[SpaceMonkey]

Originally Posted by turtle777 

You mean, those children with regular income and good enough credit history to qualify for a CC ?

Again, that's not who this regulation is about.

[hyteckit]

Originally Posted by turtle777 

Unsafe ?

How the f*** is a Credit Card "unsafe" ?

What harm does it pose to the general public ?

And please, don't give the typical "it can be used in unsafe ways, to harm to yourself".
Under that definition, the gov't needed to ban almost any and everything, as people have known to be creative enough to destroy themselves with whatever they get their hands on.

For sure, we should NOT allow knives, scissors, razor blades, tools, cleaning products etc to be sold openly.

-t

You are generalizing the argument. I didn't say credit card is "unsafe". I said it's "unsafe" to give an adult under 21 with no income and no credit history a credit card, because they lack the responsibility.

It's like me saying giving a knife to a 1 year old is unsafe, because the 1 year old child is not responsible enough to handle a knife.

Then you generalize by saying how the f*** is knife unsafe.

It's like me saying giving alcohol to a 12 year old is unsafe, because the 12 year old child is not responsible enough to handle liquor.

Then you generalize by saying how the f*** is alcohol unsafe.



Would a better word be "risky" with it comes to loans and credit cards? I was going with the "safe" theme.

How are risky loans not risky?

How is giving an adult under 21 with no income and no credit history not risky?

Government believes adults under 21 with no income and no credit history are not responsible enough to receive a credit card. It's too risky.


Why do we ban marijuana?

Because the government thinks it's not safe?


Why was alcohol was banned in the 1920's? Because the government felt people were too stupid to handle alcohol. They lack the responsibility to handle alcohol. Government felt that the needed to protect its citizen for doing foolish things and want to control human behavior.


Government does decide what's unsafe or too risky for the public, whether you like it or not. Government decides at what age a person is responsible enough to:

vote
drive a car
get married
drink
smoke
get a credit card

[turtle777]

^^^ Is that all you got ?

I'm convinced

-t

[hyteckit]

What am I trying to convince you of?

[jokell82]

Originally Posted by hyteckit 

Why do we ban marijuana?

Because the government thinks it's not safe?

Actually no. It's mostly illegal due to racism. http://blogs.salon.com/0002762/stori...naIllegal.html But that's a wholly separate conversation.

[hyteckit]

Originally Posted by jokell82 

Actually no. It's mostly illegal due to racism. http://blogs.salon.com/0002762/stori...naIllegal.html But that's a wholly separate conversation.

And we ban alcohol in the 1920's because of racism too.

[hyteckit]

Why is there a legal drinking age?

Why is the government deciding what's too risky or unsafe for the public?

Why is the legal drinking age in the US 21?

Because our government feel that's it's unsafe for anyone under 21 to be drinking alcohol. Our government believes people under 21 lacks the responsibility to handle alcohol.


National Minimum Drinking Age Act - Wikipedia, the free encyclopedia


Alcohol can ruin a person's life.
So can bad credit and enormous amount of debt.


What's wrong with our government believing people under 21 needs to be protected from what the government deems unsafe or too risky for someone lacking the responsibility?

[jokell82]

The national drinking age is also bullshit, and the fact that they couldn't pass a law and had to tie it to highway funds pretty much proves that. South Dakota v. Dole is a disgrace and flies in the face of the constitution.

You're either an adult at 18 or you're not, but having an arbitrary limit placed on legal adults is stupid.

[jokell82]

Originally Posted by hyteckit 

And we ban alcohol in the 1920's because of racism too.

And how did that ban work out?

[Dakar V]

hyteckit just doesn't know when to stop.

[turtle777]

Originally Posted by hyteckit 

Alcohol can ruin a person's life.
So can bad credit and enormous amount of debt.

Why stop there ?

