Lending – Mact Asso http://mact-asso.org/ Mon, 21 Jun 2021 20:19:58 +0000 en-US hourly 1 https://wordpress.org/?v=5.7.2 https://mact-asso.org/wp-content/uploads/2021/04/default-150x150.png Lending – Mact Asso http://mact-asso.org/ 32 32 Los Angeles-based SoLo Funds Raises $ 10 Million to Offer Alternative to Predatory Payday Lenders https://mact-asso.org/los-angeles-based-solo-funds-raises-10-million-to-offer-alternative-to-predatory-payday-lenders/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/los-angeles-based-solo-funds-raises-10-million-to-offer-alternative-to-predatory-payday-lenders/ SoLo Fund wants to replace payday lenders with a market-driven community model for personal loans, and now has $ 10 million to expand its business in the United States Payday lenders offer short-term, high-interest loans to the most vulnerable borrowers, and their loan terms often trap borrowers in a cycle of indebtedness from which there […]]]>

SoLo Fund wants to replace payday lenders with a market-driven community model for personal loans, and now has $ 10 million to expand its business in the United States

Payday lenders offer short-term, high-interest loans to the most vulnerable borrowers, and their loan terms often trap borrowers in a cycle of indebtedness from which there is no escape.

About 80% of Americans don’t have enough savings to cover unforeseen expenses, and it’s this statistic that has made payday lending such a lucrative business in the United States.

Over the past decade, websites like GoFundMe and others have sprung up to provide a space where people can donate money to individuals or causes which in some cases serve to supplement donations. income of those most in need. SoLo Funds works as an alternative.

It is a market where borrowers can set their loan repayment terms and lenders can earn extra income while supporting people who need help.

The company funds tens of thousands of loans per month, according to chief executive and co-founder Travis Holoway, and loan volumes are increasing by about 40% per month, he said.

Although Holoway did not disclose the book value of loans traded on the platform, he said the company’s default and delinquency rates were lower than its competitors. “Our default rate is about three times the industry average, which is the payday lending industry that we are looking to disrupt,” Holoway said.

The company also offers some sort of default insurance product that lenders can purchase to cover losses they incur, Holoway said. This service, rolled out in April of last year, helped explain some of the explosive 2,000% growth the company experienced during 2020.

SoLo saw the most activity in Texas, Illinois, California, and New York, high population states and cities with the highest cost of living.

“Our borrowers are teachers… are social workers. When you live in these big cities where the cost of living is higher, they can’t afford the financial shocks that they might experience if they lived in. Dayton, Ohio, ”said Holoway.

While the company’s borrowers represent a cross-section of America, lenders also tend not to come from the demographics that a casual observer might expect, Holoway said.

About half of the loans on the platform are made by people Holoway has called strong lenders, while the rest come from less frequent users.

“A majority of [power lenders] have a university education and the majority of them tend to be white males. These are individuals who you might not think will be powerful lenders… They can make $ 100,000 to $ 125,000 a year, ”Holoway said. “They are looking to diversify their capital and deploy it to generate returns. And they are able to help people who otherwise would not be able to pay their groceries, pay their rent, or cover their transportation costs. “

Given the growth of the company, it is no wonder that investors like ACME Capital, with the support of America Impact Fund, Techstars, Effort catalyst, CEAS investments and more have joined the new cycle. previous investors like Western companies, Taavet Hinrikus from TransferWise, Jewel Burks Salomon from Google startups, Zachary Bookman from OpenGov, Richelieu Dennis of Essence Ventures and technological innovation accelerators also participated in the financing of the company.

“For too long there have been limited options for people in need of immediate help funds due to unforeseen circumstances, such as a change in schedules, unforeseen car problems or other cases, ”said Holoway. “Solo was created to provide safe and affordable options for borrowers who need cash fast, while creating a market for lenders to grow their capital and help community members in need. We believe that at the end of the day people are inherently honest and tend to be generous, and the growth of our platform is further proof that people want to do good in the world and make an impact.

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The “ghost banks” are back and still too big to fail https://mact-asso.org/the-ghost-banks-are-back-and-still-too-big-to-fail/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/the-ghost-banks-are-back-and-still-too-big-to-fail/ A decade later, these full impacts have become clear. AIG, which had become a gigantic shadow bank, had – unbeknownst to many – unwisely agreed to be the counterparty to a multitude of credit default swaps, against which it held little capital. When things went wrong, the government had to stabilize the financial world by […]]]>

A decade later, these full impacts have become clear. AIG, which had become a gigantic shadow bank, had – unbeknownst to many – unwisely agreed to be the counterparty to a multitude of credit default swaps, against which it held little capital. When things went wrong, the government had to stabilize the financial world by accepting responsibility for all of AIG’s reckless loans, essentially taking on the role of the FDIC for a financial entity that taxpayers were never supposed to support. In the aftermath of the financial crash, it was revealed that there were a number of grotesque shadow banks like AIG, such as Metlife, Prudential and GE Capital. These were so important that they could be considered, under the Dodd-Frank banking reform bill, as “systemically important financial institutions” or SIFIs. Yes, that’s another euphemism for “Too Big to Fail”.

