Circuit City Credit Cards are now good at Best Buy

Unlike other companies, Best Buy has been able to withstand the recession and actually profit. The bankruptcy of the Circuit City has forced thousands of shoppers to buy their electronics at their local Best Buy store. Furthermore, it was recently announced that Circuit City credit card holders were sent a Best Buy credit card to replace the Circuit City credit cards. The other option that cardholders have is to close the account. However, closing credit accounts will negatively impact your credit. It was also found out that most Circuit City cardholders were unaware that their credit accounts were still open. This leaves credit cardholders vulnerable to identify theft as well.

The best option for Circuit City credit card holders is to take the Best Buy replacement card and continue to use it as you did in the past at Circuit City. Best Buy is also going to honor the previous terms and conditions that you were given by Circuit City. This makes the transition very easy. The bottom line is that Best Buy is not going to change your terms (interest rates, due dates, etc) from what you are already accustomed too.


I am in no way being paid by Best Buy, but quite frankly, they are a superior store. Best Buy has a very good selection of CDs, DVDs, high definition televisions, computers, and almost anything electronic that you can think of. The prices are also very good as well. I have made many purchases in the past at best buy and will continue to do so in the future.

Labels: Best Buy, Circuit City, credit cards

JP Morgan Chase Eliminates Monthly Credit Card Service Charges



JP Morgan Chase & Co. has announced that it will refund monthly service charges on about 400,000 low interest credit cards. This move comes after thousands of consumers began to complain. JP Morgan Chase had announced to customers back in January that they were going to start to charge a $10 monthly fee and raise minimum payments from 2% to 5% of an accounts outstanding balance. However, it seems that JP Morgan Chase has had a change of heart. In April, Chase will cease charging the $10 monthly fee. Chase does plan to keep the minimum monthly payments at 5% of the outstanding balance.

It seems to me that some banks are trying to gain back customer confidence. JP Morgan Chase did accept $25 billion of TARP funds recently. Furthermore, credit card issuers have been under attack by consumers for unfair lending practices. Credit card issuers have recently cut cardholder lines of credit and raise interest rates on customers who have been paying their accounts on time every month. Card issuers claim that they have had to raise rates and cut credit lines in order to make up for losses due to delinquent accounts.

I think that the economy will eventually get better and credit will begin to flow again. The recent unleashing of the governments latest program TALF (term asset backed securities lending facility) will help credit to flow again. The idea behind the TALF is incentive institutional investors into purchasing consumer asset backed securities. Once these markets start to revive again, credit will start to unthaw, people will begin spending and jobs will start to be created instead of lost.

Labels: credit card service charges, credit cards, JP Morgan Chase, securitization markets, TALF, TARP

Lawmakers planning to create a Financial Products Safety Commission


Lawmakers announced today a plan to create a Financial Products Safety Commission that would oversee financial products such as mortgages credit cards, auto loans and retirement accounts. This commission would be similar to the Food and Drug Administration that oversees consumable consumer products. One of the main purposes of this commission is to oversee the mortgage industry. Mortgages have changed and become more complex in recent years. Not only are they more complicated, some of them are also predatory in nature. Many mortgage loans that were offered to people were very destructive. I heard about one company from California that was offering people the ability to pay half of the interest while the other half portion of the interest would be accrued on your principal. Once the mortgage re adjusts, these people are then forced to pay a much higher monthly payment then they could actually afford. Some people were duped into these types of loans while others did not plan how they were going to afford the house in the future. Mortgage brokers were more than happy to facilitate these types of loans as well. Everyone was making money, and people were moving into new houses. Unfortunately the house of cards came crumbling down.

Lawmakers are also looking at regulating the mortgage backed securities markets as well. They want to be requiring that loan originators stay with a portion of the loan to ensure that they have a vested interest that the securities will perform over the long run. Quite frankly, I don’t think that is going to be a good idea. I think credit originators should be able to sell their securitized products freely. The emphasis should be placed on the rating agencies. Regulators need to make sure that the rating agencies are generating unbiased ratings. During the housing bubble the rating agencies were manipulating their scoring methods in order to come up with AAA credit ratings. Rating agencies were under pressure to please banks that in turn wanted to sell more mortgages. Had the rating agencies been more scrupulous and under more regulation, banks would not have a choice then to be careful.

The creation of the securitization markets has helped our country. If banks were not allowed to package and sell their loans, our country would not have been able to grow as it has. Securitization markets have allowed investors the ability to build shopping centers, homes, hotels and all sorts of other infrastructure projects. These projects created jobs that fed our economy for many years. After the fall of Lehman Brothers, these securitization markets have all but dried up creating a lack of credit in our economy. This lack of credit has spurred a viscous cycle that has created job loss and financial hardships. I am in agreement that there needs to be more regulation in certain areas. I only hope that regulators will regulate and strangulate these markets.

Labels: asset backed securities, auto loans, credit cards, Financial Products Safety Commission, Lehman Brothers, securitization markets

United Airlines goes Cashless in the Sky


United Airlines recently announced that they would no longer accept cash on certain flights beginning March 23, 2009. The airline is going to be requiring that all in flight purchases be made with a credit or debit card. This will make things more efficient and easier for stewardesses when they take your order on your next business flight. Instead of having to hand out change and collect cash, airline flight attendant will be able to quickly process your credit card in flight.

Passengers no longer have to worry about having exact change to buy a cocktail during your flight. After March 23rd all you will have to do is “whip” out your credit or debit card and order whatever your want. Flight attendants will appreciate not having to handle cash and pass out change. This will also allow you to be able to “open a tab” much like you do at a restaurant or bar.

United Airlines is also announcing a joint venture with MBNA credit cards. Any purchases that you make in flight will earn you extra reward points. I wonder if they will give you extra rewards for shopping at the Sky Mall in flight magazine.

It will not be long before you are able to make your purchases in flight online. This would allow passengers to browse the available goods and make an immediate purchase. Type in your credit card information on the airplane’s individual computer screens and before you know you will be shipping that blanket you saw to your home. (I need to save this paragraph for another topic, but I just thought I would mention my ideas any way.)

It will not be long before other airline companies such as Southwest and Alaska airlines follow suit. Airplane travelers have always had to worry about having cash, preferably small bills like $5 or $1, on hand to pay the flight attendant for your beverages. Instead, travelers need to be sure to keep their favorite credit or debit cards on hand ready to make purchases.

If you are looking for a good credit card to take with you on your next trip, take a look at the American Express Starwood Preferred credit card. Earn 10,000bonus rewards points after you make your first purchase. This is enough to earn up to three nights free at participating Starwood hotels. Apply now and get a decision in 60 seconds.

Labels: Alaska Airlines, American Express Starwood Preferred credit card, credit cards, debit cards, travel, United Airlines

Three Reasons Why You Need A Secured Credit Card

There are many reasons why a secured credit card can benefit you, especially, if you have little or no credit history. A secured credit card is a credit card that is backed by some sort of cash deposit. In order to qualify for a secured credit card you need to send cash to card issuer as collateral. This cash remains in escrow until further notice. If you default on your payments, the card issuer will use your deposit to pay the outstanding balance. However, if you handle your account responsibly you will reap many benefits. Listed are three ways a secured credit card can help you:

1. A secured credit card can build your credit. If you have no credit or bad credit, a secured credit card can help you build up your credit. Should you use it responsibly and make the payments on time every month, this will be reported to all three credit bureaus. In time your secured card could even turn into an unsecured credit card because you have built up history with the card issuer.

2. Everyone needs some form of credit card to survive these days. In fact, you can not rent a car without a major credit card. Furthermore, credit cards are also used to make purchases online. There are a few processors that can process checks online, however, for the most part, if you do not have a credit card you will be limited when making purchases online.

3. The deposit in your account will earn interest. So long as you make all your payments on time, the deposit that you sent the card issuer will earn interest for you. This money will sit in a bank account that you will be unable to touch earning interest. This interest earned will also offset your interest paid, resulting in overall savings for using your credit card.

There are many ways that a secured credit card can help out anyone. The most important benefit of a secured credit card is the effect it will have on your credit. Should you use your card responsibly month after month, it will be reflected in your credit score. The better your credit score is the lower interest rates you will pay for future loans. Should you fail to pay the card as per the agreement, you will loose your deposit. Most secured credit card issuers will issue lines of credit between $500 and $10,000. The amount that you deposit will reflect your credit limit. A $1000 deposit will get you a $1000 credit line. The Applied Bank Visa Gold Card is an excellent choice for those seeking a secured credit card. Click on the card image below and apply online now.

Labels: Applied Bank Secured Visa Gold, credit card, credit cards, secured credit card, Visa Gold

Identity Theft on the Rise: Visa reports another Security Breach


If you are one of the millions of Americans who uses a credit card, be aware that identity theft is on the rise. According to visa another major credit card processing company has reported a security breach in its system. Visa is not saying who the credit card processing company is, however, it is reporting that a substantial amount of information was stolen. Furthermore, the breach does not only affect a particular brand of Visa credit cards. All brands have been subjected to the security breach. Officials are saying that only credit card numbers, PAN numbers and expiration dates were stolen. They have indicated that social security information and encrypted PIN information was not stolen.

Both Visa and MasterCard are in the process of identifying those banks whose credit cards were affected. Individuals should check over their statements carefully to make sure that there are not any unauthorized charges.
I know I am guilty of not scrutinizing my credit card statements very well. Today’s worldwide economic crisis has caused identity theft to be one of the most committed frauds in the United States. Thieves are very creative as to how they will steel information. Thieves will go so far as looking through dumpsters or find more sophisticated ways of stealing information through the Internet. Do not reply to suspicious emails. I have on more than one occasion received unwanted emails claiming to be from Bank of America, the IRS, and the latest one I got today claimed to be from JP Morgan/Chase. These emails claim that they need information to update your account. They will send you to an authentic looking website where you are supposed to fill out the form. Do not ever give these people information. First of all, large corporations and the Internal Revenue Service do not ever solicit information via email. Cyber thieves are looking for any method that they can to steel information such as bank account numbers, credit card numbers, social security information and even your state driver’s license information.

I recently wrote a blog entry about an Internet customer wanting to buy a large and expensive amount of goods from my online website. He was claiming to be a priest from Ghana, Africa making a purchase for his church. Although I was not surprised that a church would want to purchase my products, it did surprise me that he was wanting such large quantities, did not give a phone number and send me four different credit card numbers to make the purchase with. As soon as I tried to process the cards, they were declined. Furthermore, the address that he gave me for the billing address could be found on neither Map Quest nor Google maps. I knew that I was dealing with a thief and immediately called the credit card issuer.

If you feel that you are a victim of identity theft report it to your credit card issuer immediately. The Fair Credit Billing Act of 1975 protects us as consumers from these types of frauds. You have between 30 and 60 days to dispute the charge with your credit card issuer. More than likely, the card issuer will credit the account and investigate the charges. However, if you are looking to take a more pro-active role than a reactive one than I highly suggest that you click on our sponsor add below.

Labels: Credit card processing companies, credit cards, Fair Credit Billing Act, identity theft prevention, identity theft protection, visa securty breach

American Express Offers $300 to Cardholders to Close Accounts

American Express has found a polite way to close cardholder’s accounts. American Express is offering select customers $300 to pay off their balances and close the account. This move does not surprise me as credit card issuers continue to look for ways to limit their exposure. Since the collapse of Lehman Brothers in September of 2008 credit card issuers have slashed credit limits, limited marketing efforts and increasing interest rates and fees. These select cardholders have until February to decide if they want to participate in the offer. Furthermore, they are allowing those who choose the offer until March or April to close their accounts. American Express is supposed to then give you a $300 pre paid American Express debit card.

American Express stock has lost almost one-third of its value since last year. Recent unemployment has caused credit card delinquencies to rise more than forecasted. In order to expand its business, American Express has drifted away from catering to mostly affluent clientele. They have broadened their credit card portfolio to include loans to riskier individuals. This strategy has backfired for American Express due to the current economic downturn. American Express is looking for ways to save money and limit their risk exposure.

Every card issuer from J.P. Morgan/Chase to Citigroup has slashed credit card limits. This in turn has hurt our economy very much. Consumers with have had less money to make purchases from everything cars to television sets to video game consoles. The TALF (troubled asset loan facility) program is supposed to boost consumer credit. This bailout plan is supposed to give investors $1 trillion to purchase consumer asset backed securities. Since the collapse of Lehman Brother’s investments in asset backed securities have almost disappeared. The TALF plan is supposed to give investors confidences to once again invest in these types of securities.

In my opinion, American Express is looking for polite ways to cancel their less desired customer’s credit cards. These people might be less creditworthy and more susceptible to becoming delinquent with their bills. A $300 credit voucher certainly gives someone an incentive to close out his or her account. This is certainly a “nicer” way to cut someone’s credit. Instead of involuntary closing accounts like other credit card issuers have, American Express is giving certain cardholders a big incentive to closes out their account. This will certainly help out American Express’s public relations.

The last thing the country really needs is more slashed credit limits. The credit crisis has caused all kinds of havoc throughout our economy. As consumers, we need credit to continue to make purchases as we did. Businesses need this money to pay employees, who in turn spend money. The bottom line is less credit means less purchases. As purchases decrease, jobs will continue to disappear. This starts a viscous cycle that without government intervention will continue to spiral.

Labels: american express, credit card issuers, credit cards, TALF

When will the economy get better?

The credit crisis has affected everyone in the United States and is now spreading around the world. The Obama Administration just signed a $787 billion stimulus package that is supposed to end this economic downfall. The only problem is that Wall Street does not seem to respond to the news. The Dow Jones Industrial Average continues to fall despite all the efforts the government is making. Job losses continue to mount and government funding at the state level is drying up. Obama keeps telling us the economy is going to get worse before it starts to get any better. The American people, including myself are tired of hearing the same speech and continue to watch the economy further deteriorate. The biggest question on my mind and everyone else’s mind is when the economy will get better.

I do not believe that the economy will get any better until the government gets the housing crisis under control. The losses from the housing market continue to bog down the balance books of our nations largest banks. Bankers are afraid to lend more money because of the massive amounts of losses that they are experiencing in the mortgage industry. The sub prime mortgage market has damaged the economy beyond control. The government should buy up these “toxic assets” from the banks and work and figure a way to work with homeowner’s so that they can keep their houses. The problem is that many of these people have purchased homes that they simply can not afford. These people need to be flushed out of the market and replaced with homeowners that are able to keep up with the payments. Banks will be able to start lending money once bad assets have been cleared off their balance sheets. In the meantime, the government can hold onto the unoccupied housing inventory and sell it off as times get better. The people who could not afford their homes must become renters once again.

