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JEleazarian
Trad climber
Fresno CA
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Jan 14, 2009 - 12:44pm PT
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Karl,
The credit card companies already do that. They're called default rates of interest. I had one client whose rate was jacked up to 41.2%! When I first started practicing law, those who charged those rates didn't rely on the legal system to collect their debts.
That said, charging and collecting are two different things. A lender would not make money charging 5% until the borrower gets in financial trouble, then jacking up the rate to, say 30%. Although the 2005 changes in the Bankruptcy Code made Chapter 7 a bit more expensive, that's still what's likely to happen to the debt.
Lenders make money loaning to borrowers who repay.
John
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Karl Baba
Trad climber
Yosemite, Ca
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Jan 14, 2009 - 12:56pm PT
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"Although the 2005 changes in the Bankruptcy Code made Chapter 7 a bit more expensive, that's still what's likely to happen to the debt. "
That law was changed specifically to cover some credit card company butt so fewer people could use Chapter 7. More middle class people have lost access to Chapter 7 now so the creditors can extract every pound of flesh.
Loaning at 5% could certainly be profitable when banks are paying tiny amounts on deposits and checking are then able to use the leverage of Fractional Reserve lending to loan out money they don't actually have on deposit.
Peace
Karl
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stevep
Boulder climber
Salt Lake, UT
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Jan 14, 2009 - 01:03pm PT
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Bluering, my point exactly about Bush and Hilton. They don't have Galt ideals, and yet they live light-years better than most of society. Does wanting to live in this Randian utopia mean we have to do something about that? If so, what? How do we create a meritocracy where intelligence and hard work get you further than having an important last name?
As hard work being all it takes, I'd disagree. You can be smart and work your ass off in a crappy school in a crappy enviroment, and still end up with the short end of the stick.
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paul roehl
Boulder climber
california
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Jan 14, 2009 - 01:07pm PT
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I look forward to the day when credit card moguls and their lawyers are sent to reeducation camps. There they can while away the hours considering the gross sins of their business while picking brussels sprouts and weeding strawberries.
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bluering
Trad climber
Santa Clara, Ca.
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Jan 14, 2009 - 01:54pm PT
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Steve (I'm a Steve too), living with a Galt ideal system doesn't guarantee a successful career, only independance and an ability to support yourself, to not be a "moocher".
Success in life is defined differently to different people, but the Galt success would be self-reliance IMO. I think that was the major point of the Galt model.
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Karl Baba
Trad climber
Yosemite, Ca
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Jan 14, 2009 - 04:04pm PT
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"They're called default rates of interest. I had one client whose rate was jacked up to 41.2%! "
yup, and beware folks. If you have a bunch of cards and you're late on one, the other ones can find out about it and put you on the insane default rate even if you've always been current with the card.
My problem with Atlas Shrugged is the creation of some imaginary larger-than-life heroic characters of a specific class and concocting an unlikely story where they are the heros. Why not just suggest that superman and batman are the models for a better society?
Peace
Karl
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bluering
Trad climber
Santa Clara, Ca.
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Jan 14, 2009 - 04:25pm PT
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the creation of some imaginary larger-than-life heroic characters of a specific class and concocting an unlikely story where they are the heros.
Karl, I think you're missing the point entirely. It's the opposite of your above quote. The point is that ordinary, realistic, everyday people are quite capable of contributing to society. Even if it's a menial, unsophisticated job. It's about being self-reliant and independant and being happy with that, whether you're making just enough to live happily or make more than enough.
I haven't read the book, but based solely on what's been described here, I get the point. Maybe I'm wrong.
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Karl Baba
Trad climber
Yosemite, Ca
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Jan 14, 2009 - 05:10pm PT
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I didn't say rich, I said "specific class" which in this case was something like Superheros who can do anything without hiring others or needing infrastructure because they are just so dang smart, industrious and self righteous.
They aren't saying "it's all about the money" I didn't say that either.
peace
Karl
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Karl Baba
Trad climber
Yosemite, Ca
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Jan 14, 2009 - 07:30pm PT
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Yes I can....Feel yours too!
;-)
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