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View Full Version : Urgent.. I thought I might inform everyone..



jtlabs
02-23-2006, 07:53 PM
For those that do know, you might want to check with your credit card company to see what your next credit minimum payment may be because all minimum payments are on the rise by almost double the amount by next billing cycle. This was a law past a few months ago that I have been following and my mother just saw her minimum payment rise. Luckily she can afford to pay off her dept, but some people can not afford the increase and they are not warning anyone! So I thought I share.

For the record I have 2 credit cards and I called up the CC company and they confirmed that this is happening. This may kick start the depression that I believed was inevitable unfourtunately.

What can you do? Close the credit accounts that have high or low balances(or both) to retain your current credit payment. Your not effected if you close before your next payment comes. Keep in mind though that closing your account does affect your credit, but late payments do also and you get penalized interest wise. So you weigh your options.

BTW can anyone else speak to this? I knew this was going to happen because I am very much into the economy but can someone else please verify if your CC minimum payment is scheduled to go up? Thanks.

p.s. If you paid your credit card recently they will not have your next payment in the computer, however they should be able to calculate your next payment, if it is the same ask them about the required increase to jog their memory.(sometimes you have to draw it out as people do not like giving people bad news if they can avoid it.)

Regards,
Jay

jtlabs
02-23-2006, 08:38 PM
Just a link I dug up on the subject you can probably google a lot more...

http://credit.about.com/od/creditanddebitcards/a/051805.htm

lukeinva
02-23-2006, 09:21 PM
Just another reason to NOT have a credit card, I am glad I dont have any!

onepocketfanatic
02-24-2006, 05:38 AM
Don't charge more than you can afford to pay at the end of the month.. no minimum payment applies.

Fran Crimi
02-24-2006, 07:16 AM
I know, right? They've got you between a rock and a hard place. Apparently, Congress has decided that people aren't paying off their debt fast enough so they upped the minimum required payment. Depending on the company, they can raise the minimum payment anywhere from 1% to 4% of your total balance.

I received a courtesy call from my bank giving me the option to accept the new minimum payments or to go back to the old way. However the person on the phone wasn't at all clear that the 'old way' involved closing my account. I said to him, "So you're giving me the option to go the new way or the old way?" He said yes. So I said, I'd rather go the old way. Two seconds later, he said, "OK, your account has been officially closed. WHAT???? I was furious. I told him to reopen it. I never meant for them to close it. He said it was too late. He already closed it and couldn't reopen it. Unreal. I replied, "YOU WILL REOPEN MY ACCOUNT RIGHT NOW!" He refused.

So, I asked for a supervisor and she supposedly overrode the system and reopened it. Two days later, I got a letter in the mail saying "We're sorry, but due to the excessive amount of time that passed since you asked to reopen your account, we were unable to reopen it." TWO SECONDS --- EXCESSIVE???

I had to call them back and threaten a law suit before they finally agreed to reopen the account.

I just saw on the news the other day warning people to watch out for those offers that say ---"No late fees." The payment period is much shorter and if you pay 30 days late they can up your interest rate to over 30%. They've become loan sharks.

Fran

catscradle
02-24-2006, 01:05 PM
<blockquote><font class="small">Quote Fran Crimi:</font><hr> .... They've become loan sharks.

Fran




<hr /></blockquote>

They've always been loan sharks.

catscradle
02-24-2006, 01:08 PM
<blockquote><font class="small">Quote jtlabs:</font><hr> For those that do know, you might want to check with your credit card company to see what your next credit minimum payment may be because all minimum payments are on the rise by almost double the amount by next billing cycle. This was a law past a few months ago that I have been following and my mother just saw her minimum payment rise. Luckily she can afford to pay off her dept, but some people can not afford the increase and they are not warning anyone! So I thought I share.

...<hr /></blockquote>

Anybody paying the minimum is in a heap of trouble anyway. From a certain perspective, it can be said that they are being done a favor by being forced to pay off more sooner.

jtlabs
02-24-2006, 04:25 PM
I agree, I have no problem with the law, I have a problem with the lack of news coverage. They should have prepared the public, but of course that would take away from CC companies profits. Also as the author in the link above pointed out, big government should have never allowed the companies to lower minimum payment percentage to 2%, but we all know greed comes first, especially in today's day in age. Lets face it, knowledge is power(if used), and financial literacy is not a power they want in the hands of the less fortunate. Although Greenspan himself said he thinks it is very important for the survival of America as a world power.

