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The Stimulus Package and Higher Taxes are being fueled by The Credit Card Industry!

I have always been good with simple math. In one way this has been a bad thing because it enables me to see the mathematical manipulation of peoples lives while others don't seem to notice, yet I have no standing because I am not a physics major nor do I have a PHD in math.

Imagine being the character who yells out that "soylent green is dead people",  and nobody knows what you are talking about. Imagine being the person who coined the phrase, "if you build it, they will come", and nobody was interested.  

The Credit Card problem is becoming the soylent green of our entire economy. Even economists who state that the credit card industry is causing a huge economic problem will then state that the credit card problem is on equal footing with other economic problems, without seeing that credit cards may be the UNDERLYING problem that is affecting the other economic problems as well.

What is frustrating to me is that people who don't have credit card debt feel it is a problem that is beneath them, that it only affects the reckless and self indulgent, those who ASKED FOR IT.

That sentiment cannot be farther from the truth for most americans.

We are all interconnected mathematically. You could probably count on one hand the number of businesses that DO NOT take credit cards but do take debit cards. Even if you don't have credit card debt, or pay off your debt every month (bravo by the way), the place that employees you, and the vendors that either supply or purchase products or services from your business, in all likelihood RELY ON CREDIT. Without those credit lines, you may not still have your job, and guess what you might end up relying on to get by.

Now is the time to link the credit card industries recent actions to higher taxes. The credit card companies, the FDIC, and the federal reserve continue to suck out the fragile, economic life lubricant known as credit lines and lower interest credit card rates from every small city in the United States and their local economies. The credit card companies are also shafting their most reliable, honorable, never late paying, never miss a payment type of customer.

Credit card companies are ALSO sucking out the very economic life force that helps local, state, and federal governments meet their tax goals. So now there are two equal anti-economic forces working against the working class. 

As local credit dries up, and interest rates rise (even as the federal reserve drops interest rates to the banks) governments receive less in consumption taxes and property taxes as people make less purchases, home values drop and people are foreclosed on.

It is NOT ENOUGH to just be against higher taxes. If you are against higher taxes but not against higher credit card interest rates, you have not figured it out yet.

Now is not the time to be either a democrat or a republican. Now is the time to find alternative ideas to the same old stuff that got us in this economic mess. Incentive based Credit Card Programs are the only way to stop the downward spiral of the world's economy.

Instead, we are being force fed a "This is going to hurt me, more than it is you" chant by the banks as they continue to raise interest rates and lower credit card limits. Creative, incentive based credit card programs have not been tried, and that is the real crime that is going on and on and on.

One of the best articles I have seen about the state of the world's economy, from Asia Times.

Asia Times asks for permission before copying their articles, so I will just put a link to the specific article that I think is very well written and explains the economic pitfalls the world is facing. One of the most important things they say is something that I have been preaching about as well. If money is not flowing back to the banks from private enterprise and blue collar jobs, the economy cannot improve.

In my opinion, the credit card industry is the key force in destroying the current economy by doing the exact opposite of what they should be doing. The credit card companies should be reducing old debt interest rate obligations and offering creative incentives to get people who can afford it to pay down their debts.

Asia Times take on the Global Economy and why the reports of a recovery are laughably premature.

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Wells Fargo increased their trading assets by 600% over the past year, the exact opposite of what should be going on in these tough economic times.

Asia Times take on the Global Economy and why the reports of a recovery are laughably premature.

More Proof that Wall Street is Out of Touch with the Real Economy and Real Americans as Credit Card Companies Continue to Suck the Economy Dry.

Click here for the most recent DailyPUMA article.

(Edit note, a couple of weeks after the writing of this article comes a powerful article from Asia Times that basically concurs with a few of the major points made below. ASIA Times on the Global Economy.)

(2nd Edit Note, Monday May 18th, 2009, almost three weeks after what was written below comes an article questioning the stock markets recent rise.)

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Since I started my Daily-Protest against Chase Bank and the credit card industry, my television viewing time has dropped. Very very early this morning, while I was revamping Daily-Protest.com, I had the overnight news on.

The CBS overnight news kept replaying a story that the worst was behind us, that inventories had depleted, and that sometime this year the economy would pick-up. The only way the economy will pick up this year is if the CREDIT CARD INDUSTRY does EXACTLY THE OPPOSITE of what they are presently doing!

Lets add up middle america economic indicators, the real indicators, the ones that matter. Joblessness, continues to rise. Home prices continue to drop. Rising home sales are from forclosures. Car Dealerships, going out of business too fast to count. Credit Card debt, rising.

Funding two wars halfway around the world, priceless.

If the world's net worth has dropped by 1/2 over the past year or two, but the world's unsecured debt has remained the same, then that means that the worlds unsecured debt has actually doubled when comparing the numbers! 

Factor in that the Credit card companies have actually raised interest rates, stolen frequent flyer miles from their best customers, are labeling anybody a with low interest rate on their unsecured debt as a toxic asset, and are assessing huge, 100% to 400% increases in the interest rates whenever a customer is late on a payment, and we can actually safely state that the credit card industry's percent of the world wide wealth has increased by at least another 100% on top of that doubling!

But wait, it is even worse than that. After a person is late on just one credit card payment, the other credit card companies can also raise that person's credit card interest rate to around 30%. Eventually people give up trying to pay down a debt at 30 percent interest rate. However, before the debt is given up on by the credit card company, it keeps growing by obscene amounts every month. 30% unpaid interest can increase one's debt by 50% or more every year!

