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Speaker 1: Ridiculous History is a production of iHeartRadio. Welcome back to

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Speaker 1: the show Ridiculous Historians. Thank you, as always so much

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Speaker 1: for tuning in. Credit on the production goes to our

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Speaker 1: super producer, mister Max Williams.

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Speaker 2: Swipe my credit cards. I don't know if it is.

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Speaker 1: Get to the magnetic stripe. There's a story behind that.

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Speaker 2: It was that come hithertone, Max, I dig it very

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Speaker 2: very sylvia of you, sir.

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Speaker 1: I am Ben Bullen, joined as always with the man,

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Speaker 1: the myth, the legend, mister Noel Brown does mister Brown.

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Speaker 2: Yes, sir, I've got to ask you. Do you have

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Speaker 2: credit cards? You know I do?

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Speaker 3: And it's funny. It's funny you should ask. Not really,

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Speaker 3: it's actually very in character that you had asked.

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Speaker 2: Podcast.

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Speaker 3: It's totally cool, man, we see through your ruse. Ben Bowlin,

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Speaker 3: you'll reindeer games.

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Speaker 2: Well, give me some credit. I will.

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Speaker 3: I'll give you all the credit. I'll give you more

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Speaker 3: credit than you deserve. No, untrue, you deserve every scrap

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Speaker 3: of credit.

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Speaker 2: Though. Thank you very much.

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Speaker 3: Is heaps I heap it upon you, but no to

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Speaker 3: answer your question, I I remember a time where I

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Speaker 3: felt so scared about my financial future. And then I

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Speaker 3: was like, oh, I haven't done any of the things.

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Speaker 3: I'm not going to have any credit established. And you know,

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Speaker 3: at this point, I think I was in my teens.

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Speaker 3: Looking back on it now, though, I realized I kind

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Speaker 3: of did everything at the exact appropriate time. I got

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Speaker 3: my first you know, debit card and stuff when I

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Speaker 3: was a teenager, and then I didn't get a credit

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Speaker 3: card until I was probably you know, twenty, maybe eighteen nineteen,

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Speaker 3: something like that. But for any kids out there, you

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Speaker 3: young people out there, it is a good idea to

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Speaker 3: get and utilize a credit card very responsibly early in life,

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Speaker 3: because you're establishing a credit history and you can't just

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Speaker 3: build that out a whole cloth.

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Speaker 2: It's a history, and you want to kind of build

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Speaker 2: on that.

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Speaker 3: So yeah, I think I do remember having a period

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Speaker 3: though where I was in not crippling credit card debt,

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Speaker 3: but more than I.

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Speaker 2: Would have been comfortable with.

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Speaker 3: And thankfully, through the magic of podcasting, I've pulled myself

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Speaker 3: out of that. And now I do have two credit

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Speaker 3: cards that I earn points with, so I try to

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Speaker 3: use them and then pay them off and reap those points.

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Speaker 1: Maybe children also make your parents and authority figures get

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Speaker 1: you a prepaid credit card. The rat race has begun,

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Speaker 1: says America.

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Speaker 2: It's time to run and scamp or Max, You're not

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Speaker 2: like it, but we're in it. You know, there's nothing

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Speaker 2: we can do about Yeah, give.

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Speaker 4: It to us. I mean, so, as I've joked on

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Speaker 4: here before, I am the fiscal education business and Greek guy.

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Speaker 4: I have actually five credit cards at this point, now

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Speaker 4: I have I don't carry any bounce on any of them.

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Speaker 4: But I have one card that I only use for travel,

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Speaker 4: has great travel points, and it's got like benefits of unredewing,

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Speaker 4: and so I'm playing this trip. And it's then kind

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Speaker 4: of a hellish process of booking, like some state in

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Speaker 4: New York.

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Speaker 2: And last night finally.

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Speaker 4: Got confirmation ten thirty pm, super tired, barely awake, I went,

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Speaker 4: I booked the stuff, and then I realized after I

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Speaker 4: booked it that my debit card and my credit card

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Speaker 4: looked very similar. And I booked it on the worst

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Speaker 4: possible of all of my cards, so meaning a higher

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Speaker 4: interest rate, lower points, just a waste of time or

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Speaker 4: is it one of.

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Speaker 2: Those ones where you have to pay in blood at

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Speaker 2: the end of the month, the blood price I mean

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Speaker 2: I get to quarterly quarterly, Yeah.

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Speaker 1: Because you chased the blood, how about you? Man, oh man,

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Speaker 1: thank you so much for asking. Well, Yeah, so I

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Speaker 1: have I have several cards in a specific arrangement.

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Speaker 3: I don't And by that I mean, I bet you

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Speaker 3: mean in your wallet even an order you know of operation,

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Speaker 3: that you've got them stored in.

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Speaker 1: Order of operations fits for sure. I definitely I don't

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Speaker 1: use them to the point where the credit card or

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Speaker 1: the credit rating system here in the US is a

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Speaker 1: bag of badgers all its own. It's a future episode.

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Speaker 1: But I recently got news, and this happens every so often.

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Speaker 1: I'll get news from one of the credit card companies

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Speaker 1: that they're going to deactivate my account because I have

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Speaker 1: not used the card, but in activity, they're going to

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Speaker 1: hold my credit card or my credit score ransom unless

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Speaker 1: I mess with them a little.

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Speaker 2: And so then I'll go to a.

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Speaker 1: Place and buy something gum, right whatever, right and uh

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Speaker 1: And just for the record, Noel did say gum like

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Speaker 1: chewing gum, not a gum.

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Speaker 2: I said a gum. Yeah, don't come after us, and

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Speaker 2: then we'll uh.

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Speaker 1: And then what I'll do is immediately go and pay

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Speaker 1: that pay that off, usually before it even posts beat

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Speaker 1: the interest rate, and uh, it's always kind of a

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Speaker 1: haha moment. But that's because credit cards and the credit system,

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Speaker 1: I think, became their own sort of fascinating, at times

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Speaker 1: scary and certainly ridiculous game. I mean, how would we

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Speaker 1: explain a credit card to someone from nine hundred BCED.

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Speaker 3: I promise to pay you for this later, uh, and

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Speaker 3: am legally bound to do so by contract.

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Speaker 2: I got to jump in here.

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Speaker 4: No, I know you've playing fall At four more recently

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Speaker 4: have you run into It's not a random encounter, it's

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Speaker 4: an actual plan accounter. The guy trying to pitch you

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Speaker 4: on a CAP's credit card. I have not, so it's

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Speaker 4: an I don't I don't want to spill too much

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Speaker 4: of it. But it's an eastern Boston by the by

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Speaker 4: the coast. You can run into a guy who is like,

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Speaker 4: for one hundred and twenty five caps, I'll give you

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Speaker 4: this car that's worth one hundred caps.

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Speaker 2: You can use anywhere, but the convenience, it's obviously a griff.

