FIRE Emergency

[ricket]

Re: FIRE Emergency

The death of internet purchases as we have come to know them.

What the hell? Have none of you ever used a debit card to pay for purchases online? Since when are credit cards the only mechanism for paying for transactions online??

That sucks. We've been paying for pretty much everything via credit card for the past 5 years or so, and paying it off every month. We've accumulated enough miles on my AA card during that time for several international trips. I use my Shell Card and get 5% cashback on gas every month. In the past, I've financed my car purchases by flipping 0% offers from card to card.

Actually, the only reason you were getting the "free" stuff was because during the boom times the CC companies were raping and pillaging the less creditworthy with higher interest rates, late fees, etc. Now that the boom times are over and the less creditworthy are defaulting (creating a hole) plus they are missing out on any extra lost revenue, they have to appease their shareholders somehow otherwise they will be forced to file for bankruptcy. The management, sales agents, etc can't pay themselves...

So, once again, the prudent get the shaft because some people are irresponsible with their cards.

Credit cards are a literal scam. The banks create the money out of thin air, then charge you interest for being so nice to loan you such "credit". But wait, the dollars to service the debt (i.e. interest) is never created which makes the total amount of debt owed higher than the principal created, which means that if everyone paid their accounts every month, eventually the entire system will run out of money (the original "principal" got relabeled as "interest") and due to hard reality of 1 always being less than 2, people will be forced into default. This will happen regardless of how "prudent" the borrower is since they don't have the means to create the dollars out of thin air like the Federal Reserve and the banking cartel does.

I think this is completely BOGUS - a last ditch attempt by the CC industry to scare people into not reforming fraudulent credit card practices.

Our entire banking/credit system is bogus and shouldve been nationalized/broken up/dissolved a long time ago. Unfortunately, they are allowed to continue the money creation that puts politicians in place that furthers their own insider advantage. The only solution will be armed revolt and they will be the only ones responsible.

How come people continue to willingly participate in this financial racket we call banks? The only conclusion that I can come to is that everyone is so blind to what's really going on, that they have drank the kool-aid and don't even know it...

[Master Shake]

Re: FIRE Emergency

What the hell? Have none of you ever used a debit card to pay for purchases online? Since when are credit cards the only mechanism for paying for transactions online??


Actually, the only reason you were getting the "free" stuff was because during the boom times the CC companies were raping and pillaging the less creditworthy with higher interest rates, late fees, etc. Now that the boom times are over and the less creditworthy are defaulting (creating a hole) plus they are missing out on any extra lost revenue, they have to appease their shareholders somehow otherwise they will be forced to file for bankruptcy. The management, sales agents, etc can't pay themselves...

Credit cards are a literal scam. The banks create the money out of thin air, then charge you interest for being so nice to loan you such "credit". But wait, the dollars to service the debt (i.e. interest) is never created which makes the total amount of debt owed higher than the principal created, which means that if everyone paid their accounts every month, eventually the entire system will run out of money (the original "principal" got relabeled as "interest") and due to hard reality of 1 always being less than 2, people will be forced into default. This will happen regardless of how "prudent" the borrower is since they don't have the means to create the dollars out of thin air like the Federal Reserve and the banking cartel does.


Our entire banking/credit system is bogus and shouldve been nationalized/broken up/dissolved a long time ago. Unfortunately, they are allowed to continue the money creation that puts politicians in place that furthers their own insider advantage. The only solution will be armed revolt and they will be the only ones responsible.

How come people continue to willingly participate in this financial racket we call banks? The only conclusion that I can come to is that everyone is so blind to what's really going on, that they have drank the kool-aid and don't even know it...

Is anyone forced to apply for and use a credit card? Is there some mandatory usage requirement that I am unaware of?

[bobola]

Re: FIRE Emergency

I recently picked up a new American Express card on a trip to Costco.
There's no annual fee and it pays 5% back on gas purchases for business owners, and 3% for non-business owners.

I asked the sales woman how AE plans to make money off me and she said the interest rate on the balance is 28%.

Quite possibly the perfect credit card....

[charliebrown]

Re: FIRE Emergency

agreed im not going to pay instant interest on my cards. I will switch to debit transactions. I talked with my credit union today they said they had no plans on doing "instant interest". They offer no rewards.

I am leary of debit based transactions. Fraud or merchant error could wipe out your bank account. The bank says they will make you whole, but how long does it take? how many checks are going to bounce etc. while they put your money back.

I will probably open a separate account that will have debit card access, and keep a minimum there. the only reason i keep a high balance is to pay the gvt their tax! property tax, and quarterly payments.

