« June 2009 | Main | September 2009 »

August 21, 2009

Overdraft protection programs

With "protection" like this, who needs enemies? Unlike checks, which can not be declined in advance, debit card overdrafts are allowed to go through so they can change you an overdraft fee and make a profit.

I could be wrong, but I think credit card companies do the same now as well. They only decline purchases if they suspect fraud. If you go over your limit, they are glad to let you, then charge you a fee.

From the New York Times:


Not many people would knowingly pay more than $35 for a cup of coffee. But far too many people are getting saddled — with no warning — with outsized bills for minor purchases, under a euphemistically labeled “overdraft protection program” that most major banks have adopted over the last 10 years.

Before that, most banks would simply have rejected debit transactions, without a fee, when the card holder’s account was empty. Now, they approve the purchase and tack on a hefty penalty for each transaction....

Banks have historically covered bad checks for valued clients, who were invited to opt in to overdraft protection or to link their checking accounts to savings accounts or to lines of credit. But as more people began to use debit cards, the banks started to view overdraft fees as a major profit center and started to automatically enroll debit card holders into an overdraft program. Some banks instituted a tiered penalty system, charging customers steadily higher fees as the overdrafts mount....

Some bankers claim the system benefits debit card users, allowing them to keep spending when they are out of money. But interest rate calculations tell a different story. Credit card companies, for example, were rightly criticized when some drove up interest rates to 30 percent or more. According to a 2008 study by the F.D.I.C., overdraft fees for debit cards can carry an annualized interest rate that exceeds 3,500 percent.

Posted by Mike at 04:25 PM | Comments (0) | TrackBack (0)

August 13, 2009

Well at least they track a third

It's kind of like monitoring a third of the countries trying to build nuclear weapons, or a third of the terrorist organizations focused on destroying the world, or making a third of buildings earthquake proof, but I guess it's better than a sixth?

From the AP:


NASA is charged with spotting most of the asteroids that pose a threat to Earth but doesn't have the money to complete the job, a federal report says.

That's because even though Congress assigned the space agency that mission four years ago, it never gave NASA the money to build the necessary telescopes, according to the report released Wednesday by the National Academy of Sciences.

Specifically, the mission calls for NASA, by the year 2020, to locate 90 percent of the potentially deadly rocks hurtling through space. The agency says it's been able to complete about one-third of its assignment with the current telescope system.

NASA estimates that there are about 20,000 asteroids and comets in our solar system that are potential threats. They are larger than 460 feet in diameter — slightly smaller than the Superdome in New Orleans. So far, scientists know where about 6,000 of these objects are.

Posted by Mike at 02:44 AM | Comments (0) | TrackBack (0)