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Speaker 2: Sounds like a Magic Beans kind of scenario. Bro, I

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Speaker 2: promise you, if we run into it, buy it.

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Speaker 4: Because twenty five caps isn't worth that much, because it's

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Speaker 4: just like the jokes they build into the game behind

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Speaker 4: that card is more than worth.

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Speaker 2: It for the ready. But when they're when they're fired,

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Speaker 2: they're fire.

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Speaker 3: And honestly, some things they've done to sort of fix

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Speaker 3: Fallout for have really made it a much more playable game.

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Speaker 3: I'm a little annoyed by all the reminders that my

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Speaker 3: villages are being sacked because I really don't freaking care about.

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Speaker 2: That aspect of the game.

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Speaker 3: Yeah, find those notifications to be a little they take

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Speaker 3: me out of it. But I'm looking forward to playing

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Speaker 3: Nuca Cola World and I'm about to start the far

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Speaker 3: hardware deals.

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Speaker 4: Yeah, I mean the whole settlement thing. It's like the

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Speaker 4: Scarrim Civil War. It's the part of the game that

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Speaker 4: I wish I could just take out.

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Speaker 3: But I mentioned the magic Beans scenario because I think

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Speaker 3: that's actually a pretty cool, you know, sort of allegorical

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Speaker 3: stand in for a credit card.

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Speaker 2: It's sort of like this promise of future prosperity.

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Speaker 3: It's a way of buying in to being one of

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Speaker 3: the swells, even if you can't actually afford it. Right now,

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Speaker 3: that's at its worst, right the way we've described it

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Speaker 3: at the top of the show. We're trying to pitch

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Speaker 3: it as more of a financially responsible tool that you

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Speaker 3: can use to build your credit and then become one

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Speaker 3: of those swells. But when people use it to reach

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Speaker 3: an economic status that they actually can't afford, that's when

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Speaker 3: things get real nasty, and therein kind of lies the grift.

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Speaker 1: Right. Here's how it works. These credit cards are extremely

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Speaker 1: common throughout the world, in the United States in particular.

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Speaker 1: The u United States is the home of the modern

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Speaker 1: credit card, as we'll see, But the basic idea is simple.

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Speaker 1: Think of Popeye. We'll have an episode on Popeye coming

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Speaker 1: along too. Wimpy will gladly pay you on Wednesday or

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Speaker 1: whatever for a Hamburger earlier in the week. That is

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Speaker 1: the heart of the credit card. A company provides you

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Speaker 1: with a certain amount of credit, a floating IOU opportunity,

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Speaker 1: and with this account you can pay for things without

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Speaker 1: spending cash on hand at the time of purchase. In theory,

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Speaker 1: when everything works well and is not predatory, you pay

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Speaker 1: back what you owe at the end of each cycle,

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Speaker 1: which is usually a monthly billion cycle for the company,

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Speaker 1: and the company makes a bit of a profit, a

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Speaker 1: bit of a vigorous by charging interest on the money

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Speaker 1: that you have borrowed for the amount of time that

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Speaker 1: you borrowed it. There are also other fees, like maybe

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Speaker 1: annual fees, maybe you know, any other kind of.

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Speaker 3: For the privilege of a certain type of card, like

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Speaker 3: I believe American Express is an annual fee, but you're

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Speaker 3: also supposed to pay your ballance off every single month,

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Speaker 3: that's the idea, and if you don't, that interest rate

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Speaker 3: can be rapacious.

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Speaker 1: So the idea then is that these other fees could

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Speaker 1: be what we would call financial accoutrement. It's simple enough

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Speaker 1: in theory, but it gets much more complicated in credit

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Speaker 1: an incredibly quick rate. Interest rates speaking, rates can vary widely.

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Speaker 1: Some can be profoundly dangerous, predatory, usurious. A lot of

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Speaker 1: cards have countless perks, like we mentioned Skymiles. You might

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Speaker 1: get annual gifts, discounts on other financial products which improve

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Speaker 1: with the perceived eliteness of the card. Some cards are

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Speaker 1: only for specific demographics of income or credit or profession.

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Speaker 1: Some cards are invitation only. In short, it's a messy,

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Speaker 1: messy bowl, a very expensive, very profitable spaghetti.

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Speaker 2: So how do we get here?

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Speaker 3: Well, it turns out, like most things, we go into

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Speaker 3: our ridiculous history, the origins of credit gods are more

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Speaker 3: ancient than one might think, you know, as is the

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Speaker 3: origin story of currency itself. The moment currency became a thing,

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Speaker 3: someone kind of probably figured out, probably several people in

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Speaker 3: parallel that, you know, I could lend the currency to

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Speaker 3: people and make money on that alone, because I have

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Speaker 3: more than they do. They need what I have, therefore

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Speaker 3: I can capitalize on them.

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Speaker 1: Yeah. In the ridiculous cinematic universe, I like to picture

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Speaker 1: sort of a Space Odyssey two thousand and one moment,

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Speaker 1: but instead of a monolith, there was the idea of

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Speaker 1: invisible value. Someone came up with the idea of cash,

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Speaker 1: someone else wanting to borrow it. This third guy, who

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Speaker 1: might be an alien shows up and says, hey, I

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Speaker 1: have an idea, and then you know, off to the

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Speaker 1: races ticket in teams.

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Speaker 3: Let's check out the Point Sky, which is a great resource,

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Speaker 3: by the way, for the kind of stuf we're talking about.

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Speaker 2: In terms of which card you might want to get,

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Speaker 2: what kind of works.

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Speaker 3: You might be seeking. It's good stuff, he says. It's

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Speaker 3: not really one single company. There is one single points

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Speaker 3: guy but I like to think of it that way,

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Speaker 3: so we'll go with this, he said. The Mesopotamian and

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Speaker 3: harpen civilizations use clay tablets to track their trade and transactions,

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Speaker 3: much like modern day credit cards, according al Gosha, And

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Speaker 3: by the way, think about the flintstones. We've ever seen

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Speaker 3: a credit card depicted on the flintstones. It's a big,

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Speaker 3: giant piece of stone, a piece of slate, probably, so

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Speaker 3: much like modern day credit cards.

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Speaker 2: These the clay tablets.

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Speaker 3: According to Jonathan Mark Kinoyer, an archaeologist and professor of

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Speaker 3: anthropology at the University of Wisconsin Madison, earthen tablets bore

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Speaker 3: seals from the two civilizations and were used out of necessity.

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Speaker 2: What does that sound like, Ben, The seals almost like a.

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Speaker 3: Bank insignia or the particular whoever issues your credit card.

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Speaker 3: The volume of goods being traded between them was so

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Speaker 3: large that paying with physical money would have been too cumbersome.

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Speaker 1: Yeah, it's part of why currency is a thing, right,

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Speaker 1: even gold backed currency. You can't give people.

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Speaker 2: Really difficult to part it around ten thousand bucks worth

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Speaker 2: of gold.