Dodd-Frank created new regulators, like the Financial Stability Oversight Council, to prevent this kind of devastating financial disruption. One of the powers of the FSOC was the ability to attach the designation “SIFI” to any type of business it wanted, which in turn would require that business to provide more reporting and keep more capital in its reserves. . These efforts, however, have largely failed when it comes to shadow banking. For example, in 2013 the FSOC attempted to classify colossal asset managers like BlackRock (which manages nearly $ 7 trillion in assets under management and whose operations are funded by products similar to money market funds). and obscure financial products such as repo agreements) as SIFI. Asset managers retreated and won.

In addition, says Graham Steele, finance expert at Stanford University, the Federal Reserve has also “never really taken the time to set the ground rules for doing [the shadow banks] safer, ”before the arrival of the Trump administration, by removing and removing regulatory requirements from a number of shadow banks, including insurers Metlife and Prudential. GE Capital and AIG downsized to get rid of their post-crash scarlet letters, but Metlife and Prudential are still big, not designated, and less regulated than it should be.

Finance, especially after 2008, works because the state guarantees that the worst of what we’ve been through before will not happen. Not paying for these insurances is tantamount to fraud. Because shadow banks are financed by loans and lines of credit from the big banks, the failure of one is inseparable from that of the other. Considering the size of most financial institutions, shadow banks included, there isn’t really a part of the financial sector that is not systemically important. Plus, as Steele noted, size wasn’t the only factor that Bill Dodd-Frank said could make a business systemically important. Another such condition was whether the institution in question had significant financial activity, as housing finance could easily be considered. Bailouts and backstops, Steele says, must be paired, at a minimum, with requirements to divide those large entities into smaller, less risky companies with more returns and higher capital requirements. It is even possible that some of these companies must be transformed into public services. “When the going is good,” he says, “we find out that we are ensuring the survival of all these shadow banks.”

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Firestorm Abortion Clinic | Jackson Free Press https://mact-asso.org/firestorm-abortion-clinic-jackson-free-press/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/firestorm-abortion-clinic-jackson-free-press/ Shortly after noon on Wednesday, an ambulance arrived at the Jackson Women’s Health Organization, Mississippi’s last abortion clinic. Photo by Trip Burns Shortly after noon on Wednesday, an ambulance arrived at the Jackson Women’s Health Organization, Mississippi’s last abortion clinic. But the commotion was only just beginning. Diane Derzis, owner of the clinic who became […]]]>

Shortly after noon on Wednesday, an ambulance arrived at the Jackson Women’s Health Organization, Mississippi’s last abortion clinic. Photo by Trip Burns

Shortly after noon on Wednesday, an ambulance arrived at the Jackson Women’s Health Organization, Mississippi’s last abortion clinic.

But the commotion was only just beginning.

Diane Derzis, owner of the clinic who became involved in a legal battle over a state law implemented in 2012, said the clinic was proactive in transporting the patient to a hospital for observation.

“This is a medical procedure. There are risks, and we will do what is necessary,” Derzis told the Jackson Free Press this morning. Derzis added that the woman “was fine when she left the clinic”.

The incident reignited the debate on the safety of abortions. Last year, the state legislature passed a law that requires all abortion providers in Mississippi to be granted admitting privileges to a local hospital. A federal court allowed JWHO to remain open while it tried to comply with the law, but the clinic was unsuccessful. A status hearing will take place next week.

Yesterday’s events also sparked a social media battle between clinic supporters and abortion opponents, sparked in part by a story on The Clarion-Ledger website.

The unsigned story used photographs provided by the Pro-Life Mississippi abortion opposition group of emergency medical technicians putting the patient in an ambulance.

Derzis called the story an example of “unprofessional journalistic ethics”.

“I just find it insensitive,” she said. “It’s beyond pallor. It’s amazing.”

An email to Clarion-Ledger City editor Sam R. Hall requesting comment was not returned until press time.

In the past 24 hours, supporters of the clinic have triggered an avalanche of comments on the Clarion-Ledger site criticizing both the daily’s coverage and the abortion clinic protesters who took the photos. Volunteers say Dana Chisolm, president of the nonprofit group Pro-Life Mississippi, exclaimed “Hallelujah! when the ambulance arrived.

