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+--- Thread: Sallie Mae Credit Cards Poor Decision (/Thread-Sallie-Mae-Credit-Cards-Poor-Decision)
RE: Sallie Mae Credit Cards Poor Decision - armstrongsubero - 07-06-2019
@cookderosa thank you, I was now about to say that, it's nice to act like it can never happen until it does. I think we need to protect these young people here.
@mysonx3 The govement provides protection to you in the form of Police, Fire, Emergency services etc why should financial protection be any different? So if someone is stupid and burns their house down by arson the fire service should not rush to stop it from burning? Should they wait until the fire burns the whole block down?
It is a major problem that is affecting your society that can lead to recession, which has a direct impact on the global economy...
To ensure the American economy survives we need goverment intervention.
I am the assistant leader of a Police Youth club here and on a weekly basis I work with about 114 kids, and about 3/4 of them are young adults. Trust me they are NOT ready to make those type of life changing financial decisions when they reach 18, they are still kids and are not capable of making those decisions.
Its like statutory rape, even if that 15 year old loves that 30 year old guy with all her heart and has sex with him, by law it is rape. She is not capable of that decision. Aa horrible as rape is, people can recover from it and lead healthy lives. If you are drowning in debt, you can end up homeless on the street and lose everything.
Our entire lives revolve around earning money and reproduction. Everything else just supports those two facets of society. Jobs, cars, vacations all these things are just secondary to our purpose of earning money to take care of our selves and our family.
All our lives we try to find love to have a family, ensure they have a roof over their head and food on the table. Thats all it boils down too. Debt has the ability to take that away and leave your life in misery.
You all don't have to agree with me, fight for 'freedom' which will lead to your demise. It is just your culture I guess..
RE: Sallie Mae Credit Cards Poor Decision - dfrecore - 07-06-2019
(07-06-2019, 10:55 AM)videogamesrock Wrote: So I’m going to say no, the government should not dictate the banks lending practices. The bank is actually the one who determines that and is far better at calculating risk.
Let’s look at a charge off for example. A bank charges an interest rate which calculates default. It’s already priced in. A young person then stops paying a credit card, it goes into chargoff status, the persons credit is ruined for 3-7 years which self-regulates getting more credit and learned a lesson. They then settle for a fraction of the debt to close out the account.
The consequence and benefit of the chargeoff would be a sufficient learning gained by mistakes. Remember we learn most by making mistakes not having government protect us from those mistakes.
More regulation just means more costs passed on to responsible borrowers.
So I am in agreement with the government should not step in to regulate things, as long as they don't bail out the banks that are irresponsible in their lending. When banks know that they can become "too big to fail" we have a huge problem. The more the government steps in to save people, the more irresponsible they are - this goes for companies and industries as well.
If banks know that they will fail if they give bad loans, then they will be more prudent in their lending. If they have to live with the consequences of their actions, they will be smarter. That's just how life works. You don't need government to always tell you how to act.
Here's an interesting way of looking at government making rules that have unintended consequences. The US requires quarterly earnings reports for public companies. This is good in some ways, as companies are more transparent in their actions, you can see insider trading, etc. BUT, the negative consequences are that companies are so tied to the quarterly earnings that they don't always make good long-term decisions, and it's gotten worse and worse over the years. They now almost solely do things based on the quarter, which is almost never a good thing long-term. I mean, look at your own finances. If everything you did was based on the next 3 months, you'd keep kicking the can down the road, because you don't have to pay attention to 6 months or 3 years or 30 years from now. You only have to pay attention to tomorrow. That's a huge problem, personally and in the marketplace.
Government rules & regs & laws almost ALWAYS have unintended consequences that many can see, except the people making them - they are so narrowly focused on solving a single problem that they can't see the problems they will cause.
Just a thought. It's why I'm much bigger on the market solving a lot of problems, rather than the government trying (and failing most of the time) to do so.
