My daughter Charlotte just received an unsolicited offer from Citibank to have her own Mastercard credit card. She’s only nine years old.
I’m tempted to fill it out for her just to see whether they’d be willing to send her a real credit card . . .
Elizabeth Warren, the TARP Oversight Chair was on the Rachel Maddow’s show discussing the aggressive anti-consumer practices of credit card companies, and warning that the credit card industry is about to try to kill federal efforts to regulate the industry. She reminds us that in 1980 a credit card agreement was only about a page long. Now credit card agreements are 30 pages long, full of “tricks and traps.”
MADDOW: Are you worried that the [credit card] industry’s going to be about to kill [credit card reform legislation] in the crib? Reporting is that it’s their top priority to get rid of it.
WARREN: My gosh! I have to tell you, it’s like they’re stampeding in the halls already in Washington. the Gucci loafers. These guys have built up a huge war chest, they’ve been interviewing public relations firms to see who can come up with the next Harry And Louise ad to explain to the American people why they’re better off with credit cards that nobody can read, hundreds of pages of mortgage documents that nobody can read…the idea is you’re better off with how things are…forget all that stuff the happened over the last few years. And we promise to keep things up just like we did before. I just can’t believe they’re trying to sell that to the American people.
You can read much more on this topic at Jason Linkins’ post at Huffpo’s new Lobby Blog.
What do Americans owe on their credit cards? A huge aggregate amount that constitutes a ticking time bomb that could further devastate the economy. Here are the details, from Consumeraffairs.com:
Average bankcard borrower debt, defined as the aggregate balance on all bank-issued credit cards for an individual bankcard borrower, inched upward nationally 0.82 percent to $5,776 from the previous quarter’s $5,729, and 4.09 percent compared to the first quarter of 2008. The highest state average bankcard debt remains in Alaska at $7,476, followed by Tennessee at $6,869 and Nevada at $6,677.
This is per individual bankcard borrower. For the average debt of a married couple, then, double the average amount.
The same site reports that the number of consumers who are three or more months behind on their credit card payments is up 11 percent over the same period from 2008.
In an article titled, “The Trouble with Democrats,” William Greider of The Nation documents the many ways in which the democrats lack the moral will to rein in predatory lending and enact real economic reform. How about modestly adjusting the bankruptcy code to allow 1.5 million people to keep their houses? Forget it. How about capping payday loans at 35%? No way. You see, most Democrats are scared of payday lenders unless the interest cap is 390%. How about putting meaningful rate caps on credit cards? No way, because the financial services industry doesn’t want that.
This article is a thoroughly disgusting review of Democrat spinelessness and a reminder about who pulls the strings in Washington. Hint: it’s not The People.
Could you ever imagine George W. Bush scolding credit card companies for “ripping off” and “abusing” American consumers? Barack Obama is proposing to do away with the fine print and to do away with profits that depend on misleading hard-working families by hiding fees and penalties. He wants to sign a bill reforming the industry by Memorial Day.
You can now obtain a sticker that acts as a credit card. That’s right, you read me correctly: you can stick it to your cell phone, wallet, shoe, coffee mug, etc. The possibilities are endless!
Actually, I’ve exaggerated a bit. You can stick the sticker almost everywhere, but the technology is not so new. In fact, the credit-card-sticker has been in use in Japan and Malaysia for some time now. The sticker contains a chip that uses Radio-frequency identification (RFID) to emit a signal. That signal, like the magnetic strip on your average credit card, contains information that allows you to “charge” a purchase.
Sound familiar? You may be using RFID already, in the MobilePass wand that you use at the gas station. The Chicago Transit Authority has been utilizing RFID for years, and the New York Transit Authority is preparing to start a trial. In fact, your very own United States passport may contain RFID technology. So why am I such a scaredy-cat?
I received a replacement credit card today because my account number “may have been illegally obtained as a result of a merchant database compromise and could be at risk for unauthorized use.” I was not informed of the time, place, manner of the “compromise” and if the identity of the “compromisers” or their methods are known, I remain ignorant of them. I’m leery of the credit-card-sticker because where there’s a will, there is a way.
History suggests that RFIDs can be remotely read and stolen, cloned, infected, or otherwise used for unintended purposes. Now, Visa is preparing to launch a product that allows you to use your phone as a credit card (and not just in Malaysia). This means that if you’re using the technology and you lose your phone, you may be losing your expensive toy, contacts, pictures, applications, etc. stored on that expensive toy, and control over the use of one or several of your credit card accounts.
Sure, there are ways to encrypt this information, but with every safeguard comes a more determined hacker. I’m going to stick to the inconvenient plastic card because the “authorities” are used to tracking its thieves and (I would not discount this factor) it’s probably less sexy to steal!