Fran Crimi
02-24-2006, 06:56 PM
<blockquote><font class="small">Quote catscradle:</font><hr>
Anybody paying the minimum is in a heap of trouble anyway. From a certain perspective, it can be said that they are being done a favor by being forced to pay off more sooner.
<hr /></blockquote>

That's not the point. You know the old saying: "Don't do me any favors." I can understand requiring people to pay the interest payments if they can't afford to pay off the balance, however, unless there's a contractual agreement where the person already agreed to a certain percentage as a minimum payment, it's unfair to change the rules on them in the middle of the game. What should have been done was to set the new minimum payment level for all new purchases and for all new card users after a certain date. Retroactive adjustments after the fact are unfair. The option to close your account is not a viable or fair option.

I'm surprised they're getting away with this.

Fran

jtlabs
02-24-2006, 08:58 PM
[ QUOTE ]
Anybody paying the minimum is in a heap of trouble anyway. From a certain perspective, it can be said that they are being done a favor by being forced to pay off more sooner.
<hr /></blockquote>

It really is not as simple as that. Let me quote something I wrote a few months when the bill was sitting in the senate, maybe this will shed some light on the subject..
Warning! a bit long but worth reading.

[ QUOTE ]

A lot of people have been debating if we are in a RE bubble or not, and those who believe it is a bubble just think the FMV drop off is going to be slight and then stagnate.
Well let me tell you what I believe. I not only believe that we are in a RE bubble; I also believe we are in a currency bubble and that when those bubbles pop, they will plummet into the ground!

How is that so you ask? Well a little knowledge on the differences between the gold standard and the current Fiat money system should help shed some light on the subject.
In a nutshell, the gold standard was paper money backed up by gold. Today, that system is replaced with what is called the Fiat money system, which is a credit based monetary system. I urge you to read the following if you want to gain a valid understanding of what financial problems lay ahead.

http://www.usagold.com/gildedopinion/Greenspan.html -- Gold and Economic Freedom by Alan Greenspan

http://www.usagold.com/gildedopinion/greenspan-gold.html - Greenspan on Gold and Money -- in Congressional Testimony with Ron Paul

A post that expresses my concerns quite well,

Rediscovering Gold in the 21st Century
Craig R. Smith
Substance Over Symbolism: The Folding, Spindling &amp; Mutilating of America's Money System


Imagine for a moment that you have the ability to create any amount of money, without ever having to produce anything.

Is there anyone or anything you couldn't buy? Probably not.

Sound impossible? It should be, but it isn't. Just ask your local Federal Reserve banker - they do it every day.

The folding, spindling and mutilating of America's monetary system became legitimized in 1913, when the Federal Reserve was formed. Long ago bankers discovered a nasty little secret referred to as "fractional-reserve banking" which is fueled by credit and debt creation out of thin air.

The modern American monetary system is the result of an incestuous relationship between the federal government and the private banking cartel, deceptively called The Federal Reserve System (a.k.a. "The Fed").

But don't expect the mainstream press or prominent political figures to ever discuss this relationship publicly. Sadly, few Americans understand the process, or even challenge the Fed's attempt to manipulate the money system.

In the two centuries prior to the creation of the Fed, unredeemable paper currencies were judged as unethical and immoral. As of 1792, they were deemed unconstitutional as well.

The fundamental misconception today is that America's paper or electronic currency, denominated in Federal Reserve Notes, is that a dollar actually has any intrinsic value.

In the words of former Fed economist John Exter, "Today¬&amp;#146;s U.S. dollar is nothing more than an IOU-nothing." Paper money retains only the symbol, or form, of its original substance - gold and silver.

Let¬&amp;#146;s now examine the untold story of how and why the U.S. dollar was transformed from substance (gold) to symbolism (debt) - and what you can do to recover the substance while you still have time.

