NYT/AP: Gas Prices Blamed for Late Credit Payments

[DeepModem Mom]

Gas Prices Blamed for Late Credit Payments
By THE ASSOCIATED PRESS
Published: September 28, 2005


WASHINGTON (AP) -- The percentage of credit card payments that were past due shot up to a record high in the second quarter as surging gasoline prices strained budgets and made it difficult for some people to pay their bills.

The American Bankers Association reported Wednesday that the seasonally adjusted percentage of credit card accounts 30 or more days past due rose in the April-to-June quarter to 4.81 percent. That followed a delinquency rate of 4.76 percent in the first quarter and was the highest since the association began collecting this information in 1973.

''The rise in gas prices is really stretching budgets to the breaking point for some people,'' the association's chief economist, Jim Chessen, said in an interview. ''Gas prices are taking huge chunks out of wallets, leaving some individuals with little left to meet their financial obligations.''

While Chessen mostly blamed high gasoline prices for the rise in credit card delinquencies, other factors also played a role, he said.

With personal savings rates dismally low, people have less of a cushion to absorb the big jumps in energy prices, Chessen said. The personal savings rate dipped to a record low of negative 0.6 percent in July....


http://www.nytimes.com/aponline/business/AP-Late-Loans....

[Coastie for Truth]

1. The "Bush Recession" is starting.

[ozone_man]

10. The big one that is.

The last one was just a warm up for the one that's coming. We never really left the last one, just an illusion supported by massive deficit spending and housing refinancing. Reminds me of the Wily Coyote running off a cliff. It's finally time to take that look down.

[bushisanidiot]

2. High gas prices are to blame for many things.. I can't afford to take

my kids to the movies once a week anymore because I'm paying an extra $80 a month in gas which sucks up my entertainment budget. I imagine there are families all over the country not going out and spending like they used to because of the crazy gas prices..

we're sinking.. and the only ones who think the economy is doing "great" are the oil, power and insurance companies. they get richer and we get poorer.

THANKS, AWOL BUSH!! THANKS A LOT!

[natrat]

3. heating bills this winter will break lots of budgets

lets see -heat, food or creditcard payment-no longer the land of plenty

[Mountainman]

4. a record low of negative 0.6 percent in July.?

If I remember my econ classes correctly, negative 0.6 percent is called dis savings. Or people are spending more than they take in. On the savings,spending and income graph that means the line is below the zero mark where incomes equal spending. It's been a long time since I had econ though.

[Nay]

19. You're exactly right, mountainman. It does mean that people, on

the whole, are spending more than they are taking in. They have been doing this for a couple/three years. Less than 10 years ago, economists used to grouse about Americans only saving 1 or 2 percent -- now, we're in the negative range. Any economist will suggest to you that this can't go on for very long.

[katusha]

5. Credit Card Payments Hindered by Gas Prices

http://news.yahoo.com/s/ap/20050928/ap_on_bi_ge/late_lo...

WASHINGTON - The percentage of credit card payments that were past due shot up to a record high in the second quarter as surging gasoline prices strained budgets and made it difficult for some people to pay their bills.

(snip)

"The rise in gas prices is really stretching budgets to the breaking point for some people," the association's chief economist, Jim Chessen, said in an interview. "Gas prices are taking huge chunks out of wallets, leaving some individuals with little left to meet their financial obligations."

(snip)

With personal savings rates dismally low, people have less of a cushion to absorb the big jumps in energy prices, Chessen said. The personal savings rate dipped to a record low of negative 0.6 percent in July.

(snip)

After Hurricane Katrina, gasoline prices jumped past $3 a gallon before calming down. Although damage to oil facilities was less than feared from Hurricane Rita, economists expect gasoline prices to stay high.

The double blow from the two hurricanes is expected to slow overall economic activity and hiring in the months ahead, economists say.
------------------------

[Lochloosa]

6. Wait till people see their minimum payments double.....

then the shit will hit the fan. I am so glad to be out of debt!

[tanyev]

7. No kidding.

If just the rise in gas prices was enough to cause a lot of past due payments, then doubling the minimum payment is going to bring the house of cards tumbling down.

[Tight_rope]

35. Learned in 1999 the Clinton moto...."PAY AS YOU GO"!

I love not being part of the true American dream "To be in debt", is the true American dream...."CHARGE IT"!

[orwell]

8. The Talking Heads

on CNBC and Bloomberg this morning were all "glass is half full" about gas prices. Oh Boy...more profits. They mentioned...briefly...that "some" in the middle or lower classes might have a tough time of it - what with having to drive to work and all - but who cares. They were all making money. Wheeeeeee!

A seat on the Merc went for a record today as all those glittering profits waited for the next perspective oil trader. Meanwhile, Pug/Dem bankruptcy collusion will eventually be recognized by the great unwashed as a direct sellout to the big credit card companies who are chomping at the bit to increase payments and profits.

It's nice to be a capitalist when the workers don't realize how badly they are getting screwed. Same as it ever was...

[intheflow]

9. Thank God the bankruptcy bill went through!

Can you imagine the suffering those poor credit card vampires would have to endure without the bill's protection?

[AZBlue]

18. Are we sure the Credit Card Cos don't have a weather machine?

Yeah, really nice timing for them, huh? Between Katrina & Rita destroying thousands of lives and subsequent high gas prices (which not only hits us at the pump but in the cost of just about ALL goods purchased) I'd almost believe that credit card companies created the hurricanes.