[GRG55]

Re: FIRE Emergency

...So, once again, the prudent get the shaft because some people are irresponsible with their cards.

Isn't this more or less the way the USA has worked for some time now? Investor's lose, speculators win; levered banks get bailed out while prudent banks see increased FDIC charges; people in debt up their eyeballs get sympathy from politicians who want to help them at the expense of those that are not; those who still make a productive contribution and have income are taxed so those who squandered can be bailed out; and on it goes...

The only thing happening now is that they're finally starting to get around to introducing the "New American Dream" policies in all those areas of commerce previously overlooked...:rolleyes:

[KGW]

Re: FIRE Emergency

I have no credit cards, gave up doing business with usurers on principle:p

I use my debit card for online purchases, avoiding Paypal whenever possible. At brick and mortar shops, I choose the credit option as this allows you to sign your name rather than give your pin. Same thing at gas stations, who then ask for your zip code. The debit card has a limit, but you can get them to raise the limit depending on the size of your accounts.

[brent217]

Re: FIRE Emergency

May 19, 2009
Credit Card Industry Aims to Profit From Sterling Payers

By ANDREW MARTIN


“It will be a different business,” said Edward L. Yingling, the chief executive of the American Bankers Association, which has been lobbying Congress for more lenient legislation on behalf of the nation’s biggest banks. “Those that manage their credit well will in some degree subsidize our profit margins, now that we can no longer screw those that have credit problems.”

http://www.nytimes.com/2009/05/19/bu...t.html?_r=1&hp

Fixed for clarity

[don]

Re: FIRE Emergency

What the hell? Have none of you ever used a debit card to pay for purchases online? Since when are credit cards the only mechanism for paying for transactions online??

The answer is no, didn't realize one could. I do purchase frequently online and would miss it sorely. If there was a massive shift to online debit card use, how long before one's bank would charge for that service? FIRE is hungry and looking for its pound of flesh wherever it can find it. :eek:

[Munger]

Re: FIRE Emergency

The answer is no, didn't realize one could. I do purchase frequently online and would miss it sorely. If there was a massive shift to online debit card use, how long before one's bank would charge for that service? FIRE is hungry and looking for its pound of flesh wherever it can find it. :eek:

If one is concerned about liability one does not pay with a debit card - online or otherwise. If you get overcharged or if your card gets compromised there is a mountain of difference in who is responsible for the loss. There is really no benefit other than moral satisfaction of not doing business with "usurers."

[ricket]

Re: FIRE Emergency

Is anyone forced to apply for and use a credit card? Is there some mandatory usage requirement that I am unaware of?

You use one every day and don't even realize it.

The entire US financial system is one giant credit card, that has been maxed out. I will prove it with this statement: The sum of the present and future debts far exceeds the amount of money "created" (ie principal) in all the loans that exist in our financial system. This implies that every dollar you hold in your hand is actually a future obligation to pay back at a later date (plus interest). Your salary, your savings, etc all come from a loan that has been taken out at a specific place in the financial system. It may not have been taken out directly by you, but your employer more than likely took a loan out to "expand" his business and hire new employees (or you as a business owner may have borrowed money on a new business account). Either way, you are, in fact, beholden to interest rates and you do actually participate in the "credit economy" whether you want to admit and/or realize it or not.

Most people I talk to who have the mentality that you do all think the same thing. Just because you are not individually in debt, your wealth/savings has already been promised to someone else. It will be confiscated from you and you will have no control over it. Unless you refuse to participate in their game entirely. The most minimum way you can not participate in this racket is to keep bank balances to a minimum and keep everything in instant/liquid cash and your savings in gold or silver that you physically posess. Doing otherwise is contributing to the game and you are only allowing them to continually steal from you, your friends, family, and the public.

You can stick your fingers in your ears and scream "LALALALALALA" as long as you want, but I promise you you won't find any evidence refuting what I say. The reality is so simple that a 5th grader can figure it out.

[Thailandnotes]

Re: FIRE Emergency

They also write in their contracts that the merchant is not allowed to publicize the fees or surcharge for them.

This is ignored in many countries. Here in Thailand, when I go into the travel agent to buy a ticket, there is a sign saying add 3% if you're paying by credit card. ATM limit is now 80,00 baht per day or roughly 2,300 dollars. For big purchases, Everyone hauls around big stacks of cash.

[ricket]

Re: FIRE Emergency

If one is concerned about liability one does not pay with a debit card - online or otherwise. If you get overcharged or if your card gets compromised there is a mountain of difference in who is responsible for the loss. There is really no benefit other than moral satisfaction of not doing business with "usurers."

