What's All This Then?

commentary on the passing parade

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Friday, February 06, 2009

Since I’m an old retired guy and stay home a great deal , I get to hear a lot of background noise as a result of having the radio on most of the time. Of course I stayed home even when I wasn’t retired because I was self employed and worked out of my house. But with work to do, the radio wasn’t on that much. Now that it is, I get to hear all sorts of strange things that I didn’t used to hear. Radio and television have become today’s substitute for ambulance chasing. One radio station that I listen to has competing PI attorneys urging listeners to call them if they developed a hung toenail from socks they bought at Sears Roebuck. O.K. - no PI attorney has such an ad - but no matter how they couch their ads - it still sounds like ambulance chasing to me. Mesothelioma seems to be a major come on of the broadcasting PI attorneys. There are local, regional and national ads from law firms claiming to have the greatest expertise in pursuing claims on behalf of people who are suffering from this asbestos causing cancer. There’s one local father/son advertiser - the father a doctor with acknowledged expertise, having held positions of responsibility and published on the subject - and the son - of course a PI attorney.

But the ads that have been catching my ear - that have intrigued me more than offers to sue the world on your behalf - are the people who offer to help you get out of credit card debt. No - not to offer to help get you out of debt but to absolutely get you out of debt by utilizing "secrets" that the credit card companies "don’t want you to know." Shades of Kevin Trudeau - the master of "what they don’t want you to know" scams.

What all of these advertisers claim is that you, the person who has some outstanding credit card debt - and most of them aren’t interested in talking to you unless that debt is somewhere north of ten thousand dollars - have the right to negotiate a settlement of that debt for far less than the balance owed. I emphasize the word "right" because that’s the word that these "we’ll get you out of debt" advertisers emphasize.

Now I understand that everyone who has debt of any kind has an absolute right to try to negotiate a reduction of that debt with creditors. There’s no law that says you can’t try. But what these ads seem to say is that you absolutely have a right to settle your debt for less than you owe and that this is one of the "secrets that they don’t want you to know." The idea intrigued me so much that I went to the trouble of actually reading my credit card agreement. I only use one credit card. No matter which card you may use, when you sign up with one of these companies, you get a copy of what you’re agreeing to in the mail. Most of it is in small print and most of it is written in financial gobbledygook - but credit card companies have to follow the law - they can’t fool you with legal mumbo jumbo to hide what terms of a contract really mean - so I figured those "secrets" - the ones that would let me run up a lot of debt and then settle it for peanuts - had to be in there somewhere. But shiver me timbers, I couldn’t find a single word that sounded like a "right" to avoid paying off the amount I charged. I could take time to pay it off - but pay I must or I would have to surrender my first born.

I suppose the reason that these ads piqued my interest is because in another life - a thousand years ago - I was in the debt adjustment business. Most of time, the best I could do for a client was persuade his or her creditors to accept a lower monthly payment and if I was able to get all of his monthly payments down to a manageable, single amount - including the fee that I charged - the debtor experienced some relief from pressure - even if it was only temporary. More often than not, these people owed too much for them to repay on a monthly basis and ended up filing bankruptcy. The irony of this "service" is that there was nothing that I did that the debtor couldn’t have done himself - that is to say, call each creditor and negotiate a more manageable payment - the alternative being to file bankruptcy and wipe out the debt completely.

But if companies are advertising on the radio and saying that there are indeed "secrets" that credit card companies don’t want you to know and that they know these secrets and they can help you settle your credit card debt for less than you owe - then such secrets must exist - and who better to ask about them than The Google? So I went to Google and typed in "secrets the credit card companies don't want you to know." The Great and All Powerful Google said there were 309.000 hits on the subject but I didn’t recognize any as the advertisers I’ve been hearing on the radio. Still - at the top of the list was site after site listing varying numbers of "secrets" the credit card companies don’t want you to know - as few as five and as many as eight - though the most popular number was seven. One company had a listing for seven AND eight - but none of the seven or eight "secrets" spoke of a "right" to settle your debt. Just stuff about credit cards that anyone with an average IQ - or access to Google - could find out for themselves. Without paying someone with magical promises a fee.

Because yes indeed believers, the first thing that will happen if you contract with someone to help you get rid of your credit card debt is that a fee will be added to all of the money that you already owe. There is no free lunch and there are no magical secrets to get someone to forgive what you owe them - except in fantasy land. Which thought allows me to make a closing comment about the fantasy land known as the stock market. If you ever needed proof that the stock market is divorced from reality as most people know it - just look at the action of yesterday and today. The job losses in January were just announced. 598,000!!! Isn’t that just confirmation that things are looking up and we should all be rushing into the market to buy stocks? Over a hundred points to the upside on the Dow yesterday and over 200 points today. Sure enough Charlie Gibson said that Wall Street "shrugged off" the bad employment figures and concentrated on the coming stimulus bill. And following Charlie, our local news anchor said that Wall Street ignored those mean unemployment numbers and concentrated on the stimulus package. And a little later, Jim Lehrer said that Wall Street shrugged off the unemployment numbers and zeroed in on the coming stimulus package. Or words to that effect. That little old man in the green visor must have been working overtime in his cubbyhole underneath the NYSE.

And it wouldn’t surprise me if a whole bunch of those stock buyers driving up prices used credit cards to do their buying. Probably because they know the secrets credit card companies don’t want them to know..