The overly inflated credit debt keeps racking up higher and higher debt. Then it goes into default. The entire debt, that has been first outrageously inflated by 50 to 100%, is then sold to a bill collection agency for a portion of the total debt due. When the banks sell the defaulted debt, it might be 60 cents on the dollar, 40 cents on the dollar or even just 25 cents on the dollar. However, because of how the debt was so rapidly inflated at that 30% interest rate, the bank actually doesn't lose any money, even if they sell the debt at 25 to 30 cents on the dollar!

Here is where it gets really ugly. The bank is able to then write off the ENTIRE overly inflated debt that caused the debtor to eventually give up trying to pay it off. Imagine if you could being keep all of the money you earned in a years time while legally claiming that you lost an additional 50% and are owed a rebate, or bailout money from the government!

But wait, it's even worse than that! Not only do the banks get this huge credit card default write off on their 30% interest credit card debt, they then can receive new bailout monies from the government to help mitigate phantom credit card loan losses that don't actually exist!

But wait, it's even worse than that. The banks hold on to the new bailout money, refusing to circulate the very money the government has allocated them. By not releasing this new bailout money and not using it to lower credit card interest rates to the consumer, tens of millions of americans continue to create more and more debt on their credit cards, and the entire credit card debt cycle mentioned above repeats again!

But wait it's even worse than that. The banks then squeeze those who relying their credit card debt and home equity line debt to get through these bad economic times by REDUCING their credit lines, sometimes to BELOW what they owe! Now factor in those who have missed a payment for a medical emergency, job layoff, even an electronic billing mistake that can easily happen when a credit card company CHANGES THE DATE on a bill without informing the customer! All of these are reasons for the credit card company to raise the interest rate to 30%! 

Yet many of these law abiding citizens fight to salvage their credit score, resulting in additional huge profits for the banks from those who believe a debt is a debt that must be repaid, even at 30% interest. Unfortunately, a 30% interest rate is so high that unless one can make at least 3 times the monthly minimum due, or pay the debt off in full right away, the debt may never go down fast enough.

If one gives up trying to pay a 30% interest rate card, the banks make huge profits from several different sources. If a customer continues to pay 30% interest, the banks are happy because the customer is just stalling the inevitable, in essence creating additional wealth for the banks before the customer eventually defaults. The banks win no matter what the indentured credit card borrower does once the interest rate is raised to 30%.

The banks are winning every which way even as the FDIC "clamps down" on the banks for not having enough cash reserves.

So, going back to our percentage analysis of unsecured debt and how much it has increased when compared to the world's actual wealth, we can safely add another layer of gross profiting by the credit card industry at the worlds misery. Credit Card debt may have actually increased by over 400% when it is compared to the amount of perceived wealth that still remains in the world's economy.

Credit Card debt at 30% interest IS the additional hidden tax being perpetuated on the world's economy.

But wait, it may be even worse than everything stated above. What if the bankers, upon classifying a credit card loan at 30% that the consumer has given up trying to pay back, a "toxic asset", sells that "bad" credit card loan to another company that is run by a friend, a relative, a lover, a drug cartel? If the banker is in anyway connected with the new buyer of the debt they have resold, that means the banker has found an additional way to profit from the same piece of debt, also known as insider trading or collusion.

So, going back to our percentage analysis of unsecured debt, we can safely add another layer of gross profiting at the worlds misery. 

Over the past two years, Credit Card debt may have actually increased over 500% when compared to the amount of perceived wealth that remains in the world's economy. I don't have to know what the actual two numbers are to make an estimate at the percentage amount. A 500% percent increase in credit card debt as compared to the world's perceived economic value cannot be a good thing, can it?

And if I am correct, then there is NO WAY THE eCONomy can recover, unless some of these usurious interest rates are made to disappear.

So what do the credit card companies do in this time of worldwide crisis? They raise the interest rates on all of their credit cards while trying to destroy the credit rating of their best customers by raising the monthly minimum payment on these always on time paying customers by 250%.

Won't you join me in fighting back? Just put a Daily-Protest.com sign somewhere where others will see it. It is really that simple. Learn more at CHASE BANK PROTEST DAY-9, HOW YOU CAN HELP. IT IS FREE AND YOU DON'T EVEN HAVE TO PROTEST.

This LINK just in, Congress Fiddles while Home burns. If everybody had less to interest to pay on old credit card debt, they'd automatically have more money to apply towards their mortgage payment.

Six Simple Ideas to help people, the economy, and reduce foreclosures.

1. All Renters should be allowed to fully deduct their yearly rent charges on their income tax. The renter's "deduction / savings" would automatically be deposited into a 4% interest bearing account that could be spent on education, medical emergencies / insurance, or used towards a down payment on a home.

2. Instantly reduce ALL primary home mortgages to a Fixed 4% interest rate.

3. Send Full Tax Disclosure statements to all tax payers that calculate and reveal the SUM TOTAL of all the taxes they paid throughout the prior year.

4. Reduce interest rate charges on ALL credit card debt that is older than 1.5 years to zero percent for those that can keep on making their monthly payments.

5. An Additional credit card incentive, pay twice the monthly minimum due and ALL INTEREST RATE CHARGES FOR THAT MONTH ARE WAIVED.

5. Make Tax Refund Checks instantly depositable into special savings accounts that pay 4%, allow citizens the ability to deposit a matching amount as well, don't tax the interest from this account.

6. Make balloon mortgages illegal, instead, have the monthly mortgage slowly inflate, even if it is a month by month increase, have it be such a small amount that the mortgage payer can afford the increases for a few years after the increases have started.