On Sunday morning I ended up watching Maxed Out, a documentary that attempts to uncover the nastiness that we know as our credit lending industry. From Showtime's website:
"This revealing documentary blows the lid off abusive consumer lending practices that find some banks, mortgage lenders and credit card companies knowingly extending high-interest products to debtors that are bad credit risks in hopes of foreclosing on their homes or reaping other "obscenely profitable" benefits from drowning their own customers in a sea of debt."
If you haven't already seen it, you must site down and watch it because it'll blow your mind. Not only will you be amazed at the insane practices of the credit and banking industries, but you'll be amazed at how our government has 1) done nothing about it and 2) gotten themselves into their own debt crisis where even they can barely pay their monthly minimum on their debt.
The problem seems to be twofold to me. First, you have the credit card companies offering credit to people who shouldn't be getting credit. These credit card companies make their money off of late fees and interest payments and WANT you to be late. If you're the type of person who pays off their balance in full each month, you're worthless because the credit cards aren't making any money from you.
The second problem is the lack of consumer education. Just look at how many college students get themselves into massive amounts of debt because they signed up for a credit card to get a free t-shirt, only to find themselves in thousands of dollars of debt months later because they don't understand how credit cards work. Since efforts to ban credit card companies from college campuses have failed, maybe the solution is to require credit card companies to hold educational classes to any student that it signs up on campus and students won't be able to receive actual cards until they've taken the educational course.
All in all, the documentary was eye opening, saddening and educational. I don't know if people in other countries have the same type of debt issues that we do here, but our debt problem is growing and doesn't seem to be going anywhere anytime soon.
(if you don't have Showtime, you can purchase Maxed Out on Amazon.com)