The Implosion of Credit in America – A New Paradigm


In 2008, as we moved into the financial crisis, Americans were saddled with more credit card debt than ever before. The cycle began with decreasing home values which reduced equity. Credit card companies, despite getting bail outs from the US government were reevaluating their portfolios. Americans on the cusp were notified that credit lines were being reduced or closed. The reduction in credit lines impacted the ratio of available credit to outstanding debt which caused the credit scores to fall. Falling credit scores caused yet another round of credit line decreases plus an increase in interest rates. The US Treasury is handing out money for close to zero percent but the credit card companies are now charging Americans as much as 30 percent interest or more. The rise in interest rates is making it near impossible to make more than the minimum payments each month and late payments are becoming inevitable. Decreasing credit lines, increased debt to credit ratios, paying minimum payments causes further decline in credit scores creating yet another round of credit line reductions. Where does all this end. How do Americans dig themselves out of this loan shark driven credit market? Eliminate debt? Tough to do when assets are dwindling, jobs are scarce and wages are falling.
However, that is the answer. Eliminate debt. Convert remaining assets into cash and reduce debt. Deplete savings and reduce debt. Cancel any hopes of retirement and reduce debt.
Or?
There is one other option Default. Here is a logical argument for defaulting:
• Americans are supplementing the income of credit card companies through bail outs with their tax dollars anyway.
• The cyclical decline of credit scores is self induced by the credit card companies making the value of those scores virtually worthless. A clever scam to make more absurd profits by increasing interest and fees to the point of strangulation.
• There is obviously no end to the greed of the credit card companies as they maneuver around the intent of the law discovering loophole after loophole, political and geographic asylum. Out of state or off shore solutions are well within their bag of tricks to suck America out of America.
• The United States government does not have the stomach to call it like it is. Greed gone wild and the bankruptcy of America. And as goes America, so goes the world.
• The Credit Card Reform law going into effect in February 2010 doesn’t go far enough. So what is safe? If the greed continues, what kind of anarchy will result. Is your home safe? Your car? Your services like telephone, electricity, fuel? Groceries?


Where is the outrage? Why do Americans accept this kind of self indulgent behavior by the leaders of our largest publicly held financial companies. We wouldn’t permit our children to behave like this.


Here is some further reading:

http://money.blogs.time.com/2009/10/29/guess-how-many-credit-card-companies-engage-in-unfair-and-deceptive-practices/

http://www.dailyreckoning.com.au/bankers-pull-another-fast-one/2009/02/16/

http://money.blogs.time.com/2009/10/30/ten-signs-that-the-economy-is-still-in-awful-shape/


http://www.usatoday.com/money/perfi/credit/2009-05-21-obama-credit-card-reform-law_N.htm

I am always looking for new ideas, new concepts and upcoming technology.  TED (http://www.ted.com/) is a great source of new ideas on an international level and I have written about TED in my Newsletter. 

Locally, you might consider looking at Ideas Boston (http://www.ideasboston.com/).  Ideas Boston  sponsored by a variety of influential partners such as The Boston Globe, WBUR, Comcast, State Street Bank, IBM, etc. was created by The Boston Globe in 2004.  As a non-profit organization, it promotes innovation, diseminates new ideas  and hosts an annual conference of cutting-edge thinkers.  Have a look and a listen.  

In 1982, when I started my company I create an Image Book. You ask, “what is an Image Book”?  Search the Internet and you will be hard pressed to locate a description. Scan Wikipedia and you will find no explanation. So here it is for all to see. An Image Book is a very personal record of the images, both words and objects, that will be in your life many years in the future – as if they were part of your life today. Images of your success, health, wealth and happiness. It contains the words and phrases that will hold true meaning for you as you chart your course. It is meant to be reviewed and pondered every day.

Well, I just wiped the dust off my Image Book and leafed through the plastic sheathed pages. It was very interesting. Many of the images have come and gone – like that Sony Betamax I had my heart set on. But many have come into my life like the travel and the technology, cars and buildings.