The other major factor affecting the economy is the lack of consumer credit available. Everything from retail sales to automotive sales has seen significant losses in sales volume since the credit crisis began in September of 2008. The problem is the lack of investors purchasing consumer backed securitized assets. The problems in the mortgage market have spooked investors away from these types of investments. The Obama Administration is supposed to unveil the TALF (Termed Asset Backed Loan Facility) to help unfreeze consumer credit. They have expanded this program from $200 billion to $1 trillion. Under the TALF program, the government is supposed loan money to investors who are going to purchase asset backed securities such as auto loans, student loans and credit card loans.

I am trying to figure out the TALF program but I do not completely understand how this is going to work. The only thing that I do understand is that the only way we are going to get this economy back in shade is to unfreeze the credit markets. The ability to sell these asset backed securitized investments on world wide market is going to be crucial. Unfortunately, the shenanigans of many an unethical mortgage broker has scared away investors from asset backed securitized investments. Once the housing market stabilizes investors will start to move towards these types of investments. It will be up to the Obama Administration to do anything possible stabilize housing and instill confidence in investment markets once again.

Labels: asset backed securities, auto loans, credit cards, credit crisis, TALF

Security Breach at Wyndham Hotels Risks Customers Identities

A recent statement issued by the Florida Attorney General is warning Florida residents that a data breach at the Wyndham Hotels and Resorts may have put up to 21,000 residents in jeopardy of identity theft.

A spokesperson for Wyndham said that they reported the breach of security to the Florida Attorney General in December of 2008. Wyndham believes that someone had unauthorized access to customer credit and debit cards. Wyndham has already sent a letter to everyone in that database with a list of pre cautions that they should take. The measures include obtaining a free fraud alert from one of the credit reporting agencies.

IF YOU THINK YOU MIGHT BE A VICTIM YOU CAN CHECK YOUR CREDIT REPORT FOR FREE BY CLICKING ON OUR SPONSOR LINK BELOW !!

Labels: credit cards, debit cards, Florida Attorney General, free credit report, Wyndham Hotels

Use Your Driver’s License like a Debit/Credit Card

Imagine being able to use your driver’s license to pay for your purchases. This idea is has come to happen in the state of Texas. The fact is that 24 states make driver’s licenses with a magnetic strip on the back. National Payment Card Association, a Florida based company, has now launched a service that turns your drivers license into a debit card. The service basically links your driver’s license information back to your bank account. This makes it possible for you to use your license like a debit card and make purchases wherever you go.

The State of Texas has already been participating in the program at certain participating gasoline stations. Texas residents who want to participate need to create an account by registering at RollBackPrices.com. Being that I am a Texas resident, I think I am going to sign up for this service very soon. I always keep my drivers’ license in my car and sometimes travel without my debit card. This will make it very easy for me to fill up my vehicle. Customers must create a PIN (Personal Identification Number) that they will use for this service. Be careful not to let anyone know what your PIN numbers, since, National Payment Card Association will only be responsible for up to $50 in fraud. You probably also have some sort of fraud protection with your bank, however, I don’t know if they will cover purchases made with your driver’s license.

The company plans to soon expand into grocery stores and drug stores. This service is very beneficial to many people. Another feature that the company offers is an instant email every time your driver’s license based debit card is used. Paypal is another popular payment processing company that offers this feature on its debit card. This feature ensures that you do not forget what you have spent. If you check your email as often as I do, you will be able to easily keep track of your expenses. Make a separate folder in your email account for emails coming from National Payment Card Association and you won’t loose track of your emails. You can then start to examine your expenditures simply by referring back to old emails.

The huge competitive advantage that National Payment Card Association has over other credit card processing companies is the fantastic rates they offer. Most credit card processing companies charge their customers, a per transaction fee plus a small percentage of the total amount charged. National Payment Card Association charges a small fee of $.19 (nineteen cents) per transaction. That amount is much cheaper than the $.25 transaction fee plus a %1.5 processing fee. These savings are then passed on to customers, According to company spokesman. An Austin, Texas based gasoline station offers a $.10 discount per gallon for store customers that use their Texas drivers license to process gasoline payments.

American companies do not stop innovating the way credit/debit cards are processed. I wrote about the marriage of your cell phone with your credit cards in a previous article that on this blog. This feature would allow people to use their cell phones to process their credit or debit cards. The use of a driver’s license to process your payments is another very innovative way to make payments. I think this idea is going to become more widespread as more states start adopting the use of magnetic strips on the back of their drivers licenses. At some point this week, I plan to sign up for this service. Once I sign up and start using it for a while, I will let you all know if I like the service or not.


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Labels: Credit card processing companies, credit cards, debit cards, National Payment Card Association

Escapre Card by Discover

Discover has recently launched a new credit card called the Escape by DiscoverEscape by Discover
You can also redeem your points for gifts should you not want to use your points for travel. Discover allows you to buy gift cards from over 90 of its established rewards partners. These partners include but are not limited to companies such as Borders Books, Amazon.com, AMC Theaters, Brooks Brothers, L.L. Bean, Eddie Bauer, Outback Steakhouse, Red Lobster and scores of other major retailers and popular restaurant chains. You can also use your miles to pay towards your monthly statement. The exchange rate is figured at $25 for every 5000 miles. I would definitely use the reward miles for restaurants or travel. You can figure that for every mile you earn one half of one cent or .005 would go towards your balance.

You can also use transfer your balance from another credit card and pay 0% interest for up to 1 year. 0% interest also applies to purchases 6 months. This is a great way to make large purchases such as televisions, jewelry or to pay for an emergency car repair. Instead of paying regular interest rates you wont have to pay anything. A $600 brand new television could be easily paid off at $100 per month for 6 months.

The only real drawback to the Escape by Discover
It is good to see credit card issuers coming out with new products. Our economy is in shambles and any new available credit source is welcomed. The 25,000 sign up bonus points and the excellent rewards program make this card very tempting. All in all, the this new offer by Discover is an excellent credit card offer that I would definitely recommend to anyone

Labels: credit card issuers, credit cards, Discover credit card, Escape Card by Discover

What mistakes should you avoid when transferring your balance from one credit card to another?


We all enjoy the freedom our credit cards give us, but when the freedom comes with a high interest rate we need to look at our options. If paying off the whole balance isn’t something you can do at the moment, then you will want to look at transferring your balance to a credit card that offers 0% interest on transferred balances. Sounds like a great idea, you have a high interest rate with a high balance, and you receive a card offering 0% interest rate on transferred balances, what could go wrong?

There are a few mistakes that you could make when transferring your balances. So doing your homework is very important. Now that almost every credit card company has a website, you can investigate most of the details of the card’s transferring policy. Look in the fine print for the following items:

• Avoid balance transfer fees. These fees can be identified as a percent of your transferred balance or a specific dollar amount. Fees are generally limited to $50-75.00; while that doesn’t sound like much, you were transferring your balance to avoid interest and fees.
• What is the expiration date for the 0% interest? Six to 12 months is generally the length for 0% balance transfers. Track the balance transfer duration on your own as the duration typically begins the moment the balance shows up, not the billing cycle. If you lost track or never tracked it to begin with, call the company and find out the date that the balance will begin to accrue interest charges.
• Watch carefully that you do not make a cash advance instead of balance transfers. Often times you will receive checks from the card company to use for cash advances or paying other bills with a check when the card can’t be used. These are not balance transfers and will be charged interest. Only using the card for 0% balance transfers will result in no interest charges.
• Always make a payment. If you miss a payment, you will begin accruing other charges; late fees and over the limit fees are two fo the most common, if not making a payment and the late fees bring the balance over the limit.
• The 0% interest does not extend to purchases on that card. Make certain you know the interest rate on balances other than transferred balances. Often times the 0% interest is made up on purchases on the card. Money has to be made for the company somehow.
• Payment is applied to the lower interest first on the balance. If you have made a purchase or cash advance on this card in addition to the balance transfer; your payment will pay off the balance transfer portion first. This enables the company to make money on the portion of the balance that charges interest.

Have a plan on how you will be paying the transferred balance before it begins to be charged interest. Put extra money in your savings account to earn interest while you make interest free payments on the transferred balance. You will be making money instead of spending extra money on this transferred balance. Make certain you pay the remaining balance off before the last billing cycle of 0% interest. You do not want to be charged interest because you missed the cut off by one or two days. Ensure you have plenty of time.

Cards that offer 0% interest on balance transfers can be a great way to save money or ease you through a lean cash period if you are informed and savvy. Do your research, track your time carefully and plan the balance pay off correctly and you will come out financially ahead.

Labels: 0% credit card, balance transfer credit card, credit cards

New Federal Program Aimed to Help Consumers Obtain Credit

A new program by the Federal Reserve is aimed at making it easier for consumers to get credit cards and auto-loans. These loans might not necessarily be at lower interest rates but should be easier to obtain. The goal of the Fed is obviously to loosen credit markets and once again spark consumer spending. Next month the U.S. central bank will begin offering up to $200 billion in loans to investors that have AAA-rated securities backed by new consumer loans and small business loans as well. The lack of credit available for both consumers and businesses has devastated our economy. In order for our country to come out of this recession we will need to make credit available again for consumers.

Credit card companies have been cutting back on the number of new customers as investors have fled the purchase of credit card bonds. The amount of new credit card solicitations has almost completely gone non-existent. Card issuers are now pulling out of many affiliate-marketing programs as well. Credit card affiliates direct new customers to card issuers who in turn pay a commission to the website should the application is approved. However, since November of 2008 many card issuers have been removing certain card offers from the affiliate marketing channel. However, as market conditions worsen, some card issuers have completely pulled out of the affiliate channel. Bank of America, Chase, American Express, Citigroup and new Capital One has either pulled out completely or partially from affiliate marketing channels.

In addition to acquiring fewer customers, card issuers have also cut back lines of credit for existing customers. The lack of credit availability has created a domino effect across every sector of the economy. Consumers have been spending less due to the lack of credit. The lack of consumer spending then causes retailers to cut back on employees, thus continuing the loss of jobs.

The flow of credit back to consumers will spur spending once again. This new program by the Federal Reserve is supposed to address the lack of consumer liquidity directly. Credit card issuers rely on the purchase of credit card backed bonds in order to continue lending. Credit card companies do not keep loans on their books. They sell the loans on Wall Street as bonds. The idea behind the Federal Reserves new consumer lending program is to get investors purchasing consumer loan type bonds. This includes car loans as well.

Our country needs credit to help sell products. The auto industry has also been devastated by the credit crisis. Every automaker from General Motors to Toyota has experienced losses never seen before. Car dealers do not blame the lack of traffic into their dealerships for the lack of sales. They are unable to obtain financing for a large percentage of new customers. Carmakers have been forced to shut down production in order for dealerships to sell off excessive inventory. The plant shut downs have affected the entire automotive supply chain. Point Logistics, a dedicated trucking company for General Motors has seen a 50% decrease in its business. This has forced the company to cut back on employees and reduce hours as well.

As I have said many times before, the Obama administration has a very difficult job ahead of them. The new government spending initiatives are aimed at creating new jobs. Consumers without employment can not pay debt, nor can they make major purchases, such as automobiles and other higher dollar goods. I am hopeful that the new administration will succeed at restoring our economy back to normal.


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Labels: consumer loans, consumer spending, credit card bonds, credit cards

Watch out for Cyber Fraud.

The other day I wrote an entry about a experience I had with a customer. To make a long story short, this guy wanted to buy some shade sails that I sell on the internet. Anyway, he claimed to be a Reverend from Africa wanting to buy 30 shade sails for his church. The total order was going to be about $12,000 (badly needed money) and so he sent four different Mastercard credit cards for me charge his order with. I was kind of suspicious of a scam but not 100%. As soon as I went online to try to charge the cards they were declined. I sent him an email back stating that the credit cards had been declined and two days later he sends me another email with four more Mastercard credit card numbers. Different then the ones he had sent before but they all had same eight digits as the other ones. By this time, I knew I had a scam artist on my hands and decided to call Mastercard to find out if the cards were valid or not. They in turn instructed me to call Citibank. I then called Citibank gave them the card information and sure enough, none of the information that he gave was matching.

The next day, as I was doing research for this blog, I found an article about a company called Heartland Payment Services who processes credit cards. Unfortunately, a hacker broke into their system and stole an undeterred amount of credit card numbers. They must have stolen thousands since this company processes credit card for more than 250,000 companies. I might not be a detective, but I would not suspect that this person tried to pass off some of those stolen card numbers. Heartland has been able to determine how long the spy ware was embedded within their system.

Cyber fraud is a very common occurrence these days. I receive every day emails claiming that I won the lottery or some sort of wacky job offer where I am supposed to be receiving monies on behalf of some foreign company. I have even received an email claiming to be the Internal Revenue Service. They then go on to say something about my stimulus check. The IRS does not solicit people via email. I have also received email from Bank of America asking me to update my account information. I do not even have an account at Bank of America. Every kind of scam that you can think of has more thank likely already been thought by some cyber thief in a foreign country.

Africa, in particular Nigeria, is well known for these types of con artists. They operate in internet cafes half way across the world prying on unsuspecting victims. Many people have fallen victim to these types of scams. I remember watching a documentary on 20/20 about a doctor that was conned by one of these con artists. Instead of using their knowledge for something productive, they use their intelligence for something sinister. These con artists are even celebrated over there.

Anyone can fall victim of cyber fraud if they are not careful. This individual that was trying to pass me the stolen credit card numbers to purchase my shade sails were looking to buy things on the internet that they could resell. It did not really make sense to me why this Rev. Oliver Smith wanted to buy 30 shade sails. He could have also tried to rob me by asking for a bank account number where he could make a wire transfer. That thought had run across my mind as well. People need to be careful with their credit card and personal bank account information. People need to look out even more especially during these hard economic times.