“In my opinion, it’s not very ‘pro life’,” commented Laurie Roberts, the clinic’s lead escort who also writes for the Jackson Free Press, on Ledger’s website. “Why would you want to rejoice because someone else is sick? … It takes a sad person to rejoice over someone else’s illness.”

Chisolm spoke up on her own, commenting via Facebook (emphasis added): “I am NOT happy that EVERYONE is suffering. I would like the suffering of women and the death of babies to end. I will rejoice. when that stops happening. weekly at 2903 N. State Street, Jackson, MS. “

Derzis also noted that the fact that the patient was admitted to the hospital proves that the law on admitting privileges is not necessary.

“It doesn’t say anything about patient or women’s safety. It’s about bankrupting us,” Derzis said.

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An interest rate cap worked for the military. It may also work for Illinois. https://mact-asso.org/an-interest-rate-cap-worked-for-the-military-it-may-also-work-for-illinois/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/an-interest-rate-cap-worked-for-the-military-it-may-also-work-for-illinois/ Much to their disappointment, none of their dire predictions came to fruition. The rule was published and implemented without incident. Financial institutions and businesses of all sizes have been able to identify military borrowers and comply easily. Loan requests from military aid companies have plummeted, proving that restricting access to these products causing cycles of […]]]>

Much to their disappointment, none of their dire predictions came to fruition. The rule was published and implemented without incident. Financial institutions and businesses of all sizes have been able to identify military borrowers and comply easily. Loan requests from military aid companies have plummeted, proving that restricting access to these products causing cycles of debt was the right approach.

For Illinois lenders, compliance will be even easier because everyone is protected. Indeed, the MLA became the model for regulating these terrible products and essentially established the first true national usury law in the country. Its success absolutely refutes the specious arguments put forward by opponents. There are many safe alternatives and we will all be better off for them. Credit unions can operate successfully and financially at 28% or 18% and have proven to be safe alternatives to credit. In addition, Bank of America and Apple offer loans below 36% that are in full compliance with the law.

Illinois residents deserve the benefits of the Illinois Economic Opportunity Act. Payday lenders target honest, well-meaning people who just want to pay their bills and take these short-term, high-cost loans for 14 days. Statistics show that they are unable to repay the loan within this time frame and therefore the average payday loan borrower ends up extending or renewing the loans an average of 10 times. Loans, which start with interest rates close to 300%, often end with rates above 1000%. Judgments and collection actions against borrowers have haunted them for years.

The Illinois Economic Opportunity Act is modeled on the MLA and was passed by the Illinois General Assembly in a bipartisan fashion, with broad support. Pritzker, by signing this measure, can give low-income Illinois residents good news in these troubled times. This measure can put us on the map for all the right reasons. We can be a leader in consumer protection, social justice, racial justice and economic justice not only for the people of Illinois, but for the Midwest and the nation as well. Please, Governor, sign the invoice now!

Colonel Paul E. Kantwill, US Army (Retired) is the founding Executive Director of the Rule of Law Institute at Loyola University Chicago School of Law. He is a former Deputy Director of the Consumer Financial Protection Bureau. He is also a former Pentagon Defense Department official and is retired after a 25-year active-duty military career.

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New workplace benefit is a lot like a payday loan https://mact-asso.org/new-workplace-benefit-is-a-lot-like-a-payday-loan/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/new-workplace-benefit-is-a-lot-like-a-payday-loan/ When it comes to healthy financial habits, tapping into your income before payday is an old-fashioned red flag. However, a growing number of companies, including Walmart, provide advances by offering what is now called “accelerated compensation”. As a benefit, around 12% of companies include accelerated pay as another way to attract candidates like wages remain […]]]>

When it comes to healthy financial habits, tapping into your income before payday is an old-fashioned red flag.

However, a growing number of companies, including Walmart, provide advances by offering what is now called “accelerated compensation”.

As a benefit, around 12% of companies include accelerated pay as another way to attract candidates like wages remain relatively stagnant at all levels, according to Michelle Armer, director of human resources at CareerBuilder.

“It’s not a loan,” said Jeanniey Mullen, director of innovation and marketing at DailyPay, one of those payroll service providers. DailyPay customers include Kroger, Mcdonalds, the Boston market and Berkshire Hathaway, according to the company.

“There is no reason for payroll to be made once a week or once a month,” Mullen said. Through the application, workers have real-time access to earned wages. Like an ATM, DailyPay charges a flat transaction fee of $ 2.99.

Granted, accelerated payment is not the same as a payday loan, which is generally considered the worst way to borrow money in a pinch. Often offered through payday lenders or even online, these short-term loans, typically $ 500 or less, can carry an interest rate that easily reaches triple digits, in addition to ‘fees. financial ”or service charges.

