Barnson.org

Recently we’ve been inundated with “0% APR” offers from various credit card companies. After trying two of them out, and being very disappointed, I finally sat down and read all the fine print. And I figured out what should have been obvious at the beginning:

0% APR is only good for the credit card companies. It’s very bad for an individual consumer’s financial health.

Today, before I shredded it, I read in detail the terms of the new “0% APR” Discover Card we received in the mail. Unfortunately, it’s mulch now, so I can’t refer to the exact verbiage, but here are the terms they are not specific about:

1. Your billing cycle is a 25-day cycle, not 30 or 28. This means that, even though they offer a low “0% APR” on purchases, that only applies for the first 25 days of the purchase. I’ll show you why, in combination with the “balance transfer” deal, this is a racket which enormously benefits the credit card company. But at the heart of the system, if you pay your bill on the same day every month, it’s impossible to avoid paying interest on purchases.
2. That billing cycle gives you a moving target for payment every month. Some months, you’ll be paying early in the month, some months, you’re later in the month. Some months, you’ll have to pay TWO payments (one towards the beginning, one towards the end) in order to keep current and avoid late fees and immediate invalidation of your 0% APR! Can you afford two credit card payments a month? This keeps you off-balance, and more likely to lapse into the “default” terms of your credit card, which will usually double or triple your monthly payment.
3. Balance transfers. Oh, these seem like a holy grail for people who, like us, ended up owing a lot on a credit card due to medical expenses while uncovered by health care, and have yet to dig themselves out. Here’s how they actually work, and how that “0% APR” offer is a sweet investment for your credit card company.
4. The 0% APR, even if it’s “for life”, is actually for a limited period, no matter what. You have to jump through some extraordinary minutiae to keep that APR… minutiae which involves racking up consumer debt without any way to pay it off until your 0% APR loan is paid off.
5. There’s a minimum $5.00 to $50.00 balance transfer fee which is immediately applied to your credit card at the CASH ADVANCE rate. That’s 28% interest, and since it’s at the “cash advance” rate (the highest rate), it will be both the first loan taken out, and the very last one paid off.
6. The terms of this Discover card specify that, once the “term” ends, in order to keep the low APR, we’d have to make THREE minimum qualifying purchases or cash advances every month. A minimum qualifying purchase is one that is at least $50.00, and has a rate around 10%, or 28% for cash advances. So you have a $150 minimum purchase requirement every single month.
7. The heart of the racket is this: you always pay off your lowest-interest loans first. Let’s say you have a $10,000 balance to transfer. At “0% interest”, you’ll have a payment around $90 per month, which includes a little interest on that $50 “cash advance” you took out to get the balance transfer in the first place. That little bit of interest is basically the equivalent of the fees they aren’t charging you. It’s only a few bucks a month, but it pays for itself for the credit card company.
8. Balances which carry a 0% interest rate aren’t subject to the same restrictions on payments that balances with interest are. Nice little loophole in the law: they don’t need to make you make 3% minimum payments! This means that, if the rates we’ve seen before are any indicator, at the default payment rate, it’s going to take you TEN YEARS to pay off that 0% interest balance.

Add it all up: you have $50.00 which is going to sit in there for probably the life of the loan. Once your term expires, you have to spend $150 a month on the card, which you aren’t allowed to pay off until you’ve paid off your 0% loan. This means that your monthly rate is going to keep creeping up until you’ve paid the thing off! If your “term” is, say, three months, that means that for the first three months, you are going to have a nice, low $90 payment. Then every month thereafter until you have paid off that balance transfer, your payment is going to creep up by about $5.00. Since you are not allowed to actually pay off those high-interest balances until your low-interest balance is paid off, you’re screwed.

Here’s the math on this one. You do a $10,000 balance transfer at “0% APR”. You fulfill the bizarre payment requirements to the letter, and you start out your loan with what you think is a sensible payment of $170 a month… WELL above the minimum payment they expect. This would pay off that $10,000 in five years, right?

Sure. The first year, everything is going well. You make your fifteen payments (remember that 25-day billing cycle you have to remember?) Heck, you overpay, because like most sensible people you assume $170 a month, and actually end up paying two extra payments in the year. “Cool,” you think, “my balance is down to $7960”.