Labels: credit card, credit cards, cyber fraud

Why the Government Should Invest in Credit Card Bonds


The credit card industry has taken a significant toll since the onset of the credit crisis. Direct mail credit card marketing has seen a significant drop in the amount of mail being sent. Credit card issuers have pulled cards away from the affiliate marketing channel as well. The problem is that card issuers are having a hard time securitizing credit card debt. By that I mean, that credit card issuers are having less success bundling credit card debt and selling it off as an investment in Wall Street in the form of credit card bonds. The sale of credit card bonds is down 50%, thus so are approvals. The credit card industry needs to be able to be able to sell their receivables in order to generate new customers. As part of the economic stimulus package I think the Obama Administration should start buying up credit card bonds. This way consumer credit is unfrozen and people can go out and spend once again. Credit Card liquidity is needed in the economy in order to keep people shopping. The Obama administration needs to invest in credit card bonds and thus increase the spending power of the American consumer. Consumer spending via credit cards creates jobs in every sector of the economy from retail to logistics.

Retail spending has seen a significant drop off because of the credit crisis. More Americans these days putting their money back in the cookie jar. Even though some people have money they are not spending it. Job uncertainty is at an all time high these days. No one wants to spend money if they fear that job loss is possible. However, part of the reason for all these job losses is that no one is spending money. It is almost like a viscous cycle as well. Spending decreases as people continue to hoard money. Jobs suffer and continued losses occur because people are not spending. The reality is that economic growth happens because of consumer spending; not saving. The credit card industry has made it possible for consumers to spend money. The retail and service industry without credit cards is like the housing market without mortgages.

The Obama administration needs to stabilize the credit card industry as well. Card issuers have seen significant losses due to the credit crisis. The collapse of the mortgage industry has caused significant job loss in the United States. Those who are now unemployed are having a harder time making their credit card payments. In response, the credit card industry has had to reduce spending limits and increase interest rates in order to make up for the losses. This reduction in consumer credit has adversely affected spending. As I stated previously also, the reduction of spending has destroyed the job market as well. The government should invest in credit card bonds and as a condition require that card issuers lend more money to consumers. In order to save the economy we need to re establish consumer confidence and resume lending.

Credit cards have empowered consumer spending for many years. This spending has been the number one factor causing economic expansion. People with credit are able to go to restaurants and stores to spend money. Malls and shopping centers are built in order to facilitate the consumers every desire. Stores are forced to shut down when spending decreases. Circuit City has become the most recent victim to fall because of the credit crisis. 30,000 more jobs have been lost. Circuit City blames its failure on reduced consumer spending and its lack of ability to secure loans. The Obama administration needs to address this problem very soon. Once credit begins to flow again spending will increase, jobs will be created, and our economy will be back on track.

Labels: Circuit City, credit card, credit card bonds, credit card issuers, credit cards

Capital One No Hassle Points Rewards

You’ve worked hard at keeping your credit on track, and you deserve a reward program that reflects that. The Capital One No Hassle Points Rewards is an excellent option for you because you’ve worked hard, and you need a program that works just as hard as you do.

With no annual fee, and a low interest rate for balance transfers and purchases, it’s not only simple to save money on the things you buy, but also a great way to earn two points for every dollar you spend on every day purchases such as groceries, filling up on gas, and drug stores- but also, one point for each dollar on every other purchase you make. With no limit on the number of points you can earn, and points that don’t expire, it’s a great way to earn your way towards gift cards, travel and other merchandise. You don’t have to search for special places to earn your points, which makes this a very easy program for your busy life.

Also, it offers an APR of 0% until October of 2006, while still providing you with the common benefits of a platinum reward program you already come to expect from Capitol One- up to $100,000 in travel accident insurance, extended warranties for purchases, and emergency roadside assistance. You can rely on the benefits you look for, and enjoy the rewards you’ve earned with this card, even as you just go about doing the things you do from day to day.

You’re savvy about the things that matter to you and your credit and now you’re ready to see what rewards programs have the most to offer you. Capital One No Hassle Points Rewards has impressive benefits that actually work for you as well as giving you everything you already come to expect. Isn’t it time you found a points reward program that gives back what you’ve earned?

Labels: Capital One No Hassle Points Rewards, Captila One Credit Card, credit cards

Cash vs. Credit Cards

Thirty years ago very few people in the United States had credit cards. Today there are more than 650 million credit cards issued. As a kid in the seventies and eighties I do not remember seeing credit cards being accepted at the movie theatre. For the most part, everyone paid everything with cash. Things have changed drastically from where they were twenty or thirty years ago. Today there are credit cards everywhere from the movie theaters to the back of a taxi. It is now hard to imagine even going to the grocery store and not being able to pay with your credit card. Credit cards have completely changed the way we pay for things. It is even harder to get along without a credit card if you want to make purchases online. Have credit cards changed society for the better or for the worse? In this post I want to compare the pros and cons of life, as it once was when people paid with cash versus our modern cash less society.

In the days of black and white television everyone paid for things mostly with cash or checks. People went to the department stores to make purchases and always paid with a cash or check. Cash of course would always be the preferred method. A cash based society operates on less debt. People did not use credit cards to finance purchases. People used layaway for purchases that they could not afford. Cash was kept in the bank or in the “cookie jar”. If you did not have cash, you would pay with a check. Finances were much simpler. You spent what you had and paid with cash.

In 1970 only about 51% of American families had a credit card. Today you can’t throw a rock without hitting someone with a credit card. In the old days, everyone had to send his or her bills out in the mail or stand in line to pay. You can now pay most bills either over the phone or online if you have a credit card. This is a major improvement over writing checks and sending out a stamped envelope. The biggest advantage to having a credit card is the ability to have access to emergency loans when needed. Also, credit card companies offer rewards for spending money on their cards. That would be impossible to do with cash. Rewards earners can cash in their points for cash back, products and the most popular is airline points. 20,000 reward points can go along way. Credit cards also offer insurance on purchases that you make online or at the department store. The other advantage to having a credit card is how easy it is to replace if it gets lost. If you loose your wallet with a wad of cash chances is slime that you will see it again. If you loose your credit card all you have to do is call the issuer and cancel it. You are protected even if someone makes unauthorized charges on your card.

In all, I think that life is better now with the widespread use of credit cards. Credit cards make things easier to pay for. You can now log onto the computer or use your telephone to pay a bill with your credit card. Also, credit cards offer protection for consumers. Cash purchases do not get the same benefits that you can get when purchases are made on a credit card. There are no rewards points earned on cash purchases nor is their any consumer protection. Credit cards have given our society the flexibility that a cash only society can not provide. Money can be obtained for emergencies when needed. You can also go online and see a real time transaction report of your spending. In order to track cash expenditures, you need to save receipt, or write down what you spend on paper or pad. Credit cards have definitely made our lives easier and given us spending flexibility as well.

Labels: business credit cards, credit card, credit cards, small business credit card

How to Stay Out of Credit Card Troubles

Credit cards have essentially replaced the use of cash in our society. They are used everywhere these days. You can use your credit card to go to the movies, dinner, shopping, club hopping, traveling and just about anywhere that you can imagine. The lure to use your credit card has grown more and more over the years. Credit cards can be a great tool if used properly. However, when abused credit cards can get you in a lot of financial trouble. Staying out of trouble with your debit card is as easy as following a few basic guidelines.

Do not spend more than you can afford. This is the very most basic guideline to follow if you want to be a responsible credit card user. There are many people who apply for credit cards and use them recklessly. Reckless spending patterns are very easy to get into with a credit card. Most of are used to spending physical cash from our pockets. The day starts and you have $35 in your pocket. You spend $12 at lunch and put $20 of gas in your car. This leaves you with $3. At the end of the day your realize that you have spent $32 since you physically started out with $35 and are left with $3. With a credit card it is very easy to keep on spending. People a lot of times do not realize how much they have spent on their credit cards until the bill comes. I know because this has happened to me before as well. If you have a $10,000 limit and $4000 monthly income before you know it you will have racked up a bill if you are not careful. Since you are not actually physically seeing your money disappear it becomes very easy to start spending. However, if you have a plan and stick with you will be all right. A person with a $4000 monthly income should only spend what they plan on repaying at the end of the month.

Another good way to avoid getting into credit card hot water is too leave your credit cards at home. The old saying “out of sight out mind” is so very true in many situations. If you leave your credit card at home and not take with you too the mall with your friend, chances are you will not end up spending any money on things that you do not need or can not afford. Spend cash if you plan to have a night on the town. How many times have you gone to a club, had a few drinks and ended up spending more than you planned on your credit card? I know it has happened to me before. Alcohol lets free on inhibitions and many times the credit card spending will start. If you leave your credit card at home and spend cash, you will be limited to spending a certain amount. In the morning when you wake up you will certainly be thanking yourself for following my advice.

Log on to your online account frequently. As I mentioned previously, it is very easy to forget how much you have spent on your credit card. Most, if not all, credit card issuers have an online account for you to log on and check your statement on a regular basis. Most online sites will even track your spending in real time. In other words, if you spend $8 on lunch at the Chinese restaurant and then go log on to your account an hour later the charge will show up. Pay pal has a service that will send you an email or text message when a charge is made to your Pay Pal issued credit card. This is a very good way of keeping track of your spending. Other credit card issuers should also offer customers the same feature. Come home to your computer, go through your emails and see exactly how much you have spent.

Credit cards used responsibly will benefit anyone. There are often emergencies that come about where a credit card comes in handy. Sudden car repairs, doctor’s expenses and home repairs can easily and quickly cause you to end up in a financial fix. If you have a credit card and have used responsibly you can get yourself out of that bind quickly. However, if you have overspent your credit limit you might continue in a financial bind should you not have any other way of obtaining emergency money. Do not spend more than you can afford. Leave your credit card at home. Go online frequently to check your account. Stick with these guidelines and you will definitely keep out of financial trouble with your credit card.

Labels: credit card, credit card advice, credit card issuers, credit cards

Credit Card are Accepted Everywhere These Days

Credit cards and debit cards have definitely transformed the way we do business these days. These plastic cards that we take so much for granted have enabled us to engage in sorts of commerce. The old fashioned mail order days when you sent your check to some post office box somewhere in America are over. Although I am sure any mail order business will not refuse your check in the mail; these days mail order companies have transformed into Internet businesses that can process your order with credit cards in a flash. We were using credit cards over the phone way prior to the Internet. Credit cards are now being accepted in places that you would have not even thought of before.

Technology is now changing the way credit cards are processed and also opening up new avenues where credit cards can be accepted. The invention of the cell phone has made it possible to process credit cards almost anywhere on this planet. If you had a satellite based phone you could litteraly process a credit card anywhere in the world. This technology now makes it possible for merchants to just call a phone number, enter the card information and wait for an approval decision. Twenty years ago it would have been very difficult to set up a weekend flea market stand that could accept credit cards. Today many flea market vendors are able to accept credit cards very easily. No longer is it uncommon to go to a place like a flea market and use your credit or debit card.

Airlines are also joining the plastic money band wagon. Major airlines like Air Tran, American Airlines, Continental, Delta, Frontier, Jet Blue, Spirit and even Southwest Airlines are accepting credit cards in flight. Credit and debit cards are making our lives easier even while we travel on our favorite airline. Exact change is no longer required to purchase cocktails or beer on your flight from New York to Phoenix. These days it is possible to give the stewardess your debit or credit card instead of the cash that you have in your wallet.

You still do not necessarily need your cash once you have landed and ridding in a taxi. A company headquartered in New York has now created a service that allows taxi drivers to process credit cards in the back of their cab. Creative Mobile Technologies make a device that will allow you to swipe your credit card within seconds. This credit card swipe machine also includes a small touch screen monitor where customers can view where they are on a GPS controlled map. They can even get information about restaurants and other places of activity within the area. According to a press release this new service is being utilized in Boston and New York. It will not be long before other Taxi companies catch on and begin offering the same service.

Credit and debit cards are being accepted in wider variety of places as our society becomes “cashless”. Many people in today’s society carry at least a debit card if they do not have a credit card. Furthermore, as more employers start adopting direct deposit, even more people are using at least a debit card. We no longer have to be embarrassed by holding up the checkout line while we write out a check, have your identification checked and then get it processed. Instead, swipe your credit or debit card into the card reader, enter your pin code and your transaction takes place in a flash. Credit cards also offer protection from carrying cash as well. Loose your cash and your chances of recovering what you lost are usually slim. All you do is call customer service and cancel should you loose your debit or credit card. Furthermore, a new card is sent to you right away and your back in business. Now that you can use your credit card virtually anywhere, it make more sense to leave your cash in the bank.

Labels: Creative Mobile Technologies, credit card, credit card reader, credit cards

Capital One No Hassle Rewards Student Credit Card

In 1988 Nigel Morris and Richard Fairbank founded Capital One. The core focus of Capital One was to provide consumer loans such as credit cards, home loans, auto loans as well as banking and savings products. In addition, Capital one was one of the first mass marketers of credit cards. They began this mass marketing in the early 1990s. The Capital One No Hassle Rewards student credit card is an excellent choice for students those with limited credit history.

Capital One has established itself as a significant player in the credit card market. Students will be happy to take advantage of the many features that this credit card has to offer. 0% interest until June will give cardholders a chance to save money on purchases they make with their credit card. Charge your books on your Capital One No Hassle Rewards student credit card and avoid paying any interest until June. This 6 month no interest policy applies to all purchases made during the introductory period.

The Capital One No Hassle Rewards credit card also has an excellent rewards program. Cardholders can earn 1% cash back for all charges made on their Capital One credit card. This is a great way to save money as well. Use your credit card where you spend the most money like at grocery stores or gasoline stations. Should you spend $5000 throughout the year on your credit card, you will earn $50 back in rewards cash. Furthermore, there is no limit to the amount of cash back rewards that you can earn. In addition, you will earn a 25% bonus based on your previous years cash back earnings. Furthermore, there is no limit to the amount of cash back that you can earn. There is also no time limit to redeem your rewards nor is there a limit that you must meet before you can withdraw that rewards cash. Also trade you rewards points for gift cards as well.

Another major advantage to this Capital One student credit card is that it protects its customers against liability relating to fraud. You will have $0 liability should your credit card be stolen from you and used before you are able to report it. By law credit card issuers can hold their customers up to $50 responsible for fraud. Capital One goes the extra mile and does not put any responsibility on the cardholder.

Students also pay a 3% fee for all cash advances they make on their Capital One Rewards No Hassle student credit card. The only disadvantage to your cash withdrawal is that the minimum fee will be $10. Therefore should you withdraw a small amount of cash like $30 you will be billed $10 for that transaction. Should you withdraw a larger amount like $400 your fee will be 3% of the withdrawal which equals $12. It makes more sense to use the cash advance only when you need to withdraw a relatively large amount of money.