The most powerful impression from this, almost 30 year old document, were the words I selected. They still hold true today as they did when I was half as old. Such as, 

When our childhood ended, did we cease to dream? Hardly. Yet after quiet moments looking beyond the horizon, we hesitate to speak. We pull back, rationalize into insignificance. Are we embarrassed by the “childishness” of it all? What a loss. For, surely to benefit from seeing things anew, we must acknowledge the sense of wonder that remains with us. And grant that child freedom. So, share your vision, your big ideas. And just perhaps it will fly.

Sorry but the author is unknown. Think about what you want in your life. Make yourself an Image Book. You will be surprised ten years from now at how capable you were at predicting the future.

Like those you work with.

Jay Goltz, author of The Street Smart Entrepreneur and owner of a few sips in Chicago that employs more than a hundred people discovered the need to like and respect the people you work with.

He also has a few points for you to always keep in mind.

• Respect the mission
• Go the extra mile
• Treat one another well
• Rock from the top.

A short list of commandments for any organization.

I was curious how many domains were registered – especially 4 character domains like trif.com.  Well there are a bit more than 1.5 million possible 4 character/digit possibilities and most are taken. In actuality, only about 450 names remain.

There are 83 million .com’s registered and another 300 million deleted domains.  There are 12 million registered .net’s and 8 million registered .orgs.

You’ll find it interesting to note that more than 400,000 domains are added every day and more than 450,000 domains are expired every day.  So it would seem the .com is stabilizing.

One of the oldest domain names registered?  think.com was registered May of 1985. 1985 and 1986 saw registrations of dec.com, hp.com, and xerox.com.

We Just finished working with a client, Bulk Connection, Inc., to add content sensitive video overlay to web pages. We put together the web site, but the videos were inserted as a simple overlay after the fact.

Check it out at http://www.bulkconnection.com/Services_Liquid_Video.htm. Another example can be seen at http://www.whatsinyourcity.net/. The technology is a standard scripted video shot against a green screen and then overlaid onto your web page. You can do your own script or you can use an actor. It is very cool technology with a lot of possibilities.

The company that makes all this possible is OnSite Video, http://www.onsitevideos.com/ located in Boston.

For the past couple of years we have been defining and redefining our vision and mission for our Company. It isn’t an easy thing.  In all our thought and brainstorming, we have found a few basic principles  that explain why we have been around for more than 27 years.  It all comes down to a few basic attributes which you can find in our people and by association in our Company.  These attributes should apply to all service organizations. Look for them.

The first is honesty.  Without honesty there can be no trust and without trust, you cannot keep a customer. A good sales person can sell anything once. Trust will keep that customer coming back. Next is loyalty. Loyalty to a customer is no different than the loyalty you have to your own company. Loyalty signifies your dedication and sense of involvement. It makes you one of the team. Third is listening. Listening can’t be accomplished  while talking, selling, pitching or arguing.  Listening is the first step in problem solving.  

Lastly, it’s PERSONAL.  Those who say, “it’s just business” really don’t get it.  It is never just business.  It is about relationships, friendship, pride and the ability to communicate. If you see these attributes in your vendor, hang on tight.

We humans are amazingly creative and inspiring. Don’t believe it? As you may have seen in the previous article, the presentation was given at the 2009 TED conference held this past July in Oxford, England. You can view other inspirational and moving presentations at http://www.ted.com. The service is also available as an App for your iPhone, search the App store for TED. It’s free and remarkable.

Are you interested in how some new ventures are looking to mimic nature, have a look at biomimicry in action http://www.ted.com/talks/janine_benyus_biomimicry_in_action.html. Would you like to know how schools kill creativity? http://www.ted.com/talks/ken_robinson_says_schools_kill_creativity.html Looking to see how kids can be transformed by music? http://www.ted.com/talks/jose_abreu_on_kids_transformed_by_music.html.

See you in India in 2010?

Have a look at what is coming. You may have already gotten a glimpse with your wirelessly recharging emergency lights or your wireless electric toothbrush, wireless electricity is just around the corner. Eric Giler, CEO of WiTricity, talks about how electricity can be harmlessly transferred from one object to another using a frequency transmitter and receiver. What this 10 minute video and demonstration. It is near-to-market technology that may soon charge your iPhone, pacemaker or electric car. I can’t wait.