Skip to comments.The 'Democratization of Credit' Is Over -- Now It's Payback Time
Posted on 10/10/2009 3:21:06 AM PDT by TigerLikesRooster
The 'Democratization of Credit' Is Over -- Now It's Payback Time
By S. MITRA KALITA
NEW YORK -- Karen King owes nearly $36,000, more than she's ever earned in a year.
All day long, bill collectors call. She hunts for a second job, sometimes skips meals, and stays with other family members at a grandfather's crowded apartment, trying to get out of debt and turn her life around.
She largely holds herself at fault. "Years ago, I lived for now. It was so stupid," the 28-year-old says. "It's depressing, but I can't live that life anymore." Now, she says, "I basically want to live for the future."
The recession has forced a financial reckoning for Americans across the income spectrum. The pressure is especially acute for the low-income Americans who relied on borrowing for daily expenses or to gain the trappings of middle-class life. Shifting credit practices over several decades had enabled them to live beyond their means by borrowing nearly as readily as the more affluent.
(Excerpt) Read more at online.wsj.com ...
” “... I lived for now. It was so stupid,” the 28-year-old says. “It’s depressing, but I can’t live that life anymore.” Now, she says, “I basically want to live for the future.” “
This girl needs to keep her day job - and her night job... She’ll never make it as a politician.....
>>’Democratization of Credit’
It is like the Democratization of our country. Not something to be proud of, as anyone familiar with the writings of the Founders would understand.
If she thinks Bama gonna pay'em she can line up with the other fools....this b'tch should pay what she owes and quit complaining.
It’s amazing to me how the government has forced socialist programs onto private sector financial businesses and then make the incredulous claim the “capitalism” has failed.
It’s true. And if not abused, a good and great thing.
However us economic and financial ants have to realize we stand on a quicksand of the Federal Reserve and the US Federal Government that may, at any time change the financial and credit environment in a moment. Dropping rates to zero, punishing savers and the thrifty, causing people to search for more riskier returns( stock market, bonds anyone?) Or they may raise them to 10 percent.
The governments( town, state and federal ) have no, zero interest in financial education of us neo-serfs. They keep us ignorant, award fake degrees for the modern age, use elite undecipherable language (Greenspan ).
I could go on....
To paraphrase Lincoln. ‘We the government can fool/tax/order/command all the people some of the time, some of the people all of the time, and the rest we’ll buy off, or use the IRS, ATF, FBI and drag them through the courts until they are in jail or they live in a shelter.’
Rise lather repeat.
Failure = more regulation, more state power.
I would not blame the government. Rich people had huge amounts of extra capital and were faced with very low returns in normal investments. It is not surprising that they sought to make big profits through what is essentially loansharking. I would like to get 10% on my investments too, but always thought this was not a good way to do it.
The most important thing (other than the article itself) is something that appeared elsewhere on the WSJ site and that is education.
They reference it as a civil right issue. And on this one thing, I agree.
I was trained as a CFP (Certified Financial Planner) but ended up in the business of my first love...plants. Go figure.
My sweetie is a teacher. I cannot tell you how many times I’ve railed at him over this. Instead of spending a 42 minute class period on....diversity, sex ed, “green” training, and all the rest....
WHY AREN’T WE TEACHING KIDS MONEY MANAGEMENT ??????
Instead of setting up these outfits in neighborhoods to teach adults about this, this MUST become a classroom endeavor. It is worth that 42 minutes of classroom time.
Teach about checking accounts, credit cards. Teach about why payday loans suck. Explain how credit works.
I’m proud to say the state of Utah has passed such a measure. The rest of the country needs to follow suit.
from the article,”In New York, their clients’ average debt is $18,000, and half have incomes under $10,000. “
More than enough fault to spread to the lender,the borrower and well as the politicians for not dealing with this issue 20 years ago.
Then you're not paying enough attention.
End the Fed and the debt slavery will end.
What a great headline.
I can’t possibly explain to you how incredibly “money stupid” people are.
(Now you know how I ended up in plants. They don’t talk back!)
We have a million issues in our education system right now. But IMO, there is nothing that is bigger than this one.
Trust me, you haven’t lived until you’ve sat across from someone who had no stinkin’ notion that accepting the 24 credit card offers in the mail, might actually not be a good thing!
They don’t know that bad credit (once you explain what bad credit is) can PREVENT them from getting the job that they need.
They don’t understand that drug tests are for economic reasons (to weed out potential thieves), not for insurance reasons.
We have a big job ahead of us.
*banging my head on monitor*
Somewhere the risk/costs were taken out.
I suspect an entire generations of socialized Americans are unfamiliar, more and more, with the notion of paying.
The lenders are in the business of knowing who they are lending to. It is their problem. Maybe if lending loan losses were not wright off( ible ) that would tighten their act up.
The government wanted masses to buy stuff so that they could collect sale, excise taxes, and ‘spur/warp/distort/stimulate/corrupt’ peoples economy( ie, make them non frugal, non economical’ Turn them into unthinking, a political consumers. Sheeple.
You have to teach them how to add and subtract first.
“Low earners have more mortgage trouble”
WOW! Just wow. I SO did not see that coming. Could it be some people can’t handle mortgages? Oh wait, the banks were forced to hand them out like candy in the name of diversity. Thanks, Bawney Fwank.
The gal in the story was clearly living beyond her means, spending every cent of every paycheck as soon as it came, and more. How did this mentality come about, that everybody thinks they deserve a middle-class lifestyle (or even upper middle-class) without the income to support it? Not just this chick, but kids right out of college expect to assume the lifestyles of their parents, delayed gratification be damned!