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- Manlobbi
Personal Finance Topics / Macroeconomic Trends and Risks
No. of Recommendations: 1
https://finance.yahoo.com/news/us-overdraft-fees-j...Fourteen of the largest U.S. retail banks posted jumps in the income they generated from overdraft and bounced-check fees during the first nine months of the year, while two big banks reported sharp declines, according to a Reuters analysis.
The charges mostly relate to overdraft feesAs we near a recession, the kicking of the working class continues.
No. of Recommendations: 14
"The charges mostly relate to overdraft fees"
As we near a recession, the kicking of the working class continues.
Yes, how silly of the banks to enforce the rules you agree to when you open an account. That the banks are making a profit off of the overdraft rules is more a sign of failure to understand the tool being used or a belief that they are immune to the consequences. IMO we would be a better country if adherence to accounting principals in our finances were the norm. Bankruptcy is not a beautiful tool, and if you take on debt, don't screw those you borrow from and renig on your word.
I taught middle school math for a trimester. In addition to the standard curriculum, I would do exercises involving personal finance and investing, including balancing a check book, (dating myself here,) and calculating the cost of buying on credit without payment in full monthly. At home I taught our kids about delayed gratification and want vs need when it came to purchases, and budgeting for those purchases. These days people are given the expectation that they can have it all NOW, take out tens of thousands of dollars in loans, just to have the Gov't forgive the debt, and college kids are hounded with credit offers with the hope that they will run up that debt and be subject to crazy interest rates. Neither the predatory lending, nor the failure to understand what you are signing up for and failure to follow through with the consequences are acceptable.
IP
No. of Recommendations: 3
For the vast majority of Americans living paycheck to paycheck, rising prices and reductions in hours get reflected in missed payments and bounced checks. The OP is correct to point out that the financial sector benefits from the hardships of working people. Not to worry though, the foreclosures and defaults of working people will hit the banks soon enough
https://www.newyorkfed.org/newsevents/news/researc...
No. of Recommendations: 1
For the vast majority of Americans living paycheck to paycheck, rising prices and reductions in hours get reflected in missed payments and bounced checks.
And I used to be one of those people, getting thrown into adulting at 19 during stagflation, working 3 part time jobs in a crazy high cost of living area. Food, basic shelter, transportation. Had a budget for 2 of the 3. My understanding of economics was learned the hard way. Wasn't pleasant, but one has to pay for their education somehow, and I credit that school of hard knocks with getting me to where I am now.
IP
No. of Recommendations: 5
The OP is correct to point out that the financial sector benefits from the hardships of working people. Not to worry though, the foreclosures and defaults of working people will hit the banks soon enough
Am perhaps incorrectly perceiving an adversarial stance towards banks, and honestly am perplexed by it. Perhaps you can educate me on where I have it wrong.
Debt is a tool that should only be used with understanding. It can be a timesaver and presents opportunities, but comes with risks. Although the government likes to buy our votes with free money, it is not actually an entitlement, and one that a for profit entity would have no right to provide. The risk in debt falls on both the receiver and the issuer. Consequences in miscalculation of risk has consequences on both parties. Am just as against bank bailouts as I am against forgiving consumer debt, but I don't take glee in either happening.
When I was that very poor 19 year old, I used debt to get groceries when my paychecks had yet to hit my account. Not talking a splurge here, as my groceries revolved around materials to make soup, so a turkey leg, bag of onions, potatoes, carrots, celery...all things that were crazy cheap at the time and other than the turkey leg, lasted more than a week. Budget was $5/week. I had overdraft protection on my checking, which admittedly I did not understand fully. Though no bounced check fee, was stunned at the interest charge the first time it happened. (Remember that this was the day of 18% mortgages, and unsecured loans were substantially higher.) Learning my lesson, it only happened once. I have never carried a balance on my credit card. When money is in such short supply, it is idiocy to spend it on interest without extreme need. However, I appreciated having that credit available to me. It was my emergency fund before I had even heard the term. What it was not was extra income to spend.
Debt can be incredibly freeing, or it can be a millstone around your neck as you head into deep water. It's not the tool itself that is the problem, but how it is understood and used.
IP
No. of Recommendations: 1
"I taught middle school math for a trimester. In addition to the standard curriculum, I would do exercises involving personal finance and investing, including balancing a check book, (dating myself here,) and calculating the cost of buying on credit without payment in full monthly."
GOOD for you! That was valuable practical education!
In 1963, I was taught to write a check--only. Preparing me to be a good consumer.
LOL
IMO we should be teaching middle student pupils the power of compound interest. I did not learn that until my university education. And sadly I did not utilize that information until I was 30! I was a good little conspicuous consumer until then.
No. of Recommendations: 1
its kinda of convenient not having rules written down when ultimately those same taxpaying customers contribute to a $500b bailout during the gfc.
but practically speaking, if a bank isnt stealing for you, they are stealing from you.
and the only way to get the former is not just literacy, but also not to be poor.
No. of Recommendations: 7
GOOD for you! That was valuable practical education!
I was in a pretty special situation, where I was helping out a private school that lost their math teacher without notice. I was a research chemist before kids and with 12 credits of college calculus under my belt I understood the concepts just fine. I was the middle school math department, had no real guidance other than being handed the books, and could do much of what I wanted. Most teachers don't have that luxury.
Also introduced the concept of FIRE and how to get there via LBYM and investing. Was an interesting experience, often in a Chinese curse sort of way, mostly because of some of the parents and administration. I left with an enhanced appreciation of just what teachers go through. Really, teaching should be a much higher paid profession.
IP
No. of Recommendations: 0
Not to worry though, the foreclosures and defaults of working people will hit the banks soon enough.
That'll definitely convince the banks to loan money to working folks at lower rates and lower fees. #sarcasm
