Posted on 11/25/2008 7:44:53 AM PST by TigerLikesRooster
More customers resume using old-fashioned cash
By ANNE D'INNOCENZIO – 1 day ago
NEW YORK (AP) — Cash or credit? For more Americans, who have already maxed out their credit cards or are just trying to manage their spending better in the tough economy, the answer is increasingly the old-fashioned one.
Retailers like Wal-Mart Stores Inc., Target Corp. and J.C. Penney Co. are noticing a marked shift away from credit cards in favor of cash and debit cards. A big factor is less credit available as major card issuers cut spending limits and raise fees even for customers who pay their bills on time.
(Excerpt) Read more at google.com ...
The forced severing of this connection is not entirely bad.
Ping!
I agree, but... the financial services sector has built its profits on collecting fees from credit transactions. They don’t make money when cash changes hands. The financial sector will shrink in size relative to the economy over the next few years, IMO.
If you use CCs and pay off the balance each month, they're fine. Especially if you need to rent something or make reservations.
If taxes skyrocket as expected in the coming years, you’ll see a lot more of the cash economy.
Maybe Walmart will bring back layaway. Although I no longer need to use it, I remember when I did, and was angry when they discontinued it. I see layaway as being the bridge between poverty and credit.
and if you don’t have the cash you can’t spend it.
I liked their layaways but hated the lines to pick stuff up.
One reason for customers using cash has to be the exorbitant fees charged by banks for non-sufficient fund transactions.
One customer of mine bounced a $6.50 transaction. Over the next few weeks the billing company sent it through again and again.
Within days, she racked up $180 in nsf fees.
The bank saw this billing snafu as their payday. Even though they knew this was not the person’s fault, they refused to waive any fees.
Banks make no money on people who keep low balances in their checking account. The only way they can make it up is with fees.
When things like this happen, low income people close their bank accounts and go to cash.
Paulson opens his mouth is a.m. and the Market which was up 3 figures tanks...
he says “Americans need credit?”
NO! AMERICANS NEED TO SAVE!
And Americans need to pay cash and pay down their debt just like the federal government needs to do!
gezzzzzzzzzzz...
No wonder Goldman went bust with clowns like Paulson running the show!
I never pay with cash I always use my debit card. I use paper checks for paying bills through the mail. The debit card is just like a paper check except the money is taken out instantly.
How are we going to make it when people start acting their wage!
I wish Dave Ramsey had a ping list......
” The debit card is just like a paper check except the money is taken out instantly. “
A second difference — it’s virtually impossible to ‘bounce’ or overdraft a debit card.... (I know — I’ve heard “decline” often enough...)
It’s bad for the card companies who charge every retailer a fee for every transaction.
This whole thing is creating ramifications in ways few predected. I’m sure more are coming. It is fascinating to watch it unfold - kind of like it is fascinating to watch a slow motion film of a train wreck.
‘Cept we’re all on the train.
I suppose if I were to have jumped from the fire in the WTC I could have tried to enjoy the once in a lifetime view on my way down.
I went in to Walmart the other day to get a can of Shout. I had about 40 dollars in my purse. I spent 154 dollars plus 34 in the camera department. If I had left the card at home the most I would have spent was 40 dollars.
>>If taxes skyrocket as expected in the coming years, you’ll see a lot more of the cash economy.<<
And barter...
I am finding that as my mind wanders every day I keep catching myself consciously trying to figure out ways to avoid earning TAXABLE income. Kinda weird. Seriously.
For the last several years, my wife and I have commented that if everyone started spending money the way we do, this economy would collapse.
It is beginning to look like this economy is going to collapse.
>>Paulson opens his mouth is a.m. and the Market which was up 3 figures tanks...<<
Hehehe... I saw that drop on the chart at my.yahoo. My first thought - somebody must have said something...
Sometimes the truth hurts. ;)
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