Due to an ongoing health crisis in the family, blogging will be 'on and off' as time and circumstances permit for the foreseeable future. I also beg your indulgence if I am slow in responding to emails. New posts will appear below this notice.

Tuesday, May 19, 2009

Great Credit? Hold onto your wallet... it's about to be picked

I have made this point in the past, usually in more nuanced language. But it bears repeating. And for those who prefer plain English, let's lay it on the table. Credit cards are evil. And the institutions that issue them are scum sucking crooks. Credit is just a fancy word for 'debt.' And "debt" is a four letter word. I strongly endorse a credit cardless society. It will be a great day when American's finally decide they are tired of being ripped off by these thieves, cut up their plastic and ship the pieces to VISA, Master Card, American Express etc. in a box weighted with lead bars C.O.D.

The credit industry's unethical, and soon to be (though not yet) illegal practices by which they milked hundreds of billions of dollars over years from people was enough to make me swear off their plastic millstones from around my neck years ago. But now that Congress is finally about to crack down on at least some of their shady lending practices, which would make members of a certain Sicilian fraternal society blush, they have decided to start soaking those with solid gold credit.

For those who harbor any doubts, read this.

2 comments:

orrologion said...

The only thing credit cards are good for is for literally short term credit in place of carrying cash around or checks. If you can't pay the full bill off at the end of the month, you shouldn't be putting it on a credit card. Credit Cards are not appropriate loan instruments - in this way they are like loan sharks and are the definition of usurious practice and generally prey on the poor.

The only other thing we have used credit cards for is to gain airline miles on the primary airline to our hometowns, and for 0% longer term loans for major purchases (which we always pay off well before interest begins to accrue).

I would disagree that debt is by nature a four letter word. Debt is merely a means to an end. In fact, the Orthodox Church and various saints such as St. Cyrpian of Carthage (and many early Christians) made a living by offering loans - but loans without excessive interest that would create wealth by impoverishing others, but simply as regular business loans. See Frances Young, “Christian Attitudes to Finance in the First Four Centuries”, Epworth Review 4.3 (Sept. 1977), 78-86:

http://www.earlychurch.org.uk/pdf/er/finance_young.pdf

Visibilium said...

It's all a matter of assessing and pricing risk. If the less creditworthy customers don't get soaked with fees that they heartily deserve through their lack of impulse control, they'll be excluded from the market unless the more creditworthy folks can be tapped for cross-subsidization. Cross-subsidization is a long-run loser, however, owing to its implicit attempt to wish lower time preferences on lousy credit customers.

Maybe the meritorious Orthodox solution would be to stamp the credit card applications of less creditworthy customers with the advice: "Go suck an egg."