Knives can ruin a person's life.
Power tools can ruin a person's life.
Chocolate can ruin a person's life.
Soda pops can ruin a person's life.
Fast food can ruin a person's life.
Pron can ruin a person's life.
Video games can ruin a person's life.
Riding a bicycle can ruin a person's life.
Waking down the street can ruin a person's life.
Being in public places can ruin a person's life.
Flying can ruin a person's life.
Yard work can ruin a person's life.
Making camp fires can ruin a person's life.

Should the government regulate and limit any- and everything that could potentially go wrong ?

Please, hyteckit, spare me your answer. I know what you're going to say.

-t

[hyteckit]

Originally Posted by jokell82 

And how did that ban work out?

Not so well.

The war on drugs is working out so well either, but that hasn't cause the government to give up on the ban.

But it doesn't mean the government doesn't have the right.


smoking age - 18
drinking age - 21
marijuana smoking age - illegal to all, except for medical reasons
credit cards - everyone over 21. Under 21 requires proof of income or a co-signor
X-rate movie - people over 18
sex toys - illegal in Alabama

[hyteckit]

Originally Posted by turtle777 

Why stop there ?

Knives can ruin a person's life.
Power tools can ruin a person's life.
Chocolate can ruin a person's life.
Soda pops can ruin a person's life.
Fast food can ruin a person's life.
Pron can ruin a person's life.
Video games can ruin a person's life.
Riding a bicycle can ruin a person's life.
Waking down the street can ruin a person's life.
Being in public places can ruin a person's life.
Flying can ruin a person's life.
Yard work can ruin a person's life.
Making camp fires can ruin a person's life.

Should the government regulate and limit any- and everything that could potentially go wrong ?

Please, hyteckit, spare me your answer. I know what you're going to say.

-t

Should the government regulate and limit any- and everything that could potentially go wrong ?

No.

Does the government regulate and limit products and services that they deem unsafe or too risky for public consumption?

Yes


Here's are some:

smoking age - 18 and over
drinking age - 21 and over
marijuana smoking age - illegal to all, except for medical reasons
credit cards - 21 and over. Under 21 requires proof of income or a co-signor
X-rate movie - 18 and over. Might be illegal in some states?
sex toys - illegal in Alabama



Should and Can are different arguments.


I'm arguing Can the government do that. I'm arguing "Yes".
I'm not arguing Should the government do that. I'm not arguing either way.

[jokell82]

Actually according to the constitution they cannot. Unfortunately it happens anyway.

[turtle777]

Originally Posted by hyteckit 

I'm arguing Can the government do that. I'm arguing "Yes".
I'm not arguing Should the government do that. I'm not arguing either way.

Ok, but the whole point of this thread is to discuss what *should* be done.
*Should* the credit card regulation be done or not.

Discussing what the government *can* do is futile. We already know they they can do many stupid things, and many things that are unconstitutional.

-t

[andi*pandi]

oops.

[ort888]

What the new credit card law means for you -- MSN Money

Here are some other things the bill regulates... are we also against things like more clear language, not forcing people to pay the lower interest portions of their balance first, and making it harder for credit card companies to do all the sneaky little things they like to do to nickel and dime us?

[ghporter]

Originally Posted by turtle777 

Ok, but the whole point of this thread is to discuss what *should* be done.
*Should* the credit card regulation be done or not.

Framed like that, I'd like to point out that I do not think that the credit card industry should need a rule that says they have to check an applicant's credit worthiness and ability to pay before extending credit to them. I think it's both a shame and an indictment of the industry that this appears to be something they "need help to remember to do."

Government regulation of something that should be a fundamental business practice, sort of like a printing company ensuring that they have adequate supplies of paper and ink, is not an optimum solution. But it looks like the credit card companies are not doing this most basic check to see if young applicants are credit worthy, and it seems to be hurting a lot of people, so maybe they need to be led by the hand like little children, at least in this situation.