Students should also be aware of additional fees that Capital One charges for late payments and for going over your limit. The late fee is usually calculated on the amount of your outstanding balance. The fee is $15 for outstanding balances between $0 and $99.99. A fee of $29 is applied to all outstanding balances that are between $100 and $249.99. For outstanding balances of $250 or more, a $39 late fee is applied. Over the limit fees are also based on your credit limit. A fee of $19 is charged for going over your limit should that amount fall between $0 and $499.99. Should your credit limit be within the $500 to $999.99 range then your over the limit charge will be $29. For credit limits of $1000 or more it will cost you $39 to go over the limit.

The Capital One No Hassle Rewards student credit card is an excellent credit card to build your credit history. Cardholders will be very pleased with the rewards programs offered as well as the 0% 6 month introductory fee. Students who are approved for the Capital One credit card will ultimately benefit from using this credit card.

Labels: 0% credit card, credit card issuers, credit cards, Rewards Credit Card, Rewards Credit Cards, student credit card, student credit cards

5 Rules Everyone Should Know about Credit Cards

1) A credit card does not become valid till it is signed

The back of every credit card has a section for a signature. Usually it is a small strip that you can write on. Next to the strip there is a small notation that says “not valid until signed”. This is where you want to sign your credit card. The card is not considered valid until this section is signed.
There are steps that a merchant should take when he or she is presented unsigned card:

a. The merchant should first ask for the customer’s identification. Adriver’s license is ideal. A signed passport will work should the customer not have a driver’s license.

b. Then, the merchant should ask the customer to sign the card and compare the signature to the signature on the driver’s license or passport. Should the signatures match, then card is good. If the signatures do not match, then the merchant needs to call the card issuer and report possible fraud.

c. If the customer refuses to sign the card, then the merchant should not accept the credit card.

2) Liability for the unauthorized use of a credit card can not surpass $50.

The Fair Credit Billing act was established to protect consumers against fraud and billing errors. In order to initiate a dispute, a cardholder should write the credit card issuer within sixty days of receiving your credit card statement. Furthermore, this letter needs to be sent via US mail. However, the cardholder is only responsible up to $50 should the unauthorized use not be reported within the sixty days.

3) A minimum purchase can not be required by a merchant as a condition to use your credit card.

Have you ever been to a convenience store to purchase a soda and chips with your credit or debit card only to find out that the store owner is requiring you to charge a minimum of $5? This practice is against the user agreement that the merchant signs when they are given a credit card processing account. The only thing the merchant can do to offset fees incurred by accepting credit cards is to increase prices. They can include a cost factor in the price of the soda and chips, but they may not require customers to make minimum purchases or charge a surcharge for using your card. In today’s direct deposit society more and more people carry debit or credit cards as opposed to cash.

4) Do not buy extended warranties on purchases if your credit card already has a purchase warranty program.

How many times have you gone to Best Buy or Radioshack and been asked to purchase an extended warranty on what you just bought? For those of you paying on your credit card chances are, your credit card issuer already comes with a buyer protection program. This is one of the advantages to using a credit card to make purchases as opposed to cash. Be sure you know the features that your credit card has to offer. In addition to purchase protection, many credit cards even give you rental car insurance or even road side assistance.

5) Merchants are not allowed to pre authorize your credit card to include a tip.

An example is when you go out to dinner and pay your meal on a credit card. You are fist given the bill, and then you give the waiter or waitress your credit card. This person must authorize your card for the amount of the meal only. They may authorize the tip without your say so. You (the cardholder) then decide how much tip to give once the individual brings back your credit card and receipt. Should you choose to give a tip, then the restaurant is allowed to charge your card.

Labels: credit card, credit cards, Fair Credit Billing Act

Capital One Business Platinum Preferred Credit Card

Capital One was founded by Richard Fairbank and Nigel Morris in 1988. Capital One Financial Corp’s primary focus is on credit cards, home loans, auto loans, banking, and savings products. Capital One was one of the first credit card mass marketers starting in the early 1990s. The Capital One Platinum Preferred business credit card is an excellent choice for any consumer.

Capital One is one of the strongest credit card companies on the market today. This credit card has many features that customers can take advantage of. The most enticing feature that the Capital One Platinum Preferred business credit card has to offer is its introductory rate. New cardholders will be happy to take advantage of 0% APR on purchases and balance transfers until 2010. That gives new customers one year without having to pay interest. This credit card is an excellent choice when transferring a balance from one card to another. Transfer your balance from another credit card If you are paying a high interest rate. Someone with a $10,000 balance being charged 18% will save $1800 by transferring their balance to the Capital One Business Platinum Preferred credit card. If you are planning on making a large purchase you will have the opportunity to pay it off in a year.

This credit card also offers an excellent rewards program. You can choose from multiple rewards programs such as gasoline stations, building supplies and hardware, computers and electronics, office supplies and furniture, advertising and shipping. They will even offer you triple rewards on the category of your choice. All other categories earn one point per dollar spent. Business owners can save money using these rewards categories. If you’re company ships products on a daily basis, you can earn triple rewards for using your Capital One Platinum Proffered credit card with most major parcel carriers such as UPS or FedEx. You can also use your Capital One credit card for travel miles as well. There are no limits on the miles you can earn, no expiration either. You get to keep your miles for the life of your account. Furthermore, you get to fly with any airline that you choose with no blackout dates or seat restrictions either.

There is no annual fee either to be a Capital One Platinum Preferred business credit card holder either. There is small $39 over the limit fee should you over charge on your credit card. Furthermore, there is also a late fee charge. This fee is based on your outstanding balance. If you owe less then $100 your late fee will be $15. If you owe between $100 and $249.99 your late fee will be $29. For a balance of $250 or more, you will have to pay a $39 late fee as well. Capital One also offers an excellent cash advance rate. Pay 3% interest on all cash advances using your Capital One Platinum Preferred business credit card. Therefore, should you withdraw $1000 cash for an emergency, you will only have to pay a $30 fee. Other card issuers charge much more on cash advance loans.

The Capital One Platinum Preferred business credit card is meant for those established business owners with excellent credit. Capital One is offering up to $20,000 credit lines for those that qualify. After the introductory period, the APR for balance transfers and purchases will be as low as 14.99%. Interest rates are determined by the applicants credit history and will vary accordingly. In all the Capital One Preferred business credit card is an excellent choice for those looking for a good business rewards credit card. Card users can save money by choosing from the many categories offered by Capital One.

Labels: business credit cards, business rewards credit card, Capital One Business Platinum Preferred Credit Card, credit card, credit cards

Corruption Still Exists in Our Government Agencies

Six top officials from Lexington Kentucky’s Blue Grass Airport lost their city issued credit cards, according to an article released by the Associated press. This was discovered that they had charged $4500 at a Texas strip club. This came after executive director Michael Gobb had charged around $200,000 on travel and other expenses in the past two years. Furthermore, it is also believed that Gobb was one of the strip club attendees as well.

I have never heard of any government jobs that allow you to use your credit card at strip clubs. Never mind the salesman that takes their clients to the clubs to close a big deal, these guys were out to entertain themselves. How did the executive director get away with spending so much money for so long? This does not make sense to me. Then again, many things are not making sense these days. This outing took place in 2003. Why does it take so long for these things to be found out? I guess it must have been easy to get away with such things when the executive director is involved. $4500 spent among 6 guys equates to $750 each person. How many drinks and table dances does this add up to, I wonder? They must have had the VIP room all to themselves all night. It all sounds like a great night with fact that they spend taxpayer dollars.

This does not come as a surprise to me. There are a lot of corrupt individuals out there in all-economic sectors including the government. I recently heard about an incident involving some inspectors working for the FDA. They were in cahoots with a fumigation company who was doing work for the government. In addition, all this was taking place at a US Customs import lot. Certain commodities are supposed to be fumigated before entering the United States. These guys were falsifying documents stating that the goods had been fumigated when in reality nothing had been done. Then they would turn around and charge the importer (who is responsible for paying) and split the money.

The Lexington City employees also must have been in cahoots with each other. There is supposed to be a system of checks and balances within our city or federal government departments. However, it seems that these checks and balances do not always work like they should. A $4500 trip to a strip-club on taxpayer money should be made a crime. These guys should all be made to pay back what they spent plus interest.

Labels: credit card, credit cards, government corruption

Watch Out for Credit Card Billing Mistakes


In today’s society there are literally thousands of credit card transactions being processed every day. Billing mistakes will commonly happen. If you do not watch your credit/debit card statements closely, chances are you will get the occasional double charge. I recently had an experience at a Valero convenience store where I live in Texas. They ran my debit card, which had been chewed up by my dog, through the machine to make a $20 purchase. Immediately the clerk responded that it did not go through. I asked here to run it again and she came back to say again that it had not gone through. A few days later, I logged onto my online account to check my account balance, and sure enough, the charge was there. The transaction that the clerk had repeatedly denied that it went through was charged on my account. I went back to the same store, and made a comment to the clerk. She claimed that it was impossible, and that I was wrong. She then gave me phone number for me to call to report the problem. I did not argue with the clerk, as I figured there was really nothing that she could do about it. This is just one example of double billing.

Macy’s, a well-established retailer, recently experienced problems with their credit card software that caused them to double bill its customers. This took place during a two hour period right before Christmas 2008 shopping. Fortunately, the retailer was able to spot the error and make corrections on customer’s accounts. However, if it were not for Macy’s discovering their error, many people would have been double charged on their credit cards. Many people would have caught the error and reported the problem, however, just as many would not have seen the problem.

Have you ever given a credit card to a waiter for him or her to charge your meal at a restaurant? I am sure 99% of you who are reading this article will respond yes to that answer. Employees can very easily make a mistake when swiping a credit card. The truth is you have not seen this person actually handle your credit card. A rookie might accidentally run your card more than once thinking that he or she was unsuccessful the first time. However, this individual might not realize that they have already charged your card. A second or third swipe might very well cause that person to unknowingly bill your credit card. Those of you who check your statements on a regular basis will probably spot the double billing. However, those who do not check their credit card bills thoroughly might not see the error. This ends up being a windfall for the restaurant and big loss for you.

The moral of the story here is to check your credit card statements every month. Chances are, at some point in time you will discover a billing discrepancy. Pay-pal, an online payment processing company offers an excellent feature for subscribers of their credit and debit cards. They will send you an email every time that your credit card is used. This would be a great feature that other card issuers should offer their customers.

Once you have detected a billing error or even fraud on your credit or debit card you need to contact customer service. The advantage to having a credit or debit card is that they will immediately give you credit. In my case, I had to fill out a form at the bank that issued me the debit card. They will then go argue the problem with Valero. In the meantime, I have been given credit. Should Valero prove me wrong, the bank will refund them the original charge. I seriously doubt that Valero will be able to contest this. In 2009 I plan to be look over my statements much more thoroughly, especially since I am one of those who does not normally look at billing statements.

Labels: credit card, credit card billing issues, credit cards

How to Negotiate Credit Card Companies

1. Save credit card offers sent in the mail.

How many times have you gone to the mailbox and found credit card offers from every issuer you can think of? You can use these offers to your advantage when negotiating interest rates with your credit card company. If another company should offer you a better offer in the mail, show this offer to your current card issuer. This is proof that you are a good customer. Furthermore, this shows that other credit card companies also desire your business. Be sure to have the ability to prove to your current card issuer that other companies are really after your business. This can be easily done with a scanner and/or fax machine. Make copies of the card offer so that you can easily fax proof of the other offers.

2. Always read the fine print.

Be sure you are aware of both major and minor details that are written in fine print. Credit card companies are famous for making enticing offers without giving all the true details. Many times card issuers offering a 0% interest rate are only doing it for a specified amount. This is known as an introductory offer that will usually not last for more than 6 months to a year. Furthermore, the more knowledgeable you are, the better prepared you will be to negotiate.

3. Always try to speak to a supervisor when calling customer service.

Many credit card companies have dedicated call centers that handle the hoards of questions and issues that customers have on a day to day basis. These jobs are usually low paying and have a high turn over. Many times, you will speak with an individual who does not know 100% how to handle customer’s issues. This person, out of ignorance, may tell you that something what you are requesting is not possible. However, we all know that in negotiating anything is possible. A supervisor is more than likely much more knowledgeable and has had experience dealing with different types of issues. Most company policies will require a supervisor to come to the phone when requested. Simply ask the customer service rep to speak with a supervisor. Sometimes they might be able to help you, however, more often then not you will get better results when speaking with a supervisor.

4. Be ready to sell yourself.

Once you have the supervisor on the line, you need to convince that person why you are valued customer. If you are seeking a better interest rate, explain to the supervisor that other credit card companies are offering you a better rate. Also, if you have always made payments on time, be sure to remind them. Furthermore, if you pay your balance every month, be sure to remind them as well. As I mentioned in step 1, be sure and have proof ready to send the supervisor. The more informed you are the better chance you will have of a successful negotiation.

5. Call another card issuer if the one you are talking to you does not make the offer you are looking for.

Always remember that there are other fish in the sea. If one company does not want to negotiate with you then simply hang up and call someone else. If one door closes, another one will open. Talk to multiple companies. Another card issuer might find your requests reasonable and be willing to work with you.


6. Lastly, be ready to transfer your balance to a new card if needed.

Card issuers prefer for you to have a balance with them, then no balance. Cardholders who maintain very low balances do not get charged a lot of interest. This goes against a card issuer’s business model. They make money of off interest charged to you that is based on your balance.

There are many ways to negotiate with any company, including credit card issuers as well. Knowledge is the key to a successful negotiation with anyone. The more informed you are with information, the more ammunition you will have when pleading your case. In addition, always, try to speak with someone that what is going on, such as a supervisor. A rookie customer service rep might not know all the rules that apply to his or her company yet. Lastly, be willing to transfer your balance from one card to another in order to secure a better deal.

Labels: credit card, credit card issuers, credit cards, how to negotiate with credit card companies

How Can a Pre Paid Credit Card Teach Your Teenager Responsibility?

Pre paid credit card are becoming much more popular as society transforms itself completely cashless. The popularity of credit cards and debit cards has influenced our society greatly. Furthermore, advancements in technology make credit card or pre paid cards more practical than ever before. Parents, especially, can take advantage of the many pros that some sort of plastic can offer. Pre paid credit cards are a great way for parents to give their children allowance and monitor behavior at the same time.