RE: Sallie Mae Credit Cards Poor Decision - videogamesrock - 07-06-2019
@dfrecore Government rules & regs & laws almost ALWAYS have unintended consequences that many can see, except the people making them - they are so narrowly focused on solving a single problem that they can't see the problems they will cause.
yes yes yes! The government solves one problem then creates many more problems that makes peoples lives worse. Then the government goes in an tries to solve those too. Unintended consequences are a real problem created by bureaucrats. As for too big to fail, banks should never be rewarded for poor management. I think the Obama administration should have broken up all banks that received TARP into 100's of smaller entities to add competition and punish for poor management.
@armstrongsubhero To ensure the American economy survives we need government intervention. No, they government has created almost all problems due to intervention. Mass inflation is created due to government intervention and the purchasing power of the dollar has eroded so much due to the intervention of the government. All social programs are failing form Social Security to the Affordable Care Act. Government cannot centrally plan peoples lives in economies that are so intricate down to transactions on the individual level.
More government makes your cost of living much more expensive.
RE: Sallie Mae Credit Cards Poor Decision - mysonx3 - 07-06-2019
Honestly, I can't fathom how someone can compare preventing people from taking a loan to having a police force in terms of necessity. Frankly, that's asinine.
Sallie Mae Credit Cards Poor Decision - videogamesrock - 07-06-2019
(07-06-2019, 03:44 PM)mysonx3 Wrote: Honestly, I can't fathom how someone can compare preventing people from taking a loan to having a police force in terms of necessity. Frankly, that's asinine.
It’s kinda like having the SS double checking everything you do to make sure your decisions are the best thing for the Reich.
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RE: Sallie Mae Credit Cards Poor Decision - armstrongsubero - 07-06-2019
@mysonx3 You can call my ideas asinine if you want, its because you lack the perspective I do on the situation. Just because my viewpoint differs from yours does not make mine asinine.
I compare it because many persons don't understand the ramifications debt has on human life. Someone NEEDS to step in and police these financial institutions.
For example by strain theory debt leads to cause of crime, many people in debt may resort to crime, white collar or otherwise to clear the debt they cannot legitmately take care of.
Debt leads to a host of social and economical issues which people take wayyy to lightly.
Your goverment is also on a spending spree and are borrowing more, the more they borrow, the more private borrowing will suffer as they'll be competeing for loans with the general populus which of course will make interest rates shoot up, which means people will be borrowing on higher and higher interest rates.
Many couples get divorced in America because of money problems, I've even read a few places its the #1 cause. Money and money problems causes frustration and arguing which stems from of course debt which leads to divorce. I think broken families are a sore point in thier own right and another discussion, but we all know the negative impact broken families have on society and the economy when single parents utilize social services to take care of their kids.
Students and graduates to their neck in debt causes them to default and ruins thier chance to get the ONLY thing you should buy on credit which is a house. No house means less marriages and less marriges means you wont be able to enjoy the power of a combined income to get you out of debt.
From an economic and social perspective debt is bad. You can defend it all you want. Instead of taking the swell headed approach and deny that debt is a problem, it people realize there is a problem, maybe a solution can be reached.
You can say as you wish, but government intervention is necessary to prevent people from taking advantage of its citizens as they are now.
The average Joe and even college grads are dumb with finances.
This reminds me of that documentry I looked at of people in Africa saying Ebola does not exist and kept eating the bats and getting infected. Its ignorance it its fullest.
There is a problem and someone needs to do something about it. These instiutions are performing financial rape to these kids and there is no one to Police it.
Then again I'm not American so it's not my place to question your culture, America and debt goes hand in hand so you really can't see anything wrong with it, but America is our largest trading partner and when you all get recession or have major economic problems it directly affects many countried in the rest of the world.
I have personally seen the impact goverment can have on stepping in. Recently we had a foreign exchange problem, the government put a restriction that no one business or individual be able to spend more than $500 US a day on all the banks, sure a few businesses complained (most notably foreign ones like Pricesmart) but it was necessary and we got over it. We are okay now and can afford to support many Venzuleans who are fleeing their country and coming here. Many of them send foreign exchange back to Venezuela and if the goverment didnt step in, I dont know what would have happened.
