It’s a crisis of faith to some degree. But with recent news of the London Inter Bank Offer Rate (LIBOR) you begin to understand to some degree the pervasive nature of it.
Take consumer credit – it’s tied to the prime rate in most cases. And the prime rate, it’s determined in part by LIBOR!
A massive ripoff – I did a little playing around with various interest rates on a $1,000 debt for 12 months at 10% interest. You end up paying $1,054.98, not too bad.
But lets say because of LIBOR – you now pay 15% – you end up paying back $1,083.09. Sure, it’s only a difference of $28.11. But now multiply it out by the number of credit card holders – probably 100 million people. That’s an additional $28,110,000.
It’s high time we regulate the banks again. Scrap the insurance company/bank merger bit, and break up a few national banks. You’ll see interest rates drop, and better yet an easing of credit.
Another industry ripoff I see is the utility game. Wire line phone service is one of them, and it’s only getting worse. The phone systems have gotten so automated that labor costs were greatly reduced. And the bell companies get good rates from electric providers. But yet they milked the customer for all we are worth – what with the fees and such. Even VOIP isn’t immune.
Hell – a regular Verizon pots line around here is $45 without any features. A phone you can’t take with you. Meanwhile for an additional $5 per month over what a wireline phone would cost, I have not only phone service I can take with me, but sms, web, email, facebook, flickr, kindle – you name it.
Electric providers are another case. The cost of electricity here is going down because natural gas prices are going down. Yes, all to do with all that fracking which I find distasteful, but electricity prices are dropping by 21% around here. So what does National Grid do, but hike the distribution charges.
We should never have deregulated utility providers. We’ve found out what deregulation really does, it destroys the environment, destroys consumers, and all in all is just a REALLY bad idea.
Think about it, all this money we pay to companies just because they can charge what they want, if we pumped that back into the economy instead of into the pockets of the utility shareholders!