Monday, December 09, 2013

A Wise Word...

In Banking:  It's "us-'r-y(ou)" !

"Usury is Murder."

- Hebrew proverb

Wall St. Banking:
In the choice between "us-or-you",
We always pick us!

Wall St. Banking:
"We'd like to help you, 

all the way down!"

There Is A Difference:  Credit Union members are still protected ethically and financially by a statutory maximum interest rate (usury cap) of 18% on CU lending.  Banks - to the great detriment of consumers - have no such ethical or financial constraint...

Let's level that playing field!!  


Anonymous said...

Consumers are not protected by statutory maximum interest rate usury caps either ethically or financially. Caps cause dislocations of economic resources. Consumers are supposed to be protected by the by a Board of Directors that establishes interest rates that covers expenses. During the debate to raise the Federal usury caps from 12% in the early 80's Dr. Harold Black suggested a usury limit of 500%. He figured that the credit union directors were responsible for determining the appropriate rate to charge credit union members.

Supporting a usury cap seems to suggest that credit unions are not controlled by an ethical or financially responsible board. Maybe be even worse, you maybe suggesting that they really do not serve members anymore?

Jim Blaine said...

Why take the risk of a rogue CU/Board?

The usury cap is a terrifically powerful "marketing tool"...why not differentiate ourselves in the marketplace?

Let's commit to our members!

Put our mouth where our money is...

Anonymous said...

If you fear a rogue CU/Board than you have a very weak internal control that needs to be addressed.

Actually, you have Boards with a lot of authority but no accountability. It is an accident waiting to happen.

Jim Blaine said...

Absolutely, nothing better for control of irresponsibility than controls… the usury cap of 18% is one of those prudent controls.

Hope we don't think controls like the U.S. Constitution or The Bill of Rights cause dislocation of economic resources…can't be a free market if it is also not a fair market.

Last time I checked "Greed" - perhaps the greatest of economic "dislocators" - was still one of the seven deadly sins… alive in the human heart and thriving in our economy - if not rampant!

Anonymous said...

Usury caps do not provide the control that people think and they actually cause a shortage of credit.

This is not robust economics. This is basic economics 101.

Jim Blaine said...


Did you say "ROBUST"!!!!!!!!


Anonymous said...

Robust = Hampel