If you are one of the lucky retail credit-card holders AMEX wants to dump, you get a cool $300 (as in prepaid gift card). But there is a catch. No free lunch even for a favor.
Here’s the deal. Agree to pay off your credit card balance and close your account by Feb. 28.
It’s just that little problem of coming up with all that cash you owe. For some that nut is in the $9000 range. But AMEX gives you until April 30th to pull it off, the financial equivalent of the loaves and fishes miracle.
Whether you can or cannot meet this challenge your account is still closed. No questions answered.
You can be sure this move is in your best interests. It’s doubly comforting to know that American Express has also ducked under the biggest TARP ever conceived (The ‘Toxic’ Asset Relief Program) to the tune of $3.4 billion.
I wonder what they do with all that money.
P.S. Did I fail to mention that you lose all your Membership Reward Points on this deal? Yikes! Only 4 days left to spend them. Hurry.
P.P.S. Miss the April 30th deadline and you don’t get the giftcard.
R.I.P. And your account still stays closed. Now, I dare you to check your credit score.
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( 2.9 / 149 )And you thought it was the other way around? Not anymore it seems.
But can you guess who said it? You’ll be surprised.
He is a seasoned and knowledgeable veteran, aware of both systems, but watching from the sidelines now as the global financial meltdown and the subsequent bail-outs of world famous banks and corporations continue.
Give up?
It’s none other than Mikhail Gorbachev, the Soviet leader who opened up his country to elements of capitalism. Obama and other western leaders should take note.
CAPTAINS OF THE UNIVERSE
Would you agree … the most vocal proponents of capitalism are rich and powerful?
You can find them in almost every industry and country. I suspect they are heavily concentrated in the financial service industry where the money to be made defies reason. (You decide if the gains of the super-rich on the backs of the workers [e.g. free trade driven job losses] also defy another value we cherish.)
And it is an industry. It produces goods and services and distributes them globally although certainly unevenly among the general population.
Innovation (the legerdemain of financial engineering), free markets (deregulated), easy credit (driven by low interest rates), and business credibility (as vouch-safed by paid rating agencies) are all designed to make high profits for the shareholders and multi-million dollar salaries* for the corporation’s executive management. (*estimated at 370 times the pay of the average American worker)
Executives triple-dip with annual bonuses tied to attendance and other exacting performance measures; they also stand to reap windfall profits through stock options honored by a grateful nation and legions of lawyers. Such activities and largesse are under the watchful eye of well-compensated Boards of Directors who treat good governance as gospel.
SO WHAT'S THE PROBLEM?
The public want their bank deposits protected from loss. Government obliges through taxes collected from all workers to create deposit insurance. Is this not the worker subsidizing the risk taking ventures of the banking corporation who singularly stands to profit?
In the worst case scenario (today!), bail-outs to cover toxic ‘assets’ (lol) and prevent a ‘run-on-the-bank’ are financed through printing money, a gift from future generations of taxpayers. What is so repugnant here is the ultimate lose-lose scenario; when the risk-taking private enterprise loses, you lose, too.
Other financial service organizations employ private capital from the general public to make risk-based investments. The greater the profit potential (for distribution to the shareholders and employees), the greater the risk.
As events have proved, should any financial player lose big on a bad bet (sub-prime mortgages, collaterized-debt obligations, junk bonds, etc.) then government will choose the survivors arbitrarily, in effect, by securing their as yet unknown total liabilities with public funds to keep the entity solvent.
BEHIND CURTAIN #3
Does anyone seriously think this will ever prove to be enough cash and stimulus given the enormity of the bad bets still floating in Neverland? It seems we have reached the “Too big to bail-out” decision.
This option lets the banks fail and saves the depositors. That may put a cap on the loss. The complex mechanisms for this I know not. But this exercise and the bail-outs are what occupy legislators today and will do so for months to come. So far, 35 U.S. banks have been closed and another 200 are on the edge.
When losses are socialized, the taxpayer pays. In other words, we socialize risk. Is this fair when we capitalize profits with the gains going exclusively to the corporation, its executives, and shareholders?
ANOTHER ALTERNATIVE
What arguments can you offer to make banks like utilities, simply service-providers like the water and electric company? Are they not an essential service, the life-blood of our system?
If we could regulate them as tightly as the nuclear power industry, we may prevent a repeat of the current crisis and the global loss of trillions of dollars in asset value, a loss of such magnitude that no one has yet been able to quantify. ($30 trillion? Or is it $300 trillion and counting?)
The problem gets personal. Then again, you know this.
Copyright 2009 William M. MacKay
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( 2.9 / 159 )…said Warren Buffet, YOU FIND OUT WHO WAS SWIMMING NAKED. Britney Spears you say?
