Paper or Plastic! A Call to Action

Paper or Plastic? A common cry heard everyday at supermarkets, part of an effort at greening America.

In this economic morass in which we find ourselves the cry, Paper or Plastic, takes on a new meaning. It again refers to the greening of America, but it is equally, if not more important, for our survival.

The abuse of plastic—credit and credit cards—has placed the U.S. and its citizens in potential grave financial straits.

Over-leveraged and over-wrought, many people find themselves in untenable, unrecoverable debt. Upside down in their homes, over burdened with credit card loans, and years of car payments, many Americans are feeling stressed over huge debts. But, when will they get relief?

Relief will not come from the banks. Despite being responsible for the financial meltdown that we are experiencing, the banks continue to point the finger at irresponsible consumers while hoarding the dollars that they do have. In many cases the consumers are responsible. But the banks share a greater responsibility for the current economic problems.

Stop using Plastic!

Plastic issued by the banks is killing this country in more ways than one. The use of credit cards has our economy on a precipice and the continued use of plastic threatens to pull us over the edge.

It is imperative for Americans to begin a greening process. The use of cash over plastic will begin a de-leveraging process that is vital to the survival and eventual recovery of the U.S. economy.

Banks and credit card companies have given a clear indication of how they value the American consumer—their valued customers. They continue to stick the knife in and twist it.

In order to make up for their poor business decisions and their unfettered greed they increase interest rates to usurious levels and begin lowering credit limits.

Stop using Plastic!

Using cash begins the survival process. Increasing payments to the credit card companies, especially those charging criminally high interest rates, lowers the amount of interest you are paying and puts more money in your pockets.

Additionally, using cash at local businesses, instead of plastic, gives the business operator more capital to help with their survival. Cash eliminates the fees that credit card companies take from the business every time a customer swipes the card.

Savings is also important to the survival of the individual and families. Money in the bank creates a much needed peace of mind that has been lost in this downward spiraling, unsure economy. But savings must be balanced with the usurious rates big banks are charging. It is foolish to leave excess money in the bank at 2% when credit cards are costing 21 or 24% each month. Take part of the savings and apply it to your highest interest card each month. Finding the balance is important and paying down debt while accumulating a modest savings can lead to a faster recovery for both individuals and families.

It will be more effective if you Stop using Plastic and use cash for things you need. If you can’t pay cash for something you probably don’t need it.

It has got to be more depressing and elevate the level of anger when BIG banks report record earnings and continue to raise your interest rates. It is especially disconcerting when these same banks are borrowing money for near zero interest from the Fed and the Government, charge ever increasing interest on the consumer, and no one does anything about it.

As an example JP Morgan Chase, who reported second quarter earnings of $2.7 billion, continues to charge me 24.17%, citing universal default, despite the fact that I have remained current and have been lowering my balance  for more than two years. A bank that borrows money for zero and charges me 24.17% is criminal.

But it isn’t just Chase. Bank of America and Citigroup reported second quarter earnings the should make customers livid. BofA earned $3.2 billion in the quarter and Citigroup reported over $4 billion in profits. Each of them still owe $45 billion each to the taxpayers for the TARP money they took. And they, too, are borrowing from the Fed discount window at near zero percent interest.

And Congress, despite the recent weak attempt at a credit card bill, continues to let these crooks operate. Citigroup raised interest on over 18 million customers in advance of the bill taking affect. Others are converting fixed rate cards to variable rate cards because of a loophole where only the fixed rate cards fall under the purview of the law.

That’s being real good corporate citizens don’t you think?

So what do we do about it? How do we get back to a level of fairness. Short of indicting these crooks? The answer is clear.

Stop using Plastic!

Continue to work at finding your balance between savings and credit. The fear of losing a job should convince every American that life can change in an instant. Start preparing for the future, and your survival, today. Start the process by cutting back.

Become wise! Begin your individual recovery today!

Use cash and quit using your credit cards.

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