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Speaker 1: So if we fast forward later in the Babylonian age

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Speaker 1: or in the Babylonian Empire. We see that the Code

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Speaker 1: of Hamerabi, which is fascinating one of the earliest examples

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Speaker 1: of modern law, or the predecessor thereof. The Code of

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Speaker 1: Hamarabi has a lot of rules and it mentions the

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Speaker 1: concept of credit, and it talks about credit in terms

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Speaker 1: that we would associate today with things like loans. They

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Speaker 1: had rules around what happens when you don't make good

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Speaker 1: on a loan you owe, or which you are fraudulent.

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Speaker 2: The rules were strict.

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Speaker 1: They're mirrored in a bit diluted, more civilized form in

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Speaker 1: n credit card protections and regulations, and as we know,

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Speaker 1: you know, consumer credit. The concept of it made agriculture possible.

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Speaker 2: Totally in a very real way.

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Speaker 3: Well, I mean to think about it in general, like

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Speaker 3: you know, in order to start a business, Let's think

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Speaker 3: of agriculture as like one of the earliest forms of

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Speaker 3: like setting up shop. You need capital, and you can't

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Speaker 3: make capital if you don't have the business. It's sort

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Speaker 3: of a chicken or the egg kind of scenario. So

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Speaker 3: you need someone to be an investor in you, aka

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Speaker 3: loan you some money. And if that's done at a

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Speaker 3: reasonable rate and you're good at agriculturing, you can pay

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Speaker 3: that back lickety split, and then before you know it,

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Speaker 3: you're raking in the corns or whatever it might be

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Speaker 3: and reaping the benefit, reaping the harvest, et cetera.

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Speaker 1: Right, Yeah, let's go to Lewis Mandel, financial economist and

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Speaker 1: author of a book called the Credit Card Industry, a

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Speaker 1: history which we read for this show. Consumer credit, he says,

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Speaker 1: is characteristic of agrarian societies. Quote, they very often have

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Speaker 1: to finance agricultural operations by borrowing money for seeds and

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Speaker 1: other things to keep them going until harvest. Just like

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Speaker 1: a credit card interest rate. As long as the weather

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Speaker 1: is okay, then you're gonna make good at the end

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Speaker 1: of the year. So the idea is ancient, but the

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Speaker 1: application changes in step with technology. I love that you

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Speaker 1: mentioned American Express on the way there. We got to

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Speaker 1: mention our Knights Templar episode from Stuff they Don't want.

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Speaker 2: You to know, absolutely the creators of the very first bank.

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Speaker 3: I also believe we all agreed a pretty surefire inspiration

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Speaker 3: for the Iron Bank in the Songs of Ice and

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Speaker 3: Fire novels by George R. M.

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Speaker 2: Martin.

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Speaker 3: So yeah, the Knights Templar, creators of that very first

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Speaker 3: Bank made to help safely, I guess, guarantee the safe

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Speaker 3: transit of money during the Crusades. That was a whole,

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Speaker 3: big part of it, and it was very, very interesting.

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Speaker 3: They took a little cut from those transactions. And because

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Speaker 3: once again they were kind of first to market. Wasn't

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Speaker 3: the deal that they amassed so much freaking wealth that

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Speaker 3: they rivaled the powers that be and therefore became a

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Speaker 3: giant threat.

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Speaker 2: Yeah.

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Speaker 1: Yeah, King Philip in particular did not dig these guys.

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Speaker 1: I think the main reason they fell, yeah, was King

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Speaker 1: Philip the fourth of France, because.

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Speaker 3: That's the deal with the Iron Bank too. And then

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Speaker 3: in the books is that they are basically the power

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Speaker 3: behind the throne. They are so wealthy they command isn't

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Speaker 3: it the Golden Company, or they're in charge of like

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Speaker 3: this entire private army that could topple the entire the

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Speaker 3: whatever the realm.

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Speaker 1: Yes, yeah, they're having kingdoms. Also, King Philip owed the

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Speaker 1: Templars money, which is where things started to go wrong.

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Speaker 1: But anyway that happened, learn more about it and stuff

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Speaker 1: they don't want you to know. We mentioned America, American Express,

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Speaker 1: I should say at the top, So let's head to America.

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Speaker 1: American Express specifically, and learn a little bit about them

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Speaker 1: because they're a big player in.

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Speaker 2: These early days.

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Speaker 3: Very interesting because a lot of the companies that we're

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Speaker 3: going to mention that were part of this merger are

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Speaker 3: to this day their own thing, or at least a

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Speaker 3: couple of them separately.

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Speaker 2: Yeah, exactly.

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Speaker 3: So American Express was the product of a merger of

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Speaker 3: three companies, Wells and Company, Livingstone Fargo and Company, h

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Speaker 3: and Wells Butterfield. How Wells gets to be in two

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Speaker 3: of these operations. These are the same Wells. It's got

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Speaker 3: to be and could be awkward names, very true, but

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Speaker 3: we certainly know I am currently not really, I'm honestly

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Speaker 3: out of laziness due to several acquisitions.

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Speaker 2: Am a member of Wells Fargo, which is they had

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Speaker 2: some issues.

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Speaker 3: Right Ben, remember with the secret fees and the inflation

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Speaker 3: of those fees in order to make quotas and all

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Speaker 3: of that.

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Speaker 2: Didn't work right with me. But in the buttet twitch banks.

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Speaker 1: Yeah, and not to keep referencing stuff there on what

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Speaker 1: you know, but check out the Wells Fargo episode up

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Speaker 1: there wherein it's proven that they non consensually created accounts

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Speaker 1: for holders.

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Speaker 2: Imagine that.

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Speaker 1: Yeah, well for acount, real people, real accounts that have

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Speaker 1: an account made exactly dummy accounts that allowed them to

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Speaker 1: inflate those numbers so that they could meet their sales quotas.

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Speaker 2: And I still have Wells Fargo as well. I mentioned

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Speaker 2: that episode. So okay, good to know that I'm not

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Speaker 2: the only rube out here. You shook a finger. Yeah, yeah, yeah,

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Speaker 2: jump in there.

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Speaker 4: I just know of they talk about that fake account

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Speaker 4: thing on last Week Tonight in one of the couple

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Speaker 4: of seasons ago. So there's good information about that last

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Speaker 4: Week tonight. And yeah, I mean I bank with Truest,

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Speaker 4: which is a weird conglomerate with a terrible name.

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Speaker 2: Yeah, and it's uh, it's keep it over interest.

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Speaker 1: Also shout out to the writers of Last Week Tonight

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Speaker 1: for following stuff they'll want you to know.

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Speaker 3: Yeah, true, no, no, no, they have very parallel stories

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Speaker 3: that haven't write around the same time.

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Speaker 2: But good information in both of those resources.

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Speaker 1: And so American Express was quite successful. By eighteen sixty five,

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Speaker 1: they had nine hundred offices in a total of ten states.