As difficult as it is for honest, hard-working Americans to fathom, the lifeblood of the American political and economic system is legal plunder. The 19th-century economist Frederic Bastiat summed up the tendency of central governments to embrace economic plunder in this way:

"There are two ways to acquire the niceties of life: to produce them or to plunder them. When plunder becomes a way of life for a group of men living to- gether in society, they create for themselves in the course of time, a legal system that authorizes it and a moral code that glorifies it."

The gradual devaluation of U.S. currency during the 20th century reflects a more subtle transformation - too many Americans have abandoned the morality and economics of our Founding Fathers.

Today's warped and degenerate political system represents a marked departure from the statesmanship of a bygone era. Economics likewise has degenerated into a convoluted science orchestrated to conceal a colossal fraud perpetrated on an unsuspecting public.

In short, "We the People" allowed the Federal Reserve, with the full cooperation of the federal government, to replace the "Puritan work ethic" with a "pagan plunder plan" and now the chickens are starting to flock home to roost.

To achieve this massive wealth distribution plan required a shift in public values from hard work and responsibility, to hardly working and gambling. This dramatic change has occurred gradually over the past two or three generations.

The result or fruit of this shift can be seen in the monetary realm. We abandoned true money (commodity - gold or silver) in favor of false money (fiat - paper, electronic). Here's how it happened, in a nutshell.

All true money must be derived from a commodity, or at least have a substance to back it up, or it will gradually become fraudulent, or fiat money.

Historically, the most common substance used as a medium of exchange and a store of value has been gold or silver coins of a standard weight and fineness.

The U.S. Coinage Act of 1792 specifically defined a dollar as "one twentieth of an ounce of gold (25.8 grains of 90 percent fine) or a silver coin containing one ounce of silver (421.5 grains of 90 percent fine)." The Founding Fathers specifically prohibited the federal government from issuing Bills of Credit, (paper money) in the U.S. Constitution.

Congress shall have Power to coin money and regulate the value thereof ... No State shall make any Thing but gold and silver Coin a Tender in Payment of Debts.
-Art.1 Sec. 8 &amp; 10

America's system of constitutional, commodity-based money functioned well in our nation for 125 years, from 1792 to 1913. Then "We the People" made a big mistake - we allowed a privately owned corporation called the Federal Reserve to begin creating paper money instead of gold and silver coins as the Constitution requires.

The Federal Reserve's monetary manipulation began with a promise to create paper money that could always be redeemed for commodity money - gold or silver coin. This 100 percent redeemable money is referred to as fiduciary or trust money.

The creation of fiduciary money assumes that the promise of payment in substance by the issuer is redeemable at some future point. Trust money was used as a medium of exchange even though it consisted largely of an intrinsically valueless substance - paper.

Since the U.S. government was prohibited by constitutional law from issuing this trust money, the Fed - a private corporation - was created to soften and manipulate the economic down-cycles in 1913. The price we have paid is surrendering our substance money (gold) for trust money (credit/debt). In my view, central bankers took the mine... and we got the shaft. Why do I say that?

History has proven time and again that neither bankers nor governments possess the discipline needed to limit the amount of credit (or paper money) to equal the true supply of gold and silver coins. So the supply of paper money (credit/debt) must continually rise.

The result is always disastrous in the long term because the economy suffers through cycles of inflation, deflation, artificial growth, recession and depression. Because U.S. citizens did not protest the use of trust money, our economic system then began to degenerate into untrustworthy or fiat money.

Fiat paper money abandons any promise whatsoever to redeem the paper currency in any physical commodity. This third step in the decline of our currency is considered by many historians and economists as the beginning of the end, monetarily.

Dr. Franz Pick, the noted Austrian economist, aptly stated the link between a nation and its money,

"The destiny of a currency is, and always will be, the destiny of a nation."

Under the fractional-reserve banking rules, a bank must always issue more units of fiat money than can ever be redeemed (typically at an 8:1 ratio). Fractional-reserve banking is inherently a fraudulent system. But by 1933 FDR forced Americans off the gold standard and onto the treadmill of credit fueled by fractional-reserve banking.

