From the story:

The Pacifica City Council will hear the public’s opinion on a temporary moratorium on new payday lenders in Pacifica tonight. 

The possibility of a ban is partially the result of a study by the Insight Center for Community Economic Development in which it was found that Pacifica has the highest per capita rate of payday lenders in San Mateo County, and one of the highest in the San Francisco Bay Area.

If you work in the industry and are in the area, now is the time to step up and make your voice heard.

Good profile on Spencer Bachus (R-AL), the incoming chairman of the House Financial Services Committee.

The Texas fight is a “showdown,” so what should we call Mississippi?  From the story: 

There is no doubt that payday lenders serve a need. Their customers often have poor credit histories or lack collateral that traditional banks require.

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Before they vote to extend the loophole or close it, they should conduct a close study of the issue. What would happen if the original 36 percent interest rate was raised? Would that allow the payday lenders to remain in business?

What would happen if the loophole is closed? It’s likely many of the lenders would close their businesses. But where would the working poor go for short-term loans?

Yes, do a study. Real scholarship always proves the need for payday lending.

At least that’s the way one television station is playing it.

Two tribes in the online payday lending business won in court.  From the story: 

“We hold that tribal sovereign immunity applies to state investigatory enforcement actions,” the Supreme Court said, adding that the trial court on remand must determine whether Cash Advance and Preferred Cash Loans “act as arms of the Miami Nation of Oklahoma and the Santee Sioux Nation, respectively” and are entitled to the tribes’ sovereign immunity from subpoena enforcement.

I think what this means is states cannot enforce their lending laws against the tribes, but the federal government can.  I guess they will be brought under the CFPB eventually.  It will be interesting to see if they fight that.

High risk borrowers are back in play for the credit card industry.  From today’s New York Times:

Credit card offers are surging again after a three-year slowdown, as banks seek to revive a business that brought them huge profits before the financial crisis wrecked the credit scores of so many Americans.

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Lenders are “tiptoeing their way back into the higher-risk pool of customers,” said John Ulzheimer, president of consumer education at SmartCredit.com.

In extending credit again to riskier borrowers, lenders are looking beyond standard credit scores, on the theory that some people who may seem to be equivalent credit risks on the surface may show differences in spending or other behavior — like registering on a job Web site — that suggest variations in their ability to keep up with payments.

Strong words from Allen Meltzer who just wrote a history of the Federal Reserve.  From the article:

Allan Meltzer, author of a new exhaustive history of the Federal Reserve, slammed Congress’s recently passed financial reform law for creating an “abomination” in the Consumer Financial Protection Bureau. During a panel discussion at the American Enterprise Institute with former Fed chairman Paul Volcker, Meltzer, who has been critical of federal intervention during the financial crisis, said that the Consumer Financial Protection Bureau was “absolutely not the way to go.”

“It should be on the budget if it’s going to be a regulatory authority in the Federal Reserve,” he said, criticizing the way that CFPB would not be subject to the normal congressional appropriations process. Because the agency would be dealing with the distribution of wealth in this country, “Congress should have a much heavier hand.”

Elizabeth Warren is in the running.

Elizabeth Warren sat down with The Washington Post and said this: 

“There are a lot of financial institutions that make their money by keeping products confusing so the price isn’t clear until it’s way too late,” Warren told me. “They make money by concealing risk, which means that people can’t compare the products head to head.”

The cost of payday loans, of course, is fully disclosed.  And consumers understand the comparison with competing products such as overdraft protection and bounced check fees.

From the story: