"Complaints rise about interest rate hikes" was scrolling across the bottom of the screen on CNBC's Power Lunch show this morning. That piqued my interest, so I waited for the discussion to follow. When Bill Griffith and his cohorts finally brought up the story, the discussion, although brief, covered a variety of viewpoints. There were arguments made both against, and in defense of the banks. These are the highlights that I noted:
Arguments criticizing the Banks:
- Banks that have received TARP money are raising interest rates on Credit Cards
- Responsible consumers are targeted for increased fees
- Rate hikes are arbitrary and indefensible
- The "Consumer Bill of Rights" is still merely a pipedream, no action seen yet
- Banks use creative ways of charging for services that are already being provided for free
Arguments supporting the Banks:
- Banks should charge whatever they need to in order to stay profitable
- Consumers don't have a "right" to borrow; it is a privilege provided to them
- Consumers know that Banks are going to charge them outrageous fees: "Caveat Emptor"
- Consumers can shop for a better deal if they don't like the one they are getting
After seeing this newscast, I was left with a smug feeling of satisfaction. You may have noticed, I am on a mission to unify a movement to counter the way banks treat credit card customers. Practices, such as arbitrary rate hikes and credit limit reductions, and the current way they are administered are unacceptible.
The reason this issue is so important to me, and to you as well, is because of the wide ramifications these actions have on our individual financial well being, as well as the economy overall. For an illustration of how this impact is felt, please read Who's Stealing Your Dreams, a post I put up yesterday. The point of that post was to show how this small, everyday part of our lives can destroy our hopes of becoming a homeowner.
In that post, one commentator wrote that he did not like the comparison I made between Banks, a lawful enerprise, and thieves, clearly lawbreakers. I feel quite comfortable making that comparison, because a law is not necessarily just simply because it is the law. The laws that allow banks to literally steal your money, such as by unilaterally increasing interest rates to usurioous levels, using very questionable rationale, should be a crime. One of the panel on the Power Lunch program said as much also.
There are many victims who have become more vocal about this "criminal" activity as well, hence the news crawler I mentioned at the beginning of this piece.
I will not use this monologue to argue for or against the viewpoints I saw discussed on the Power Lunch program (I do want to mention that the last point, shopping for a better deal, sounds good; but the deals all have the same pitfalls, so there is no real "choice"). However, I do hope that everyone will pay attention to this subject, and become more aware of the need to take proactive steps to bring about change to this system. The current system that allows such abuse of credit card users is totally unacceptable. For that reason, I would encourage everyone to take steps to stop using them.
Please consider joining the Credit Card Revolt group. Share your experiences, good or bad, with the credit card companies. Together, we can bring about positive change!