You wont know the severity of the problem until you are in it yourself.
Debt destroys lives and ruins families. Debt is bad. Something needs to be done, we have already proved the banks are just taking advantage of the situation so we cant depend on them to resolve it. They will milk every cent from their victims without remorse.
This wont fix itself.
RE: Sallie Mae Credit Cards Poor Decision - mysonx3 - 07-06-2019
Armstrong, you just made the argument that you are more qualified to comment by virtue of having never witnessed what you are talking about. Think about that logic for a moment.
Comparing someone who voluntarily borrows money to a rape victim is simply repugnant, not to mention outlandish.
RE: Sallie Mae Credit Cards Poor Decision - armstrongsubero - 07-06-2019
@mysonx3 if thats all you got from everything I said that then I have nothing further to say...
And if you have been following everything I've been saying you would know my reference was to statutory rape....voluntary dosent make it right...
RE: Sallie Mae Credit Cards Poor Decision - videogamesrock - 07-06-2019
“I compare it because many persons don't understand the ramifications debt has on human life. Someone NEEDS to step in and police these financial institutions.”
The government has already stepped in and taken control of this called bankruptcy. You go to court, show a clerk your debts and income and a judge discharges your debt; you are now magically debt free. No additional policing needed.
“Your goverment is also on a spending spree and are borrowing more, the more they borrow, the more private borrowing will suffer as they'll be competeing for loans with the general populus which of course will make interest rates shoot up, which means people will be borrowing on higher and higher interest rates.”
No No No. The gov floats a bond and the central bank prints money to buy it. It is called quantitative easing. Also, the social security admin buys those bonds. Gov does not get loans in the traditional sense you are describing.
“Many couples get divorced in America because of money problems, I've even read a few places its the #1 cause. Money and money problems causes frustration and arguing which stems from of course debt which leads to divorce. I think broken families are a sore point in thier own right and another discussion, but we all know the negative impact broken families have on society and the economy when single parents utilize social services to take care of their kids.”
The gov will not solve the problems of two individuals spending more than they make. It would be impossible to police. What you are suggesting is for people harder to obtain loans slowing economic growth in the private sector. The Soviet Union tried this and failed when it controlled its citizens spending based on need the central planners defined versus the wants of the individual.
“Students and graduates to their neck in debt causes them to default and ruins thier chance to get the ONLY thing you should buy on credit which is a house. No house means less marriages and less marriges means you wont be able to enjoy the power of a combined income to get you out of debt.”
Most people choose to rent because of mobility and renting does not affect if people get married, most of my tenants are married and use dual income to pay for their bills.
“From an economic and social perspective debt is bad. You can defend it all you want. Instead of taking the swell headed approach and deny that debt is a problem, it people realize there is a problem, maybe a solution can be reached. “
No, debt is a fantastic thing if used to leverage. I have $800,000 in debt and it doesn’t stop me from getting more loans as I used the debt to leverage more income. What you are suggesting is making borrowing much much harder for people like me to expand my business. Your suggestion would seriously hamper the business side of liquidity access.
“You can say as you wish, but government intervention is necessary to prevent people from taking advantage of its citizens as they are now.”
Nobody is taking advantage of citizens other than the government. If two people agree to transact no matter what the interest rate is, it is fine because both parties believe they have something to gain out of that transaction. What you are suggesting is that government should be the intermediary and have the final decision of that transaction—disrupting two people from accomplishing what they want.
“The average Joe and even college grads are dumb with finances. “
I agree, but so is government. K-12 education in finance would be more appropriate.
“This reminds me of that documentry I looked at of people in Africa saying Ebola does not exist and kept eating the bats and getting infected. Its ignorance it its fullest.”
Huh?
“There is a problem and someone needs to do something about it. These instiutions are performing financial rape to these kids and there is no one to Police it.”
Holy crap.
“Then again I'm not American so it's not my place to question your culture, America and debt goes hand in hand so you really can't see anything wrong with it, but America is our largest trading partner and when you all get recession or have major economic problems it directly affects many countried in the rest of the world.”