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Speaker 1: This was extraordinary and awesome for any financial company. At

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Speaker 1: this point. There were big things on the horizon. This

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Speaker 1: is where we start to see the early signs of

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Speaker 1: the modern credit card. By eighteen sixty five, they still

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Speaker 1: are not called American Express yet, But by eighteen sixty

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Speaker 1: five they introduced something called the charge coin, a literal token.

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Speaker 1: We'll get to it in a second. But it wasn't

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Speaker 1: until let's see, eighteen sixty eight they merged again and

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Speaker 1: they became the American Merchants Union Express Company. Five years

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Speaker 1: after that, eighteen seventy three, they become the American Express Company.

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Speaker 1: Also around this time they start creating their first money

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Speaker 1: orders and travelers checks.

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Speaker 2: Well you know what it is, too, Ben.

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Speaker 3: In a lot of ways, the history of credit is

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Speaker 3: a history of virtual payment, a history of payment without

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Speaker 3: actually forking over the cash.

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Speaker 2: Right, it's all backed by cash.

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Speaker 3: You're paying with a promise or a promisory note or

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Speaker 3: whatever it might be. But no one ever, really, I

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Speaker 3: don't think, even in these days, gets paid. The counts

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00:19:29,920 --> 00:19:33,080
Speaker 3: are settled and they're balanced, but I don't know, like,

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Speaker 3: was somebody at one point or another, if you were

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Speaker 3: buying something on credit, delivering the loot or was it

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Speaker 3: just kind of like you now have credit through this creditor,

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Speaker 3: Like it does seem to be if it's not exactly

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Speaker 3: virtual money at this point, it's tending toward that direction

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Speaker 3: because it is a practical problem that needs to be solved.

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Speaker 3: To your point about carting all this gold and specie.

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Speaker 1: Around, also check out our earlier Ridiculous History episode.

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Speaker 2: What do we call it?

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Speaker 1: Weird things that have been used as currency?

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Speaker 2: I think that's right.

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Speaker 1: Peppercorns, coscos, the conks, yes, conk shells. So we do

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Speaker 1: to your point, No, we see a trend, a slow

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Speaker 1: trend toward the idea of money or value over the

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Speaker 1: physical representation thereof, and between nineteen hundred and nineteen forty

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Speaker 1: we see an increase in credit as a form of payment.

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Speaker 1: This is where we see those charge coins, and then

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Speaker 1: something called shoppers plates. So department stores issue these little

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Speaker 1: metal plates, and they've got a customer's specific number, their

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Speaker 1: ID number, and then a little mark a seal again

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Speaker 1: of the merchant.

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Speaker 2: But you can't really take those with you.

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Speaker 1: You can take the charge going with you, but the

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Speaker 1: shopper plate kind of stays at the store.

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Speaker 3: And just to go back to the whole idea of money,

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Speaker 3: orders and traveler checks once again, that is like a

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Speaker 3: way of virtually transmitting payments, and it saves you back

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Speaker 3: to that whole Knight's Templar thing. It ensures the safe

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Speaker 3: passage of those funds and the Knight's templar. It was

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Speaker 3: in a lot of ways about protecting people from being

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Speaker 3: robbed physically. In this case, it's more like, well, you

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Speaker 3: don't even have We'll keep the money here and we'll

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Speaker 3: issue you this piece of paper, this document that is

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Speaker 3: a stand in for the money that you can then

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Speaker 3: pay it on the other side of wherever you're going

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Speaker 3: and then will balance the accounts with them after the facts.

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Speaker 1: Yeah, exactly, and for a little bit of a transaction fee.

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Speaker 1: And if we happen to loan out some of your

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Speaker 1: money to other people for this part of the game, right,

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Speaker 1: well that's fine.

402
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Speaker 2: You'll get what you need and it's time.

403
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Speaker 1: Western Union also introduced what they were calling metal money

404
00:22:06,960 --> 00:22:10,560
Speaker 1: in nineteen fourteen, and this was a kind of kind

405
00:22:10,560 --> 00:22:13,919
Speaker 1: of elite thing, also a plate kind of situation, right exactly,

406
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Speaker 1: as a metal plate. It would give to the customers

407
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Speaker 1: they liked. And then ten years later, it's like nineteen

408
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Speaker 1: twenty four, gas companies start doing this. General Petroleum Corporation

409
00:22:25,280 --> 00:22:28,600
Speaker 1: issues metal cards and you could take this card to

410
00:22:28,680 --> 00:22:33,359
Speaker 1: your gas or your mechanic service, and you can't just

411
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Speaker 1: pay later. And these companies took this idea. This is

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Speaker 1: important because they took the idea of a single store

413
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Speaker 1: credit token and they let you take it to multiple

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Speaker 1: branches of the same business, which is.

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Speaker 3: A big deal because you know, prior, you know, even

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Speaker 3: with like company credit or like a company store script

417
00:22:56,040 --> 00:22:59,040
Speaker 3: or whatever, you can only use it in very specific places.

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Speaker 3: And the idea, yeah, what this is heading towards is

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Speaker 3: a more universal system of credit acceptance. And nowadays, you know,

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Speaker 3: if a place has you know, it's funny, isn't it funny? Ben,

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Speaker 3: Pretty much anywhere we'll take Visa MasterCard, but not everyone

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Speaker 3: will take American Express.

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Speaker 2: You got to check on that one, right, Yeah, part

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Speaker 2: of it.

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Speaker 1: American Express, perhaps due to their age, still has some

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Speaker 1: different rules, right, like higher fees in many cases for

427
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Speaker 1: the business owner. And then additionally the idea which doesn't

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Speaker 1: apply in every case, but the idea that one must

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Speaker 1: pay the entirety of the balance at the conclusion of

430
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Speaker 1: each monthly billion cycle.

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Speaker 4: Yeah, and jump in here real quick, as you know,

432
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Speaker 4: I managed restaurants for a number of years and at

433
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Speaker 4: the end of at the end of a shift of

434
00:23:49,040 --> 00:23:51,040
Speaker 4: every employee of the restaurant order, you print up the

435
00:23:51,160 --> 00:23:53,560
Speaker 4: entire sheet of all the transactions and you would have

436
00:23:53,640 --> 00:23:57,760
Speaker 4: a breakdown. Is cash, demit, credit card AMEX Alex is

437
00:23:57,760 --> 00:23:59,440
Speaker 4: not a separate one. And the reason why is because

438
00:23:59,480 --> 00:24:03,399
Speaker 4: AMES generally passes a lot more of the cost the

439
00:24:03,520 --> 00:24:07,680
Speaker 4: fees onto the vendor and not the consumer. That's why

440
00:24:07,880 --> 00:24:10,840
Speaker 4: Amex generally gives you much better rewards than a lot

441
00:24:10,840 --> 00:24:13,920
Speaker 4: of cards. Another one is that way is Discover and

442
00:24:14,119 --> 00:24:15,680
Speaker 4: the two cards I use for my day to day

443
00:24:15,800 --> 00:24:17,960
Speaker 4: is Amex and Discover for that reason because I get

444
00:24:17,960 --> 00:24:18,720
Speaker 4: great points on them.