[sarcasmo]

11. Here comes the Debtors Prison.

[kostya]

12. Credit Card Payments Hindered by Gas Prices

http://news.yahoo.com/s/ap/20050928/ap_on_bi_ge/late_lo... ;_ylt=AovnEI.TwRpJHu15NCzsnwWs0NUE;_ylu=X3oDMTA3b2NibDltBHNlYwM3MTY-

The American Bankers Association reported Wednesday that the seasonally adjusted percentage of credit card accounts 30 or more days past due rose in the April-to-June quarter to 4.81 percent. That followed a delinquency rate of 4.76 percent in the first quarter and was the highest since the association began collecting this information in 1973.

...
The association's survey also showed that the delinquency rate on a composite of other types of consumers loans, including auto loans and home equity loans, climbed to 2.22 percent in the second quarter, up from 2.03 percent in the first quarter.

Tip of the iceberg finally popping up?

(on edit: sorry, dup'd the second paragraph)

[NVMojo]

13. And the Reid supported bankruptcy bill starts soon! Humpty Dumpty!

[enigma000]

14. Trouble ahead

Me thinks that if 5% of the adult US population can’t make their minimum payment and that with monthly minimum payments set to double (due to changes in the credit laws) the US and A LOT of individuals are going to be feel like “too little butter spread over too much bread”

[NYC]

16. Doubling the minimum payment is not mandatory.

Maybe the credit card companies will rethink this.

On the other hand, what have they got to lose?

[sarcasmo]

15. Many articles like this to come in the future. Debtors Prison.

[tanyev]

17. And they can use the people in the debtors' prisons

to work at newly created American sweatshops which are exempt from labor laws because they are criminals and it will be even cheaper than foreign sweatshops. Brilliant.

[Moderator]

20. Kick

[CornField]

21. Overdue Credit Card Bills Hit Record High

http://news.yahoo.com/s/ap/20050928/ap_on_bi_ge/late_lo...

WASHINGTON - Charge it! That familiar refrain is producing an unwanted response for more Americans: Your bill is overdue! Surging energy prices, low personal savings and the higher cost of borrowing have combined to produce a record level of overdue credit card bills.

The American Bankers Association reported Wednesday that the percentage of credit card accounts 30 or more days past due climbed to an all-time high of 4.81 percent in the April-to-June period. It could grow in the months ahead, experts said.

The previous high of 4.76 percent came during the first three months of the year, in keeping with a generally steady rise over the past several years.

"The last two quarters have not been pretty," said Jim Chessen, the association's chief economist.

(much more at link)

[VegasWolf]

22. Just give them to Tom DeLay's accountant. nt

[rzemanfl]

23. Wait until next year. This will seem like the glory days...n/t

[gizmo1979]

33. No crap.can you pay your

heat bill with credit card?

[CornField]

24. I especially thought this was telling

Late payments may be bad news for consumers, but credit card companies do not necessarily mind them because late fees are a source of revenue.

"Credit card companies are increasingly addicted to their fees," said Daniel Ray, editor-in-chief at Bankrate.com, an online financial service. "Six years ago, all fees — including late fees — contributed only a minor portion to overall revenue. Today it accounts for more than 30 percent."

[TallahasseeGrannie]

26. Yeah and at 29 a pop for a late payment, they love them! n/t

[DemInDistress]

25. What will people do when

credit card companies demand that a creditor pay double the minimum
monthly balance? Banks will implement this new rule before the end of
05'.So those who can scrape up enough for the minimum now have to dig deeper.Shame on this Bush Crime Family............

[HockeyMom]

29. Just in time for the Holiday Shopping Season too

AND the higher home heating costs. If retailers thought they were hurTing last year, wait until this year. Do you charge Holiday Presents for your family, or do you keep them WARM?

Ah, but the Bush supporters with their Hummers and their tax cuts, don't give a DAMN.

[ClintonTyree]

30. End of economy........

no GI Joe with the Kung-Foo Grip for little Johnny this year. Combined with gas and fuel oil prices rocketing this winter the economy will plunge along with the Stock Market. Of course we're due for a Stock Market "correction" (read; another transfer of wealth from the middle class to the rich) so the rich will have another banner year. All is good in republikanland, the poor are poorer, the middle class are now poor and the rich....well, they own it all now! Now THAT'S what capitalism is all about.

[ThumperDumper]

27. Oh, crap! That reminds me... n/t

[jkappy]

28. how many pay max?

I wonder what the percentage is for persons who do not pay the actual bill, or the max. Is that figure also rising?

[brentspeak]

31. Good thing the credit card companies got the bankruptcy bill passed

[2Design]

32. probably new bankruptcy law - be a lot of filings between now

and oct 17th - so their lawyers probably told them not to pay anymore

[ClintonTyree]

34. The same shit happened under Reagan.........

Americans followed the government's lead and ran up unbelievable credit card bills. Ahhhh.... the times were GOOD! Of course all the bills came due sometime (except for the government's) and people were filing for bankruptcy left and right. Trickle down economics strikes again! bush SOOOOO wanted to be remembered as another St.Ronnie and it looks like he might exceed his wishes. He'll not only be remembered as the worst president ever, he'll be the president that single handedly plunged the nation into a second great depression. Way to go, georgie!