As a teenager, I remember the days of going to the mall with my allowance and spending on anything I wanted. Even though my parents told me not to be spending my money on video games, I did anyway. In those days (back in the 1980s) there was really no way of my parents knowing how I am spending my allowance. I could basically do anything I wanted with the money that they gave me. If I was told to do one thing, I would do the complete opposite. Today, parents can monitor their child’s spending habits with ease.

The advent of the internet and computers now make it possible for parents to monitor their children’s behavior. For example, your child tells you he or she is going to the movies and instead goes somewhere else. In the old days when your parents gave you cash, it was possible to take that money and spend it somewhere you were not supposed to. In addition, it was very unlikely that our parents would ever ask for some sort of receipt. However, if your child has a pre paid credit card, you can see exactly where expenditures are coming from and the dates they were made. This makes it much more difficult for a child to lie to about their whereabouts.

In addition, pre paid credit cards will show your child how he or she is spending their allowance. Hardly anyone kept spending detail when I was a teenager. By Friday I had already forgotten how much money I spent at lunch on Monday. Had I been able to access my account online and see where and how my money was being spent, I might have been a better money manager today. Pre paid credit cards will also give your child a sense of responsibility. No longer can your child tell you he or she forgot how they spent their allowance. Online account access will give you an exact detail as to how money is being spent. The ability to monitor your child’s spending will give you peace of mind as well as instill good spending habits in your children.

A pre paid credit card could also get your child out of any sort of money emergency. Your pre paid credit card will allow you to send cash almost in an instant should your teenager be away and need money for an emergency. Pre paid credit cards can be loaded with new funds either online with another credit card or at a participating retailer. Certain pre paid cards will even allow you to go to participating retailers where you can re load the card with cash very easily.

A teenager is much better off using a pre paid credit card as apposed to cash. A pre paid credit card can offer parents peace of mind as well. No longer can your teenager lie about how he or she spent their allowance. Just log into the card issuers online account and get up to date spending stats. This will tell you if your child went to the movies or did something that they were not supposed to do. A pre paid credit card can also help your child in an emergency. Money can be easily transferred into your child’s pre paid credit card account very quickly. No need to go to Western Union or any other money wire courier. Money deposited into a pre paid credit card account is accessible much easier and with less expense. Lastly, a pre paid credit card can help teach your teenager to become a more responsible adult.

Labels: credit card, credit cards, debit cards, pre paid credit card, pre paid credit cards

Payday Loans Defined

A payday loan, sometimes also called a paycheck or payday advance, is a short term emergency loan until your next pay check. Payday loans are sometimes even called cash advances. Cash advance through a payday loan is very different from a credit card. Credit card companies issue a line of credit that allows you to withdraw a pre approved amount of cash at your convenience. Payday loans issuers need to approve your cash advance every time you withdraw. The other major difference between s payday loan issuer and credit card issuers is the amount of interest that is charged. Payday loan issuers charge you based on how much you borrow. This amount is usually somewhere between $10 and $20 per every hundred dollars borrowed. Payday loans are very helpful, however, borrowers must use them responsibly.

Payday loans are used for a wide variety of purposes. Payday loans are great for those who do not have a credit card or whose credit cards are maxed out. They can be used to handle minor emergencies such as sudden car repairs or medical bills. For example, if your car breaks down and you need to $500 to fix it, a payday loan might be the only form of credit available to you. Many people need their vehicles to get back and forth between work, especially, in areas where there is limited sources of public transportation. A payday loan might be the only source of funding available to repair your car. This quick emergency loan may provide you the means to fix your car, get to work, and continue to earn money.

Payday loans may be as financially dangerous as they are useful. The amount of interest charged on a payday loan is extremely high. No bank or credit card company will charge as much interest as payday loan issuers. A $15 charge on a $100 2-week payday loan is equivalent to a 390% annual interest rate. There are 26 pay periods in a year. The $15 charge you are paying on $100 is equivalent to 15%. Multiply 26 by 15 and you end up with 390%. That is an exorbitant amount of interest charged. Charges, like interest, will begin to add up quickly if payments are missed. Should you fail to pay your loan in the 2-week allotted time period, your principal will rise. Charges will add up even faster if you miss any payments in between or fail to pay your principal. Therefore, it is very possible for your $100 loan to end up costing $300.

Payday loans are regulated from state to state due to the controversy surrounding the amount of interest lenders charge. In total, there are more than 35 states who regulate payday lending. Essentially, payday loans are regulated in states that limit how much interest can be charged in very small, or micro loans. Payday lenders are permitted to charge unlimited rates in states that do not cap interest charges on small loans.

Payday loans, allow people who otherwise can not borrow through traditional means, such as banks or credit cards, the ability to borrow money. It is very easy to obtain a payday loan. All that is required is a job and a checking account. However, these loans are only intended for a very short period of time only. Payday loans should always be paid on your next payday. Borrowers run the risk of paying very high interest rates should they fail to pay the loan timely. Payday lending is regulated from state to state. Should you wish to inquire about payday lending laws within your specific state, you may refer to online resources such as www.PaydayLoanInfo.org. Lastly, be sure and use payday loans responsibly and sparingly or face the possibility of paying the loan for a long time.

Labels: apply for a payday loan, credit card, credit card issuers, credit cards, payday loan lenders, payday loans

Credit Card Users Plan to Charge Less in 2009

According to a study by GfK Roper Public Affairs & Media, 32 percent of 1004 people polled responded that they would be using their credit cards less. On the other hand, 50 percent said that they would not change their usage habits. 15 percent said that they would not use their credit cards at all. The remaining 1 percent revealed that they would be using their cards more. The independent poll was conducted December 5 through December 7 of 2008. The following other facts were uncovered during the survey:

1) 72 percent of those polled disagree with the fact that credit card companie should have the right to raise rates and/or change terms for any reason.

2) 71 percent polled believe that credit card companies should be further regulated by the Federal Reserve.

3) 67 percent of individuals do not agree that bail out funds should be used to help people who can not pay off their credit cards.

4) 40 percent of poll participants credit card users find that paying by credit card is far more convenient than paying by cash

5) 19 percent of participants use their credit cards for emergency expenses.

50 percent responded that they would continue to use their credit cards as before. The United States is a credit based society as opposed to other emerging economies like Russia who use cash. The creation of modern credit systems has fueled economic growth in our country for many years. The lack of credit available in this current economic environment has caused significant problems for certain industries. The automakers have suffered deeply due to the current credit crisis. Consumers without funding can not make large purchases like cars. Suffering carmakers like General Motors and Chrysler are finding it very difficult to survive in this environment. The same principles apply to retailers as credit card limits are slashed. Ultimately, it will consumer spending that will get us out of this financial mess.

Those 15 percent who do not plan to use their credit cards reflect a portion of consumers who are suffering from financial problems. These people have perhaps suffered some sort of job loss, loss of savings or plan to save money. Unfortunately, this does not help our economy. It will be up to our next Presidential Administration to create jobs and instill a renewed confidence in the American buyer.

The other portion of the poll suggests that consumers are not happy with the way credit card issuers conduct their business. This should not come as a surprise since over 60,000 people left comments on the Federal Reserve website complaining. Credit card customers are complaining about hair-trigger interest rate hikes. Some customers have seen rates double and even triple. Others have seen their credit limits reduced substantially as well. Credit card issuers will comment on any specific cases, but maintain that this additional revenue is needed to make up for mounting delinquencies.

In all, I believe that most Americans will resume their old spending patterns once the economy recovers. Card issuers will also see defaults decrease once Americans are working again. Current unemployment is at an all time high of almost 7%. An estimated 24,500,000 Americans are without work. This is also a negative factor affecting the credit markets. Regulation of the credit card industry is not by favored by industry insiders at this point. However, more stringent regulations on the credit card industry could prevent what has happened to our fledgling mortgage markets.

Labels: credit card, credit card regulation, credit cards

Beware of Credit Card Skimming

Credit card skimming is type of financial con that involves someone copying your credit card information from the magnetic strip. Essentially what is happing is that someone is actually cloning your credit card. A skimming device is used to scan your information. The con artist than takes your credit card details and transfers it to another card that has a magnetic strip. For example, someone working as a waiter for a restaurant gets your card to charge your meal. Once the con artist has your card in had they swipe through the skimming device and you have just been robbed. It is also not hard to obtain a card with a magnetic strip. Any swipe card used to gain access to a hotel room or office building will work. Thieves can become very creative when looking for ways to make money.

Should you become a victim of credit card skimming contact your credit card provider immediately. You can call the loss and theft department which is usually open 24 hours a day, 7 days a week. Your credit card company will than take appropriate action. Fortunately, most credit card issuers will not hold the cardholder responsible for unauthorized charges. However, all credit card holders are paying for fraud. Fraud losses are usually anticipated and already figured into your interest rates. In other words, honest people have to cover the costs of dishonest people. This may not be fair for everyone, but unfortunately credit card fraud is fact of modern life.

In all, fraud is very costly for society in general. As consumers we are paying additional fees for all types of fraud. Automobile insurance, health insurance, the mortgage industry and credit cards are examples of industries that are very susceptible to fraud. More often then not, honest citizens are usually the victims of fraud. Should you suspect that you have become a victim of credit card fraud; report it to the authorities right away. Perhaps one day, technology will be able to protect consumers more than it does today.

Labels: credit card, credit card skimming, credit cards, fraud

Discover Financial Services Applies to become Bank Holding Company


The fourth largest U.S. credit card company, Discover Financial Services posted fourth-quarter profits due to a $535 million after tax litigation settlement from Visa and Mastercard. In addition, Discover is applying to become a bank holding company in order to access TARP (Troubled Asset Relief Program) funds.

Credit card companies are taking heavy losses due to current economic conditions. Unemployment is at an all time 15 year high. The rise in unemployment has caused many people to become past due on their credit card bills. In hard times, people tend to give more priority to utility bills and groceries than credit cards.

Despite the profits created from a lawsuit windfall, Discover is faced with heavy losses from bad debt right offs. In 2007 bad debt right offs were at 3.85% and have risen to 5.48% in 2008. In addition, Discover is also experiencing a significant rise in 30-day delinquencies. In 2007 30-day delinquencies were at 3.58% and have gone up to 4.56%.

Discover stock has also taken a beating like most of the financial sector. The 52 week high this year for Discover Financial Services was $19.87. Today DFS stock is trading right under $10. That is a 50% loss in stock value for this year.

Discover was originally the brain child of what was once Sears Financial Networks. During the 1987 stock market crash, Sears Financial Networks was forced to sell off its divisions, including its Discover Card division.

Labels: credit card, credit cards, Discover credit card, Discover Financial Services

The Fed Lowers Interest Rates to Historical Lows

On December 16, 2008 the Federal Reserve announced another major rate cut to the prime interest rate that will significantly lower borrowing costs. The idea is to stimulate the housing market so that the economy will start to churn again. The major force driving our economy into this recession has been the decline in housing prices. Housing prices have not fallen like this since 1932. The most valuable asset that American consumers boast is their house. The decline in the housing industry has created one of the worst economic recessions since The Great Depression.

The deregulation of the mortgage industry created an over inflated housing market that started this recession. Mortgage companies marketed exotic interest only loans, adjustable rate loans and other similar offers to consumers who otherwise would not be able to afford the house they were buying. Home purchases began skyrocketing since mortgages were being almost given away. This created a bubble market and thus housing prices were perceived to be higher due to the increased demand. In addition, more and more people began borrowing against their home equity. The increased home values also loosened up other credit markets like auto loans and credit cards. Consumers began spending based on easy credit and over inflated home values.

The idea behind interest rate cuts is to stimulate the housing market once again. In order to stabilize credit it is going to be imperative to keep home prices from continuing to fall. However, before home prices start to stabilize, home purchases need to increase. The idea is to get consumers to start buying houses once again. First time home buyers can possibly purchase from home owners who are looking to upgrade their living space. This will start a cycle again of people buying homes. The increase in home purchases will stabilize prices and instill confidence in the economy once again.

The other idea behind the rate cut is to allow people to refinance their homes and save money on their monthly payments. A $250,000 mortgage financed at 7% for 30 years will cost approximately $1663 in monthly payments Financed at 4.5% that same $250,000 mortgage will now cost approximately $1266 in monthly payments. That is a savings of almost $400 per month. That is a significant amount, considering $400 a month can buy a new car. Even if you do not need a new car, the savings will give consumers additional disposable income. A more empowered consumer will definitely help improve the economy. The extra $400 a month can also be used to buy clothes, go to the movies, and even take badly needed vacations. As it is, consumers are not spending money and the economy is retracting. The continued retraction of the economy will only hurt the job market more than it already has. In turn, this additional disposable income will begin to start creating jobs again. Businesses will begin to hire again as sales start to increase again, thus causing the economy to recover.

In all, the Federal Reserve is trying to everything it can to stabilize the economy. I agree with CNBC’s Mad Money Jim Cramer that the Fed is finally taking action to help our economy recover. In order for credit markets to start to recoup again home prices need to stabilize. The most valuable asset the most Americans lay claim to is their home. The stabilization of the housing market will bring about confidence in the economy once again. Lastly, the United States has survived the Great Depression, two world wars, Vietnam and even the terrorist attacks of September 11, 2001. With that said, I am quite certain that we will survive the Credit Crisis of 2008.

Labels: credit card, credit cards, economic recesion, interest rates, prime interst rate

Additional Credit Card Regulations Coming Soon

Amidst an economy in turmoil, credit card companies are being forced to face additional regulations that will change the way they do business. Regulators are getting ready to revamp the way credit card companies are able to do operate in the near future. This move comes after thousands of people have complained about unfair lending practices by the credit card industry. These new rules will require the approval of the Federal Reserve, the Office of Thrift Supervision and the National Credit Union Administration. They are all expected to vote on Thursday. This move will certainly help consumers alleviate some of the financial burdens that they are forced to deal with. Credit card issuers, on the other hand, say this will hurt their ability to lend money.

Many credit card issuers have raised interest rates and/or slashed credit lines due to recent economic conditions. Citigroup recently raised its interest rates on many cardholders after having said earlier that they were not going to do so. They claim that the increase in credit card default has caused them to have to suddenly raise rates. However, credit card companies are being criticized for raising rates unfairly as well. Some issuers will even raise your interest rate if you are late on other bills. For example, card issuers are increasing rates on people who have been late on car payments and even utility bills. This comes at a time when people are losing jobs by no fault of their own and falling behind on payments. Some consumers have even seen their rates rise from 14% to 28%. That is a 100% increase. These increased rates make it much more difficult for people to pay down debt. Many of these people are having a hard time making monthly payments and are consequently becoming even more indebted to the card issuers.

