No More Deadbeats



You know, back in the 80's when interest rates were pretty good, I didn't mind paying 15% on a credit card when my savings was earning around 8%, that seemed equitable.

But those days are gone. I still have many of those cards, but over time they have creeped up, some of them, to pretty high rates while my savings interest has moved in the other direction. Back in the 80's bankers told us that the credit card interest rates were in competition with savings rates, and to loan you money - they had to borrow money, and bla bla bla.

Hmm. So how then, if the interest rates fell so drastically under President Clinton, did the loan interest rates grow to such extremes?

Deadbeats came the answer. You see, those poor bankers have to charge higher rates because so many of us bail on the loans. So between bankruptcy, and the cost of the loan - you have high loan rates. Simple, see?

No, I don't see. I have never defaulted on a loan - so my risk level should be low. But, ok - it is what it is.

Now, the government is saying that they are going to force people to pay off their loans. No more chapter 11. No more bankruptcy. HURRAY! I say. Now my credit card rates should (based on 80's math) get down to about 10% or so right? Right. How many of us need a calculator to figure those odds? I don't care what math you use, nobody can divide by zero!

Anyway - as this thought is running through my head (which is about to explode) I discover that I, being the law abiding citizen and filling the W4 out properly (dual income, 1 deduction) have grossly understimated my tax liability this year to the tune of about $5k. GREAT! Just when I need to file for bankruptcy - I can't!

Then the thought strikes me that perhaps if the government wasn't taking all your money - perhaps there wouldn't be so many deadbeats who are unable to pay their bills. Hmmm - coincidence? I don't think so.

Posted: Thu - March 17, 2005 at 08:29 PM   If this blog entry was of use to you, why not show your appreciation by donating to support the site? Just click on the MAKE A DONATION button on the right hand side of the page! It's all handled by PAYPAL.
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