Well, perhaps but I had others in mind, like the ones running the banks, investment dealers, and hedge funds.
Swim suit sales, propelled by the captains of finance no doubt, will be predictably brisk this spring. But no designer stuff. Oh, no! There’s that $500,000 cap on their income. Well done, Obama. Squeeze ‘em ‘til it hurts.
The rest of us will be content with the old togs we bought last year but might surprisingly find them a little baggy with all the belt-tightening this winter.
No Sports Illustrated fame for us in their annual eye candy edition. Is it my imagination or are the talent a little thinner this year? Hmmm.
So settle back. Don’t worry. Be happy.
The rising tide pushed by a wave of stimulus may create a tsunami that lifts all boats and sweeps the flotsam out of sight and out of our life.
I live in hope.
Copyright 2009 William M. MacKay
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( 2.9 / 153 )A great lifestyle is a process of “natural selection” as Charles Darwin coined the phrase. Whatever your appraisal of your lifestyle it is, like evolution and our very nature, the end result of a long, slow process.
Over recent decades, dissatisfied with the slowness of the dream creating mechanism (saving) that earlier generations endured, we embraced credit and debt with historical consequences. Yet, even today, this process of choice is still operative in spite of the limitations imposed either by the availability of credit or by the decline in your personal income.
While “survival of the fittest” became the more popular term that explained how living things evolved it also offers a perspective on how you get to that great lifestyle you would define for yourself.
Getting there is an evolutionary battle. The combatants in this struggle (being of our own making) have also evolved from two powerful natural forces. Parental and cultural conditioning come to mind.
It is, however, your values, attitude, desire, and motivation that are the determinants of how you spend your money. But if your wants get perverted and become everything you “need” then all bets are off that your survival can be guaranteed or your dreams realized.
This behavior may reinforce the notion that we are but modified monkeys, as T. H. Huxley said, although not quite as low as modified dirt.
Why the problem? You can’t buy “everything” you want. Your desires are infinite.
Even to the most casual observer there is not enough money to acquire what all advertisers and retailers are offering to make you and your life perfect. Of course, it’s natural to want it. Throw in the availability of loose credit, rampant greed, and blind regulators and you have the perfect storm we are now trying to survive.
But you can buy “anything’ you want. Here’s the distinction.
The “anything” you want is much more of a selective process. It’s a value-added enhancement to the survive and reproduce model that drives much of our behavior. It is what separates us from a beetle or a pig. The choice is conscious.
While I don’t support the existence of Homo economicus, a rational Adam and Eve that walked out of the Garden of Eden, there is a place for sober second thought in how we go about getting what we want and can sustain. The sustaining aspect is the key to defining your choice.
Natural selection has a very long time horizon. So does life expectancy in the 21st century. What’s the best you think you can manage and sustain given the duration and uncertainty of the years ahead? Now, the operative word is “ think”. No immediate gratification here.
This is not about giving up your dreams and aspirations. It is about putting what you truly value in the spotlight of reality and doing something that will ensure its survival.
You cannot have it all but you can enjoy --with modest analysis, planning, and action--what you value most when you remember that wealth is all that you have for which you would not take money.
Copyright 2009 William M. MacKay
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( 3 / 163 )As weekends come and go, and wherever you find yourself, there are others who are doing or enjoying less. If you’re at home you are not the only one.
Sure, some friends carry on with their Friday or Saturday tradition. However the night is defined…be it “club, girls’, bowling, or movie night” … whatever the recreation, I have no doubt that the fun is tempered by the thought of who is missing from the social circle this weekend. And perhaps why they are missing.
What’s happening to your friends and family?
I just heard Obama pushing Congress to pass the $900 billion plus stimulus plan to avoid a catastrophe. Chrysler announced the closing of several assembly plants for 10 days starting on Monday. An acquaintance was just diagnosed with cancer. A friend’s partner just left today.
Not-so rich, you see, is about more than the money in your jeans. It’s the lifestyle big picture.
Clearly, money is the enabler here so you can afford those nights out with family and friends. But it is too limiting to budget with only this narrow financial perspective.
The grand vision of your lifestyle encompasses so much more than just what money will buy. But as one wag said, “There’s only one thing money can’t buy and that’s poverty.”
So while this weekend may not be just what you prefer doing and would do if you had more money, consider your good fortune in other ways. Whether it is spent with a special friend, partner, or child you love; or alone with a good book, terrific DVD movie or a hobby that engrosses make the most of it.
It is the little things in life that add up and make it special. Adopting this attitude now may make the year ahead one to remember rather than one to regret.
Copyright 2009 William M. MacKay
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