Most recessions and depressions are usually prolonged by government intervention.
“Debt destroys lives and ruins families. Debt is bad. Something needs to be done, we have already proved the banks are just taking advantage of the situation so we cant depend on them to resolve it. They will milk every cent from their victims without remorse.”
It is not true at all. Poor decision making can destroy families, but banks do not destroy families.
Suggested readings:
Capitalism and Freedom
Free to Choose
Economics in One Lesson
A country cannot realize its full potential unless restrictions that limit trade and increase the cost of doing business are kept to a minimum.
RE: Sallie Mae Credit Cards Poor Decision - armstrongsubero - 07-06-2019
@videogamesrock
If you're saying bankrupcy is the answer to debt, then you clearly have issues. Do you know what bankrupcy does to someone? A bankrupt 27 or 30 year old has just drastically eliminated their chances of owning a house and from what I inderstand, its difficult to declare bankrupcy on student loans.
I'm fully aware of how goverment borrowing works and yes it does directly impact the private sector rates, Here have a read mr 'No No No' :-D
https://www.economicshelp.org/blog/1504/economics/problems-of-government-borrowing-2/
And also basic economics, what happens if the central bank keeps printing more money?
Business debt is different than PERSONAL debt, know the difference. Thats business 101, hence the reason for LLCs and what not. If you are taking out personal debt for business purposes then you have a lot to learn about business else you may lose your house, car and alll its contents if things go south.
The job of the goverment is to manage the country and its affairs. Everyone thinks managers are useless. Google did an experiment and guess what their findings are, people need managers. A country is nothing more than a business. Without goverment intervention in many things, only chaos would exist.
We all agree the K-12 system fails. People are coming out of high school not knowing about basic math. 12 year olds don't care about financial education, its just another test to them, they'd rather play on their X-Box and forget everything they learnt. I was watching a documentry where for manufactring jobs they cant find candiates bacause K-12 system grads dont have the basic math, reading and science skills expected which has to be done via employer training after they leave school.
Well in the ebola program the people were failing to admit there was a problem, they were saying nothing is wrong with the current system of them eating bats even though it was giving them ebola. Same thing with the student debt problem that you all are saying is not one.
The systems in place you guys have are failing and no one wants to admit it.
Yes holy crap is a good phrase. I keep my stance these banks and financial institutions are like pedophiles. Preying on these kids who really dont know better. Dosent matter if the kids consent and willingly sign away their lives to the banks, these kids are ignorant and the banks are taking advantage of it.
Yes they DO ruin families.
Banks preying on kids causes them to be in debt which causes them to default giving them bad credit, meaning they cannot buy a house and start a family.
If they go into bankrupcy like you say then they will have near eternal ruined credit and cant buy a house and start a family.
If they do get married then both parties would have a mountain of student loan debt and credit card debt raking up interest. And guess what? They will never have enough money and constantly argue and get divorced. Your culture is based on 'keeping up with the Jonses' buying things you dont need with money you dont have to impress people you dont care about.
Spare me the economics readings, take a look at how goverment borrowing affects private sector interest rates, that economics 201. And we all know the problems of capatalism and what not. I study economics in my spare time cause my hero Elon Musk did....thanks for the suggestion though.
Ahhhh the full potential postulate.
Well the problem with such an economy is that it is dependent on their being a market. What happens in a case of surplus? Or with massive layoffs due to automation? Both of which will occur very soon and is already beginning.
Automation and AI means businesses can produce more with less people...which due to being unrestricted creates a surplus of goods and services which due to massive layoffs means less people can afford these goods and services, which will lead to economic stagnation and decline.
Supply and demand yeah?
Well the solution is UBI to keep the economy running which we all know is unsustainable. Giving people UBI then taxing them on it makes no sense. Of course you could eliminate tax bit how will govetment services get funded?
There needs to be regulation on businesses and trade, to ensure the economy runs. There needs to be a compromise.
Well keep dishing out loans and credit cards to 18 year olds. I know how that cookie will crumble.