debt based Capitalism

This is a bit different from my usual theme however as I work in the area community services and human need it always urkes me that we as a society still accept that banks can dictate their profitability on people without any compassionate realisation of people individual situations. For instance, if a person falls on hard times for whatever reason, banks and finance companies have what they term 'hardship' options whereby they either reduce payments for a period or suggest up to 3 months lapse of payments. This sounds all very good to person struggling to put food on the table and cloth & feed children. The only problem is, the financial institution then compounds the interest on the outstanding debt prolonging the agony.
The governments in the western world must be fully aware of this practice as they are the ones that hand out the welfare vouchers to welfare organisations. In my opinion financial institutions should ware their share of the burden and risk associated with a changing economy not just expect to make the same or better margins under all conditions. Another thing is 'motor vehicle loans' these fall outside of the control of the reserve bank when it comes to falling interest rates. If one has a home loan, one can expect payments to drop if there is a drop in interest rates. Why do financial companies still charge the initial contract rate for motor vehicles no matter what the current reserve interest rate is?.

To leave a comment, please sign in with
or or

Comments (1)

  1. stevehayes13

    If you are expecting bankers to exhibit a social conscience and sense of morality, methinks thou shalt be grievously disappointed. Consider the practices of that much renowned “ethical banker”, Mr Stephen Green, who as head of HSBC ensured the organisation made fabulous profits by laundering the money of drug cartels and terrorists amongst other things. Mr Green is, of course, now Lord Green, Minister for Trade and Investment, with responsibility for financial services and banking in the British government.

    July 19, 2012