Here is an example that may help you grasp why fractional banking is flawed. Imagine that you live on a small island with just one other inhabitant - a fractional-reserve banker. On the island there is only $1,000 in circulation total. Let¬&amp;#146;s say you decide that you want to start a fishing business, and visit your banker for a loan. The banker agrees to loan you $1,000 but must charge you $50 interest. That mean you will owe $1050. But wait, there is only $1,000 in circulation. Where will the other $50 come from? It must be created by the banker or you could never fully pay the loan back. This is the origin of inflation and devalues every other dollar in circulation.

Therein lies the faulty foundation of fractional banking - it must constantly inflate the amount of currency which in turn decreases the value of all the money in circulation. The consequences are many, but most harmful is the crushing of the middle class via long-term monetary inflation. If (when) the public finally discerns that the Emperor (Fed) has no clothes, I expect hyper-inflation and a flight back to substance money in a New York second.

Lenin pondered this modern flaw in the Capitalist system stating,

"The best way to destroy the Capitalist system is to debauch the currency. The process of inflation is so insidious that not one in a million can properly diagnose it, until it is too late."

The Federal Reserve and the federal government are banking on Lenin¬&amp;#146;s conclusion - that the public will not become aware of this insidious process¬&amp;#133; until it is too late.

Karl Marx also knew that centralized money control was critical to control the masses.

"Centralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly." -5th Plank, Communist Manifesto, by Karl Marx (1848)

The facts are that popular delusion and public confidence are the only two forces that uphold our present fiat money system. The financial house of cards created by our massive personal, corporate and government debt is now more vulnerable than ever. The government knows it and the Fed knows it - they even admit it in print:

"All the paper money issued today is Federal Reserve Notes. The real backing for the nation¬&amp;#146;s money is faith in the strength, soundness and stability of the U.S.economy." -Hats the Fed. Reserve Wears, Federal Reserve Bank of Phil., p. 4

One can only deduce that the Fed believes that as America¬&amp;#146;s faith and confidence goes, so goes the economy. It is interesting that the root meaning of the word credit (credaria) is "to believe." It is true, we now have a monetary system purely based on faith - faith in a system that betrays us and our children.

Over the last decade the government has even established a formal "Consumer Confidence Index" as a means of monitoring and manipulating the public confidence in the economy and money system. This index has been moving downward in 2001, reflecting a loss of confidence in the Fed... and our money system.

Starting in 1990, Federal Reserve Notes have two subtle additions: a metallic strip embedded in the bill and special micro-print around the President's bust. The official reason is to thwart counterfeiters and monitor anyone attempting to leave the U.S. with a suitcase full of cash through the use of special airport detectors.

This sounds reasonable enough, right? After all, counterfeit Fed notes are popping up all over the world. They're calling it economic terrorism. The Fed cannot allow competition in the money counterfeiting business to encroach on its domestic policy of issuing unconstitutional fiat (read: counterfeit) money.

The next major step is to convince Americans to convert entirely to a totally intangible, electronic money system - with no "cash" at all.

It took the last decade to prepare us, but I expect over the next decade the government and banks will accomplish it because it offers convenience - the new passion of American culture.

So, where do we go from fiat money? To what I call virtual money - that is, pure credit transactions reduced to blips on computer screens. This new form of money gives the government total economic control over the populace - a goal many have long desired. Financial privacy is also forfeited in the process.

Should all of this give you grave concern, or a sleepy nod? It depends on how much you value your privacy, sovereignty, freedom, liberty and that of the next generation - all of which are God-given rights under the U.S. Constitution.

The steady decline in the value of buying power throughout the past 80 years is a crime in my book. In fact, a 1900-dollar is worth less than 3 cents today due to inflation.

What can be done? How can we recover an honest foundation for economic stability - even if our government won't? One person at a time. The good news is that we still have options and rights.

Gold and silver coinage has been used as a medium of exchange and store of value throughout all recorded history. From Abraham in the Old Testament to your great grandfather - they all knew that real money represented true freedom and liberty. They also knew that freedom was not free, it often required waging a battle - which was anything but convenient.

Gold and silver coins represent true economic value because they have integrity by design and content. Prior to 1933, U.S. gold coins were the visible evidence of an honest money system. The denomination and value of the coin corresponded with the weight and fineness of the substance - gold. "A just weight and measure," as the Bible demands.

