off of this train weck.

Maybe it is time to exit the middle class. Seriously, forget about being a professional. Get a retail job that pays under $30k/year. Sign up for government aid. Sign up for low income housing. Sign up for food stamps. Turn into a leech on the system. You may just live a happier life.

Okay, off the soap box. Really, I am not political. Honestly I am just happy to be buying a home. The main reason we even have credit cards is to improve our credit rating to buy a home. Now that we have reached that goal there is no rational excuse to be a part of this whole mess. Time to shred those little plastic buggers and move on. I pray that this news doesn't have the effects that I have discussed above. Hopefully it will all just blow over. Maybe the Tax Stimulus rebate will make it all better. Who knows.

p.s. if you have not seen Maxed Out yet, go rent it. It is kind of Michael Moore like, but interesting none the less.

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