Tag: loan statistics

22
Aug

Payday Loan Statistics – Misleading Politicians and the Media

Thomas Sowell at the National Review wrote an interesting article about payday loans and the magic of numbers. In it he wrote, “A common practice in making small loans of a few hundred dollars for a few weeks is to charge about $15 per hundred dollars lent. Politicians, the media, community activists, and miscellaneous other busybodies are able to transform these numbers into annual percentage charges of several hundred percent, thereby creating moral melodramas and demands that the government “do something” about such “abuses.”

Mr. Sowell goes on to discuss the ramifications of the passage of legislation in Oregon that reduced the maximum allowable usury rate to 36% resulting in the closure of Oregon small businesses, the misinterpretation of “numbers” by politicians and the media to achieve their wrongheaded goals and more. He ends with this, “In other words, numbers do not “speak for themselves.” Politicians, the media and others speak for them — very loudly, very cleverly, and often very wrongly.

He also wrote, “Not surprisingly, most of the small finance companies making payday loans in  Oregon went out of business. But there are no statistics on how many low-income people turned to loan sharks, or had their electricity cut off, or had to do without their medicine.”

“This is just one of the many ways in which self-righteous busybodies leave havoc in their wake while going away feeling noble.”

It’s an inciteful article. It’s entitled, “Magic Numbers, Don’t be misled by payday-loan statistics.” It’s short and concise; certainly worth a few minutes of our time!

Again, here’s a link: “Magic Numbers Don’t be misled by payday-loan statistics.”

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27
Jan

Magic Numbers Don’t be misled by payday loan statistics.

Magic NumbersDon’t be misled by payday-loan statistics.

This is an interesting article by Thomas Sowell at the National Review.

It’s a good read! Mr. Sowell begins … “Words are not the only things that enable political rhetoric to magically transform reality. Numbers can be used just as creatively — and many voters are even more gullible about statistics than they are about words, apparently because statistics seem more objective.

The latest congressional crusade is to clamp down on small finance companies that provide “payday loans” and check-cashing services in many low-income neighborhoods, where there are few banks.”

He goes on… “A common practice in making small loans of a few hundred dollars for a few weeks is to charge about $15 per hundred dollars lent. Politicians, the media, community activists, and miscellaneous other busybodies are able to transform these numbers into annual percentage charges of several hundred percent, thereby creating moral melodramas and demands that the government “do something” about such “abuses.”

Read the article in its entirety here: National REview.com

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