[ort888]

I'm sure the credit card companies have crunched the numbers and know that it's not actually a bad business practice. They know a percentage of these kids won't be able to pay or will get in trouble and it's fine with them because they still profit on a whole. If they didn't they wouldn't be so aggressive in targeting unemployed kids.

[hyteckit]

Originally Posted by ort888 

What the new credit card law means for you -- MSN Money

Here are some other things the bill regulates... are we also against things like more clear language, not forcing people to pay the lower interest portions of their balance first, and making it harder for credit card companies to do all the sneaky little things they like to do to nickel and dime us?

Speaking of nickel and dime, here's an article debating both sides of the coin on this new credit card law on young borrowers.

http://www.usnews.com/articles/busin...-spenders.html

[turtle777]

Originally Posted by ort888 

I'm sure the credit card companies have crunched the numbers and know that it's not actually a bad business practice. They know a percentage of these kids won't be able to pay or will get in trouble and it's fine with them because they still profit on a whole. If they didn't they wouldn't be so aggressive in targeting unemployed kids.

Yes.

It's like the lottery, or gambling.

If you participate, and your are not careful, you're gonna lose a lot of money.
Other than that, the individual should be free to make a wise or a dumb choice.

-t

[G Barnett]

I said "no" to credit slavery many years ago, and don't regret it a bit. Haven't had a single card since then and it hasn't been an issue at all. At this point I'm living ENTIRELY within my means -- I don't even have a car payment to worry about.

Pay 'em off, cut 'em up and never look back. It's soooo liberating.

[turtle777]

Originally Posted by G Barnett 

I said "no" to credit slavery many years ago, and don't regret it a bit. Haven't had a single card since then and it hasn't been an issue at all. At this point I'm living ENTIRELY within my means -- I don't even have a car payment to worry about.

Pay 'em off, cut 'em up and never look back. It's soooo liberating.

Now, would to feel as good about it if the government had forced you, by making up tons of regulations, giving you no choice and options ?

-t

[ghporter]

Originally Posted by turtle777 

Now, would to feel as good about it if the government had forced you, by making up tons of regulations, giving you no choice and options ?

-t

How is that question relevant? He's stating that he HAD cards, not that he avoided having them.

And most people survive the time between 18 and 21 without major trauma, especially from "not having a credit card I can't afford to pay for."

[turtle777]

Originally Posted by ghporter 

How is that question relevant?

You can only be proud of something that you achieved with your own free will.

Have you ever been proud of something that you were forced to do ?

-t

[CreepDogg]

There are many government regulations on the books that are onerous, invasive, and interfere with liberty. IMHO, this is not one of them.

[hyteckit]

Originally Posted by turtle777 

You can only be proud of something that you achieved with your own free will.

Have you ever been proud of something that you were forced to do ?

-t

Define "forced to do."

You mean like:
My economic situation forced me to work two jobs in order to pay for college. I'm proud of it.
Or the draft forced me to fight in the war. However, I'm proud to serve my country.

I was forced to get a job because I was under 21 and wanted a credit card?
I was forced to get a job because I was under 21 and wanted an iPod?

I was quite proud being able to support myself when I was under 21, without relying on my parents to financially support me.




Besides, limiting your options is really forcing you to do something.

Under 21 and want a credit card?
Well, choose to get a f*cking job then. No job? Well, no credit card for you.
It's your choice to get a job or not right?


Want to buy a house and get a home mortgage?
Well, get a f*cking job. No job? Well, no mortgage for you.

[turtle777]

^^^ Exactly. And what business has the government in all this ?

-t

[ghporter]

Originally Posted by turtle777 

You can only be proud of something that you achieved with your own free will.

Have you ever been proud of something that you were forced to do ?

-t

Isn't "paying one's debts" something to be proud of? Failing to pay those debts has some pretty harsh penalties attached, so isn't that "being forced?"

And yes, I HAVE been proud of accomplishing some things that I was "forced to do." For example, Basic Training. Once in, I was "forced" to do a lot of things, and I wound up doing most of them pretty well. I was one of the few in my flight that actually seemed to know left from right, and I was used as an example of how to march-which was "forced" onto me, but which I took quite a bit of pride in.

