02 Apr 2007
James Scurlock on Fixing the Credit Mess

This sounds like a fine film. He's right about one thing - people do need to take responsibility for their screwups, and a lot of the debt problems we (and, honestly, I) have are the direct result of our screwups.

But the problem I have is, do they owe what they borrowed plus a little interest or are they responsible for three, four, five times what they borrowed? That's what we used to call "usury," and that's not only unrealistic but it's ruinous. It's extremely important for people to be responsible for what they borrowed, but when you have these contracts that Harvard Law School professors can't understand, and fees and interest rates that no one can be prepared for, it's just setting people up to fail.

I can remember watching a movie when I was a kid about gangsters and "loan sharks" - they were charging 25% interest and the Feds were hot on their tails. Today that's the default rate from most credit card issuers... it cannot continue, and will eventually collapse in on itself as nobody will be able to pay the bill or purchase the seized property.

I feel like we're seeing the old curse come full circle: "May you live in interesting times."

James Scurlock's film Maxed Out takes a hard look at the American lending industry and how it has enabled the country's spiraling debt. Scurlock, a business school dropout who opened and sold four restaurants before he turned 25, discusses recent shakeups in the business world and where both debtors and lenders should go from here.

(link) [U.S. News & World Report]

22:41 /Politics | 1 comment | permanent link

North Korea admits food crisis

Well, I suppose there's a first time for everything...

North Korea has made a rare admission that it needs outside help to tackle its food crisis, aid officials say.

(link) [BBC News | News Front Page | World Edition]

22:34 /Politics | 0 comments | permanent link

EMI-Apple pen deal to sell songs

This has implications far beyond the end of DRM. It also heralds the end of the subscription model for online music and movies, because with DRM an "all you can eat" subscription model makes no sense.

Breaking from the rest of the recording industry, EMI Group said Monday it will begin selling songs online that are free of copy-protection technology through Apple Inc.'s iTunes Store.

(link) [CNN.com]

22:25 /Copywrongs | 0 comments | permanent link