445
00:24:19,040 --> 00:24:23,280
Speaker 1: Oh and we should say no credit card company nor

446
00:24:23,440 --> 00:24:28,600
Speaker 1: financial institution reached out to us to ask about this episode. Absolutely,

447
00:24:28,880 --> 00:24:33,800
Speaker 1: so we are being objective here. Those metal plates, those

448
00:24:33,880 --> 00:24:36,600
Speaker 1: precursions of the modern credit card, they were about two

449
00:24:36,600 --> 00:24:38,919
Speaker 1: and a half by one in a fourth inches. They

450
00:24:38,960 --> 00:24:42,680
Speaker 1: add your name as a customer, you're billing address, and

451
00:24:42,840 --> 00:24:45,760
Speaker 1: in department stores like your Macy's and what have you,

452
00:24:46,320 --> 00:24:49,560
Speaker 1: that shopper plate would be kept in the store. You

453
00:24:49,640 --> 00:24:52,080
Speaker 1: would go there, you would tell them who you were,

454
00:24:52,640 --> 00:24:55,240
Speaker 1: and they would make sure you were there by checking

455
00:24:55,320 --> 00:25:00,520
Speaker 1: your plate. It's simpler in some ways to like old

456
00:25:00,640 --> 00:25:05,760
Speaker 1: school beer gardens that might keep a specific stying for

457
00:25:06,040 --> 00:25:07,080
Speaker 1: regular customers.

458
00:25:07,200 --> 00:25:09,520
Speaker 2: Oh fun, Yeah, I never thought about that. Yeah, it

459
00:25:09,600 --> 00:25:10,080
Speaker 2: makes sense.

460
00:25:10,160 --> 00:25:12,440
Speaker 3: And let's you know, yeah that you're that you're a

461
00:25:13,359 --> 00:25:18,120
Speaker 3: It's almost like loyalty programs or something like yeah, sorry,

462
00:25:18,119 --> 00:25:18,320
Speaker 3: as a.

463
00:25:18,320 --> 00:25:23,640
Speaker 1: Loyalty program, like going to Lyndall calder a history professor

464
00:25:23,760 --> 00:25:28,840
Speaker 1: at Augustana College out in Illinois. Different stores like Macy's

465
00:25:28,840 --> 00:25:34,119
Speaker 1: again might also issue brass tokens or paper certificates to

466
00:25:34,240 --> 00:25:37,440
Speaker 1: their their very best customers, and you would walk in,

467
00:25:37,920 --> 00:25:40,480
Speaker 1: you would show the customer the token, you would walk

468
00:25:40,560 --> 00:25:42,960
Speaker 1: out of the store with whatever you want, and it

469
00:25:43,160 --> 00:25:45,399
Speaker 1: was assumed you would pay the thing by the end

470
00:25:45,480 --> 00:25:47,440
Speaker 1: of the month. If you did not, you would have

471
00:25:48,640 --> 00:25:51,960
Speaker 1: other additional fees. You would be in trouble and you

472
00:25:52,000 --> 00:25:53,880
Speaker 1: would be embarrassed at the Macy's.

473
00:25:55,160 --> 00:25:57,280
Speaker 3: Are we kind of been still in boom times here?

474
00:25:57,600 --> 00:26:01,200
Speaker 3: We haven't hit depression times quite yet. Right, We've survived

475
00:26:01,240 --> 00:26:02,920
Speaker 3: depress You've survived depression times.

476
00:26:02,960 --> 00:26:03,760
Speaker 2: We've had it now.

477
00:26:04,400 --> 00:26:08,360
Speaker 3: Credit now is back to being pretty cheap, pretty attainable, right,

478
00:26:09,119 --> 00:26:13,879
Speaker 3: I don't know that we have yet necessarily those kind

479
00:26:13,920 --> 00:26:20,359
Speaker 3: of usurious predatory practices. I'm sure they exist. But you know,

480
00:26:20,440 --> 00:26:23,159
Speaker 3: as long as there have been people slinging credit, we

481
00:26:23,280 --> 00:26:24,840
Speaker 3: have things that we talked about this on, stuff that

482
00:26:24,880 --> 00:26:26,560
Speaker 3: I want you to know too, like these rent to

483
00:26:26,720 --> 00:26:29,960
Speaker 3: own rent to centers, the predatory practice of that once

484
00:26:30,000 --> 00:26:34,120
Speaker 3: again capitalizing on this notion of you too can live

485
00:26:34,200 --> 00:26:37,639
Speaker 3: the American dream, you too can have the sectional sofa

486
00:26:37,920 --> 00:26:40,919
Speaker 3: and the and the color television. But then there's all

487
00:26:40,960 --> 00:26:46,600
Speaker 3: of these hidden interest rates that are absolutely backbreaking.

488
00:26:46,400 --> 00:26:50,080
Speaker 1: Yes, and absolutely on purpose in some ways. In the

489
00:26:50,200 --> 00:26:53,040
Speaker 1: early system, it was kind of like the old practice

490
00:26:53,040 --> 00:26:55,640
Speaker 1: of layaway in your Walmart or your kmart.

491
00:26:55,760 --> 00:26:57,440
Speaker 3: You know, I guess that's what I'm saying, right, It

492
00:26:57,480 --> 00:26:59,960
Speaker 3: doesn't seem like people are as nasty. It seems like

493
00:27:00,119 --> 00:27:04,000
Speaker 3: it is a little more beneficial to the consumer early on.

494
00:27:04,200 --> 00:27:07,680
Speaker 3: It doesn't quite devolve into some of the nasty things

495
00:27:07,720 --> 00:27:09,000
Speaker 3: we know until a little later.

496
00:27:09,359 --> 00:27:12,720
Speaker 1: Yeah, predatory rates were not as normalized at this point.

497
00:27:12,840 --> 00:27:15,639
Speaker 1: I think that's right, school, and maybe maybe people have

498
00:27:15,800 --> 00:27:20,280
Speaker 1: better financial home training, so you would be less likely

499
00:27:20,880 --> 00:27:24,280
Speaker 1: to agree to anything that would charge you twenty five

500
00:27:24,359 --> 00:27:28,119
Speaker 1: percent of a purchase, you know what I mean, Because

501
00:27:28,880 --> 00:27:32,480
Speaker 1: it's terrible stuff. But in nineteen forty six things were

502
00:27:32,560 --> 00:27:37,200
Speaker 1: still often geographically based. This is where we see folks

503
00:27:37,280 --> 00:27:40,920
Speaker 1: like John C. Biggins from Flatbush National Bank in Brooklyn

504
00:27:41,320 --> 00:27:44,240
Speaker 1: create a system called charge it charge.

505
00:27:44,119 --> 00:27:44,840
Speaker 2: Without an E.

506
00:27:45,359 --> 00:27:48,600
Speaker 1: So, you know, what's cool. Apps do the same thing today.

