Poaching payday loan companies
Happier times at Advance America
As we saw in the case of Advance America payday loan company, legislation can get businesses put on the “threatened” list. Advance America recently shut down all its stores in New Hampshire and reached a legal settlement in Georgia.
Save the lenders
If heavy regulations continue to interfere with the nature of business, payday loan companies may eventually become extinct. The people who are intentionally trying to bring about this end obviously never ran out of financial options. Extinction of the payday loan industry would mean fewer choices for low- and middle-income families who hit a financial snag.
Happy Birthday Dear Darwin
The Advance America case foreshadows an uncertain future and possibly an unnatural death. However, today, on Charles Darwin’s 200th birthday, I pay tribute to him by recognizing cases of “survival of the fittest” under natural circumstances — or at least “free market” circumstances.
Charter Communications not so fit
While many cable companies are thriving, Charter Communications Inc. is filing for bankruptcy. In a capitalist society, if the market gets maxed out, someone has to go. But Charter will not shut down, it will restructure.
It has negotiated with its creditors and will be forgiven about $8 billion in debt. Charter says it will finish a major restructuring before April. Whether that will be enough to save the company from being snuffed out remains to be seen.
Game over?
Midway Games is best known for its "Mortal Kombat" series.
A few weeks ago, I came across an article that claimed the video game industry was recession proof. Well, that may be true for the overall industry, but once again, the weakest link is struggling for survival.
Midway Games has filed for Chapter 11 bankruptcy, meaning it doesn’t have to repay its creditors. That indicates that the company will continue to operate. Midway owner Matt Booty says the company will now begin “exploration of our strategic alternatives.”
I think Darwin would agree with market analyst Michael Pachter, who implied it just might be time for Midway to sell.
Predatory legislating
Without regulations holding them back, payday loan stores once appeared fit as a fiddle. If legislators keep tinkering with the market, payday loan companies may become the victims of unnatural selection.
Natural selection may be a great metaphor for those companies situation. Granted, Advance America is more like the condor – it’s habitat is being encroached on by so called “do gooders.” Failing to adapt to an unlivable environment isn’t exactly their fault. If Midway succumbs to bankruptcy, is someone going to call Flawless Victory?
You have got to be kidding me. Predatory legislating? “Without regulations holding them back, payday loan stores once appeared fit as a fiddle.” Yeah, it’s just their customers who were going under. You make me sick.
If legislation passes and out laws payday loan stores to customers we will have a worse epidemic on our hands with unemployment. Besides putting the stores out of business you have to consider the vendors that support the stores (i.e. advertising, sign companies, software vendors, etc).
Besides that credit will be even tighter. I don’t mind the regulation of the business but within means of business owners being able to survive and getting lending controls better. Like anything else…if you give someone the opportunity to use a credit card anytime more than 1/2 of people would max it out. This is no different.
Keep the business and get better lending controls…the APR disclosure is CRAP also. Payday loan fees are cheaper than a bank. Take the APR formula of a $30 NSF fee charged by a bank and compare it to an $18 charge on a payday loan. It’s “NIGHT AND DAY” the banks are robbing people blind and getting away with it.
PEOPLE NEED TO GET MORE EDUCATED ON THIS TOPIC BEFORE “BLOGGING”!
Control, control, control. Let people do what people will do. Nobody makes a person walk through the doors of a Payday Loan Company just like nobody forces a person to walk into a fast food restaraunt and squander their money on food that will ruin their health and their children’s. The Government is worried about employment, yet if they put a cap on the interest rate that they are able to charge, it will put them and small loan companies out of business. Do they not realize the thousands of people that this will effect? All of the employees, including but not limited to office help, managers, supervisors, IT Technicians,accounting, payroll, mailroom, etc. What about their medical, dental, life insurance? Do they honestly think that this will help people that are in financial debt? Are they also going to limit the amount of taxes and fees that the cell phone companies charge, or better yet, the amount of money that families spend on cell phones that they cannot afford? PA-LEESE, are they going to start putting a government official and the doors of the indian casinos popping up everywhere to make sure people don’t spend their money unwisely?????? Get real, I am so sick of the government trying to control something like this and not concentrating their efforts on something that will make a difference. Something like helping more people affected by Hurricane Katrina, who by the way, are going to be up yet another creek when there is no where they can get a loan when they need one. Maybe the government could concentrate some effort on the thousands of people living in boxes and shelters. Maybe those jerks and their million dollar bonuses could throw some crumbs to them out the window of their private jets as they fly over. Stop trying to control people and think about getting out and getting those pedicured hands dirty helping someone for once. Have us humans really gotten so arrogant that we have to control each other? Geesh, even God gives us the freedom to make our own choices…..Our money says “In God We Trust”……whatever.
except from Tom Lehman, a professor of economics at Indiana Wesleyan University…
“…another demonstration of the truth of Ludwig von Mises’s well-recognized hypothesis that “middle-of-the-road policies lead to socialism.” One government intervention leads to unintended consequences from the point of view of the government planners, forcing them to make a decision: repeal the initial intervention, or intervene further until the entire industry falls under the influence of government force.”
This is why government needs to stay out of industry, period.
Only the GREEDY and SELF-CENTERED payday loan companies could possibly call regulation “PREDATORY”! Talk about an oxymoron! Your very industry preys upon the poor and desperate who you trap into a never-ending cycle of debt that only builds each pay period as people take out more and more of your unethical loans just to make ends meet! I’ve fallen into your trap myself. And like so many countless struggling Americans, I’ve dealt with your nasty attitudes and your illegal collection practices that totally disregard state and federal debt collection laws. The only people who can afford your interest rates are the very rich. But guess what? 99% of the time, it’s the very poor who take out one of your loans out of desperation in the moment. Charge a fair interest rate that people could actually afford to repay, work out a reasonable repayment plan with those who cannot pay off the loan in two weeks, and then I may see your cry of “predatory legislation” as a viable reality. But until you can drop down to a more fair interest rate–like say a 25% or 30% maximum cap (yeah, that’ll be the day)–then no thinking American will ever feel for your cause or see you as anything else but scum bags who deserve to be forced out of business for your own true predatory lending!