10 Percent is Enough! - 5 Minute Version
Would you lend your money to strangers for 10% a year?
You are closing off financial markets for many people.
Claiming we need to limit interest at 10%, then speak of free markets and capitalism in the same breath is hypocrisy.
The people who have debt over 10% are not going to magically see their interest drop to 10%, therefore making their borrowing affordable. What will happen is credit will be cut off to those people.
If you don't like loans above 10%, don't get them. Period. If you don't like the bank changing interest rates on you while you have existing debt with them (i.e. credit cards) then either don't use credit cards, or be able to pay it off should they change the rate. Or fight to take away the banks right to do that.
But simply fighting against rates higher than 10% limits the market of debt to people with poor credit scores. You might see that as a good idea, but then you're essentially making choices for people. This is akin to minimum wage, while people think it's great that those going to work are guaranteed a certain wage for their labor, what really happens is jobs are cut off for any positions that aren't worth the minimum wage.
I don't like high interest rates either, but responsibility has to start with the people themselves. They have to quit taking the loans at those rates, quit being consumers and become savers. The banks will help you drive yourself into debt-slavery, it's in their best interests to do so, so people have to take responsibility for their finances and make rational choices to not accept credit at those high rates. Go to a credit union, where most will offer personal loans at rates around 10% even to people without perfect credit.
In other news, I was drawn here by the story about you guys collectively going to BOA to close your accounts. Awesome job! I did the same thing late last year and moved to a CU. It felt great, and I hope more people do so.
Make a tax
Copyright (c) 2011 Metro IAF