All of this changed overnight when FDR recalled the gold in 1933, making gold ownership illegal and allowing the Federal Reserve to issue fiduciary money, redeemable only in silver, not gold. This trust money was minted until 1965.

Since then America has functioned on debt, credit and fiat money. "Funny money," as G. Gordon Liddy once told me during a radio interview. The truth is that the systematic crushing of the middle class family due to long-term inflation is anything but funny.

In 1934 the government removed gold from circulation and in 1965 they removed silver. Notice that until 1964, U.S. silver coins still represented the economic mandate of just weights and measures. The amazing thing is how few opposed the Fed, perhaps because Americans still trusted the federal government.

Today we readily accept symbolic money instead of substance money with no thought. Our post-1965 copper/nickel tokens circulated today demonstrate a serious departure from our heritage of honest money and represent a gutted economic ethic.

Did you know that even our "copper" pennies are not even made out of copper anymore? Go ahead, scratch a penny with a nail - nothing but pop-metal. A pure copper penny is worth about 3 cents today.

Our money system today is symbolism, pure and simple, without any valuable substance to it. For this reason alone I feel that every American should diversify a portion of their fiat money into real money - gold and silver coins. As an added bonus, many historic U.S. gold and silver coins have maintained an above-average track record since the late 1960s.

The nature of our present economic and monetary environment requires decisive action - if not for ourselves, for our children and their sake. As R.E. McMaster Jr. puts it, this is "no time for slaves."

Today, monetary myth is so widespread that it appears that nothing short of a financial meltdown will rattle Americans enough to face reality. Is that what it will take? I hope not, but I fear so.

Remember 1979? The Carter deficits, double-digit inflation and feverish activity in precious metals? Most of us will never forget that year. Something similar or worse may await America - and the time to plan for it is now.

Prominent free market economists like R.E. McMaster, Jr., John Pugsley, Dr. Edwin Vieira, Lew Rockwell, Dennis Peacocke, Bill Bonner, Richard Russell, Mark Skousen, Frank Venerosa and many others agree that we¬&amp;#146;ll face a monetary and dollar crisis soon - based on the huge debt bubble amassed during the 20th century.

U.S. non-financial corporate debt has reached a staggering 46 percent of GDP - its highest level ever. Consumer installment debt is up to 21.7 percent of disposable income - also the highest level ever.

In early 2001 the average household has a credit card balance of $7,200 - an amount that would take 30 years to pay off if you made only the minimum payments. Savings rates recently hit zero.

Debt and credit has become America¬&amp;#146;s drug of choice. "Buy now - pay later" has become the new mantra of the last 40 years, but at a heavy price to our money system, our communities and our families.

The modern disintegration of the family, rising divorce rates and bankruptcy are just a few of the visible casualties that can be traced back to debt and credit abuse.

I suggest we admit that debt is America¬&amp;#146;s greatest drug problem today and follow the steps of any good rehab center - to start living within our means. This may require going "cold turkey" for some.

The only alternative (as with drugs and alcohol) is to gradually increase the dosage to continue the ¬&amp;#145;debt high.¬&amp;#146; This is what Alan Greenspan &amp; Co. is banking on to keep the economy from going into a full-blown recession in the near future.

I suggest that you "just say no" to all drugs - especially debt - or else face the possibility of becoming a bankruptcy statistic in the great debt wash-out we are heading for unless we change direction.

Sadly, few are prepared to face this potential debt crisis with a financial house that is built on anything more than paper and electrons.




Finally, the new CC law might be the straw that breaks the camels back. For those who do not know,
the new CC law requires credit card companies to raise the minimum payment, and many expect it to double from a 2%(what it is currently) to 4% by the end of fall. With the majority of the middle class already living beyond their means in credit card dept, their is no telling how bad of a toll this is going to take on average Americans. Please Read!
http://www.cantonrep.com/index.php?Category=14&amp;ID=233984&amp;r=0 -- article on the CC topic

Experts are advising people to invest in gold coins. Reason being that whenever markets crash commodities go up in value. Gold is the commodity of choice.

Just my thoughts on the subject!