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Your Credit Card Company is Spying on You
I guess I always knew we were being watched but it gave me the shivers nonetheless when I read in the New York Times Sunday Magazine that the evil ones -- that would be the credit card companies -- had taken up spying on us. We already know that years ago they started scurrying around like panicked rats, worried that they were only making money off things like standard interest rates on unpaid balances, annual fees, and the usual rate hikes on the delinquent. Never mind that they were already laughing all the way to the bank a/k/a home sweet home; they wanted more. No one ever said that sustained effort, focus and determination don't work. Pair these things with endless funds, and success is virtually guaranteed. In any case, all that mad scurrying and racing to the bottom of the greed barrel resulted in two aha! moments for the demon executives of Visa, MasterCard and American Express, just to name the top three. 1) They figured out that they made more money off people who defaulted, and, 2) they devised a way to identify those most likely to default. How? By scouring and analyzing the spending habits of their customers -- information provided to them on a daily basis by us, their unwilling victims.
In the good old days, before the economy melted like a giant pat of butter in a frying pan, they were able to gorge on the excesses of green college students, shopaholics and the working poor -- all of whom they seduced with low introductory rates then waited, like vultures, for them to screw up with late or missed payments. But after the meltdown, when far too many of their customers started going down that road, they realized they had to revamp their model. They now take all our private information, and use it against us in a brand new way.
Did you know that if you buy a no-name brand of motor oil for your car, you are more likely to default on your credit card payments? And I bet you didn't know that if you pay your dentist with a credit card, you are less likely to default. Enjoy a good game of pool? Deadbeat! Like to feed your feathered friend premium birdseed? That means you're a stand-up kind of guy. Visit a pawn shop lately? Uh oh. Sure indicator of despair. Seeing a marriage counselor? No doubt about it, you're going to break up soon, end up with half your income and, bingo! default on your credit card payments. Expect to get your rate hiked so they can collect as much as possible from you before that happens. Do you check your online balance in the middle of the night? That indicates anxiety. Call the credit card company during the day? Shouldn't you be at work? That must mean you're unemployed. Don't be surprised if they suddenly tell you that your card is canceled.
The problem with this tactic is its arbitrariness. I'm one of those good customers who try to pay their balance off every month. I don't always succeed -- especially when my business goes through its annual slow season -- but I'm always on time, and make substantial monthly payments. Yet, I've paid my dentist plenty of times with a credit card; I've purchased no-name brand motor oil for my car because I believe in using generic brands whenever I can; and I'm self-employed, so when I call my credit card company in the middle of the day with a question, that does not mean I'm out of a job.
There have been untold accounts in recent months of perfectly good customers being flummoxed at having their rates hiked or cards canceled. Ever notice how those customer representatives are at a loss to tell you why? Because, according to the article, "...they worried that customers would revolt if they found out they were being studied so closely." You bet your ass, buddy. Can we get going with that revolt, please?
As Congress gets ready to vote on a bill that will limit the damage the credit card rats can inflict on customers, let me tell you they are scurrying even more now. Reports say they're getting ready to target their best customers (with sudden rate hikes, etc.) in order to minimize the "damage" being inflicted on them -- that damage being their inability to continue gouging the most vulnerable among us.
For years I've wondered out loud why the US government seemed hellbent on allowing banks to bankrupt its citizens. Could it really just be for the purpose of enriching its corporate fat cat friends? I thought that was just too shortsighted, but silly me! As Obama tries to address this issue, there is plenty of griping about him being too tentative and not going far enough. I, for one, would like to see a slash and burn approach to the rodent problem. But I fear this thing -- so deeply entrenched in the corridors of power as it is -- may have to take a slower road. I think Obama is like a chess player, whose every move, which may not seem to make any sense at first, builds toward a specific end goal. I certainly hope so, anyway.
In the meantime, although we've been set up to depend on credit cards to navigate the lives we live (try renting a car without one), I think the thing we can do as individuals is to start using them less. For starters, let's start using debit cards and cash as much as we can. F*#@! these guys.
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Housing 500
Electric 100
Gas 100
Telephone 50
Car Payment 500
Home Ins. 100
Car Ins 100
Medical & Ins 400
Gas 100
Groc;Clothes 4x4 1200
_________________________
3250
2 working parents (with two children) at $10 an hour for a 40 hr week is 3200.00 subtract 20% for fed , ss, and state taxes leaves 2560.
(Note there is no property taxes)
The necessities add up to 3250 there is a deficit of 690
The only possible reduction is “groceries” which included food and clothes.