The regulation of the credit card industry will defiantly have a positive impact on consumers. Consumers spending less on credit card fees will be able to make other payments a lot easier. It is not right that card issuers raise rates on people for being one day late or even worse, being late on other bills that are not related. Consumers should be allowed at least 30 days to make the payment before any action is taken against their account. For many people a raise in interest rates means the difference between having food on the table and making a credit card payment. The regulation of interest will lower payments and free additional cash flow for the middle class consumer.

Credit card issuers on the other spectrum argue that further regulation will prevent them from be able to lend additional monies. Some analysts have even speculated that further regulation could cause banks to rescind an additional $2 trillion in credit lines. Card issuers will argue that 30 days is too long to allow before raising rates. Issuers also claim that the increased rates are needed to generate additional revenues to make up for borrowers who have defaulted.

In all, I think the consumer and ultimately card issuers will benefit from some of the regulations the Federal Reserve wants to pass. Hair trigger interest rate increases only prevent consumers from being able to pay off their credit card debt. Credit card companies will soon have access to TARP funds. This will help relieve their balance sheet of bad debt and enable them to continue to lend money.

For years card issuers have profited from unregulated lending practices. The further regulation of credit card issuers could ultimately prevent the credit card industry from the same turmoil that the mortgage industry has gone through. The prevention of another financial calamity in the credit card industry will keep our country from further financial ruin.

Labels: credit card, credit card regulation, credit cards

Applying for a Credit Card after Bankruptcy

According to the website uscourts.gov, there have been 967,831 bankruptcy filings in the United States since June 30, 2008. As times continue to get tougher it is almost certain that more people will be forced to file for bankruptcy as well. The good thing is that tough times do not last; tough people do. There is light at the end of the tunnel for those who have been forced to file for bankruptcy. The following guidelines are a good way for consumers to obtain a credit card after having filed for insolvency.

Many people are often forced to file for bankruptcy due to medical bills and the loss of a job. The other major reason for people filing for bankruptcy is overspending. If you are one of those individuals forced into bankruptcy due to poor spending habits, you might want to avoid credit cards or keep your credit cards under lock and key. The first thing you want to make sure is whether or not you are financially able to handle another credit card Be sure that you have a sustainable income that can cover all your basic expenses like mortgage payment, utility bills, car payments, food and other basic necessities that you require to live. Also be sure to have at least 6 months of living expenses saved up in case of another emergency.

Once you have determined that you are capable of paying your credit card again, you need to find the right card to get your credit back on track. The best option is to apply for a secured credit card with a limited limit such as $300. A good example is the Bank of America Secured Visa card. This card allows is customers to obtain a line of credit from $300 to $10,000. The card is secured with a deposit equaling the amount of credit you are trying to secure. This ensures credit card issuers will recoup their money should the card holder default. Once you have obtained your secured credit card; be sure and manage it correctly. Only charge what you are planning to pay in full. Pay your bill on time every month. Your credit score will begin to rise should you handle your credit cards correctly. In addition, after some time, it is very possible that your secured card will turn into an unsecured credit card. In all, managing your credit card correctly will help your overall credit and save you money on other loans with lower interest rates.

Another way to obtain a credit card after bankruptcy is to use someone else’s credit to improve your own. In other words, you can try to find a suitable co signor with good credit. This could be in the form of a friend or family member. Another way to obtain your own credit card is to become an additional card holder on someone else’s account. Make the payments on your own to the card issuer in order to show that it is you who is actually paying the bill. Also, be sure and pay the bill on time and in full every month as well. This will show that you are capable of being credit worthy. In the future you will be able to obtain a credit card on your own from the same card issuer because they have already established a good working relationship with you.

Bankruptcy should be an option taken only for very desperate measures. However, should you be forced to file for bankruptcy due to unforeseen circumstances, it is not a financial death sentence. It is possible to obtain credit for cars, homes as well as credit cards. A secured credit card is a great way to get off to a new start. If you are fortunate enough to have the help from friend or family members, a co signor can also help you obtain credit again. Be sure to pay the card yourself and on time should you become an additional card holder on someone else’s account. Most importantly, be sure that you have enough disposable income to pay your credit card balance in full every month. Following these guidelines will certainly help your ability to obtain additional credit after bankruptcy.

Labels: apply for a credit card, applying for a credit card after bankruptcy, credit card, credit card issuers, credit cards

Top 5 Responsible Credit Card Practices

Practice these five simple credit card rules and you are guaranteed to manage your account properly and increase your credit score.

1) Keep in mind, that your credit card is not a license to spend money. Many people take for granted that a credit card is like using actual money. People tend to spend differently with credit cards than with cash. You are more likely to spend less and keep track of your money if you have cash in your wallet. Your wallet can always be opened on a regular basis and you are able to physically count and feel how much money you have. On the other hand, with credit cards, people tend to forget how much they have spent. Keep track of your receipts and log online to view your bill on a regular basis. MOst importantly, do not spend on what you can afford to pay for in full.

2) Use your credit card for emergencies only. Do not get into the habit of using your credit cards for frivolous purchases. Spend what you can afford. Make yourself a monthly budget. Decide how much you can afford to spend with your credit card. If you can avoid it, do not use your credit cards at restaurants. Always pay your bills in cash when you go out to eat. Be careful when purchasing expensive items as well. You need to ask yourself if you are acting on needs or wants. If your purchase is based on a “want”, then you need to decide if you can really afford it. If you can, then go ahead and make your purchase. Do not buy what you can not afford. However, if your purchase is based on a particular need than your credit card can ease the gravity of your expenses.

3) Do not max out your credit cards. Often times, credit card issuers issue cards with large credit lines. It is very easy to over spend and max out your credit card. You will be fine if you can afford to pay the balance in full at the end of the month. However, if you can’t, you will quickly fall into a viscous interest paying cycle. Try to only spend between 10 to 20 percent of your credit cards limit. This will allow you to manage the debt easily and keep from getting in a debt trap. Your credit score will also go up if you are not always at the top your limit. Creditors will perceive irresponsible spending practices or financial difficulties. This can affect your interest rate or even cause you to be denied credit.

4) Leave your credit cards at home. There is a common saying that has a lot of truth to it. “Out of sight, out mind”. You will forget what you can not see. Keep your credit card at home and you will forget that you can use it. This is especially true, if you plan to have a night out on the town. It is very easy to go out, have a few drinks, and rack up a big bill. If you are armed with your credit card, chances are you will end up spending more than you had anticipated. If you leave your credit card at home and use cash, you will limit your chances of spending money you might regret later.

5) Do not ever give out the CVV code, or 3 digit code on the back of your credit card. Online retailers and payment gateways will always ask you for the code on the back of your card. If anyone finds out the information listed on both sides of the card, they will be able to use it almost anywhere online or over the phone. Identity theft is on the rise and these thieves are very creative. Be sure to always shred receipts with account numbers as well.

There are countless more ways to be a responsible credit card holder. Always keep in mind what you have just read and you will avoid debt and bad credit. However, most importantly, always use your common sense when using your credit cards.

Labels: Business Credit Card, business credit cards, credit card, credit cards, low interest credit card, low interest credit cards

A Rewards Card for the Single Professional


Everybody’s working for the weekend. Wait a minute. Wasn’t that a song from the 80s? It sure was, but HSBC has a great credit card that is perfect for the weekend shopper. The majority of consumers do most of their shopping on the weekend. During the week, most people are at work and do not have time to go to the stores and spend money. The HSBC Weekend rewards credit card is an excellent option forthe single professional and/or those who do most of their shopping on the weekends.

The best part about this rewards credit card is that it gives its users 2% cash back on all purchases made on Saturday and Sunday. Purchases made Monday thru Friday receive a 1% cash back reward. The single professional will benefit greatly from a rewards credit card such as this. Being a single professional myself, I do not have time to go shopping during the week. I do most of my shopping on the weekend when my work schedule is not so hectic. The HSBC Weekend Credit Card is perfect for the millions of single professionals who shop mostly over the weekend.

Unlike other rewards credit cards the HSBC Weekend credit card gives you an option to apply for an unlimited cash back rewards. This virtually gives you a 2% discount every time that you go shopping on Saturday or Sunday, or a 1% discount during the week. Go shopping at any weekend sale and add 2% to the total amount you would receive off your purchases. That $75 item with a 20% discount will receive a 22% discount instead. That adds up to an additional $1.50 in savings. Look at the savings on a monthly basis and you will notice a significant amount saved. Total the amount over a year and you can earn enough money to buy that latest digital camera you have been eyeing.

The HSBC Weekend credit card also offers protection for purchases made on your card. This guarantees your money back on any purchases that turn out to be defective. They also give you rental car insurance. This is an additional savings for any one that does business traveling and needs to rent a car. Be sure and decline the rental insurance when the rental company offers it, since you are already covered

HSBC is also offering a great introductory period for all purchases and balance transfers. The introductory period allows you to pay no interest for up to 12 months. This can be very advantageous to someone who is paying a higher interest rate on another credit card. Simply transfer your balance over to the HSBC Weekend credit card and pay it off in a year with no interest.

In all, the HSBC Weekend credit card is an excellent choice for those who prefer to do their shopping on the weekends. Since many single professionals do not have time to run around shopping during the week, this rewards card will empower them.

Labels: credit card, credit cards, HSBC Weekend Card, HSBC Weekend Credit Card, Rewards Credit Card, Rewards Credit Cards

Credit Card Regulation Could Adversely Affect Consumer Spending

Congress is working at passing new legislation that will restrict credit card companies lending practices. This comes after thousands of people have complained to the Federal Reserve’s website that credit card companies are not abiding to lending rules that are fair to consumers. There are arguments from both sides of the spectrum that seem justifiable. However, it will be up to Congress to come up with a solution that is viable for everyone.

The consumer argument is that credit card companies are being extremely unfair in their lending practices. For example, credit card companies are quick to raise your interest rates when you are delinquent with your payments. Many card issuers will even raise your rates if you are one day late. In addition, credit card companies are also raising interest rates on people with outstanding balances. This makes it harder for people to pay off their debt. The major complaint is that credit card companies are too quick to raise rates and very unforgiving of their clients.

The credit card issuers argue that restricting their ability to raise rates undermines their ability to manage risk. The further regulation of credit card issuers could also affect consumers adversely as well. Should card issuers be required to adhere to much stricter guidelines, they may get even stricter and contract credit even more. It is already rumored that credit card issuers may cut up to $2 trillion in existing consumer lines of credit. This would greatly affect the American consumers’ liquidity. Credit cards are the consumer’s second largest source of spending power next to their paychecks. The reduction of credit card lines of credit will further hurt the economy. Every sector of the economy will be affected should consumers loose $2 trillion in spending power.

Credit card issuers are urging Congress not to take any action until this recession is over. However, consumers want the government to take action quickly to keep unfair credit card practices from further unraveling. Consumers want card issuers to give them at least 30 days to make a late payment, however, card issuers claim this is too much time. The problem is that there are too many households with excessive credit card debt. Many people abuse their credit cards and often times do not have any intentions of paying their bill responsibly. This adversely affects the large majorities that pays their bills on time and does not spend more than what they are capable. Many times people will even defraud credit card companies. This also affects responsible consumers.

In all, Congress should be careful as too how they regulate credit card issuers. The country can not afford to loose any more consumer liquidity. Consumer spending has sharply fallen this year. There are many economists who argue that the only way to get out of this recession is for people to spend money. The lack of consumer spending in our economy will only cause more companies to fail. The country has already lost somewhere in the neighborhood of 300,000 to 400,000 jobs in the month of November. Further job loss will very likely occur should consumer spending continue to be curtailed. The loss of $2 trillion in credit card liquidity will certainly affect spending in a very negative way.

Labels: consumer spending, credit card, credit card issuers, credit card lines of credit, credit cards

Cheaper Fuel means Stronger Consumers

Oil prices continue to fall as economic conditions worsen across the globe. Oil which once topped out at $147 per barrel is now trading at $40 per barrel. Analysts are even predicting that oil will fall all the way to $25 per barrel. This means that gasoline, which was once at $4.00 per gallon will go below $1.00 per gallon.

Low gas prices are great for consumers but in reality are signs of a crippled world economy. Commodities prices, like oil prices, are based on supply and demand principles. Essentially what is happening is that less oil is being consumed on world wide basis. This means that people are not traveling as much as before and basically not consuming as much product as normal. The reality is that very low oil prices are the reflection of a sick economy.

Emerging markets like China are seeing their economy take a big toll because of the United States economy. Therefore, China and other large consumer countries like India are not using as much oil either. These countries rely heavily on exports to the United States. If the United States consumer is not making many purchases then these countries suffer as well. Therefore, less worldwide consumption of oil will continue to drive the price of gasoline lower.

Lower gas prices will actually help the economy recover. People filling their vehicles with gasoline will no longer spend as much money at the pump. Even SUV owners will see the cost of operating their vehicles drop drastically. What once cost $100 to fill with gasoline will cost about $25.00 with $1.00 fuel prices. People will now have more money to pay their bills. Credit cards will be easier to pay as well as home mortgages. Furthermore, the additional monies saved on fuel will also be spent on other items, like clothing and electronics.

However, as the economy recovers, oil prices will go back up. Emerging economies like China and India will start to consume more oil as well as people need to move around more, etc. As the United States consumer starts making more purchases, factories in the United States and other countries will start employing more people and thus consuming more energy. This chain of events will eventually cause fuel prices to rise again with the demand.

Perhaps it is going to be up to the new administration to push for new energy technologies to be developed. Honda has introduced a new car that runs on hydrogen fuel called the FCX Clarity. BMW is also going to be introducing a new hydrogen vehicle as well. Hydrogen fuel should be much cheaper than gasoline. Cheaper fuel will empower consumers to be able to make other purchases. Furthermore, cheaper fuel will also ease the burden that monthly bills create.

As the economy worsens oil prices will go down. As economic conditions begin to improve, oil prices will go back up. The cycle will definitely help the economy recover. However, there is a desperate need for cheaper alternative fuels like hydrogen. The development of new energy technologies will fuel our economy much the way the internet has. The new infrastructure that will be required to service these new fuels will also spark growth in our economy. Lastly, if we spend less money at the pump going back and forth to work, etc, then we will have more money to spend on other things as well.