It's all about context. I chose to enlist, but after that, everything else was "forced." One does not have much of a choice in the economics of one's life, and sometimes it's necessary, however unpleasant, to do things like using credit in an emergency. And for most people, credit is an addiction that is hard to break.

Now, how about this idea that anyone is being "forced" into anything unpleasant by this particular regulation? How is "you may not extend credit to anyone between ages 18 and 21 unless that person actually has the means to pay" "forcing" anything bad? If you're 19 and make $15,000, isn't it logical that you might only qualify for a maximum credit line of maybe $4000? And if you don't make as much as $15k, wouldn't it be logical to all involved that you'd qualify for a lower maximum? How is ANY of that a bad thing? Who is being hurt? Credit card companies? How can being required to only extend credit to those who can pay going to hurt them? I'd think it would be better for them and their bottom line. 18 year olds without jobs? Why should they get credit if they don't have any form of income?

I had to ESTABLISH credit before I got any sort of credit card offer. Our world of credit seems to now be inverted from "you have to have credit in order to get credit" into "you can get credit even if you don't have an income or a record of paying your debts." Which seems to have been a major philosophical seed of our current recession, since so much of it is tied up in bad investments based on bad loans.

[turtle777]

Originally Posted by ghporter 

Isn't "paying one's debts" something to be proud of? Failing to pay those debts has some pretty harsh penalties attached, so isn't that "being forced?"

Yes, definitely, that's what I mean.

Getting in debt and then paying it off by choice is a great achievement.

But if the government regulates everything, so you can not make mistakes (like getting in debt), then you also can't reap the fruit of feeling good about yourself, learning from and fixing a mistake.

-t

[ort888]

Yeah, but being in debt feels bad.

I'm sure addicts feel a sense of accomplishment when they kick heroin also.

Why are you hitting yourself in the head with that hammer?

Because it feels so good when I stop.

[turtle777]

Originally Posted by ort888 

Why are you hitting yourself in the head with that hammer?

Because it feels so good when I stop.

There *is* no good reason, but people will do it anyways, no matter what the government does.
It's NOT the government's job to protect people from stupid choices.
It's the government's job to make sure people have enough information to make an informed decision.

Again, see my list above. *Should* the government intervene in anything that has the potential of being abused in a way to harm yourself ?

Heck, let's outlaw electricity, water, cars etc.

-t

[shifuimam]

Originally Posted by G Barnett 

I said "no" to credit slavery many years ago, and don't regret it a bit. Haven't had a single card since then and it hasn't been an issue at all. At this point I'm living ENTIRELY within my means -- I don't even have a car payment to worry about.

Pay 'em off, cut 'em up and never look back. It's soooo liberating.

The only problem I have with this statement is that it propagates the myth that having a credit card is inevitably a bad thing and makes you a "slave to debt".

I use my credit card for just about everything. Obviously, it makes online transactions (besides eBay, which is all PayPal-driven these days) much safer and easier. But it also means that if my wallet gets stolen, rather than losing $xx in cash, I just have to call up my bank and say "cancel my check card and my credit card immediately", and I'm safe.

It also lets me keep close track of where my money is going, since mint.com auto-categorizes all my purchases. You can use a credit card regularly and still live a cash-only lifestyle ("cash-only" meaning "living on the money you actually have", versus "living on the money you wish you had or aren't certain you'll have in the future").

Originally Posted by hyteckit 

Define "forced to do."

You mean like:
My economic situation forced me to work two jobs in order to pay for college. I'm proud of it.
Or the draft forced me to fight in the war. However, I'm proud to serve my country.

I was forced to get a job because I was under 21 and wanted a credit card?
I was forced to get a job because I was under 21 and wanted an iPod?

I was quite proud being able to support myself when I was under 21, without relying on my parents to financially support me.