So we subtract 690 from 1200; and we now have 510 for a family of four for groceries and food for a family of 4
which is 4.25 PER DAY for each family member for food and clothes. Or , for three meals a day (forget clothes, or school fees , a tire , water heater, or any similar common emergencies)
WHICH IS 47 CENTS PER PERSON PER MEAL. ( This is why we have been telling Washington that we need FREE health care and NO income tax on those below 75K gross a year)
And I might mention that is far above the poverty line (about 22k a year)and far above minimum wage.
So, tell me, how can anyone “save” for emergencies?? Tell me, I am listening.
I think the biggest problem with the current system is that credit card companies FORCE you to use their predatory products through the corrupt system of credit reports. Because of this system, I got my first credit card at 16 along with my first bank account, because giving 16 year olds is the actually the responsible thing to do is this f#$ked up system. I have been slowly increasing my credit limits, established "relationships with banks." ect so I have "very good" credit now.
At 24, in order to recieve a score of "excellent credit", my credit monitoring service suggests that I increase my credit limit again, possibly open another credit account and definitely open a retail credit card with a store. Excuse me?!
I am at the age where my friends are getting married and wanting to buy their first houses. Most of them have only a couple payments to their student loans as a credit history, making them ineligible for standard loans. The system is totally backwards
DON'T FALL FOR THAT LIVE WITH IN YOUR MEANS GAME !!!!!!!!!
LIVE BELOW YOUR MEANS == SAVE SOMETHING EVERY PAYCHECK.
IN FACT PAY YOURSELF (SAVINGS ACCOUNT) BEFORE YOU PAY ANY OTHER BILLS !!!!!
.
see my above post and tell me how
We all have the control of our own lives right in our hands.Jimmy Carter tried 30 years ago to tell us that we should all learn to live within our means. That maybe all that uncontrolled consumption really wasn't good--not just bad for the planet, but bad for us as people. He wasn't the motivator that JFK was, so no one listened.
Imagine the power we truly have. If we only bought what we need. If we made or grew as many of the things we must have to survive, ourselves. If we all regained that sense of accomplishment--And Freedom--that comes with self sufficiency and independence from the system.
Before every one had a credit card--and that wasn't so long ago; maybe the late 60's--we paid cash for everything, saved for bigger purchases and did layaway (there's an old phrase i hear is making a comeback) for the medium things like wash machines or a new tv. Being in debt was seen as a bad thing. It was then, and it is even worse now. But Madison Ave and Wall Street have hammered us with advertising for all those years--and we bought it. Brainwashed into thinking that having things would make us happy.
The time is coming folks, when we will all realize that the only thing that can make us truly happy is Freedom.
The irony here is that by raising the rates on credit, they are forcing us to take a second look at our consumption, so soon we will have no need for any credit cards, at least if you are wise enough to see what they are doing to you. Pay them off as soon as possible and regain your freedom.
Absolutely! It's looking more and more like the hippies of the 60's may have gotten at least that part of dropping out of the system right! To paraphrase Stalin, they've sold us the rope we've used to hang ourselves!
Live BELOW YOUR MEANS -----
LIVING WITHIN YOUR MEANS = NOTHING SAVED !!!!!
.
Of course you know if people never used credit ; the market for things like boats, snowmobiles, campers etc all made HERE would evaporate and cost all those jobs
so draw the line for us
only the top 15% of earners shoudl buy those type sof goods?
BUT they are not the market for those items; so then what ?
these indistries should just go
bye bye"?
Sorry...can't help you. I always use my debit card, anyway.
:-)
I have not used a credit card for many, many years. But even so, I have had to abandon the large banks even in that regard, because they constantly attempted to charge fees and penalties ... even by transactions that (I could and did prove) never occurred.
In less than ten years' time, these predatory criminals have utterly destroyed the mega-bank institutions that they so determinedly created. They have besmirched the good name of thousands of other smaller banks which are still run by ... believe it or not! ... honest businessmen. In doing so, they inflicted "the death of a thousand cuts" upon literally hundreds of millions of people -- and now they wonder why the American economy is finally faltering.
The way I see it: "This 'economic downturn' is totally stupid and completely unnecessary. It is, in fact, the direct result of CRIME. So, bust 'em. Bust 'em hard and bust 'em bad. Then see what the economy of this still-mighty nation does NEXT."
See Carine Fabius's Profile
Irony lives. I just got home to a notice from Capital One (who I have never been late with) that as of August, my rate is going up from 8.9% to 17.9%, with cash advances now at 24.9%. Guess I paid my dentist too often with the card. Fortunately by August my relatively small balance will be paid off. I'm totally inspired! I'm only going to use the thing for car rentals and such from now on.
I rent from enterprise all the time with my debit card, I fly with it, reserve hotels - there's nothing I can't do with it.
I refuse to get a credit card - I've seen too many blaxploitation movies to not recognize what being pimped looked like. I refuse to be their ho.
