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Thread: What credit-card payoff? Consumers are dumping debt

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    Re: What credit-card payoff? Consumers are dumping debt

    What Papadimitriou found was this: Last year, outstanding credit-card debt dropped an eye-popping $93.2 billion to about $876 billion, according to Federal Reserve data, which are not seasonally adjusted. During the same period, charge-offs -- the unsecured debt the banks determine they won't get back and charge off to loss reserves -- added up to $83.3 billion.

    In other words, only about $10 billion of the drop is attributable to consumers paying off their debt.

    So, not only are people not using credit cards as much as they used to do, a lot of people are walking away from their debt, probably via the bankruptcy laws, leaving the credit card companies holding the bag.

    Still, that 93 billion is peanuts. Just wait until the federal government goes bankrupt to the tune of 20 trillion or so, then we'll really have a financial crisis.
    "Donald Trump is a phony, a fraud... [he's] playing the American public for suckers." Mitt Romney

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    Re: What credit-card payoff? Consumers are dumping debt

    Credit cards have become so totally ubiquitous in our society. Even just 20 years ago they weren't accepted in supermarkets. Now, people like me use them for any and all daily purchases, except that I've given all that up now.

    The credit cards make a percentage off of every purchase and retailers are beholden to them, because no one wants to carry cash anymore.

    I think they are, in general, a negative force in our society. We would be better off without them, in my estimation.

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by MyOwnDrum View Post
    Credit cards have become so totally ubiquitous in our society. Even just 20 years ago they weren't accepted in supermarkets. Now, people like me use them for any and all daily purchases, except that I've given all that up now.

    The credit cards make a percentage off of every purchase and retailers are beholden to them, because no one wants to carry cash anymore.

    I think they are, in general, a negative force in our society. We would be better off without them, in my estimation.
    Overall, I think you're right. People buy things that they don't need and can't afford, then get trapped on the interest and penalties treadmill.

    Guys like me make out quite well with credit cards. I charge virtually everything, but pay the bill in full at the end of the month. That way, I pay no interest, yet get the goodies, sometimes as much as 5% back on purchases. Over time, that adds up.

    Of course, the credit card companies refer to us as "freeloaders", since we don't pay their outrageous interest rates.

    I'm proud to be a freeloader.
    "Donald Trump is a phony, a fraud... [he's] playing the American public for suckers." Mitt Romney

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by Dittohead not! View Post
    Overall, I think you're right. People buy things that they don't need and can't afford, then get trapped on the interest and penalties treadmill.

    Guys like me make out quite well with credit cards. I charge virtually everything, but pay the bill in full at the end of the month. That way, I pay no interest, yet get the goodies, sometimes as much as 5% back on purchases. Over time, that adds up.

    Of course, the credit card companies refer to us as "freeloaders", since we don't pay their outrageous interest rates.

    I'm proud to be a freeloader.
    However, stores must still pay a transaction fee, charged by their merchant services account, for each CC transaction. Where do you think the money for those fees comes from? Not a decrease in the CEO's pay, I can assure you.

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by mike2810 View Post
    How do you see society doing this? Does it not have to start with a individual or the parents to make the change?

    I understand what you are saying. IMO, It still boils down to individual choice. Even though that choice may be guided by society or the people the individual associates with.
    Its kind of like saying - my libido doesn't effect how often I want to have sex. You may not understand how or why (or that it exists at all) the libido effects your desire but it effects you none the less.

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by NoJingoLingo View Post
    However, stores must still pay a transaction fee, charged by their merchant services account, for each CC transaction. Where do you think the money for those fees comes from? Not a decrease in the CEO's pay, I can assure you.
    Of course, we all pay in increased prices, even customers who pay cash. It hardly seems fair, does it?
    "Donald Trump is a phony, a fraud... [he's] playing the American public for suckers." Mitt Romney

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by Dittohead not! View Post
    Overall, I think you're right. People buy things that they don't need and can't afford, then get trapped on the interest and penalties treadmill.

    Guys like me make out quite well with credit cards. I charge virtually everything, but pay the bill in full at the end of the month. That way, I pay no interest, yet get the goodies, sometimes as much as 5% back on purchases. Over time, that adds up.

    Of course, the credit card companies refer to us as "freeloaders", since we don't pay their outrageous interest rates.

    I'm proud to be a freeloader.
    Maybe now but your were originally called "deadbeats" by them. That just gives a window into their world view, eh.
    Last edited by Shadow Serious; 03-16-10 at 09:44 PM. Reason: quotes for deadbeats.
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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by Dittohead not! View Post
    Of course, we all pay in increased prices, even customers who pay cash. It hardly seems fair, does it?
    So stop using your credit card for every mundane purchase. You're just feeding the beast. Use CASH!!!

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by Shadow Serious View Post
    Maybe now but your were originally called "deadbeats" by them. That just gives a window into their world view, eh.
    I had a citibank credit card for many years. Then one day I spaced out and missed the payment. I called to get the late fee reversed and the guy said he couldn't do it. I complained that I've been a customer for about 10 years and never missed a payment (I don't carry a balance, I pay it off each month) and he said, "I'm sorry but we don't make any money off of your account". I reminded him that they get a transaction fee every time I use their card. I told him not to worry because they won't ever be getting that fee from me again. That card went right in the ****can.

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    Re: What credit-card payoff? Consumers are dumping debt

    Quote Originally Posted by NoJingoLingo View Post
    So stop using your credit card for every mundane purchase. You're just feeding the beast. Use CASH!!!
    Then, I'd be paying for people who use credit cards and collect the cash dividends. I'd be on the recieving end of the unfairness.

    I find that unacceptable. It's much better when things are slanted unfairly to my benefit, don't you think?
    "Donald Trump is a phony, a fraud... [he's] playing the American public for suckers." Mitt Romney

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