59.9 Percent? Americans Are Racking Up Huge Credit Card Balances Once Again And Some Of The Interest Rates Are Absolutely Outrageous!

Well, it was nice while it lasted.  One of the really good things that came out of the recent economic downturn was that millions of American families decided to get out of debt.  In particular, we had seen a sustained trend of reduced credit card usage in the United States.  It looked like Americans had finally wised up.  But we should have known that Americans would not be willing to tighten their belts forever.  Unfortunately, it appears that getting out of debt is no longer so “trendy”.  In fact, the month of December was the third month in a row in which consumer credit grew in the United States.  Prior to that, consumer credit in the United States had declined for 20 months in a row.  The American people were doing so, so good.  Why did they have to stop?  It appears that the American people have fallen off the wagon and have gotten a taste for credit card debt once again.  This time, however, the credit card companies are back with interest rates that are higher than ever.  In fact, one national credit card company has hundreds of thousands of customers signed up for a card that charges interest rates of up to 59.9%.

59.9%?

You mean there are people that are stupid enough to actually sign up for a credit card that will charge them 59.9% interest?

Unfortunately the answer is yes.

In fact, the top rate was 79.9% before First Premier Bank lowered it.

These cards are targeted at Americans that have a poor credit history, and these days there are a whole lot of those.

A recent story on the website of CNN described how large numbers of U.S. consumers with poor credit are gobbling up credit cards like these.  Unfortunately, many of these consumers are also not smart enough to realize what they are getting into.  The CNN story contained a quote from a woman who was in complete shock when she discovered that her interest rate was going to go up by 50 percentage points….

“I about had a heart attack when I got a disclosure notice saying that my starting rate of 29.9% was going up to 79.9%.”

First Premier Bank has since lowered the top rate on those cards to 59.9%, but that it still completely outrageous.

Not only are the interest rates on those cards super high, but they also charge a whole bunch of fees on those cards as well.  The following are some of the fees that First Premier Bank charges….

*$45 processing fee to open the account

*Annual fee of $30 for the first year

*$45 fee for every subsequent year

*A monthly servicing fee of $6.25

So you would think that nobody in their right mind would ever sign up for such a card, right?

Wrong.

CNN is reporting that almost 700,000 Americans have signed up for the card.

Ouch.

In fact, CNN says that First Premier Bank gets between 200,000 to 300,000 new applications a month for the card, but that they only open about 50,000 new accounts each month.

Are there really this many Americans that are this gullible?

If Americans would just remember the “DBS” rule they would be so much better off.

DBS = Don’t Be Stupid

Do you know how long it would take to pay off a credit card with a 59.9 percent interest rate?

Just a 20 percent interest rate is bad enough.

According to the credit card repayment calculator, if you owe $6000 on a credit card with a 20 percent interest rate and only pay the minimum payment each time, it will take you 54 years to pay off that credit card.

During that time you will pay $26,168 in interest rate charges in addition to the $6000 in principal that you are required to pay back.

Ouch!

The number one piece of financial advice that most of the “financial gurus” give is that you should get out of credit card debt – particularly credit card debt that has a high interest rate.

Unfortunately, 46% of all Americans carry a credit card balance from month to month today.

According to the United States Census Bureau, there are approximately 1.5 billion credit cards in use in the United States.

Of U.S. households that have credit card debt, the average amount owed on credit cards is $15,788.

This is how the bankers enslave us.

We end up paying them 3, 4 or even 5 times as much as we originally borrowed.

Month after month after month we slave away to make them wealthy.

So how do you stop this vicious cycle?

You quit buying stuff that you can’t afford!

Unfortunately, the vast majority of Americans have never received any formal training on how to manage finances.

Most of us were never taught any of this stuff in school.  Most of us were totally unprepared when the financial predators started preying on us in college.  Most of us got sucked in and spent years and years trapped in credit card debt.

When you carry a balance from month to month you are willingly signing up to become a debt servant to the big banks.  They get rich while you suffer.

The sad thing is that the mainstream media is pointing to increased credit card spending as a sign that the U.S. economy is getting back to normal.

But gigantic mountains of debt is what got us into all of this trouble in the first place.

Average household debt in the United States has now reached a level of 136% of average household income.

In China that figure is only 17%.

Obviously, we have a massive, massive problem with debt in this country.

Cranking the debt spiral back up is not going to cause the economy to recover.

Well, the profits of the big banks might recover, but the rest of us will suffer.

If you want to be financially free, then it is time to pay off your credit card debt and get off the debt payment treadmill for good.

The entire global economy is on the verge of collapse, so now is a great time to renounce consumerism.  Instead, we need to be preparing ourselves and our families for the hard times that are coming.

So what do you all think about the outrageous interest rates that the credit card companies are charging these days?  Feel free to post your thoughts in the comments section below….