Besides, limiting your options is really forcing you to do something.

Under 21 and want a credit card?
Well, choose to get a f*cking job then. No job? Well, no credit card for you.
It's your choice to get a job or not right?

Want to buy a house and get a home mortgage?
Well, get a f*cking job. No job? Well, no mortgage for you.

As much as I hate to admit it, I finally agree with something hyteckit says.

The current predicament is that creditors got to the point where anyone could qualify for mass amounts of credit that they simply had no business acquiring. Now that we've gotten to that point, we need to fix it. What's the most efficient way of doing that? Currently, creditors are already putting the kibosh on handing out credit left and right - boyfriend is trying to get a credit card so that he can start building his credit. He's never been in debt a day in his life. He's also never had a credit card, and it's resulted in making it very difficult (thus far impossible) for him to get a credit card, even with a low limit. In fact, the creditors have tightened the reins so much that we can't even get a card where I cosign on it in order to get the approval necessary.

I'm not convinced that a federal mandate is necessary in order for the credit companies to get back to a point where they're doling out credit more responsibly. At the same time, there's a concern that as the economy slowly straightens out, creditors will slide back into the bad habit of approving credit to people who shouldn't reasonably qualify.

It's important to be leery of anything the federal government decides is mandatory, particularly when it comes to your rights as an individual - rights that don't directly affect other people. While the current bill seems like it won't hurt responsible people, and it only tries to strong-arm irresponsible people into being more financially stable, what's to stop the government from making more mandates down the line? Isn't that part of what got us into this mess in the first place? The feds decided to start forcing banks to approve mortgages to people who weren't previously qualified, and it snowballed from forced lending into predatory lending (in some - not all - cases), while at the same time the American public simply became accustomed to rarely hearing "no" from a lender or creditor. The bill may seem like a good idea right now, but as with anything the federal government does, we need to examine it from the angle of its longer-term impacts and implications.

Originally Posted by turtle777 

There *is* no good reason, but people will do it anyways, no matter what the government does.
It's NOT the government's job to protect people from stupid choices.
It's the government's job to make sure people have enough information to make an informed decision.

Again, see my list above. *Should* the government intervene in anything that has the potential of being abused in a way to harm yourself ?

Heck, let's outlaw electricity, water, cars etc.

-t

I understand that argument, but how do you think that should influence things like drunk driving, not wearing your seatbelt as a driver or passenger in a vehicle, and various recreational substances that are currently outlawed? Drunk driving does not always result in the injury or death of an innocent victim or the person committing the crime. Not wearing your seatbelt only puts your personal safety at risk, were you to be involved in a major collision. Do you think the government should have education requirements for children? It doesn't necessarily hurt anyone else when a fourteen-year-old drops out of high school, so why have a law against truancy?

I think that there's a balance between "the government shouldn't ever try to stop anyone from doing anything stupid" and "the government should bring down an iron fist on all actions so that people can never do anything stupid".

[turtle777]

Originally Posted by shifuimam 

Drunk driving does not always result in the injury or death of an innocent victim or the person committing the crime.

"Not always" ?

Well, I think the risk to others is high enough to make this a useful regulation.

Originally Posted by shifuimam 

Not wearing your seatbelt only puts your personal safety at risk, were you to be involved in a major collision.

I agree, I would not mandate it, as long as there is a way to make sure those not wearing a seatbelt pay higher insurance premiums, because the effects of an accident will most likely result in higher medical cost if not wearing a seatbelt.

But that can be accounted for by insurance policies. E.g. the policy could clearly state that IF you are involved in an accident w/o wearing a seatbelt, the medical reimbursement will be cut by x%.

There, easy fix, w/o a need of the government to micromanage.

-t

[Laminar]

Originally Posted by shifuimam 

The only problem I have with this statement is that it propagates the myth that having a credit card is inevitably a bad thing and makes you a "slave to debt".