Here is a neat demonstration of the "scam" that is all bankster, interest-bearing loans (at least in the US Federal Reserve Banking system):

Say you walk into a bank at 8:00AM and take out a loan. At 7:59AM, there is exactly $10,000 in existence. You need to take out a loan to start a new business and are approved for a $90,000 loan. The moment you sign the paperwork, the bank, through the magic of Fractional Reserve Banking, is allowed to extend $90,000 in credit to you to start your business (they keep 10% in deposits, the loans are recycled into banking deposits over and over, and they eventually create $9 for every $1 deposited --this is a well known mechanism of fractional reserve banking see http://en.wikipedia.org/wiki/Fractional-reserve_banking and note the table that lists how much money is created using the original $100 deposit).

So when the banks extend you the $90,000 loan, they literally increase the money supply by that $90,000. So at 8:00AM when you walk into the bank and take out the loan, the money supply has now ballooned to $100,000. So there is now $100,000 in "money" floating around in the economy. Nothing more, nothing less.

So to recap:
Money in existence prior to loan: $10,000
Money created in your new loan transaction: $90,000
Total Money in existence (assuming no more loans are issued): $100,000

Now, obviously the bank is going to charge you interest on that loan. They are an "ok" bank and set your interest rate at 15% (I use this figure to illustrate the point so it makes sense, but it applies with any interest rate greater than 0%). You think your revenues will be good, so you agree to pay back $5,000 every month. So let's do some more math:

Interest rate to service the debt:15%
Original Loan Amount: $90,000
Monthly Payment: $5,000

Using this math you will pay back the loan in 21 months (you can use this calculator to see where and how I calculated these values). Accordingly, you will pay roughly $12,758 in interest. So if you pay back the original amount and add the interest, you will be required to pay back $90,000+$12,758 = $102,758 for the total loan amount.

But wait! There is only $100,000 in existence! There will be a shortfall of $2,758 that if you dont pay on the loan then you will default on it. I hope you didnt offer up any capital, cause now the bank is going to confiscate that property since you agreed to pay back the entire amount PLUS INTEREST and you agreed to give up that property if you defaulted on the loan. Since you (the individual) is not a bank nor the Federal Reserve, you are not allowed to create US dollars (ie Federal Reserve Notes), or print it, or issue it, unless you want to go to jail. So no matter how hard you work, no matter how "prudent" you are with your finances, you *will* be forced into default and if you gave capital as collateral in case of default, your capital *will* be confiscated.

In order to come up with the shortfall of $2,758 you will have to go back to the bank and hope they loan you the $2,758 so you can service the debt. But wait again! They are going to charge you interest on that loan.:eek:

This process is so unbelievable and when I realized this very important "flaw" in our financial system, then all the problems we are having make complete 100% sense. But the reasoning screamed out by the mainstream media is so glaringly WRONG, that it either is a lie or they are absolute fools.

The reason that people dont get this is because they say "Well, I pay back loans all the time". They are correct, but the interest to pay back and service the loans has in fact come from another loan, because 100% of all US dollars/Fractional Reserve Notes are loaned into existence.

[Sharky]

Re: FIRE Emergency

If this bill gets through Congress, it will be another shot in the kneecaps for the CC industry and for economy as a whole. Many people look at available CC credit lines when making purchase decisions. As credit lines decline, so too will consumer spending.

The PayPal debit card is nice because they pay 1.5% cash-back on all purchases, and also pay you interest on whatever you have on deposit with them. Hard to see them raising fees, since they don't have any non-paying credit card holders whose expenses they need to offset.

The main downside of PayPal is that they can raid your attached checking account for any reason, should they feel the need to do so. It's a good idea to use a separate checking account for that, just in case.

[Slimprofits]

Re: FIRE Emergency

In the past, I've financed my car purchases by flipping 0% offers from card to card. So, once again, the prudent get the shaft because some people are irresponsible with their cards.

Take a step back and look at the big picture. How has the lender (and shareholder in that company) made money with you as a customer?

Not-so prudent borrowers that don't pay off their balance at the end of each month but that aren't deadbeats, all retailers that accept credit cards and anyone that pays with cash (accept at some gas stations) have been "getting the shaft" and subsidizing your actions all along.

So while it's technically true that no one is forced to apply for or use a credit card, there is a symbiotic relationship going on and you wouldn't have realized those great financing deals without the no-so prudent.

If you pay no interest on the money borrowed each month, than the only chance for the credit card lender (and shareholder) to make money off of you is on the 2.5% fee on every transaction that they get from retailers.

[GRG55]

Re: FIRE Emergency

Is anyone forced to apply for and use a credit card? Is there some mandatory usage requirement that I am unaware of?

No. But try booking a hotel room or renting a car without one...