Well, not really. You have that little $50 that you’re forbidden to pay off. $8010. Plus interest on that $50 for the first year, which adds another $66.00 to your balance (well, it fails to subtract $66.00, so the same difference). $8076. Well, it’s not such a bad deal. For $116, you just paid off a year of debt interest-free. Woohoo!

Then the “three purchases a month” rule kicks in. OK, you’ll play their little game. That second year, you rack up an extra $1800 in consumer debt you’re not allowed to pay off until you’ve paid off the stuff you aren’t getting charged any interest for. You’re still kicking in $170 a month, but the equation has changed: in that time, you just racked up an extra $2K on your credit card, and…

…Congratulations. You are now in the hole $1,000 more than when you started. And your “generous” $170 a month contribution towards your 0% debt now barely covers the interest on your loans.

What a scam.

So put yourselves in our position: a substantial amount of consumer debt, which is mostly because we converted medical debt to credit card debt, along with substantial periods of unemployment during the “bust”. Believe it or not, we got better terms from a credit card company for paying off a massive hospital bill than we did from the hospital.

What strategy would you take to getting rid of that debt in 5 years or less?

Seven weeks.

Seven weeks ago, the summer movie season had already started. Seven weeks ago, I had already turned 30. Seven weeks ago, things were just like now.. same season, same time, same.. well.. almost everything.

Its hard to think that in seven weeks – or less – everything will be different. I sit sometimes on the Rocking chair I still need to fix up, or in the laundry room I still need to finish emptying out.. and I think to myself.. I was still working on this stuff seven weeks ago. I play the song I swore I was going to record seven weeks ago, and I think.. maybe in a couple of weeks.

Its hard to think that in seven weeks, to one person, I will be a person with no history. I’m not that guy who did Into The Woods, not that guy crying because of a 10th grade breakup, not that guy who had to run away from Saint Mary’s. I won’t be the marshmallows on the ceiling guy, the Crucible guy, the Wayward Sun fan, the actor or the blogger.

I’ll just be Dad. Like my Dad. There will be a person to whom I will be the barrier from really fun but dangerous things, the enforcer of the bedtime, the shoulders to sit on, the guy you have to wait till HE comes home. Like My dad. One day, someone will tell my son Liam what I am really like, and he’ll laugh and say “My Dad? No WAY”.

Many of you have kids, and to you what I’m writing is “cute”. I will still be me, you’ll say. Or maybe you’ll say, “yeah, you’ll be totally different”. I’ve heard both. But tonight.. with Babytime just seven weeks away, I think.. oh S**T! But then I think.. – wow.. I can’t wait to meet him.. and to meet me.

So, we’ve isolated on two locations for the Barnsonian Pre-QOHS Reunion event for July 7th. Rather than use the poll option, I figured I would go with just throwing the two options out there and see if there’s a consensus.

Lisa says that unfortunately Friendly’s at Quince Orchard Plaza is no more. That’s not one of the options. Shucks – think of how much fun we could have had waiting in line for a booth. Those were hours we won’t get back, right?

First choice: the classic Old Town Gaithersburg restaurant Roy’s Place. Check out http://www.roysplacerestaurant.com/ to see their menu (number 7 on the menu might give you a sense of the place if you’ve not been before.) This is one of my families’ favorite spots. There’s no separate room but we can pull tables together and enjoy ourselves. We do group events with out-of-town family there all the time. As I said to Matt via e-mail, it’s got character. Chime in if you are familiar with Roy’s.

Second choice: Chevy’s at Quince Orchard Plaza. It does have a separate room. The chain’s site is http://www.chevys.com/.

For the sake of not having the whole world join us, I thought I’d try to keep the particular start-time off the blog, and instead, I’ll take RSVPs at timclarkejr@gmail.com and be able to disseminate information to just the interested parties.

So, who’s in? What are everyone’s thoughts on the choices?

Tim

“To produce the meat we eat now, 75 (percent) to 95 percent of what we feed an animal is lost because of metabolism and inedible structures like skeleton or neurological tissue,” says Matheny. “With cultured meat, there’s no body to support; you’re only building the meat that eventually gets eaten.”

