Kerry Lutz talks to Charles Hughes Smith about the failings of the current banking system

Charles Hugh Smith – Central Bankers Have Reached a Fork in The Road… They Should Take It

A great interview where Kerry and Charles discuss the problems of the current banking system.  I even get a mention! Exciting. (even though Kerry's comments that I 'make a living at it' aren't quite true) Great interview.

Visit the podcast site here..

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People turn to Payday Lending because banks are more costly??

I came across this very interesting article about payday lending.  If you recall, I had posted links to a movie about how these lenders take advantage of the 'unbanked' by charging high effective rates.

Turns out, the payday lenders may not be as expensive as the banks people are trying to avoid and the users of these services may be smarter than most will admit.

[click] to see the post which featured the movie.

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TURNS OUT THAT PAYDAY-LOAN CUSTOMERS ARE PRETTY SAVVY BORROWERS

By PYMNTS @pymnts

What's Next In Payments®

7:15 AM EDT October 2nd, 2014

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Conventional wisdom might lead one to conclude that payday lending is a scourge upon the Earth and an institution dedicated wholly to feasting on the financially disadvantaged and entrapping them unwittingly into an unending cycle of interest, fees and renewals intended to turn a $500 loan to buy groceries into a lifelong commitment. One also might reasonably begin to expect that their days may be numbered as the CFPB prepares to wipe their societal contagion from the face of the earth with purifying regulatory fire.

But recent data released by the CFPB seems to indicate that the conventional wisdom may be wrong on both counts.

An analysis of the complaints received by the CFPB  from consumers in its first three years indicates that payday lending isn’t really that big a problem insofar as only roughly one percent of the consumer complaints are related to payday loans. Mainstream financial products and services such as mortgages and credit cards dwarfed payday lending for the volume of complaints received. When debt collection is added in, those three areas accounted for roughly 66 percent of customer complains, reports American Banker.  This data is corroborated by FTC data that essentially reveals the same thing–payday loans represent about 1 percent of consumer complaints.

The CFPB data also revealed that if overdraft protection, the mainstream alternative to a payday loan, were evaluated in the same APR terms that payday loans are, they can come off much worse –in some cases clocking in at around 1700 percent (as opposed to the totally reasonable APR average of payday loans–350 percent). Moreover, the CFPB study noted that understanding short term loans in terms of APR may be less than helpful, since consumers prefer to evaluate the loans in terms of fees charged in dollars.  [click to go to article site]

Small businesses need investment and will pay big %%%

I came across a great news article from PBS which described the rise of alternative small business lenders online.

This is a great article because it reinforces several of the messages in my book; Invest Local.

1. There is a need for financing choice for small businesses.  Bank loans are too complex and many are rejected.
2. Small businesses need capital and want to borrow for upgrading or adding productive assets.
3. Small businesses are willing to pay great interest rates to obtain this financing.

In some of the feedback I've received about my book, investors who are used to traditional 'retail' investments say they don't believe that its easy to get returns of 9% to infinity using some of the strategies I detail in the book.

This news article demonstrates how and why there are tremendous opportunities out there.

Please take a moment to share this blog with others and if you haven't already, BUY MY BOOK!

Enjoy.