I use my credit card for just about everything. Obviously, it makes online transactions (besides eBay, which is all PayPal-driven these days) much safer and easier. But it also means that if my wallet gets stolen, rather than losing $xx in cash, I just have to call up my bank and say "cancel my check card and my credit card immediately", and I'm safe.

It also lets me keep close track of where my money is going, since mint.com auto-categorizes all my purchases. You can use a credit card regularly and still live a cash-only lifestyle ("cash-only" meaning "living on the money you actually have", versus "living on the money you wish you had or aren't certain you'll have in the future").

A real cash-only lifestyle doesn't have anything to do with credit cards. When paying with cards, people typically spend about 12-18% more.

NPR reports that when McDonalds started accepting credit cards, the average transaction increased from $4.50 to $7.00. When credit cards were introduced for vending machines, the average transaction nearly doubled.

Wells Fargo has online tools that automatically categorize my debit card purchases, so I don't need a credit card for that. My debit card works for car rentals, hotel rooms, etc. The only reason I have a credit card is for business.

BUT MY CARD GETS ME TEH REWARDS! Where you'd normally spend $100 in cash, statistically, you'd have put $112 on the card, for $1.12 in rewards (with 1% cash back). You're still behind.

Granted, credit card offer greater security and some companies are very good to work with, but using a credit card for everyday things seems a bit unnecessary, and assuming that you're different from everyone else and immune to unknowingly spending more is a bit naïve.

[ghporter]

Originally Posted by turtle777 

Yes, definitely, that's what I mean.

Getting in debt and then paying it off by choice is a great achievement.

But if the government regulates everything, so you can not make mistakes (like getting in debt), then you also can't reap the fruit of feeling good about yourself, learning from and fixing a mistake.

-t

Nothing says you can't get into debt. The rule just says that the person under 21 has to have the ability to pay. There's nothing that forces that person to pay, only the rule that says he has to have the ability. It's up to him whether he acts responsibly and pays his debts.

I think this rule simply gives a LOT of young people a fighting chance to learn about personal economics-and to figure out how to live within their means-before they stumble into credit and problems with it. Not that they can't make mistakes, not that they will have someone holding a gun to their heads and forcing them to pay up, just that they get a chance to start out right.

[ghporter]

Originally Posted by shifuimam 

The only problem I have with this statement is that it propagates the myth that having a credit card is inevitably a bad thing and makes you a "slave to debt".

I agree with you on this 100% "Having credit" is not at all equal to "being overburdened with debt." My goal with my own credit is to have my card paid off by the end of each month, making it a convenience for me, rather than a burden. Having been a GI for a long time and then a full time student, I have to admit that I have more credit card debt than I'd like to admit, but it's under control AND falling-even before I am employed in my new profession.

Smart use of credit is NOT a bad thing. Having credit means that you can often handle adverse situations without having to stop and consider whether you'll be able to feed the family tomorrow. It's been a very useful thing for me, as during my active duty service I was often in situations where I had to pay for something NOW, even though my pay would not show up until the end of the month. The catch is that it takes a little work to actually use credit wisely, and much of our society can barely wait for the next commercial, let alone several months, before they "have to have" something.

Originally Posted by shifuimam 

As much as I hate to admit it, I finally agree with something hyteckit says.

I do too. Those are really strong, well-written points. Our culture seems to think that whining about not having something somehow earns it for you. WRONG! Whining is just irritating to other people, and if you get somethign for whining, it's because someone wants you to shut UP! Working for a goal is what gets you to that goal, whether it's affording to live on your own (my son is doing that quite well, and we're really proud of him for that), affording a toy or gizmo, or anything else. "There Ain't No Such Thing As A Free Lunch" is a very powerful statement, but most people don't see both sides of it: earn what you want, AND "anything free is worth what you pay for it."

Originally Posted by shifuimam 

The current predicament is that creditors got to the point where anyone could qualify for mass amounts of credit that they simply had no business acquiring.

