The Pundit will leave the overall subject of John Hughes point in this op-ed up to debate.  What I’m sure of is that his inclusion of payday loans is misguided and his understanding of them is minimal.  Payday loans aren’t offered to live beyond one’s means; payday loan customers use them to meet unexpected needs and in emergency situations.

Hughes also characterizes the rates as “impossible” ($15 on $100 for 2 weeks on an unsecured loan is “impossible?”) and the customers as “unsophisticated.”  Once again we see the paternalistic lack of respect towards and stereotyping of people whose choices the writer doesn’t understand.  I wonder how often Mr. Hughes pays over 1000% APR on an overdraft fee.

Interesting article on the economy, “Old solutions for a new economy,” by the Spot On blog:

The economy’s two largest enemies today are the lack of liquidity in the markets and the lack of consumer credit – both created by debt. Even though equities are cheap, people have no money to invest. Even though retailers are slashing prices, nobody has the disposable income to buy anything. Obama’s economic stimulus should focus on these two obstacles to recovery, and avoid anything which might hinder their repair.

…On the consumer side, Washington should consider ways to free up credit for consumers, rather than constrict it. The Obama plan has new regulations on credit card companies and payday lenders which would actually reduce the availability of credit, even if it is done in the name of protecting the consumer.