15 Shocking Poverty Statistics That Are Skyrocketing As The American Middle Class Continues To Be Slowly Wiped Out

The “America” that so many of us have taken for granted for so many decades is literally disintegrating right in front of our eyes.  Most Americans are still operating under the delusion that the United States will always be “the wealthiest nation” in the world and that our economy will always produce large numbers of high paying jobs and that the U.S. will always have a very large middle class.  But that is not what is happening.  The very foundations of the U.S. economy have rotted away and we now find ourselves on the verge of an economic collapse.  Already, millions upon millions of Americans are slipping out of the middle class and into the devastating grip of poverty.  Statistic after statistic proves that the middle class in the United States is shrinking month after month after month.  Meanwhile, millions of Americans are starting to wake up and are beginning to realize that we have very serious problems on our hands, but they have no idea what is causing our economic distress and they are unaware that most of our politicians have absolutely no idea how to fix the economic disaster that we have created.

On the mainstream news, the American people are treated to endless footage of leaders from both political parties proclaiming that the primary reason that we are in the midst of such an economic mess is because of what the other political party has done.

Republicans proclaim that we are experiencing all of this economic chaos because of the Democrats.

Democrats proclaim that we are experiencing all of this economic chaos because of the Republicans.

Even many readers of this column (who are generally more educated and more informed than most average Americans) leave comment after comment blaming either the Democrats of the Republicans for our current economic mess.  

But do you really want to know who is to blame for our economic problems?

Both of them.

This economic nightmare has taken literally decades to develop, and both Democrats and Republicans have contributed greatly to this disaster.

Both parties have absolutely refused to stand up to the Federal Reserve and the horrific economic policies that they have been shoving down our throats for decades.

Both parties have stood idly by as the U.S. trade deficit has absolutely exploded in size and the United States has become significantly poorer month after month after month.

Both parties have refused to do anything as month after month after month large numbers of factories and good paying jobs leave the United States.

Both parties have shoved the spending accelerator to the floor when they have been in power and now we have the largest national debt in the history of the world.

Both parties have done essentially nothing as the health care industry, which was once the envy of the world, has degenerated into a cesspool of corruption and greed and now seems designed to do little more than to provide pharmaceutical companies and health insurance crooks with obscene profits. 

If factories keep leaving the United States and jobs keep leaving the United States and the federal government keeps going into more debt and state governments keep going into more debt and local governments keep going into more debt, then things are going to keep getting worse

It does not take a genius to figure that out.

The United States is continually getting poorer and is continually going into more debt.

Can anyone out there explain how that is a formula for economic prosperity?

Seriously.

Can anyone explain how that would work?

Please leave a comment and explain that to all of us if you can.

The truth is that as wealth continues to leave the United States and as the U.S. gets even deeper into debt, more Americans are going to become poor.

It really is that simple.

The following are 15 shocking poverty statistics that are skyrocketing as the American middle class continues to be slowly wiped out….

#1 Approximately 45 million Americans were living in poverty in 2009.

#2 According to the Associated Press, experts believe that 2009 saw the largest single year increase in the U.S. poverty rate since the U.S. government began calculating poverty figures back in 1959.

#3 The U.S. poverty rate is now the third worst among the developed nations tracked by the Organization for Economic Cooperation and Development.

#4 According to the U.S. Department of Agriculture, on a year-over-year basis, household participation in the food stamp program has increased 20.28%.

#5 The number of Americans on food stamps surpassed 41 million for the first time ever in June.

#6 As of June, the number of Americans on food stamps had set a new all-time record for 19 consecutive months.

#7 One out of every six Americans is now being served by at least one government anti-poverty program.

#8 More than 50 million Americans are now on Medicaid, the U.S. government health care program designed principally to help the poor.

#9 One out of every seven mortgages in the United States was either delinquent or in foreclosure during the first quarter of 2010.

#10 Nearly 10 million Americans now receive unemployment insurance, which is almost four times as many as were receiving it in 2007.

#11 The number of Americans receiving long-term unemployment benefits has risen over 60 percent in just the past year.

#12 According to one recent survey, 28% of all U.S. households have at least one member that is looking for a full-time job.

#13 Nationwide, bankruptcy filings rose 20 percent in the 12 month period ending June 30th.

#14 More than 25 percent of all Americans now have a credit score below 599.

#15 One out of every five children in the United States is now living in poverty.

As millions more Americans continue to climb on to the “safety net”, how long is it going to be before it breaks?

The reality is that the system can only support so many people.  We are now at a point where our anti-poverty programs are clearly unsustainable in the long-term, but nobody has a solution for how we are going to get all of these people off of these programs or how we are going to provide good jobs for all of them.

The cost of every U.S. government anti-poverty program is absolutely soaring.  Meanwhile, the U.S. government is already running a budget deficit that is approaching 1.5 trillion dollars every year.  If you cannot understand that we have a very serious problem on our hands then you are probably not awake.

The U.S. economic system is dying.  Blaming the other political party is not a solution.  Running around the country offering “hope” and “change” and giving people a vague sense that things will get “better” soon is not going to cut it either.