Precisely! Somehow having high default rates was "acceptable" to these companies because they still hauled in massive amounts of profit. Much of that profit was also based on charging horrendously high interest rates because of "credit problems" the companies themselves caused. I ain't buying that stuff either. The "credit card bill of rights" addresses these issues in a number of ways, including things like requiring companies to apply payments to the HIGHEST interest balances first, and making them give actually useful notice to customers if they want to raise their interest rates. In short, it's something that shouldn't be needed, but IS needed because these companies don't seem to get the whole "treat your customers right and you'll make money off of them forever" thing...

[shifuimam]

Originally Posted by Laminar 

A real cash-only lifestyle doesn't have anything to do with credit cards. When paying with cards, people typically spend about 12-18% more.

My point, however, was that owning a credit card, and using it regularly, does not default to you being an irresponsible spender, nor does it guarantee that you're going to plummet into a vortex of debt. I have never been unable to pay my card off in full each month, and for nearly every single credit card bill I've had since I started using my card regularly around the age of 21, it's been below my monthly take-home pay.

And, as I defined before, I consider "cash only" as in "I have the cash to pay for this". Yes, I do sometimes buy more because I'm using a card instead of cash - and lately, I've also been returning some of those purchases. I recently returned some stuff to Wal-Mart after deciding I didn't need it, and got nearly $100 back. However, none of my purchases have been outside of what I have the cash (as in dollars in the bank) to buy.

Granted, credit card offer greater security and some companies are very good to work with, but using a credit card for everyday things seems a bit unnecessary, and assuming that you're different from everyone else and immune to unknowingly spending more is a bit naïve.

I'm not necessarily different from everyone else in my demographic (mid-20s), but I'm different from a lot of them - I have substantial cash savings, and I've never carried a balance on any credit card I've had in my name. I don't buy stuff I can't afford. I wait until I can afford what I want - at this point, that's only been required for the purchase of my last car, and is coming in to play again with my plans to buy a house. I'm not "special" or "unique", and I'm not saying I deserve a gold star - but I am a hell of lot more financially responsible and sensible than every single person I've met under the age of 30 (and plenty older than that).

[The Godfather]

Plain and simple: The FDIC should drop coverage for any bank/lender who offers a credit line to anyone who can't earn the money to pay it back. If they want to exercise their right of decision making, it shall be done without federal security nets.

[turtle777]

Originally Posted by The Godfather 

Plain and simple: The FDIC should drop coverage for any bank/lender who offers a credit line to anyone who can't earn the money to pay it back. If they want to exercise their right of decision making, it shall be done without federal security nets.

Well, yeah, exactly.

But why stop there ? Why bail out anyone / any company for their stupid decisions ? The government's bailouts created the moral hazard in the first place.

-t

[shifuimam]

Originally Posted by turtle777 

But why stop there ? Why bail out anyone / any company for their stupid decisions ?

DING DING DING DING DING.

Why should the government ever bail out a private company for digging itself into a hole? By the time a corporation is so deep in its own sh!t that it's going to go bankrupt, it's been dealing with internal problems for too long already. Take the American auto industry - the signs have been there for decades that the way they did things wasn't going to hold up against the imports from Japan (and, more recently, Korea). It's their own damn fault they got where they are today.

And no, you can't say "what about all the innocent employees who would lose their jobs", because hundreds if not thousands of major corps in the US have been undergoing massive layoffs due to the economy. The auto and financial industries aren't the only ones feeling the burn.

[Laminar]

Originally Posted by shifuimam 

DING DING DING DING DING.

Why should the government ever bail out a private company for digging itself into a hole? By the time a corporation is so deep in its own sh!t that it's going to go bankrupt, it's been dealing with internal problems for too long already. Take the American auto industry - the signs have been there for decades that the way they did things wasn't going to hold up against the imports from Japan (and, more recently, Korea). It's their own damn fault they got where they are today.

Not every American auto company is doing poorly.