I had a burger basket today in a diner.
Yes, I asked for the mustard setup and not the mayonaise!! I’m a psycho, not a nut.
What is a burger basket? It’s a burger and some fries, served in a basket. A basket is a plastic basket lined with some thin paper.
The burger was fine, sure. The waitress was hot, but not as hot as last Saturday when she was wearing her Batgirl outfit. That day she had sparkly, glitter makeup on her face. That was neato. The neighborhood was safe.
Before I left, a guy sat down. He showed me his bankcard and asked me if they took those. I said I didn’t know, but I guessed they did.
He asked the waitress. She said they do take them if he had his ID on him.
He did.
He ordered the… burger basket.
When the waitress left, he asked me if the Dollar General store carried a particular brand of deodorant. I wasn’t sure and I told him so.
Then he told me that his bank lets him do overdrafts and it just costs him $20 each time.
I said, that’s pretty expensive. (I wasn’t comparing that fee with any others, I meant that’s a pretty expensive loan.)
He said it wasn’t expensive and that it’s more if you buy something big.
So, he was happy paying $26.79 for his basket while I only paid $6.79.
I tipped the former Batgirl a couple of bucks.
I was a waiter for six months. It was a tough job. I always felt better when someone left a tip larger than customary. It wasn’t the money, it was just nice receiving that acknowledgement of good service.
Ok, the money did help.
One time I took care of a party of six. Their tab was $354 and change. The guy who paid, on a credit card, tipped me $20. Oh well.
Anyway, I don’t think any bank only charges $20 for an overdraft fee. I checked his bank’s website and, of course, they don’t disclose ANY fee information online. I’m sure if you can get a fee of less than $35, then you’re doing great.
The point of this blog is this: People don’t look at those fees as interest charged for a very short term loan.
If the guy tips enough to round his tab up to $8, then the $20 fee for a loan lasting 7 days is an APR of 13,000%, right?
Let’s see: $20/$8 = 250% * 52 weeks = 13,000%.
Ouch.
President Obama and his peeps want to create a new federal agency, a consumer finance agency, to police and force financial institutions dealing with consumers to be more clear about the fees they are charging. The agency would require banks to create contracts that are straight forward and would require them to disclose their fees in a consistent, apples-to-apples sort of way.
Of course, the banks have fought the idea by paying lobbyists with the dollars they are squeezing out of people.
Here is a BusinessWeek article about it:
New Push for Obama’s Consumer Finance Agency
Have a pleasant day!
Joseph Michael Winett for President, 2020
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