US Economy: Many Americans too stretched to save

In a survey commissioned by the Consumer Federation of America and the American Savings Education Council, it was shown that only two of three Americans "have sufficient emergency saving to pay for unexpected expenses like car repairs or a doctor's visit." The two groups also reported that Americans are saving less than they did three years ago.

Another survey by Bankrate.com in Palm Beach Florida showed that just barely half of Americans have more emergency savings than what they owe on their credit cards.

EU-Digest

US Credit Crises - NY Attorney General Andrew Cuomo takes action on protecting the consumer against collection agencies

EU-Digest

US Credit Crises - NY Attorney General Andrew Cuomo takes action on protecting the consumer against collection agencies

New York Attorney General Andrew Cuomo Wednesday announced that his office had closed a collection agency in the state and said that nearly 20 other accounts receivable management firms had been subpoenaed to provide additional information about their collection practices. The announcements were part of what Cuomo called a “statewide inquiry into debt collection companies.” Cuomo’s office said in a press release that it had obtained a court order against Lamont Cooper and two debt collection firms he owns that operated in the state: Emanee Development, Inc. and Dial Tech LLC. The order stipulates that the companies will shut down and Cooper will be forced to pay restitution to consumers statewide. Cooper and his companies are permanently barred from engaging in the debt collection business and acting as brokers that buy and resell portfolios of consumer debt. The attorney general alleged that Cooper’s companies told debtors that they were criminals, threatened lawsuits and arrest, engaged in third party disclosure, and other violations of the Fair Debt Collection Practices Act (FDCPA). “At a time when New York families are already struggling with unprecedented levels of debt, unscrupulous collection agencies add salt to an open wound,” said Attorney General Cuomo in a press release. “Using fear and intimidation to take advantage of individuals facing debt is a shameful and illegal scare tactic. This judgment is the first step in this Office’s expanding investigation into debt collectors that violate the rights of consumers and operate outside of the law.” Cuomo also said that he has subpoenaed nearly 20 companies and law firms operating as debt collectors throughout the state.

Cuomo said that the probe of debt collection practices will include activities that are illegal under state and federal law, including fraudulent threats of criminal prosecution, harassing phone calls to consumers and their families, friends and employers, bringing lawsuits against and/or reporting consumers to credit reporting agencies without verifying that the consumer being targeted actually owes the debt, and failing to disclose that a caller is working for a debt collector.

CNN.Com: When credit cards put you in jeopardy - by Gerri Willis

For the complete report from CNN.com click on this link

When credit cards put you in jeopardy - by Gerri Willis

Consumers have racked up more than $2.2 trillion in purchases and cash advances on major credit cards in just the last year. And it's become a habit for them to spend more than they have. The overall credit card debt grew by 315 percent from 1989 to 2006, according to public policy research firm Demos. To compound the problem, fewer people are paying their credit cards bills on time. The percentage of people delinquent on their credit cards is the highest it's been in three years, according to CardTrack.com. With banks tightening their standards and the drumbeat of recession getting louder, there's no better time to grab control of your debt now.

AlterNet: Europe Beware of the Credit-Industrial Complex

For the complete report from AlterNet click on this link

Europe Beware of the Credit-Industrial Complex

In 2004, US banks pocketed $32 billion in service fees, up from $21 billion in 1999. According to BusinessWeek, such fees accounted for 76 percent of profits at the Midwestern bank, TCF. Wells Fargo in San Francisco reportedly charges $2 every time someone with a low balance calls a service representative, and a whopping $30 an hour when a rep helps someone reconcile an account. Not surprisingly, the majority of these fees falls upon the poorest customers. One out of five customers switches banks because he or she is so outraged by these charges. One estimate by Gartner Research shows that it costs banks less than 50 cents to return a payment request, while turning around and charging us anywhere from $25 to $40 for this "service." The barely regulated banks are getting away with one usurious practice after the next: In addition to the subprime fiasco now threatening the entire economy, there are the extortionate service fees on your bank accounts and the escalating interest fees, late fees and truncated payment cycles on your credit cards. Millions of us now get credit card bills that give us 10 days -- and those aren't 10 business days -- to pay up or get hit with a late fee. No wonder the credit card industry has been one of the most profitable in the country, earning on the order of $30 billion annually.

Note EU-Digest: The EU Commission can do European consumers a great service to scrutinize the activities of the Credit Card Industry in the European Union to avoid that situations which American credit card holders are experiencing in the US, don't happen in Europe.

ATM Marketplace: Western Europe sees strong debit-card growth

For the complete report from ATM Marketplace click on this link

Western Europe sees strong debit-card growth

The number of payment cards in Western Europe increased by 9 percent from 2004 to 2006, hitting a total of 787 million, according to research firm Retail Banking Research Ltd. Each adult in the region now has more than two payment cards. According to RBR, the United Kingdom remains the region’s largest market, despite a fall in its card numbers as a result of credit-card issuers closing dormant accounts.

Western Europe’s largest card markets in 2006.Most countires have more debit than credit cards. However, in Austria, Belgium, Germany, the Netherlands and Turkey debit cards account for more than three-fifths of the market. Issuance of prepaid cards, included in the debit sector, remains under‑developed, although such cards are expected to gain in importance over the next few years as banks target people who do not hold bank accounts, and as companies use them to control employee expenditure.Debit cards are the dominant form of card payment based on volumes, accounting for 63 percent of transactions despite that the fact they account for only 52 percent of cards. In contrast, credit cards payment volumes stand at only 17 percent, compared with 33 percent of cards in circulation.

Note EU-Digest: Consumers in Europe should be warned like smokers are about their health that credit cards are dangerous to their financial well-being. All they have to do is look at the US where personal credit card debt now has reached close to euro 545b (US $ 800b).

The Real Truth: US Economy - U.S. Sinks Deeper Into Credit Card Debt

The consumer credit crunch

For the complete report from the Real Truth click on this link

US Economy - U.S. Sinks Deeper Into Credit Card Debt

American's are increasingly unable to keep up with credit card bills. An Associated Press analysis of financial data from many major credit card companies showed double-digit percentage increases in bill payment delinquency. Accounts at least 30 days late increased 26% over the previous October to $17.3 billion—a $4.5 billion increase. Discover Financial Services Co. reported a jump of 25,716 accounts that were more than 30 days late over November 2006. The number rose at least another 6,000 during October of this year.

According to the Federal Reserve Bank, Americans carry $920 billion in credit card debt. Credit card companies saw an 18% rise in defaults (in which companies write off debt, deeming the cardholder unable to pay) over the previous October. These defaults total about another $961 million that is owed but cannot be repaid.“The desires of consumers to want, want, want, spend, spend, spend—it’s the fabric of the USA,” Howard Dvorkin, founder of Consolidated Credit Counseling Services in Fort Lauderdale, Fla., told the Associated Press. “But you always have to pay the piper, and that can be a very painful process.”