About 4 months ago, I took a trip from my state of OR to WA to visit my daughter....I rode with a neighbor, who was traveling to Seattle on business splitting the gas cost, was dropped off at the rental agency to pick up my, drove to my daughters....took them out to dinner that night....the next day I took the grandkids to the zoo and out to lunch then on to a shopping trip at Toys R Us.
Spent 3 wonderful nights visiting my daughter and family. Met my neighbor at 2:00 at the rental agency in Seattle, dropped off the car and headed back home. Was a wonderful trip...cheap too. I used my debit card for everything, including the car rental, with no problem at all.
I used to have two credit cards that I paid off each month, but cut them up and said "Thanks, but no thanks" a few months ago....I also closed my checking & savings account at WaMu/Chase, transferring to a local Credit Union...closed out one of my CD's and will be closing out the other when it comes up in August.
I may not have much money...but it's MINE and I'll NOT allow the "Banks" (better known as greedy thiefs) to have use of it for their ill gotten gains! They get quite enough of my money from their butt-buddies at the FED!
I got a similar letter. Evidently another reason for this is the increase in defaults on credit cards. They have to make their money somewhere so they are targeting folks like you and me who pay off our cards on a regular basis. I guess the think we can afford it!
Ours is the only nation on earth that has brought back Dickensian poorhouses that are all-but sanctioned by the United States government. This brown-nosing of banks by politicians places far too many Americans in a permanent underclass that is always on the edge of despair, bankruptcy, homelessness and crime.
When will politicians get it? If people have good lives, they are more likely to pay taxes that support services, like medical care and education, that help us have a healthy, vibrant society. But that takes the possibility of usury and super-wealth out of the equation, and God knows, "the American Dream" has morphed into some kind of hideous Donald Trump-like lifestyle that eludes most of us. And who would want it, anyway? Who wants to be so incredibly wealthy if it means so many live in poverty and despair?
Nice article... Now, it's only natural that the credit card bill gets passed (obviously, it's not quite done yet). After all, which representative is going to say no? His/her opponent will have a field day in the next election when the time comes.
On the other hand, it's expected that banks are taking issues with this. There is no reason for them to go quietly. People use their credit cards and it will be difficult for anyone to abandon their cards just because they take a different stance.
I actually love using credit cards to accrue cash back and it's easier to track expenses. Something that cannot be easily done or as well done with a debit card or cash. I simply pay it off every month.
I also pay off the entire balance every month to avoid any fees whatsoever and absolutely refuse to carry any balance. There is just no point in doing so. If I cannot pay it off in full, then I wouldn't spend the money at first place.
Online websites for research and finding good deals is another way I stretch my dollars farther. For example, I recently came across an interesting table that details the discounts on Amazon at: http://www.uberi.com
I imagine other people will find it useful too.
JohnSmithQuatro,
Good points, especially about the banks not going quietly. Here's two of the reasons why credit cards will soon not be as attractive to you:
- CC companies will restrict and/or eliminate rewards (airline tickets, purchase points, cashback) to all but the best of the best (probably about 0.01%) customers in order to increase their profits ... those things are inducements and cost them.
- Do you pay a fee? If not, you probably will start seeing those. Again, more money for them that has absolutely nothing to do with your spending/money management patterns.
The CC companies are betting that ease of use will keep most customers with them ... sort of a stupid tactic because it doesn't take into account the decimation of employment that's going on. They will, as you point out, employ this tactic ("do anything") until they realize it's not working (at which point they'll scratch their collective pinheads, trying to puzzle out what the missing piece is). And they'll continue to suffer tremendous defaults.
The current federal govt.'s doing the same thing with its mortgage-relief, auto-industry-rescue, and upcoming healthcare-reform efforts. The only piece missing from all of these is that pesky employment problem ... after all, can't pay your mortgage, buy a car, or pay for healthcare regardless of the price if you've got no money.
Or pay off CC debt.
You are absolutely right! I totally think they are deliberately bankrupting us. Six months ago I called American express to find out why they TRIPLED my Monthly minimum due & hiked up my interest rate. They explained that they were "trying to help me manage my debt!!"!!!! I had never been late in a payment & always paid significantly more than the minimun due. Didn't matter. Two months later Bank of America did the same thing. (Hey someone has to play for those CEO Private Jets, right?)
The end result is I am fu****! I am now struggling to make any kind of payments to these cards & 99% of my payments are going to usurious Interest rates & outrageous finance charges. They don't want to extend me any more credit & have in fact lowered it significantly (I have a small business) They just want to keep me indebted to them foreverby nevr letting my payments address the principle!
This new bill will not really help either because it won't cap the interest rates & Congress is owned by the big banksand besides do you think they are suddenly going to stop these practices when they can & are making billions off working Americans?
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