Credit Cards – The Great American Ripoff

Back when we used to live in India, credit cards were not a big thing.

But in the U.S., credit cards are hard to live without.

Of the three things that are almost impossible to live without in the U.S., credit card is perhaps the most required one (the other two are car and microwave).

Most people in the U.S. establish a credit history only through credit cards and over time accumulate big debts providing a golden opportunity for bailed-out, scam-artist swines like Citigroup to rip off consumers through usurious practices.

The White House recently passed the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 and a lot of unsavory details came out:

* Americans pay $15 billion in penalty fees every year

* 80% of Americans have a credit card

* 44% of Americans carry a balance on their credit cards

* Interest rate hikes are applied retroactively to old balances

* Credit card companies mail statements just 14 days before payment is due

* Credit card companies suddenly change the terms and conditions

* Contracts are drafted not to inform, but to confuse (Obama’s words)

* One in five Americans carry a balance that has been charged interest rates above 20%. Yes, above 20%

* Credit card companies force consumers to pay down debt with the lowest interest rate first

* Default on payment to one credit card company leads to interest rate hike from other credit card companies even if the consumer has been prompt in paying the other credit card company

* Credit card companies change payment due dates abruptly

There must be a special place reserved in hell for the Shylocks running America’s credit card companies.

President Obama signed the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009 on Friday.

That’s a good first step.

5 Responses to "Credit Cards – The Great American Ripoff"

  1. boopalanj   May 24, 2009 at 12:19 pm

    Here, Credit cards are something without what people would breathe easily.

    Normally, Indian middle class mindset is not inclined towards loan,credits, etc, which, they believe, would not give a peaceful life. Mostly they live with savings, investing in gold, land and today in other things etc. Responds:

    Here people live on credit.

    A single cup of coffee, a few gallons of gas (petrol), sandwich, a newspaper, cable TV, online movie rental like Netflix, movies at theater, monthly utility (electricity) bill, car repair, car wash, lunch at an Indian restaurant, groceries, vacations…Yes, sadly America runs on credit cards (Only Indian stores here insist on minimum $10 or $20 purchase for credit cards).

    As a nation, we are over $2.5 trillion in consumer debt (and mind you that is after excluding home mortgages).

    Very few people have any savings here.

    Don’t know how long our castle of sand will last.

  2. boopalanj   May 24, 2009 at 12:56 pm

    Only Indian stores here insist on minimum $10 or $20 purchase for credit cards – meaning? Responds:

    That means in an American store, you can buy a coffee for 99 cents or a candy for 69 cents and pay with a credit card.

    But in Indian grocery stores, your minimum total purchase should be $10 or $20 (depending on the Indian store, some keep it at $10, others at $20) if you wish to pay for your purchase with a credit card.

  3. boopalanj   May 24, 2009 at 1:48 pm

    May be, it is to discourage you from using Credit cards for everything. 😉 Responds:

    Too late for that. Like everyone else here, we use CC for coffee too. 🙁

  4. boopalanj   May 24, 2009 at 2:00 pm

    Here they’ll put 100 or 200 Rs as the limit according to the shops, as they do not want to pay the service charge for that little-yielding transaction [i think it is for 2%].. In some shops, they ruthlessly collect that 2% too, from the card..

    May be it is the same there too.. Why would they be discouraging you and caring about ur fate? Responds:

    Only our cheapo desi stores impose these conditions.

  5. zxcvbnm3007   May 24, 2009 at 2:12 pm

    I strongly firmly steadily believe Obama has the same peculiar queer odd taste of watching documentary movies just like me.

    Only difference he can make some useful policies EOD & I can’t.

    150 days into his presidency, let’s see what are the policies he has initiated.

    Policy 1: Closing Guantanamo Bay prison. Inspired Documentary : Taxi to the Dark Side. An in-depth look at the torture practices of the United States in Afghanistan, Iraq and Guantanamo Bay, focusing on an innocent taxi driver in Afghanistan who was tortured and killed in 2002.

    Policy 2: Universal health care for all in USA. Inspired Documentary : Sicko. A documentary comparing the highly profitable American health care industry to other nations, and HMO horror stories, narrated in an advisory tone to policy makers to initiate universal health care for all in United states.

    Policy 3: Ordering the Automotive Industry to make more energy efficient car which gives more mileage as well as friendly to environment. Inspired Documentary : Who Killed the electric car. A documentary that investigates the birth and death of the electric car, as well as the role of renewable energy and sustainable living in the future.

    Policy 4: Major credit card reform. Inspired Documentary : Maxed Out. An excellent and thought provoking film about the rising problem of credit card usage in America. The last segment of the documentary narrates the story of two college students who committed suicide, because before they leave college they have inherited an massive debt of nearly $80,000. Oh, thanks to the great marketing strategies used by credit card companies. Guess what the latest bill of rights is saying I quote, “Creditors are prohibited from providing credit to consumers under age 18 (unless they are emancipated under state law, or the consumer’s parent or legal guardian is designated as the primary account holder)”. Hey if that’s not enough for you, Obama uttered the following words in the U.S. Naval Academy graduates function last week I quote ” I will only send you into harm’s way when it is absolutely necessary”, It’s the same exact line used by Michael Moore at the end of the documentary Fahrenheit 9/11 Please note these are not run of a mill kinda documentaries. These are best of the best documentaries ever produced exposing the fatal flaws in their respective sectors. But not all documentaries are highly ranking in IMDb for the simple reason that nobody is interested in listening to the TRUTH. The only mess even Obama can’t handle is Bankers. These pigs are far wide spread and sophisticated, no single man do anything to mess they create, let alone the president of the United States of America. Responds:

    Great comment.

    You write: The only mess even Obama can’t handle is Bankers. These pigs are far wide spread and sophisticated, no single man do anything to mess they create, let alone the president of the United States of America.

    Obama is waiting for the release of Michael Moore’s still untitled upcoming documentary on the financial meltdown, scheduled to release in October 2009.

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