Some Common Cents for March 27th 2015

On Thursday afternoon, the President was in Birmingham, and outlined some of his Administration’s plans to impose greater regulatory oversight on what is known as the “payday loan” industry. Why Birmingham? Well, we have a lot of the places in our metro area and state, I mean a whole lot, an embarrassing amount really. In some sections of town, they are one of the few open businesses, apart from maybe a thrift store and a worn down storefront church.

You don’t need a political agenda or in-depth knowledge of household finances to conclude there is a lot of economic desperation wherever there is a large number of payday loan locations. You also don’t need a graduate degree in finance to know these places charge an enormous amount in percentage terms. Only someone with a heart of stone or embalming fluid in their veins would look at the Annual Percentage Rates (APR) on these types of loans without shuddering, at least a little…Read On…

The opinions expressed within this report are those of John Norris as of the initial publication of this blog. They are subject to change without notice, and do not necessarily reflect the views of Oakworth Capital Bank, its directors, shareholders, and employees.