507
00:27:48,680 --> 00:27:50,200
Speaker 2: A Z and there's got to be a spot for

508
00:27:50,280 --> 00:27:52,720
Speaker 2: a Z in there somewhere. Yeah. Yeah.

509
00:27:53,040 --> 00:27:59,760
Speaker 1: And this this card came from the Flatbush National Bank,

510
00:28:00,280 --> 00:28:04,680
Speaker 1: and if you were a Flatbush National Bank customer, you

511
00:28:04,840 --> 00:28:09,560
Speaker 1: could charge purchases directly to the bank in a two

512
00:28:09,840 --> 00:28:10,680
Speaker 1: block radius.

513
00:28:12,320 --> 00:28:16,400
Speaker 2: Wow. So like in the neighborhood. It was great, very localized.

514
00:28:16,440 --> 00:28:17,920
Speaker 2: That's wild, isn't it funny?

515
00:28:17,960 --> 00:28:20,800
Speaker 3: Though, been the way the term the word charge right,

516
00:28:20,880 --> 00:28:23,840
Speaker 3: It used to me and I the merchant charge you

517
00:28:24,160 --> 00:28:26,399
Speaker 3: a price for this thing. But then it kind of

518
00:28:26,440 --> 00:28:30,640
Speaker 3: got flipped where the term charge came to represent more

519
00:28:30,720 --> 00:28:35,040
Speaker 3: of like pay later, charge it charging it must be

520
00:28:35,240 --> 00:28:38,440
Speaker 3: from this, Honestly, the whole expression of charge it, you know,

521
00:28:38,720 --> 00:28:40,920
Speaker 3: musta although if you look at it on paper, it

522
00:28:41,040 --> 00:28:42,040
Speaker 3: really says charget.

523
00:28:42,280 --> 00:28:42,440
Speaker 4: Man.

524
00:28:42,600 --> 00:28:44,280
Speaker 2: Let's just be honest, it says charget.

525
00:28:44,760 --> 00:28:44,960
Speaker 3: Yeah.

526
00:28:44,960 --> 00:28:47,560
Speaker 2: It's American English, which sounds like a god dang it

527
00:28:47,960 --> 00:28:52,400
Speaker 2: gotten target. Big Jungus and everything.

528
00:28:52,120 --> 00:28:55,760
Speaker 1: Changes in nineteen fifty post in a New York minute,

529
00:28:56,160 --> 00:29:00,520
Speaker 1: post World War two American man the diners Club. You know,

530
00:29:00,680 --> 00:29:03,240
Speaker 1: for a lot of us listening today, you may have

531
00:29:03,760 --> 00:29:07,440
Speaker 1: memories of your predecessors having diners Club, or you may

532
00:29:07,680 --> 00:29:08,479
Speaker 1: have still around.

533
00:29:08,800 --> 00:29:12,600
Speaker 3: I think it is I checked very very rarely. Is

534
00:29:12,640 --> 00:29:15,600
Speaker 3: it accepted though, I believe if it's sort of almost

535
00:29:15,680 --> 00:29:16,400
Speaker 3: a running.

536
00:29:16,200 --> 00:29:16,840
Speaker 2: Gag in a way.

537
00:29:16,840 --> 00:29:19,280
Speaker 3: I'm sure they've done things to try to modernize a

538
00:29:19,320 --> 00:29:21,920
Speaker 3: little bit, but it accepts diners Club.

539
00:29:22,000 --> 00:29:23,120
Speaker 2: It's very unique.

540
00:29:23,280 --> 00:29:25,000
Speaker 1: And to finish what I was saying, like the the

541
00:29:25,160 --> 00:29:29,680
Speaker 1: idea is that you might associate with older relatives, or

542
00:29:29,880 --> 00:29:32,880
Speaker 1: you might associate it with sketch comedy, right, because there

543
00:29:32,960 --> 00:29:35,720
Speaker 1: is something humorous at this point. But it turns out

544
00:29:36,080 --> 00:29:41,160
Speaker 1: the diners club concept is really the heart of the

545
00:29:41,280 --> 00:29:42,240
Speaker 1: modern credit card.

546
00:29:42,560 --> 00:29:46,400
Speaker 3: That makes a lot of sense. Ben founded by Frank X.

547
00:29:46,680 --> 00:29:48,320
Speaker 3: I knew we could drop a Zer and X in

548
00:29:48,360 --> 00:29:52,080
Speaker 3: there somewhere McNamara and Ralph Schneider. Diner's Club was the

549
00:29:52,120 --> 00:29:57,520
Speaker 3: first independent car company, soon joined by Bloomingdale's Alfred Bloomingdale

550
00:29:57,560 --> 00:30:00,400
Speaker 3: had a very similar idea, and we also associate even

551
00:30:00,440 --> 00:30:04,480
Speaker 3: to this day credit cards with department stores, the idea

552
00:30:04,520 --> 00:30:08,520
Speaker 3: of having a charge accounts, you know, with Bloemy's. So,

553
00:30:08,760 --> 00:30:12,080
Speaker 3: as the story goes, Frank McNamara, he already was a

554
00:30:12,160 --> 00:30:19,760
Speaker 3: very successful businessman. He had an absolutely horrifically embarrassing experience

555
00:30:19,800 --> 00:30:23,320
Speaker 3: at a restaurant New York called Major's Cabin Grill.

556
00:30:23,760 --> 00:30:25,800
Speaker 2: So it's the Major's Cabin. I got it.

557
00:30:25,840 --> 00:30:29,480
Speaker 3: You're in the Major's cabin. You're being grilled for He

558
00:30:29,560 --> 00:30:33,640
Speaker 3: had a fine meal at Major's Cabin. Then, oh, heaven's

559
00:30:33,680 --> 00:30:37,320
Speaker 3: to Betsy, I've forgotten me wallet. I left it in

560
00:30:37,440 --> 00:30:39,040
Speaker 3: me other pants. I don't know why he's talking like

561
00:30:39,080 --> 00:30:39,920
Speaker 3: a pirate, but he is.

562
00:30:41,280 --> 00:30:45,000
Speaker 1: And luckily, according to the story, and this is from

563
00:30:45,120 --> 00:30:48,760
Speaker 1: the Diner's Club website, his wife came to bail him

564
00:30:48,800 --> 00:30:51,400
Speaker 1: out and pay the tab. He had one other recourse,

565
00:30:52,160 --> 00:30:56,320
Speaker 1: because this was the day wherein you couldn't you know,

566
00:30:56,480 --> 00:30:59,640
Speaker 1: you've seen it before, folks. Somebody might try a card

567
00:31:00,040 --> 00:31:02,000
Speaker 1: of some sort and for one reason or another, it

568
00:31:02,120 --> 00:31:07,040
Speaker 1: doesn't work. They usually have another card. His embarrassment is

569
00:31:07,920 --> 00:31:11,400
Speaker 1: like being herded on the precipice of a cliff, and

570
00:31:11,480 --> 00:31:14,160
Speaker 1: his wife saves him from the chasm. But according to

571
00:31:14,480 --> 00:31:18,720
Speaker 1: the Good Folks Diners Club. This social trauma transformed Frank.

572
00:31:18,800 --> 00:31:21,200
Speaker 2: They say. A year later, in February of.

573
00:31:21,280 --> 00:31:24,760
Speaker 1: Nineteen fifty, he returned to Major's Cabin Grill with his

574
00:31:24,880 --> 00:31:28,960
Speaker 1: partner Ralph Schneider. When the bill arrived, McNamara paid with

575
00:31:29,080 --> 00:31:33,400
Speaker 1: a small cardboard card known today as a Diner's Club card.

576
00:31:33,760 --> 00:31:37,640
Speaker 1: This event was hailed as the first Supper, paving the

577
00:31:37,760 --> 00:31:41,200
Speaker 1: way for the world's first multipurpose charge card.

578
00:31:41,280 --> 00:31:44,200
Speaker 3: Not to be confused with the Last Supper, but equally

579
00:31:44,280 --> 00:31:45,680
Speaker 3: as historically profound.

580
00:31:46,040 --> 00:31:48,920
Speaker 1: Everybody's eaten. We've got a little vintage picture of the

581
00:31:49,160 --> 00:31:51,719
Speaker 1: Major's cabin grill. By the way, there were a steakhouse.

582
00:31:51,960 --> 00:31:53,680
Speaker 2: Oh you know, they were dropping some steaks.

583
00:31:54,040 --> 00:31:56,800
Speaker 1: I saw this, I saw another, so I got a

584
00:31:56,840 --> 00:31:59,800
Speaker 1: little deep in this one. Apparently there is a different

585
00:32:00,080 --> 00:32:04,280
Speaker 1: narrative from locals and contemporaries of the neighborhood, and the

586
00:32:04,440 --> 00:32:08,920
Speaker 1: story is that mc namara may have kind of created

587
00:32:09,000 --> 00:32:11,800
Speaker 1: his own myth because he was already friends with the

588
00:32:11,960 --> 00:32:14,200
Speaker 1: dude Major, the restauranteur.

589
00:32:14,280 --> 00:32:16,800
Speaker 2: Who oh, Major's cabin grill. You think he could have

590
00:32:16,840 --> 00:32:19,040
Speaker 2: given him a pass and not made a big scene.

591
00:32:19,160 --> 00:32:23,520
Speaker 3: He just created this scene as an apocryphal sort of story, right.

592
00:32:23,840 --> 00:32:27,760
Speaker 1: Even weirder, it sounds like it sounds like Majors and

593
00:32:28,400 --> 00:32:31,120
Speaker 1: his buddy mc namara, where they were just pals, such

594
00:32:31,240 --> 00:32:34,680
Speaker 1: that Majors was the only restaurant in town who would

595
00:32:35,760 --> 00:32:41,120
Speaker 1: be the pilot, the pilot program for this dynasye because

596
00:32:41,120 --> 00:32:42,720
Speaker 1: then it could be like, oh, it could be great

597
00:32:42,760 --> 00:32:45,480
Speaker 1: for my restaurant too. And later they made up the

598
00:32:45,600 --> 00:32:46,920
Speaker 1: forgotten wallet story.

599
00:32:47,320 --> 00:32:49,200
Speaker 3: That's what I'm saying, though. Man, if they were pals,

600
00:32:49,720 --> 00:32:51,520
Speaker 3: he would have let him go fetch his wallets.

601
00:32:52,520 --> 00:32:55,200
Speaker 2: He would have given him come back tomorrow. I mean,

602
00:32:55,240 --> 00:32:56,080
Speaker 2: and io you was.

603
00:32:56,120 --> 00:32:59,520
Speaker 3: Absolutely a thing, you know, because the credit card didn't exist.

604
00:33:00,120 --> 00:33:02,560
Speaker 2: Oh heavens, what a story. So what are you see up?

605
00:33:02,840 --> 00:33:05,000
Speaker 2: Do you? What do you think the Is there a

606
00:33:05,120 --> 00:33:07,080
Speaker 2: myth here or is it totally there?

607
00:33:07,200 --> 00:33:12,560
Speaker 3: Always is Most of these about us on these legacy companies,

608
00:33:12,840 --> 00:33:16,120
Speaker 3: they all feel kind of fifty may I'm not going

609
00:33:16,160 --> 00:33:22,440
Speaker 3: to say fifty percent, twenty percent bullshnitt, thirty percent maybe yeah, yeah.

610
00:33:22,840 --> 00:33:26,000
Speaker 1: And so a lot of other credit card companies tried

611
00:33:26,120 --> 00:33:29,080
Speaker 1: to do the same thing, and just like the early

612
00:33:29,200 --> 00:33:31,840
Speaker 1: days of Soda Pop, a lot of these other companies

613
00:33:31,920 --> 00:33:36,800
Speaker 1: failed diners Club was successful explosively, so they started with

614
00:33:37,240 --> 00:33:42,000
Speaker 1: two hundred people and just fourteen restaurants in the entirety

615
00:33:42,040 --> 00:33:45,000
Speaker 1: of New York, and by one year that number had

616
00:33:45,920 --> 00:33:47,000
Speaker 1: drastically changed.

617
00:33:47,400 --> 00:33:53,120
Speaker 3: Forty two thousand card holders with around five hundred half

618
00:33:53,160 --> 00:33:58,520
Speaker 3: a million dollars in transactions, three hundred and thirty businesses

619
00:33:59,040 --> 00:34:03,320
Speaker 3: agreeing to accept this within a single month. Five years

620
00:34:03,360 --> 00:34:09,799
Speaker 3: into this whole scheme, approaching half a million members, three

621
00:34:09,880 --> 00:34:10,880
Speaker 3: hundred thousand members.

622
00:34:11,520 --> 00:34:15,359
Speaker 1: Quick inflation calculator. Those great numbers store aboo beep five

623
00:34:15,440 --> 00:34:19,520
Speaker 1: hundred thousand dollars per month in nineteen fifty one. Is

624
00:34:20,400 --> 00:34:25,640
Speaker 1: a dude a boo beat about six million, twenty nine

625
00:34:25,760 --> 00:34:29,120
Speaker 1: thou seven hundred and sixty nine dollars and twenty three

626
00:34:29,280 --> 00:34:31,160
Speaker 1: cents per month.

627
00:34:31,960 --> 00:34:35,160
Speaker 3: Sounds like he's rocking and a rolling into what we

628
00:34:35,280 --> 00:34:40,240
Speaker 3: might consider the modern day of credit and credit card companies,

629
00:34:41,800 --> 00:34:46,000
Speaker 3: because he you know this, this is like absolutely a smash,

630
00:34:46,560 --> 00:34:49,320
Speaker 3: and when that happens, you start seeing people looking at it.