Many states have set a maximum payday loan fee ranging from $ 10 to $ 30 for every $ 100 borrowed. Yet a two-week payday loan with a fee of $ 15 for every $ 100 borrowed is equivalent to a annual percentage rate by nearly 400%, according to the Consumer Financial Protection Bureau.

More from Personal Finance:
The next recession could crush many people with credit card debt
A few small adjustments can make a huge difference in your finances
Good financial habits won’t get you far

The reality is that more than three-quarters of all full-time workers live paycheck to paycheck, according to a report from CareerBuilder.

For many Americans, an unforeseen expense can still cause a significant setback, even if the country is experiencing a prolonged period of economic growth.

Although household income has increased over the past decade, it has failed to keep up with the increase in the cost of living over the same period.

“If someone has a short-term emergency it can help,” Armer said, “but it’s not something that should be abused or abused.”

If someone has a short-term emergency this can help.

Michelle armer

Director of Human Resources at CareerBuilder

“It makes sense that the technology is there so that you can access the money you’ve earned almost in real time,” said Douglas Boneparth, Certified Financial Planner and President of Bone Fide Wealth.

However, “what he tends to do is make bad discipline worse,” he added.

A better solution is to get your cash flow under control, Bonparth said.

First, look at your spending over a 12 month period to “understand how the money is going and where it is going.” From there, you can set a budget that takes your expenses into account and saves you money, he advised.

Most financial experts recommend putting at least a six-month cushion in a emergency fund to cover anything from a dental bill to a car repair – and more if you’re the sole breadwinner or in business for yourself.

“Personally, I would like to see six to 12 months,” Bonparth said.

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Senator Coons Joins Virtual Event Highlighting Capital Good Fund https://mact-asso.org/senator-coons-joins-virtual-event-highlighting-capital-good-fund/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/senator-coons-joins-virtual-event-highlighting-capital-good-fund/ U.S. Senator Chris Coons, D-Del., Spoke on September 3 at a virtual event that aimed to raise awareness of a non-profit resource for Delawarens who don’t have enough savings and have large and unexpected expenses due to COVID-19 or other financial difficulties. The nonprofit Capital Good Fund, a community development financial institution certified by the […]]]>

U.S. Senator Chris Coons, D-Del., Spoke on September 3 at a virtual event that aimed to raise awareness of a non-profit resource for Delawarens who don’t have enough savings and have large and unexpected expenses due to COVID-19 or other financial difficulties.

The nonprofit Capital Good Fund, a community development financial institution certified by the US Treasury, offers a few types of unsecured personal loans to individuals and families. Many clients are low-income families and immigrants who may not have many options for dealing with financial emergencies; however, Capital Good Fund is seeing an increase in middle class demand for its services. These loans are an alternative to payday lenders and auto title companies that often charge interest of 500% or more.

“Delaware is a state with a particularly strong payday lending lobby and industry,” said Andy Posner, Founder and CEO of Capital Good Fund. “In 2018, 75,000 residents took out a payday loan or a similar type of predatory product. The average interest rate – and I had to verify this – is over 500 percent there. You can get a payday loan of up to 3,600% in the state of Delaware. “

“We are currently in the midst of three different crises that are making their work more relevant than ever,” Coons said. “We are of course suffering from the biggest public health challenge in a century – the pandemic that has shut down so many states and so many of our economy, and put millions of people out of work.”

Since the onset of the COVID-19 crisis, Capital Good Fund has funded over 600 COVID-19 crisis relief loans from $ 300 to $ 1,500 with an APR of 5% and a three-month deferral period , and put 12% of its active borrowers on deferral plans.

During the event, Posner explained how Coons helped bring the fund’s resources to Delaware with financial support from Discover and the Longwood Foundation. Stepping Stones Community Credit Union, another CDFI serving Wilmington, houses the staff of Capital Good Fund in Delaware.

Capital Good Fund is one of the few CDFIs focused on individuals / families and providing low amount, easily accessible and unsecured loans.

According to Capital Good Fund, the loans, which range from $ 300 to $ 25,000, are regularly used for critical needs such as the purchase, repair or refinancing of a vehicle; immigration spending; Security deposits; energy efficiency improvements; respond to emergencies or crises, and catch up on rent / utilities.

Capital Good Fund and its local community partners hope the September 3 virtual event will help more people learn about the fund’s inclusive lending products as an option for Delawarens – citizens and immigrants – facing financial decisions. difficult.

For more information, visit capitalgoodfund.org.

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Here’s What Deregulation Looks Like: Some Texans Face Over $ 10,000 In Electricity Bills, Still Others In The Dark https://mact-asso.org/heres-what-deregulation-looks-like-some-texans-face-over-10000-in-electricity-bills-still-others-in-the-dark/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/heres-what-deregulation-looks-like-some-texans-face-over-10000-in-electricity-bills-still-others-in-the-dark/ This is an urgent transcript. The copy may not be in its final form. AMY GOOD MAN: This is Democracy now! I’m Amy Goodman, with Juan González. While millions of Texans lost electricity last week, some of those fortunate enough to keep their lights on now face a shocking surprise: astronomically high energy bills. Some […]]]>

This is an urgent transcript. The copy may not be in its final form.

AMY GOOD MAN: This is Democracy now! I’m Amy Goodman, with Juan González.

While millions of Texans lost electricity last week, some of those fortunate enough to keep their lights on now face a shocking surprise: astronomically high energy bills. Some were billed up to $ 16,000 for a few days of energy use. Governor Abbott on Sunday ordered a moratorium on disconnecting electricity from customers who cannot pay those bills. The skyrocketing bills are the result of the state’s decision to radically deregulate the energy grid. Some consumers buy electricity packages whose prices vary depending on the market.

We are now joined by two guests. First, we’ll see Akilah Scott-Amos, a resident of Texas who saw her electric bill climb to over $ 11,000 during the storm. Akilah, tell us what happened.

AKILAH SCOTTAMOS: Hi. Thanks, guys, for having me.

So I woke up on Sunday with various debits taken from my account in $ 100 increments because that’s what I settled it for. And when I went to the Facebook page – I’m with Griddy energy, and they’re very active on Facebook. So when I went there they were telling everyone to change providers immediately.

So the first thing I actually did was call them because I couldn’t understand why my bill was negative – $ 456. And they told me that the price of energy was going up and that I had two options. The first option, of course, was to change. And the second option was to turn off the power completely and go to the hotel.

Option one – of course I called. I called several energy companies. And either they weren’t taking on new clients, or the change date couldn’t come before the 22nd. So there I really had no choice. I signed up for the 22nd, but couldn’t do anything else. As for turning off the power to our house and going to the hotel, that was absolutely not an option. Leaving our house unprotected was not going to work. We also have a very large dog. I have two children who are recovering from a cold. We are still in a pandemic. So leaving home was just not an option.

Over the days, my bill has increased. The next day it was $ 2,500. The next day it was the same amount. We have reduced our energy consumption. We don’t use that much anyway, to begin with. So, yeah, we weren’t using lights. Our heating is gas, but of course it uses electricity to blow it. We had our electricity on 62 through the house. We used our gas fireplace. And, of course, we’ve used the internet to keep our phones and tablets charged. But other than that, we have drastically reduced our usage. But I have seen a big jump in our kilowatt consumption, which is certainly not correct. And again, I got hers with $ 2,500 a day. And now my bill is just over $ 11,000.

JEANS GONZÁLEZ: We’re also joined by Tyson Slocum from Public Citizen. Tyson, could you tell us, this whole deregulation issue, what happened in Texas and these sky-high bills, what’s your take on that?

TYSON SLOCUM: Yes, this is totally unacceptable. And while it’s clear that some individual energy companies bear the blame, at the end of the day it’s the state officials and regulators who have just done a terrible job of allowing these kinds of predatory pricing plans. of utilities to even be offered to residential households in the first place.

We must remember that during the first hundred years of our electricity system, federal law states that electricity is for the public good. And that’s what we call utilities. Naomi was doing a great job earlier talking about the important public service responsibilities that electricity provides. It is literally life or death.

And in Texas – and Texas isn’t the only one here – we’ve had a huge, drastic shift in oversight of the electricity markets, away from regulatory protections to protect people and ensure reliability, and, instead from that, a dependence on market forces. And Texas is the clearest case of this, where instead of enforcing mandatory reliability standards for power plant owners, Texas instead relies on huge price hikes to entice power producers to provide electricity even during perilous periods such as winter ice storms.

And so, what we saw was that as prices went up to $ 9,000 per megawatt hour, which is just astronomical – a typical price might be around $ 20 per megawatt hour – there were thousands of Texans who signed up for retail pricing programs that were directly tied to wholesale pricing. And most of the time, when electricity prices are normal, many of these customers have seen savings on their bills. And that’s how companies market it, these plans to households. But then, of course, when the prices skyrocketed, these companies simply passed those extremely high prices on to their customers.

And so, the real question here is: what were the regulators thinking in allowing households to subscribe to these types of predatory plans? We’ve seen it with credit cards, payday lenders, and mortgages. Energy is the same sort of thing, where we see, in these deregulated environments, unscrupulous businesses preying on the assumption that households won’t understand or read the fine print. And it’s unreasonable to expect people to understand what’s going to happen with wholesale prices. Sophisticated Wall Street energy traders wouldn’t even sign their own families up for this type of plan because they understand the risk. So I think first and foremost, as we move forward to try to figure out how it all happened, the first thing Texas needs to do is ban these kinds of predatory practices, so that households aren’t exposed to such high prices.