Labels: alternative fuels, cheaper oil, credit cards

Consumers may face the loss of $2 trillion of credit card liquidity as card issuers raise interest rates and reduce lines of credit over the next 18 months. Home values continue to decline as well making it harder for consumers to access home equity lines of credit as well. Consumers are now spending less and less money at retailers due to liquidity loss. The automotive industry has seen drastic declines in sales as dealers find it harder to acquire loans for their customers.

The United States has been over extending themselves with credit cards, auto loans and extravagant mortgages for many years. The effects we are now feeling on the economy is much like the effect we feel after drinking to much alcohol or even just over eating. Americans have over spent themselves sick.

As consumers we need to learn how to use our credit responsibly. Credit cards need to be used with prudence with making purchases. Consumers need to budget their money and not overextend their credit card debt. Set a limit for yourself that you will charge on a monthly basis and be sure to pay the balance in full every month. For large purchases where you plan to spread you payments, be sure to make a set plant as to how much you will pay each month to pay off your expensive item in a reasonable amount of time. Purchase less on your credit at once, pay your debt and then you can purchase something else again.

China and Japan will not see the consumer credit problems that we have seen in the Untied States and in Europe. The Asian culture is much more conservative and has strong beliefs about credit. Chinese and Japanese will save for large purchases as opposed to buying on credit. According to Federal Reserve figures, the American consumer has accumulated almost $14 trillion in debt. On the other hand, the Japanese have accumulated a total of $16 trillion in savings.

American consumers should learn from their Asian counterparts. Spending on credit has exceeded what we can afford. Unfortunately, creditors have not put many requirements on consumers either. There was a recent blog called “I am being foreclosed” or something to that affect, about a very novice real estate investor who over extended himself. At a very young 20 something years of age, this individual purchased seven houses that he was going to “flip”. He bought one, got excited and kept buying six more, even before selling his first “flip’. In order to secure financing, this individual used a mortgage application intended for the self employed. On this application, he was able to make up his income while lenders did not bother to verify what he was stating. This is what I would call downright lying. Furthermore, this individual is now (or was) facing Federal charges. This type of irresponsible lending on the parts of both consumers and lenders has come to a screeching halt.

Luckily I was able to learn this lesson at a relatively young age. There was a time that I had a business generating my partner and me a substantial amount of money. Furthermore, our source of income was from one client. We both made many unnecessary purchases and spent a lot more than we should have. Inevitably, when we lost the client, we lost the money. All of a sudden we had overspent and found ourselves without a major source of income. This taught me quite a good lesson. Consumers and lenders are now finding themselves having learned new lessons as well. We must all learn from the lessons of the past and march forward towards the future.

Labels: consumer debt, credit cards

The Year of the Bailout

2008 will go down in history as the year of the Great American Bailout. Congress this year has already granted $700 billion dollars in relief funds to bailout our ailing banking system. 2009 looks like it is going to be another bailout year as our new government works hard at preparing a second bailout package that will go before congress next year.

This economic disease created by our leaders past and present has infected the economy at every level and at every spectrum. In order to breathe more life into the economy the next presidential administration is expecting to spend another $300 to $700 billion in additional funds. This money is supposed to be used to create an additional 2.5 million jobs. The government is looking to spend money on re building the nations deteriorating infrastructure. Highways and bridges need to be fixed. Government buildings need to be modernized with energy efficient upgrades being one of the top priorities.

Many argue that spending money will not necessarily improve the economy. However, there are many who argue otherwise. The government needs to spend money in times of recession in order to keep the economy moving. Rebuilding our infrastructure will replace 2.5 million jobs that have been lost during this terrific downturn. In addition Obama plans to create new jobs in new energy projects that are aimed at reducing our dependence on both foreign and domestic oil.

The next bailout on the agenda is going to be our mighty troubled automakers. After executives arrived to Washington in their private Gulfstream jests, Congress rejected any talks about bailing out the big three automakers. However the big three will soon face Congress again with a new plan. The automakers need to modernize their plants so that multiple models can be made on the same assembly lines without any major modifications. Foreign automakers have been doing this for years. For example, Toyota may manufacture the Corolla and the Camry on the same assembly line without new configurations to line. There is also talks about the automakers getting rid of brands that end up competing with each other. It does make sense for General Motors to market both Buick models and GMC models. The Buick Enclave is basically the same thing as the GMC Acadia.

This downturn has also affected consumer credit so significantly that the government has had to allocate funds to unfreeze these credit markets. Citigroup has had to seek relief funds from the government to the tune of $25 billion. American Express has also had to restructure itself into a bank holding company in order to access TARP funds as well. Credit card companies continue to slash credit limits and raise interest rates. This has affected the American consumer deeply. Retailers are experiencing fewer sales as the economy continues to spiral downwards.

Our country continues to make history. Should Obama obtain approval for these new bailout funds, it will be the biggest public spending initiative since former President Franklin D. Roosevelt’s “Big Deal” public works project of the Great Depression. This will certainly alter history forever. As a nation, we must be optimistic that we will crawl out of this giant economic hole that we have dug.

Lastly, there are not many people who will not agree that something drastic needs to be done for our economy. The release of recent economic data shows that our economy has been in a recession since December of 2007. This recession has been among the worst in history. However, there is hope that our economy will start to recover possibly by spring of 2009. In the past, we have always recovered from recessionary markets within at least 16 months. Should the trend prove to be correct we have about 4 months left of this bad economy. As a nation, we must stay strong and stand together during these tough times. Fortunately, we are a much tougher nation that will withstand tough times.

Labels: 700 Billion Dollar Bailout, Barrack Obama, credit cards, economic recesion

In the evenings, when I work on this blog, I usually watch some of the financial shows that come out on CNBC like the Carmen Ulrich show. On more than one occasion I herd viewers calling in with a very intriguing question. Several people called in with the greatest credit card offer in the world (at least it sounded like to me). Anyway, these people were being offered large cash advance sums like $25,000 to $50,000 with no interest for a year. The callers, wanted to know if they should take out that money and put it in a CD with a bank and earn some interest on it. I soon came to find out that the answer was absolutely not.

Credit card companies will entice cardholders with these great offers that have many strings attached. If for any reason you are late on any one of your payments, they will hit you with fines and raise your interest rate on that cash advance from 0% to 20%. Furthermore, once you lock money into a bank CD, you are always penalized for early withdrawals. If for some reason you suddenly need that money, you will loose money in penalties.

In my opinion, unless you have plenty of money for emergencies and pay your bill a few days before the due date online, you might want to give it a try. However, if you do have money, there are better ways of investing your money. There is too much risk for that introductory offer to change for whatever reason. I would definitely agree with Carmen and avoid making that kind of financial move.

Labels: apply for a credit card, business credit cards, Carmen Wong Ulrich, credit cards, low interest credit card

In the evenings, when I work on this blog, I usually watch some of the financial shows that come out on CNBC like the Carmen Ulrich show. On more than one occasion I herd viewers calling in with a very intriguing question. Several people called in with the greatest credit card offer in the world (at least it sounded like to me). Anyway, these people were being offered large cash advance sums like $25,000 to $50,000 with no interest for a year. The callers, wanted to know if they should take out that money and put it in a CD with a bank and earn some interest on it. I soon came to find out that the answer was absolutely not.

Credit card companies will entice cardholders with these great offers that have many strings attached. If for any reason you are late on any one of your payments, they will hit you with fines and raise your interest rate on that cash advance from 0% to 20%. Furthermore, once you lock money into a bank CD, you are always penalized for early withdrawals. If for some reason you suddenly need that money, you will loose money in penalties.

In my opinion, unless you have plenty of money for emergencies and pay your bill a few days before the due date online, you might want to give it a try. However, if you do have money, there are better ways of investing your money. There is too much risk for that introductory offer to change for whatever reason. I would definitely agree with Carmen and avoid making that kind of financial move.

Labels: apply for a credit card, business credit cards, Carmen Wong Ulrich, credit cards, low interest credit card, student credit card

In 2008 the United States government has come up with more acronyms that will go down in our history books for ever. The TARP act also known as the Troubled Asset Relief Program has basically evolved into a new plan called TALF, or Term Asset Backed Securities Loan Facilities. Essentially our government decided to abandon the idea of buying up troubled assets, and instead investing the nations failing banks.

It is my understanding that the TARP program was going to be originally used to purchase foreclosed homes. The intention was to stop home prices from further falling. However, Paulson has decided that it would be better to spend the bailout funds unfreezing consumer credit instead. Paulson is now using the TARP funds to inject more capital into our banking system in order to stabilize the economy.

Congress under the TALF fund has given away billions of dollars to financial institutions that otherwise might have failed without it. Paulson has been strongly criticized for allowing the failure of Lehman Brothers to take place. Congress has recently agreed to inject $20 billion into Citigroup, which has seen its stock price on a roller coaster ride. Around this time last year Citigroup stock was trading around $35 a share and has plummeted all the way below $4 a share. News of the bailout sent Citigroup stock soaring back up to around $8 per share.

The new bailout plan is designed to restore confidence in our banking system again. Our banks need to be healthy in order to be able to lend money to businesses and consumers who spend the money in our economy. Auto loans will help the failing American automakers to increase the sales it needs to survive. Credit cards will help our retailers continue to sell higher priced items that they would otherwise not sell as much. Student loans are needed in order to continue the spark of innovative and revolutionizing ideas that come out of our country. It is these ideas that will drive our future economies as well.

Henry Paulson has left the remaining 50% of the bailout funds for the Obama administration to administer. It will now be up to our new leaders to use these funds wisely and keep our economy from further implosion. As a nation, we must stand behind our current and new leaders and keep this country moving forward. Only time will decipher what the future has in store for our economy. One thing, I do know for certain is that one way or another our country will prevail.

Labels: apply for a credit card, Barrack Obama, biometric credit cards, business credit cards, credit card offers, credit cards, henry paulson, TALF, TARP

What Are Biometric Credit Cards

How many times have you gone to the grocery store or fast food check out lane and all of a sudden discovered that you forgot your purse or wallet? Imagine if you could use some other way to pay for that item based on something unique about you. Biometric security measures are already in place in some very sensitive highly secure places. If you have ever had to access a building by using your thumb print, then you have already been exposed to biometric technologies. Apply the same technology to credit cards and other financial transactions and you have opened a completely new way for consumers to pay for purchases.

It would be quite convenient if all we had to do was go to a convenience store and give our thumbprint to pay for an item. Your unique thumbprint will then identify that you are authorized to use certain credit cards. After selecting which card you want to use, the computer will then use your thumbprint information to retrieve your credit card number, expiration date and your available balance. Once you give the final authorization, the credit card transaction is finalized.

There are other methods to retrieve your biometric profile besides your fingerprint. Retina identification is another way to gather such personal data. The human retina is just like you fingerprint in the sense that every person has unique features that set them apart from every other individual. Although not 100% perfected, retinal scanning is being used by agencies such as the FBI, CIA and prison institutions. This same technology can be used to identify your credit card or banking information also.

One of the big advantages of using some sort of biometric wallet is the security features that such a system has to offer. No longer are you tied to carrying around your plastic credit cards or paper money with you everywhere you go. That completely eliminates the chances of you loosing your wallet full of valuable credit cards and money. Your wallet now becomes built into your physical person. This also completely eliminates the chances of you forgetting your wallet at home. No longer can your overly frugal friend forget his or her money when you go out. With biometric identification technology incorporated into our financial transactions, even the checkout station at the grocery store will move smother.

This futuristic wallet has already been attempted by a company called Pay by Touch. Unfortunately, they were unable to make a successful go at it due to bad management and hardware costs. At this point there are too many configuration and cost obstacles to overcome. However, this technology will eventually be used by everyone from your bank to your hospital. The ability to identify a person’s medical history instantaneously will definitely help save many lives. I am quite certain that this technology will be embraced in the future. Perhaps it may or may not be cost effective to implement such a system at this time, but there will certainly come a day when costs come down and the technology is available at Wal-Mart.

Labels: biometric credit cards, business credit cards, credit cards

Today the government announces that it would provide up to $800 billion to unfreeze consumer credit. The financial crisis has spread from Wall Street to Main Street. Student loans, auto loans and credit cards have been much harder to come by because of the crisis. Credit card companies are raising interest rates, cutting credit limits and raising minimum payment from 2% to 5%.

Consumers this year are not spending as much money on their credit cards as they have in previous years because of reduced credit limits and higher interest rates. More people this year will be buying holiday presents using either cash or debit cards. In order to alleviate the situation the government will spend $200 billion for consumer credit.

All these billions of dollars that are being spent on bailouts are supposed to help get our economy out of the biggest financial crisis since the Great Depression. Our national economy is based on people’s abilities to borrow and repay loans. Consumers who are making large purchases usually require credit in order to make those purchases. It is not uncommon for someone to purchase a $1000 or more television set on their credit card. Retailers relay on credit cards to increase sales. If consumers are denied credit then spending will slow down and the economy will suffer even more. Consumer spending is the lowest it has been in almost five decades.

It will be up to the Obama administration to stimulate the economy and keep the nation from going into another depression. It is quite obvious that we are in a major recession, but with action, our economy will pull through. According to recent news, Obama will unveil a stimulus package that includes rebuilding our national infrastructure. Public works programs will employ thousands of workers who have lost their jobs. These people will turn around and continue to spend money, make mortgage payments and be able to pay their credit card bills as well.

Our country has been through many troubled financial situations throughout history. In 1974 unemployment was at 11.5 percent. In 1983 unemployment was at 8%. No matter how bad off things have gotten, the United States always manages to pull through. We are a resilient country that can survive almost anything that comes are way. The stock market goes up and down, yet people continue to start new companies, build new buildings and prosper without regards to the DJIA.

It was the United States that created the internet. During the 1990s we experienced years of prosperity because of the dot com era. The dot com bubble did burst, yet the technology that was created during that time moves our economy today. Companies like Google and EBay have transformed the way we do business. There are many who feel that our economy is headed for doom and gloom with no end in site. However, there are those that believe our economy will eventually triumph. I am of the belief that we will come out a stronger country because of this recession. Perhaps, we will experience on day an energy boom created by new technologies. These new energy technologies will in turn create jobs and spark another boom era; and the economic cycle will start all over.