Artificial Meat

This actually, if it worked, could have some serious benefits for the world as a whole.

” The proper function of man is to live, not to exist. I shall not waste my days in trying to prolong them. I shall use my time.”

~ Jack London ~

The Electronic Frontier Foundation has put together a new video called “The Corruptibles“. The major point to this video is one we’ve discussed here many times before: how laws are being shaped by wealthy recording and movie conglomerates to eliminate fair-use rights and ownership of digital media.

So there’s a slightly-hidden funny in the latest Pixar movie, “Cars”. My co-worker, Ken, brought it to my attention, as I haven’t seen the movie yet.

On the body of the antagonist is the proud logo: “HTB”. If you look closer, you realize it spells out “Hostile Takeover Bank”. Hah!

This got me thinking: what other fictional names could we give corporations/organizations that more closely reflect their actual mission? Maybe even with a slogan or fake quotable quote to put it into relief? Here are some of the ones I cooked up.

• MCL: Mafia Connections Limited. “I started dis dry-cleaning bizness in fiddy-tree, and we been laundering ever since.”
• WAC: The Wholly Amoral Corporation. “From day one, we’ve been devoted to the principle of extracting every possible penny from your paycheck. And we’re proud to continue that tradition today.”
• QIC: Questionable Investments Corp. “We lose your money so you don’t have to!”
• SOH: Snake-Oil Health. “Pseudo-science and superstition aren’t just our business. They’re our passion.”
• MLRA: Multi-Level Relationship Abuse, Inc. “In as little as three months, you too can lose a few hundred dollars and drive away those pesky family and friends.”
• BMSC: Behemoth Mega-Software Corp. “Anti-trust legislation doesn’t apply to us, because, look, there’s so much competition in software markets we haven’t entered yet, like diesel mechanics and drywall hanging.”

What can you cook up?

okay, here’s the sitch.

JJ Abrhams, creator of Lost and Alias (And Felicity), and director of MI3, has been given the reins to the Star Trek Mythos. Rick Berman, overseer of all things TREK since its creator got sick in 1989, had been ousted (Not a bad thing, all the good Ds9 was overseen by Piller and Moore). We’ve covered this.

The plot, so far, seems to be a prequel.. set in the Kirk / Spock days, and possibly early in their careers. JJ has said it will be a reinvention of sorts, but will fit in the established continuity. It is scheduled for 2008.

My hope is that JJ used his ablility to craft twists and turns, and to create buzz, while enlisting young casts with emotional ties to the plots, well, I just hope its good. And I will shre my thoughts about what i’ve heard so far, but what are your thoughts?

The World Cup is underway. I am way excited. I took off the afternoon to watch one of the opening day games. I have been following the U.S. men’s national team for the past two years. I watched almost all of their World Cup qualifying matches. I have cable so that I can watch US players work for their English Premiership and Bundesliga club teams. I have been counting down the months until the tournament starts. I’ve been flocking to the US soccer website for daily updates on the team.

I love soccer. And the older I get, and the more I start adopting a heterodoxic approach to life, the more I take the heretical stance of dismissing American football, baseball and basketball as lame spectator sports. I grew up following the Washington Redskins and dedicating my brain to memorizing player stats. Today, I think American football is a bunch of overgrown apes crushing each other in 5 second spurts. Baseball and basketball are equally as boring to watch and follow. I recognize that the hardest thing to do in professional sports is consistently hit a round ball with a round bat, but the overall sport doesn’t captivate. Basketball doesn’t do much for me either as a spectator sport. With so much scoring, I just want to tune in the last two minutes of the game, and even then I could care less about the outcome.

I laugh every time I hear someone call a US sports team the “world champion.” What a joke! Nothing compares to the World Cup in terms of international sports craze. It’s amazing to see a tournament based on a sport in which every nation on the planet pursues vigilantly. It’s the best of the world competing at the highest level. There is only one sport. It is soccer.

LET’S GO USA!

I’m slow. I had to watch it twice to get it.

http://cornonthekabob.ytmnd.com/

I feel a terrible need to eat some corn and watch Star Wars now…

(Thanks to the Shadowguild Mailing List!)