Thursday, October 27, 2011

Kahrdinal Sins

Many American consumers continue to suck-wind in trying to understand and manage the "Saturday night special" credit cards which ever so conveniently and relentlessly attempt to entice them into financial ruin.  Some folks claim that statement is nothing more than personal bias, paternalistic, an imposition of subjective values on the right of free choice.  Only folks who have never heard about Andrew Kahr are quite so naive.

If you might not be afraid to learn the truth about credit cards, try watching Mr. Kahr's interview (begining at the 18:40 mark or read the full transcript here) on FRONTLINE’s 2004 program: “Secret History of the Credit Card”.  And, maybe for dessert try the 2009 FRONTLINE program: "The Card Game".(Mr. Kahr makes his appearence 5 minutes in.) Mr. Kahr invented "The Card Game" and explains it to you succinctly without mercy nor remorse. Mr Kahr is as bright and shrewd as it gets and he knows for a fact that you're a sucker.... but he's counting on you thinking you're not.

In Mr. Kahr’s view of the consumer financial marketplace, there are no uncertain terms, there are no unintended consequences. Our universal human frailties are well understood. The subtle credit card tripwires and “gotchas” are purposeful; the “violations” anticipated; the “high punitive rates and fees” finely calculated; the potential for family financial catastrophe fully intended – fully intended and fully ignored. The consumer financial “sucker punch” is delivered by Mr. Kahr and his ilk without regret. You can rest assured that Mr. Kahr would "never give you an even break."

Mr. Kahr reaffirms in his 2004 interview his belief as to the “swiss cheese” porousness of all financial regulations and his personal conviction that there is always “another angle”, there is always a “work around” to any rule. Mr. Kahr says: “We figured out how banks could avoid state rate regulation”; and, one must assume that, unconstrained by conscience, Mr. Kahr can always find “creative” ways to compromise fairness.  Mr. Kahr avers that reasonable card regulations may eliminate choices for “some of us who are clever or righteous enough to merit exemption”.

Ah, hubris and the pungent whiff of several sins cardinal…or shall we say Kahrdinal? If you use a credit card you really do need to spend a few minutes at the feet of "The Master" and watch this program.

Can there be a better symbol, or symptom, than Mr. Kahr of why the American financial system is currently in such disarray and held in such low-esteem worldwide? It’s not that our financial system suffers from “moral hazard”; it’s that we have succumbed to “amoral hazard”.  We suffer mightily from the disregard and disdain of creative financial geniuses such as Mr. Kahr, whose vocabulary finds no degree of moral distinction between words such as persuade, cajole, tease, tempt, entice, mislead and deceive.  As we now see with much clarity, in a financial system where “anything goes” eventually “everything goes”.

While Mr. Kahr may pass, with highest marks, tests of his intelligence; he seems at best unaware that he may well come last on several of the most basic tests of our humanity. Emperor Kahr wears no moral nor ethical clothes and is nakedly revealed as a dangerous Kevorkian of American family finance. A false prophet of false profits.

This Halloween, to really scare the neighborhood kids, I’m dressing up as Andrew Kahr!


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