» Posted by Martin Weil on June 23, 2010

"A standard trick in the consumer-facing financial services industry is to appeal to people who are sure they're going to have no liquidity or cashflow problems in the future, and then make lots of money off them when the inevitable crunches happen. Free checking, for instance, becomes extremely expensive checking when you overdraw your account; and people regularly buy items on their credit card intending to pay the statement off in full, but then fail to do so, incurring substantial interest payments not only on that one item but on everything else they bought that month as well."

Another excellent observation by Reuters blogger Felix Salmon

» Posted by Martin Weil on October 07, 2009

"... Americans now pay more in overdraft fees every year than they do for books, cereal, or fresh vegetables," said CRL senior researcher Leslie Parrish.

» Posted by Martin Weil on September 17, 2009

One guy decides to something about it and makes a short video.

» Posted by Martin Weil on November 10, 2008

Every holiday season it seems that US retailers make their year on the backs on gift cards. These often have ongoing fees that quickly eat up the card's value. And a large portion are never redeemed. Now comes the realization that a gift card to a retailer that goes bankrupt will likely be worthless. Analysts expect consumers to lose millions of dollars this holiday season alone from unusable gift cards at failed retailers. The LA Times today has the whole story.

Moral: "If you don't know what gift to buy, just give cash. It's something that never expires."

» Posted by Martin Weil on August 11, 2008

Ever since I signed up for California's "Do Not Call" list, our telemarking calls have decreased by 90% (there seems to be no way to stop the political calls, of course). Now comes a grass roots effort to do for junk mail (I get several pieces a day that get automatically tossed into the recycle bin) what the "Do Not Call" did for telemarketing.

You can support this push for "Do Not Mail" legislation here.

» Posted by Martin Weil on March 13, 2008

From Odd Numbers

Out of 20 S.E.C. settlements for market timing by mutual funds, 16 involved (Elliot) Spitzer when he was New York's attorney general.

The percentage of illegally-gotten money that mutual funds had to give back in the Spitzer cases was 80 percent -- almost full restitution.

In the 4 settlements not involving Spitzer, the S.E.C. settled for 7 percent.

Why the gap?

Part of it was Spitzer's aggressiveness, but the other factor was that younger S.E.C. officials usually go work at the firms they're in charge of regulating. So, the incentive to bring the hammer is, ummm, somewhat compromised.

Justin Wolfers explains why this should matter:

It seems to me that the truly important violations of the public trust are when the power we give our government officials is sold, rather than what government officials choose to buy. Yet our political scandals are too often dominated by private mistakes, rather than public misdeeds. This is why I'm more worried about what the SEC is selling than what Eliot Spitzer has been buying.

» Posted by Martin Weil on November 13, 2007

Consumer Reports will take a full-page ad in the NY Times to warn consumers about the pitfalls of giving and using gift cards. They found that 27% of all cards go unused, and retailers took in an extra $8 billion because of unused, lost, and expired gift cards. Their tips:
Register it Some cards must be registered with the issuer, especially if used online or by phone.
Spend it quickly Use the card as soon as possible, especially if it expires or has a maintenance fee.
Spend it to the last penny If the card balance gets so low that there's nothing to buy, ask a merchant to do a split-tender transaction. That uses the remaining card balance for part of the transaction and another form of payment for the rest.
Hold on to it Don't throw out the card when the balance is zero. Some merchants require it for returns.

All this according to The Consumerist. My own suggestion - make your money work for you and not the retailers: Just don't buy any.

» Posted by Martin Weil on October 28, 2007

Amitosh concentrates as he pulls the loops of thread through tiny plastic beads and sequins on the toddler's blouse he is making. Dripping with sweat, his hair is thinly coated in dust. In Hindi his name means "happiness." The hand-embroidered garment on which his tiny needle is working bears the distinctive logo of international fashion chain Gap. Amitosh is 10.

From The Guardian.

Gap is by no means alone in finding children toiling at many of the firms it outsources to. To their credit however, the Guardian continues:

Gap's own policy is that if it discovers children being used by contractors to make its clothes that contractor must remove the child from the workplace, provide it with access to schooling and a wage, and guarantee the opportunity of work on reaching a legal working age.

One wonders if the rest of the consumer products industry can say the same?

» Posted by Martin Weil on October 08, 2007

The Consumerist (a great site by the way) posts this guide to resolving difficult consumer issues. If, as the site says, "you're ready to stop getting mad and start getting results," this is a great place to start.

» Posted by Martin Weil on October 04, 2007

So says new research from ASU in a recent MarketWatch article.

Robert B. Cialdini, a social psychologist and Regents' Professor of psychology and marketing at Arizona State University in Tempe, has been researching relationships between psychology and pro-environmental action since the early 1990s. He addressed the House Science and Technology Subcommittee on Research and Science Education last week with some of his recent findings.

Cialdini pointed to a pair of studies that he conducted that began with a simple survey distributed to about 3,000 Californians... "They indicated that their neighbors' behaviors would be of little impact on their own," Cialdini said of the survey's respondents. But when he looked at what they did, compared to what they said, "the only factor that had any significant impact on whether they conserved energy was their perceptions of what their neighbors were doing."...

"I can absolutely see the social pressures working," [the Sierra Club's Howard] Page said. "If you're a mom in a neighborhood where everyone else on your block drives an SUV, you probably don't feel too bad. But if everyone else drives a hybrid, well, that pressure works both ways."