JUAN GONZÁLEZ: And me –

TYSON SLOCUM: I think the second thing we need to do – yeah.

JUAN GONZÁLEZ: Tyson, if I can, I just want to bring Akilah Scott-Amos back into the conversation. Akilah, what did you know about how those prices could go up, and this whole system of withdrawing money from your accounts, not at the end of the month, but apparently on an ongoing basis?

AKILAH SCOTTAMOS: Right. You know, I understood how a wholesale scenario works, and I understand that it works well in a stable market. And the market here has been stable, because, you know, they’re in the driver’s seat. And so, they should definitely have some type of stop trigger, loss stop trigger, the same way they do with anything else, so that – for a short time , so that we are not affected in the short term. the stick. It is not fair. They missed. They missed.

AMY GOOD MAN: [inaudible] Does that mean you won’t have to pay or that they just postpone your payment? They will not cut your electricity or your energy?

AKILAH SCOTTAMOS: Right now that means, yes, I don’t have to pay now. They are not going to interrupt me. But we’ll see how long it lasts. I know Governor Abbott speaks with ERCOT to fix something. But, I mean, I have no problem with the payment. I have no problem paying my fair share. But this is not fair.

AMY GOOD MAN: Well, Akilah Scott-Amos, we want to thank you for being with us. We would have said you were one of the lucky Texans who didn’t lose power, but instead your electric bill jumped almost $ 5,000 overnight. And, Tyson Slocum, Director of the Public Citizen’s Energy Program, thank you very much for being with us.

When we come back, we look at what happened in the prisons and prisons of Texas. Stay with us.

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UK private debt crisis will worsen this recession | Christine berry https://mact-asso.org/uk-private-debt-crisis-will-worsen-this-recession-christine-berry/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/uk-private-debt-crisis-will-worsen-this-recession-christine-berry/ The UK is drowning in private debt. At least £ 6 billion in household debt – and probably many more – was racked up by 4.6 million people during the pandemic. More than one in eight people on leave have defaulted on a payment. The Institute of Tax Studies has warned a wave of “zombie […]]]>

The UK is drowning in private debt. At least £ 6 billion in household debt – and probably many more – was racked up by 4.6 million people during the pandemic. More than one in eight people on leave have defaulted on a payment. The Institute of Tax Studies has warned a wave of “zombie companies”, kept afloat by Covid-19 loans, going bankrupt this fall. There will be no “V-recovery” – and recognizing the extent of debt distress is essential to understanding why.

British households and businesses were already over-indebted before the pandemic. Many were struggling to make ends meet. This has made our economy extremely fragile – even more so than before the crash of 2008. And yet, last April, the government chose to deal with the shutdown largely by charging households and businesses with even more. private debts. Businesses were encouraged to take out loans guaranteed by the state. Households have been granted “holidays” for payment on mortgages and credit cards. These measures did not alleviate the increased financial burden on people. They just threw the box on the road – with increased interest.

The implicit assumption was that the disruption would be short-lived: once the restrictions were lifted, the debts could be repaid. But it has always been questionable. Replacing income with debt is rarely a good idea, especially when that lost income is unlikely to be recouped. If anything, the income and income that comes out of the foreclosure will be less than it went in – leaving those already close to the edge struggling to repay their debts. For this reason, some have argued that we needed a different approach – with subsidies for companies in difficulty and a reduction in costs such as rent and utility bills. But these ideas were ignored.

Now, with large parts of the country in lockdown and no return to normalcy in sight, the outlook is even bleaker. Experts warn millions of households and businesses face a financial crisis as emergency support programs are withdrawn as economic chaos and uncertainty persist. For many, the result will be insolvency, homelessness or destitution.

Over a million small businesses have taken out “rebound” loans without the usual credit checks. Much of this money will have been used to continue paying rent to business owners for closed premises. Many of these companies must now realize that for them there will be no rebound. Many will go bankrupt – including some whose underlying businesses are perfectly healthy, but who simply don’t have the cash reserves to overcome our prolonged state of near-foreclosure. If this happens, the lender will get 100% of the value of the loan repaid by the state. The company and its workers will get nothing.

Meanwhile, many households face a perfect income-crater storm and increasing cost pressures as the pay holidays end and the leave scheme ends. Many of the newly unemployed have accumulated rent arrears and personal debts, which will become impossible to repay. Some figures suggest that less than half of all rents due was paid during confinement. When the ban on evictions is lifted, a wave of homelessness is likely to ensue.

These debt burdens will not only ruin lives: they will also delay the economic recovery itself. The UK risks being trapped in a downward spiral. If indebted households have less to spend and indebted businesses close or cut jobs, demand will be sucked out of the economy. This will prolong the recession, which in turn will put more people into debt, which in turn will worsen the recession.

The UK has long focused on public debt while ignoring our slow-burning private debt crisis – and this crisis is no exception. When we talk about “how to pay for the crisis”, we are almost always talking about the increase in public borrowing. But that’s just not the problem. The borrowing costs of the state are almost zero, the risk that it will not be able to service its debts non-existent. Meanwhile, insolvency is a looming reality for households and businesses across the country. They simply cannot afford the costs imposed on them. The real question is how to distribute these costs more fairly.

The next obvious question is: why should payment to creditors be sacrosanct? Why should homeowners be the only ones in the economy not to take a hard hit on their income when millions of workers have faced substantial damage? Why should lenders be subsidized by the taxpayer to continue to benefit from distressed business loans, when the businesses themselves are hitting the wall?

Sooner or later, it will be necessary to make accounts. As the recession continues, more and more debt will simply become unpayable, whether the government and creditors like it or not. We can either wait for it to happen and prepare for the economic and social chaos it will bring; or we can act now to rebalance the burden.

The calls for wealth tax and debt reduction must be seen in this context. It is not for the well-off to make sacrifices to help the less well-off. The point is that the less well off are already make mind-blowing sacrifices to keep the income flowing to the rich creditors. If that doesn’t change soon, the UK’s recovery will be slow and painful. Addressing the growing inequalities between those who own assets and those who have debt is no longer just a matter of justice: it is an urgent economic necessity.

Christine Berry is a researcher, writer and consultant

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Evangelical movement – Religion and politics – 2008 presidential election – Christians and Christianity – Voting and voters https://mact-asso.org/evangelical-movement-religion-and-politics-2008-presidential-election-christians-and-christianity-voting-and-voters/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/evangelical-movement-religion-and-politics-2008-presidential-election-christians-and-christianity-voting-and-voters/ Today, the movement is showing signs of disintegration under its leadership. It’s not just that none of the 2008 Republican favorites live up to President Bush in the eyes of evangelical devotees, though it would be hard to find a group of characters more unsuited to these shoes: Catholic Mayor of ‘a big city ; […]]]>

Today, the movement is showing signs of disintegration under its leadership. It’s not just that none of the 2008 Republican favorites live up to President Bush in the eyes of evangelical devotees, though it would be hard to find a group of characters more unsuited to these shoes: Catholic Mayor of ‘a big city ; a Mormon from Massachusetts; a Hollywood character actor who skips the church; and a political renegade known to have crossed swords with Reverend Pat Robertson and Reverend Jerry Falwell. Nor is the problem simply that Democratic presidential favorites – Senator Hillary Rodham Clinton, Senator Barack Obama and former Senator John Edwards – look like a bunch of Bible thugs compared to Republicans.

The 2008 election is just the latest stress on a system of loopholes that go much deeper. The phenomenon of theologically conservative Christians plunging into political activism on the right is, historically speaking, something abnormal. Most evangelicals ignored abortion as a Catholic issue until after the Roe v. Wade of 1973. But following the ban on public school prayer, the sexual revolution and the exodus to the suburbs that filled the new mega-churches, protecting the unborn child became the rallying cry of a new movement to defend the traditional family. Now another confluence of factors threatens to tear the movement apart. The extraordinary evangelical love affair with Bush ended, for many, in grief over the Iraq war and what they see as his meager domestic achievements. This disappointment, in turn, accentuated the latent divisions within the evangelical world – over the evangelical alliance with the Republican Party, between approaches to ministry and theology, and between generations.

The founding generation of leaders like Falwell and Dobson, who first guided evangelicals in Republican politics 30 years ago, is disappearing. Falwell died in the spring. Paul Weyrich, 65, the tireless organizer who helped build Falwell’s moral majority and much of the rest of the movement, is confined to a wheelchair after losing his legs to complications from a fall. Dobson, who is 71 and still vigorous, is already considering a succession to Focus on the Family; he is expected to turn to the less political family councils that are his bread and butter.

The engineers of the 1980s capital takeover who struck out political and theological moderates from the Southern Baptist Convention are also retiring or dying. And in September, when I called a spokesperson for ailing Presbyterian televangelist D. James Kennedy, another pillar of the Conservative Christian movement, I learned that Kennedy had “returned home to the Lord” at 2 a.m. this morning.