Labels: business credit cards, consumer bailout, credit cards

Congress Debates Citigroup Bailout

During the last week we have seen financial giant Citigroup’s stock plunged more than 60% in value. At this time last year, Citigroup stock was worth somewhere around $30 per share. Today Citigroup stock is worth $3.77 per share. That is major tumble in stock price for a company once revered as one the most prestigious financial corporations in the world. It is surprising that Citigroup is requesting money from the Paulson Act’s Troubled Asset Relief Program. It is estimated that Citigroup owns about $100 Billion in toxic assets.

On November 23, 2008 congress held an emergency session to determine what will be needed to stabilize Citigroup and keep the stock from falling any further. Citigroup has an estimated $2 Trillion in assets. Many of these assets are tied to mortgages, auto loans and credit cards. Our economy can not afford another failure of a major financial institution like Citigroup. Citigroup has more than 200 million customers and operates in 106 countries around the world.

The government definitely needs to come up with a rescue plan that will keep Citigroup from going under. A corporation as large as Citigroup employs several hundred thousand people. We simply can not allow this company to go the route of Lehman Brothers. The confidence lost in the markets has been felt deeply due to the failure of Lehman Brothers. Citigroup has definitely become an icon in our financial system. Their failure would be certainly quite catastrophic. However, with the help of congress it is unlikely that such a failure will take place.

Labels: apply for a credit card, Citigroup, credit cards, TARP

How to Protect Yourself from Identity Thieves

It is estimated that one in thirty-five Americans will be a victim of identity theft in his or her lifetime. One of the fastest growing crimes is now identity theft. There is even a good chance that you will not know that you are a victim of identity theft. On average, an individual does not discover that they are a victim of identity theft for about fourteen months.

There are many ways from keeping yourself protected from identity theft. One of the most important is to monitor your credit report on a regular basis. Be sure to pull your credit score at least once a year. The credit agencies will charge somewhere around $9 per agency should you wish to pull it more than once per year. If you see a sudden drop in your credit score after you have been keeping up with you’re your bills then there is a good chance that you have become another victim. You can contact any of the three credit agencies for a free annual report. Remember, that knowledge is power to stop the thieves from further ruining your credit.

Another good way to protect your self is to purchase a paper shredder. Thieves will go to any length to get what they want. A thief can find information in all sorts of interesting places like trash cans, dumpsters or even the city dump. It is very common for people to throw away voided checks, deposit slips, old tax return information, bank statements, credit card receipts and credit card offers that you receive in the mail. They will look for anything possible where they can get to your account numbers, social security information and even your drivers license number. The best way to avoid this is to shred all your important documents. You can purchase a shredder for under $75 at most any retailers like Office Max, Office Depot or better yet Wal-Mart.

Email is another way that thieves will also try to get information from you. Do not answer any emails that say they are coming from a bank and asking you for your information to update their records. These perpetrators will make the emails seem very realistic and convincing. They will disguise themselves as being from Bank of America, EBay, Pay Pal and even the IRS (Internal Revenue Service). I have received many an email claiming to be from the IRS telling me that I have unclaimed refund money. They want your social security number. That is why they claim to be from the IRS. Banks or the IRS will never solicit information from you via email. It is also very difficult to catch these online thieves as more often than not they are from out of the country. If you do receive an unsolicited email pretending to be the IRS you can report it online at www.IRS.gov. Should you receive an unwanted email pretending to be a bank such as Bank of America you can report to http://www.doi.gov/pam/Fraudalert411.html.

Also, be careful if you live in a dormitory or with roommates. You might know your roommates well enough to trust; however, they can bring someone else who brings another person that ends up steeling your check book. Lock up your valuables in your own home. You can never be too careful with important information like your bank statements, inactivated credit cards or even your driver license. All someone needs to open up new accounts is your social security number or license number and it’s off too the races. Many times people can find information about you on Google as well. One piece of information given to a search engine can retrieve other data as well.

Be careful where you give out information when online. Do not log on to online banking or other online financial sites like credit card online accounts when you are on an unsecured wireless network. Hackers can be intercepting data while you’re logged onto to your computer at popular wireless hangouts like Starbucks. Lastly, do not use public computers to access online account information either. It’s quite possible that your password information stays on that computer and is retrievable by the next person to log on.

Labels: business credit cards, credit card offers, credit cards, identity theft protection

Thanks to improvements in a technology called near-field communications is now making it possible to integrate your cell phone and your credit/debit cards. This new technology is currently being tested in the United States, Germany, the Netherlands and few other countries. Essentially your cell phone will be affiliated with a carrier as well as a bank or credit card issuer.

The advantage of this new technology is that it enables devices to communicate back and forth with each other in a secure environment. This technology uses something called inductive coupling which acts uses the principles as electromagnetism. Two devices that have the NFC chips built into them will be able to communicate. For example, when you make a payment using your NFC enabled cell phone at the Wendy’s drive through several transactions must occur. First, your NFC cell phone will send the NFC enabled cashier system your credit card information like card number and expiration date. The cashier then processes your card information. Next you will have to authorize your transaction using your credit card pin. However, instead entering into the cashiers pin keypad, you will just enter into your cell phone and the phone will communicate with the cashier allowing you to approve the transaction. Then, just like if you were at the keypad, you will receive a message to your NFC enabled cell phone letting you know whether or not you were approved. If you are approved it will be able to keep track of your receipts which you could then upload to a computer or printer.

At the 2007 Consumer Electronics Show, Nokia unveiled its Nokia 6131 NFC enabled cell phone. This phone looks like any other unassuming flip phone; you might buy for $39. The only difference is that this phone comes equipped with NFC technology that will allow you to do things like pay with your credit card or even open your front door. Even some hotels are now using near-field communication technology to grant guests access to their rooms. If you have this capability they will be able to send your phone the access code you need to get in to your room. Once you arrive at your room, you will be able to open the locked door simply by entering a code into your NFC enabled cell phone.

For those worried about security, Nokia, allow you to disable the payment option via customer service. The payment button feature that is integrated with your credit card company can also be turned on and off. If you have the option on, you have the ability to enable a password for protection. You also have the option to disable the password so that you can “express pay”.

Bank of America has announced a test run that will be conducted by its employees. 500 of its workers will be given an NFC enabled phone that they can use at vending machines in the company cafeteria and break areas.

Today there are also credit cards available from Bank of America and Chase offer “express pay” credit cards that are enabled with RFID chips that don’t require you to enter a signature or password. This offers convenience for those who are willing to run around with a “loaded credit card” in their wallet. However, most of us do not like this idea very much. An NFC enabled cell phone will allow people to make safe quick payments. This will increase the amount of people who use a credit or debit card since almost everyone carries a cell phone.

Labels: apply for a credit card, Bank of America, Business Credit Card, credit cards, low interest credit card, NFC enabled cell phone, Nokia 6131, Nokia 6131 NFC

As the world continues to turn, the United States continues to bailout failing companies. The next bailout on the agenda is for the United States automobile industry. General Motors, founded in the 1908 is among the most fragile companies. It is unfortunate that General Motors will not have a happy 100th birthday celebrate. The failing automaker is now asking the government to grant them 25 billion dollars to continue to operate. Executives from GM are saying 2008 the company could implode if they do not get funding by December of 2008. The next question that congress is asking is whether or not they should loan GM the money to keep it from going under.

The financial repercussions would be felt at all levels of society should General Motors fail. It is estimated that 2.5 million people could loose their jobs if any of the big three American automakers would go under. Jobs would be lost all they way from factories to car dealerships and all those that supply the automotive industry. Suppliers, like the Lear Corporation, who supplies the automotive industry with interior components would be forced to close down manufacturing plants as well as lay off some of its workforce. This would in turn hurt other industries such as transportation that move raw materials and finished goods from plant to plant. A downturn in the transportation industry would then affect other aspects of the economy who service that industry as well. Mechanics and parts manufacturers will not have as much work due to less wear and tare on fleet trucks that are not moving as much. Even the credit card industry will be effected as unemployed workers will not be able to make their monthly payments.

Unfortunately, in order for General Motors to save the company, they need to bring back the glory days when the American automobile was considered the epitome of quality. After all, was it not Henry Ford who invented the automobile? Yes, the automobile was invented in the United States. However, foreign competitors have been able to improve upon our technology and manufacture a superior product. During the 1950s, the Cadillac was considered the one of the most prestigious. Today, Mercedes Benz, which is German made, is considered to be superior over Cadillac in both quality and performance.

The other major moral dilemma affecting the automotive industry is the future of its many retirees who count on a pension from General Motors to make ends meet. From a socialistic point, this is a great way to provide for your employees who worked hard for the company. However, from a business perspective, pension plans only increase the cost of the product. It is estimated that at least $1000 of car American car sold goes to fund pension plans. Foreign auto makers are not forced with this problem. The other factor that is driving profits down is labor costs in the United States, especially in northern states like Detroit. Workers in Detroit earn an estimated $35 per hour while workers in Alabama earn far less at $17 per hour. In order for the auto makers to survive unions must come to terms with over inflated wages being paid to some of its employees.



The next dilemma is how to make General Motors a profitable and renowned company once again. Perhaps, there too many things to mention that GM needs to improve upon, among the most important are their level of quality. Other technologies, like ways to run our cars on alternative fuels to gasoline need to be developed. We need to become a world leader in the arena of alternative fuels. Honda and BMW are already working on hydrogen engines that will power some of its cars. GM needs to do the same as well as look for other ways to power our vehicles, such as solar power. Lastly, workers need to take less pay so that the company can be profitable. In turn, General Motors can issue stock to its employees.

The Fed has stated that GM will have to abide by TARP guidelines, such as restricted executive compensation should they grant monies. As citizens we need to stand behind our manufacturing industry in order to keep the economy going. After all, this nation was built because of manufacturing jobs, particularly in the automotive industry. Lastly, we need to stick together as a country during these trying times.

Labels: Business Credit Card, credit cards, general motors, Paulson Act, TARP

As the credit crisis worsens, many people are starting to fear that the next financial crisis will involve the credit card industry. Over the last ten years the credit card default rate has been at the 5% level. By the end of 2009 some analysts are predicting that the charge off rate will double to 10%.

Due to skyrocketing charge-offs, credit card companies are forced to increase rates. Recently, Citigroup was forced to lay off 10,000 workers and raise interest rates for over 50 million card holders.

Although, some argue that the industry is going to be the next crisis, there are others that would argue otherwise. Even if the default rate goes up, others will still be able to pay their payment in full. Very few people pay off their mortgage at the end of the month.

The other argument is that the mortgage business is a 14 trillion dollar industry, while the credit card industry is a 970 billion dollar industry. As the saying goes, you have to compare apples with apples.

The other major most important factor that favors the future of the credit card industry is the fact that nobody is placing bets on whether or not people will be able to pay their bills. In reality, the mortgage crisis was caused by something that is known as a credit default swap. Prior to the great depression, people used to bet whether or not the stock market was going to do good or bad on any given day. A credit default swap is very similar in that an investor buys a credit default swap from a creditor, and is essentially making an investment on whether or not that debtor will pay or not. If the debtor does not pay than the creditor has to pay the credit default swap holder. However, if the debtor pays his debt in full than the bank collects fees back from the investor that purchased a default swap against certain loans. The banks were selling credit default swaps to investors unaware that so many people would end up defaulting on their loans. Therefore, the banks would now get stuck with property, plus they had to pay out to investors the value of the default swaps. Credit card debt is not wagered against like this.

Another very important factor to consider is that credit card companies are more flexible with their billing abilities than the mortgage business. To start credit card companies charge annual fees on top of late fees, etc. In addition, the credit card industry charges more interest than what you pay on your mortgage.

Overall, I think America as a whole will survive the 2008 financial crisis. We are the backbone of industry and the creators of some of the most innovative concepts of modern times. In all the United States has proven that it can withstand just about anything. We withstood and triumphed over foreign occupation when we were a young country. We also lasted through the Civil War and we are still here after the 1929 stock market crash and the Great Depression that followed. Therefore, I am quite confident that the credit card industry which started in the United States will survive one of the most trying times of our history.

Labels: Business Credit Card, credit cards, credit default swaps, the great depression

U.S Treasury Secretary Henry Paulson has decided to use the remaining funds from the 700 billion dollar bailout to help unfreeze consumer credit. The credit crunch which has been affecting Wall Street over the last year has finally hit Main Street. It is now harder for consumers to qualify for automobile loans, student loans and credit cards.


If consumers are unable to qualify for auto loans then the troubled automakers will experience fewer sales than now. As it is, automobile sales are down 50% this year over last year. The automobile industry provides thousands of jobs all over the United States. Everyone from car dealerships too to auto parts manufacturers will suffer tremendous losses should the United States automobile industry fails. More lost jobs will not help the current mortgage crises. Although, the Paulson Plan does not call for aid to the automotive industry, it is important that we stand up as a nation to save this dying industry. The government should give tax credits to anyone that buys a brand new American made car. Incentives such as tax benefits for those who buy American made vehicles can only help bolster sales. We need to keep people employed so money can continue to flow through the economy.


Credit card approvals have also seen a decline because of the credit crises as well . As consumers we rely on credit to purchase things that we need or want. These purchases that people would not otherwise be able to make without credit pump billions of dollars into our economy. Consumers need buying power. Without consumer buying power, retail stores will suffer more losses. We are seeing very large retailers like Circuit City filing for bankruptcy. Without credit consumers find it much harder to make larger purchases like televisions and computers.


Less consumer spending will also affect other sectors of the economy like transportation and manufacturing. If goods are not being purchased then they are not being shipped from the manufacturer to the retailer. This hurts everyone from those working in factories, trucking companies, warehouse workers, and all the support needed to keep products moving.


Student loans are also needed to keep our work force trained for jobs of today and tomorrow. Without student loans many high school graduates will be faced to find low wage paying jobs or even no job at all. Education is what keeps our work force competitive with foreign markets. The country needs engineers, teachers, doctors, and other trained professionals to keep our way of life going.


Ultimately, the economy needs credit to continue to grow. Businesses rely on bank lines of credit so that they can pay employees. Retailers count on consumers with credit that spend money at their stores. Without credit, there will be more job losses. Small businesses will have a harder time paying people and will be forced to cut jobs. Retailers will sell less and have to cut jobs as well. These losses will only further worsen the mortgage crises. In order to keep home values from falling any more than they have, we need to keep the country working.

Labels: automobile loans, credit cards, henry paulson, Paulson Act, student loans