The American people need very real economic solutions to very real economic problems. 

But nearly all of our politicians are way too busy either trying to get elected or trying to stay in office to tackle the very serious problems which are destroying our economy.

Unfortunately, the American people love to watch our politicians play politics.  They love to watch the little ping-pong ball of blame go back and forth.  They love to pick sides and to cheer for their “team”.

None of that is doing any good.  Right now millions of Americans are getting sucked into poverty each year and neither major political party is doing anything real to address the very real economic problems that are causing that to happen. 

But most Americans have become so “dumbed down” that they don’t even understand what the real problems are anymore.

All most Americans seem to want these days is to watch a good show.

So send in the clowns.

There are certainly enough of them in Washington D.C. to keep Americans entertained for quite a long time.

The Number One Tool Of Financial Enslavement

Today there is a great awakening going on across the United States and all around the world.  Tens of millions of people are becoming aware of the growing tyranny of the global financial elite.  Yet millions of those same people willingly enslave themselves to those very same financial powers.  So how is this happening?  It is called debt.  The financial powers of the world use it to enslave individuals, corporations and governments.  For thousands of years humanity has been taught the proverb that “the borrower is the servant of the lender”, and yet today hundreds of millions of people around the globe willingly have run out and have made themselves servants of the money powers.  You see, when you borrow money from a financial institution, you not only have to pay that money back, but you also have to pay a significant amount of interest.  In fact, often the interest ends up being much more than the principal of the loan.  Thus the borrower ends up devoting a great deal of his or her labor to earning money for the lender.  Certainly there are times when it is necessary to borrow money.  But what Americans have been doing over the last 30 years goes far beyond “necessary” borrowing.  In fact, the massive debt binge of the last three decades has been nothing short of a huge percentage of the American population entering into willing financial enslavement.

Do you think that is an exaggeration?  Just consider the chart below.  The word “insanity” does not even begin to describe the growth of household credit in the United States over the last 30 years….

So why is debt so bad?

Well, there are a lot of reasons.  Debt strips you of your freedom and slowly drains you of your wealth.  It puts the fruits of your labor into the pockets of others.

Getting others enslaved by debt is how the most powerful financial institutions in the world got so dominant.  It is one of the most profitable ways of making money ever invented.

What many people don’t realize is just how much interest they end up paying on some of their debts.

For example, if you go to mortgagecalculator.org, you can calculate the amount of interest that you will pay over the life of your home mortgage.  According to that calculator, someone with a $250,000 mortgage at an interest rate of 6.5% over 30 years will end up paying over $300,000 in interest before it is all paid off.    

So when those 30 years are over, you have bought a house for yourself and you have also bought a house for the bankers.

But there are many forms of credit that are far worse than mortgage debt.

So what are they?

Just look in your wallet.

Do you have a credit card in there?

If so, and if you carry a balance each month, then you are “feeding the monster” and you have financially enslaved yourself.

But you are far from alone.

According to the United States Census Bureau, there are approximately 1.5 billion credit cards in use in the United States.

In fact, 78 percent of American households had at least one credit card at the end of 2008.

So it is a rare person who does not have at least one credit card.

But not only do the vast majority of us have credit cards, we are using them at unprecedented rates.

At the end of 2008, the total credit card debt piled up by American consumers was more than 972 billion dollars.  That is an amount that is greater than the GDP of the world’s 122 poorest nations combined.

So why is credit card debt bad?

Well, because it can drain your wealth faster than almost any other method ever created.

For example, according to the credit card repayment calculator, if you owe $6000 on a credit card with a 20 percent interest rate and only pay the minimum payment each time, it will take you 54 years to pay off that credit card.

During those 54 years you will pay $26,168 in interest rate charges in addition to the $6000 in principal that you are required to pay back.

That is before you include any fees or penalties you might accumulate along the way.

Are you starting to get the picture?

Do you really want to repay over $30,000 for a $6,000 purchase?

Of course not.

So what should you do?

Stop feeding the monster.

They are getting insanely wealthy off of your financial enslavement.

It is time to get out of debt.

One of the most common financial questions that people ask today is what they should do with their money.

Well, the answer to that question is a lot more obvious than people may think.

After purchasing all of the food and supplies that are needed for the hard times that are coming, people need to get out of debt.

There are very, very few investments that will add to your wealth faster than debt is draining it.

So don’t let your money sit there and earn a couple of percentage points if you are carrying any debt that you can easily pay off.

Paying off debt will reduce your living expenses and will give you much more flexibility.  It will also put you in a much better position to weather the very difficult financial times that are coming.

When you get into more debt, you are playing the game that the Federal Reserve, JPMorgan Chase, Morgan Stanley, Citigroup, Bank of America and Goldman Sachs want you to play.  There are always going to be financial predators that are ready to drain your wealth.

But you don’t have to play that game.  Work to get yourself free.  You will be glad that you did.

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