Meanwhile, a younger generation of evangelical pastors – including widely imitated preachers Rick Warren and Bill Hybels – are pushing the movement and its theology in new directions. There are many related ways of characterizing the split: a push to improve this world as well as to save eternal souls; an emphasis on spiritual growth following conversion rather than the timing of yes or no salvation; renewed attention to the teachings of Jesus on social justice as well as on personal or sexual morality. Regardless of the design, however, the result is a new interest in public policies that address issues of peace, health, and poverty – issues, unlike abortion and same-sex marriage, where both left and right compete to present the best answers.

The right-wing backlash against Bush and the war has emboldened some hitherto wary evangelical leaders to criticize the leadership of the conservative Christian political movement. “The swiftness of the guns, the swiftness of the invasion, I think it caused a kind of desertion of what is called the Christian right,” Hybels, whose Willow Creek Association now includes 12,000 churches in the United States, told me. during the summer. “The people you might call progressive evangelicals or centrist evangelicals are those who are straying from a real revival. “

Generational and theological changes in the evangelical world make the next election a test of credibility for the conservative Christian establishment. The current Republican frontrunner in national polls, Rudolph W. Giuliani, could hardly be less like their kind of guy: twice divorced, three times married, estranged from his children and the church, and a supporter of legalized abortion and gay rights. Alarmed by the continued strength of his candidacy, Dobson and a group of around 50 evangelical Christian leaders agreed last month to back a third if Giuliani became the Republican candidate. But polls show Giuliani is the most popular candidate among white evangelical voters. He has the support, so far, of a plurality if not a majority of conservative Christians. If Giuliani takes the nomination despite the threat of an evangelical revolt, it will be a long time before Republican strategists pay heed to the demands of conservative Christian leaders again. And if Democrats capitalize on the current demoralization to capture a larger share of the evangelical votes, the damage to credibility could be just as severe.

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Brookings article on overdrafts could foreshadow increased CFPB attention to overdraft practices | Ballard Spahr srl https://mact-asso.org/brookings-article-on-overdrafts-could-foreshadow-increased-cfpb-attention-to-overdraft-practices-ballard-spahr-srl/ Thu, 11 Mar 2021 05:28:03 +0000 https://mact-asso.org/brookings-article-on-overdrafts-could-foreshadow-increased-cfpb-attention-to-overdraft-practices-ballard-spahr-srl/ An article recently published by the Brookings Institution in an editorial titled “A few small banks have become overdraft giants” serves as a warning that bank overdraft practices are likely to receive increased attention from the “new CFPB”. “. Written by Aaron Klein, Brookings Senior Fellow, the article reports that overdraft income represented more than […]]]>

An article recently published by the Brookings Institution in an editorial titled “A few small banks have become overdraft giants” serves as a warning that bank overdraft practices are likely to receive increased attention from the “new CFPB”. “.

Written by Aaron Klein, Brookings Senior Fellow, the article reports that overdraft income represented more than half of the net income of six small banks in 2020 and criticizes regulators for “tolerance.[ing] banks that depend mostly or entirely on overdraft fees for profitability. The author calls banks that rely heavily on overdrafts for their profits as “a combination of payday lenders and check tellers.” He calls on banking regulators to “crack down on these institutions that are neither safe nor sound” and “to determine if the overdraft product is really a loan, not a fee.” Mr. Klein also calls on the CFPB “to get involved”. He claims that “to call [overdrafts] fees may exempt [them] of certain regulations, but that does not change [their] nature [as a loan]. “

Under the leadership of former Director Cordray, the CFPB has taken several preliminary steps towards establishing overdraft rules. In its spring 2015 regulatory program, it said it “is examining whether the rules governing overdrafts and related services are justified and, if so, what types of rules would be appropriate”. He also issued a June 2013 White Paper, a July 2014 Report, And one August 2017 Report on current account overdraft services. The August 2017 report was accompanied by four prototype one-page form templates that banks can use to disclose overdraft fees and obtain consumer consent to the bank’s overdraft service for ATM and ATM transactions. single-use debit card. In November 2017, the CFPB published a notice in the Federal Register announcing that it plans to seek OMB approval to conduct online testing of ATM / overdraft disclosures.

The CFPB has not taken any action regarding the regulation of overdrafts under the leadership of former acting director Mulvaney or former director Kraninger. In December 2020, the Chair of the House Financial Services Committee, Maxine Waters sent a letter then President-elect Joe Biden recommending various actions the Biden administration should take in the area of ​​financial services. Protection against overdrafts was among the areas in which she recommended that the CFPB publish new rules with stronger guarantees for consumers.

Whether or not the “new CFPB” rekindles its interest in overdraft regulation, banks must be prepared for overdraft practices to receive increased supervisory attention from the “new CFPB”. and application.

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