DCist: Payday Loan Companies Targeted by Council

monkeyrotica

Sat, 25 Oct 2008 07:18:40 -0500

Well, so much for the spam filters, by which I mean Sommer and a daiquiri.

payday_loan_advocate

Sat, 25 Oct 2008 01:45:29 -0500

The US economy is of great threat these days because of the forthcoming election. People mainly focus on how they will choose the right candidate who sometimes, in the end, manipulate the government revenues which threaten the economy. Is the United States better off today than it was in 1932? That’s the year that Franklin Delano Roosevelt was first elected president, and the country was spiraling into a severe recession. FDR’s “New Deal” economic policies radically restructured the way the U.S. economy worked. Essentially, the government’s role in the economy expanded to a degree America had never seen. In the short term, Roosevelt's policies provided the country with a needed lift, but it can be argued that they caused significant long-term damage. In this Wall Street Journal article, Paul Rubin suggests that while the current state of the U.S. economy is not in the state it was in 1932, many of the same indicating factors are there: stock market in a tailspin, credit markets locking down and a popular Democratic presidential candidate – Barack Obama – is running on a platform that will inject increased government regulations into problem areas like the economy. An Obama presidency, coupled with what could be a 60-seat, filibuster-proof majority in the Senate, would bring the country as close to a pure liberalist agenda as it has ever been. Proponents of a free market economy are concerned that Obama’s governmental “hands-on” policies will not provide the American economy with the long-term direction it needs. Those who support the ideals of capitalism won’t say that we’re better off today than in 1932. They’re likely to tell you that we’re in for more of the same – a “New, New Deal.” Post Courtesy of Personal Money Store Professional Blogging Team Feed Back: 1-866-641-3406 Home: http://personalmoneystore.com/NoFaxPaydayLoans.html Blog: http://personalmoneystore.com/moneyblog/

DCster

Fri, 22 Jun 2007 16:19:26 -0500

In a city where almost a third of the residents are functionally illiterate, I'm doubtful many people who borrow from Check 'n Go are highly knowledgeable about APR calculations and amortization periods. More likely they're one or two paychecks from eviction and while these companies may help them make ends meet now or then, people who don't have financial sense end up being the big losers. Sure, we could say 'too bad for them,' and leave it up to the market, but that doesn't sound like the mark of a humane society to me.

Lil

Fri, 22 Jun 2007 14:47:34 -0500

I've been following this debate for awhile and continue to be baffled by the lack of understanding of basic financial terms like APR, etc. First of all, people walk into these location on their own. No force involved. And if any of you have ever walked into a payday loan store, you'd see the fees are fully transparent and spelled out very clearly. Nothing predatory about that. Problem is people don't seem to understand that payday loans are not annual loans...and to apply an annual rate just doesn't work. Seems straight forward to me. You borrow $100 for two weeks and you pay a maximum fee (per DC law) of $16.25. Cheaper than bouncing a check, etc. And this whole notion about lending money to people who can't pay you back...seems like a terrible business model to me. Don't think that's the case.

Cranky

Fri, 22 Jun 2007 14:44:21 -0500

J: So we should allow loansharking?

pants

Fri, 22 Jun 2007 13:37:40 -0500

Yes, this is a nasty business. Also, there was legislation last year that gave DoD the ability to regulate the payday lenders that pop up around military bases, which was somewhat controversial b/c consumer finance is usually the bailiwick of the finance committee I believe.

J

Fri, 22 Jun 2007 13:31:11 -0500

Let them charge whatever they want, it's a free market. They provide a pretty high risk service and should be compensated for their rate of risk.

Cranky

Fri, 22 Jun 2007 11:33:12 -0500

A correction on the bill: It wasn't introduced by AG Singer. The bill was introduced by Barry and Cheh. Singer issued a report a month or so ago called "The High Cost of Being Poor in DC" and supports the bill. And Virginia also tried to get rid of payday lending, but fell short.