631
00:34:49,400 --> 00:34:52,000
Speaker 3: How can we improve upon this? How can we add

632
00:34:52,239 --> 00:34:56,360
Speaker 3: features that benefit us, the card issuers, while also selling

633
00:34:56,400 --> 00:34:59,480
Speaker 3: it as features that benefit the card holders.

634
00:35:00,160 --> 00:35:01,640
Speaker 2: Somewhere in the middle is the truth.

635
00:35:01,680 --> 00:35:03,760
Speaker 3: Because you know, again, with all these points and stuff,

636
00:35:04,160 --> 00:35:06,360
Speaker 3: you got to kind of do your homework. Just because

637
00:35:06,400 --> 00:35:08,719
Speaker 3: the thing offers you points, you got to balance it

638
00:35:08,800 --> 00:35:11,560
Speaker 3: with what the annual fee might be, with how much

639
00:35:11,640 --> 00:35:13,840
Speaker 3: you have to spend to get the points. Are the

640
00:35:13,880 --> 00:35:16,600
Speaker 3: points actually of value or is it just kind of

641
00:35:16,640 --> 00:35:17,279
Speaker 3: pixie dust?

642
00:35:17,440 --> 00:35:20,400
Speaker 1: You know? Right? And this thing to be clear, the

643
00:35:20,480 --> 00:35:23,000
Speaker 1: Diners Club was kind of more of a charge card

644
00:35:23,080 --> 00:35:24,920
Speaker 1: at this point. They would let you get away with

645
00:35:25,040 --> 00:35:26,480
Speaker 1: it for a little bit, but you had to pay

646
00:35:26,719 --> 00:35:29,440
Speaker 1: everything off at the end of the month. You couldn't

647
00:35:29,560 --> 00:35:32,920
Speaker 1: carry the revolving balance, which is the real difference between

648
00:35:33,040 --> 00:35:35,359
Speaker 1: oh yeah, a modern credit card and a charge card.

649
00:35:35,520 --> 00:35:38,080
Speaker 3: That is kind of where the nastiness comes in is

650
00:35:38,160 --> 00:35:41,080
Speaker 3: with revolving credit and not to say there can't be

651
00:35:41,400 --> 00:35:44,239
Speaker 3: you know, I mean, I think most all modern credit cards,

652
00:35:44,320 --> 00:35:46,440
Speaker 3: well no, not all. In fact, it's odd. It's more

653
00:35:46,520 --> 00:35:49,160
Speaker 3: unusual for them not to be so the majority are revolving.

654
00:35:49,280 --> 00:35:51,680
Speaker 3: But you got to be really careful and know how

655
00:35:51,760 --> 00:35:54,719
Speaker 3: to calculate that. APR. We'll talk about that again. Hey,

656
00:35:54,840 --> 00:35:56,680
Speaker 3: it's kind of cool to have a ridiculous history episode

657
00:35:56,719 --> 00:36:00,560
Speaker 3: that also offers a little bit of meager financial advice,

658
00:36:00,640 --> 00:36:03,080
Speaker 3: because this is not stuff that's taught in schools, and

659
00:36:03,120 --> 00:36:05,319
Speaker 3: we always talk about how that's kind of jacked up

660
00:36:05,680 --> 00:36:08,239
Speaker 3: that there's not Maybe there are today, But when I

661
00:36:08,360 --> 00:36:10,880
Speaker 3: came up, they didn't talk about APR with us.

662
00:36:10,920 --> 00:36:12,880
Speaker 2: They didn't talk about how to get a good mortgage

663
00:36:12,960 --> 00:36:15,719
Speaker 2: rate or what that even entailed, or I have check

664
00:36:15,840 --> 00:36:19,319
Speaker 2: back in and say, hey, can you lower this exactly? Yeah,

665
00:36:19,400 --> 00:36:26,480
Speaker 2: you got to ask. And I will always fondly remember.

666
00:36:27,520 --> 00:36:30,560
Speaker 1: When I paid off credit card debt, because like a

667
00:36:30,600 --> 00:36:32,520
Speaker 1: lot of people, I had some credit card debt for

668
00:36:32,520 --> 00:36:34,560
Speaker 1: a little bit, and when I was paying it off

669
00:36:34,640 --> 00:36:39,719
Speaker 1: in full, I became an absolute revenge oriented monster. I

670
00:36:39,880 --> 00:36:44,120
Speaker 1: practiced something called malicious compliance. So I buy something that

671
00:36:44,360 --> 00:36:47,000
Speaker 1: was like five dollars, and then I would pay the

672
00:36:47,080 --> 00:36:52,200
Speaker 1: credit card company ten dollars immediately, and then I would

673
00:36:52,280 --> 00:36:55,000
Speaker 1: just never touch the card because eventually, at some point

674
00:36:55,440 --> 00:36:58,600
Speaker 1: they would send me a check for five dollars for

675
00:36:59,239 --> 00:37:02,279
Speaker 1: something like, yeah, five or four dollars, and I just

676
00:37:02,520 --> 00:37:07,759
Speaker 1: wanted to nickel and dime them on postage because I

677
00:37:08,040 --> 00:37:09,200
Speaker 1: took it absolutely.

678
00:37:09,239 --> 00:37:11,719
Speaker 2: I took it personally. Man, No, I get it.

679
00:37:12,360 --> 00:37:15,120
Speaker 3: But again, you know, there's a lot of positive stuff

680
00:37:15,160 --> 00:37:18,239
Speaker 3: to be said about a credit card system if you

681
00:37:18,440 --> 00:37:20,880
Speaker 3: use it correctly. And I think we've all been in

682
00:37:21,680 --> 00:37:23,799
Speaker 3: periods of our lives where maybe we were carrying more

683
00:37:23,840 --> 00:37:25,720
Speaker 3: a deva debt than we would like, or a balance

684
00:37:25,719 --> 00:37:27,640
Speaker 3: that we would like. So if you're anyone's out there

685
00:37:27,680 --> 00:37:31,840
Speaker 3: and they have that, or you have a really desperate situation,

686
00:37:32,239 --> 00:37:34,560
Speaker 3: there are resources out there for that too. You can

687
00:37:34,680 --> 00:37:39,120
Speaker 3: consolidate these things onto lower interest cards as long as

688
00:37:39,200 --> 00:37:42,080
Speaker 3: your credit rating isn't shot, which sometimes that comes with it.

689
00:37:42,200 --> 00:37:44,840
Speaker 3: You carry these balances and you don't pay, it really

690
00:37:44,920 --> 00:37:48,080
Speaker 3: tanks your credit. Honestly, the credit rating system might be

691
00:37:48,120 --> 00:37:50,680
Speaker 3: an episode undo itself. The history of that and the

692
00:37:50,800 --> 00:37:53,680
Speaker 3: different agencies. Yes, it's a very you know, but I

693
00:37:53,719 --> 00:37:58,520
Speaker 3: do recommend getting a free credit Karma account through buying

694
00:37:58,560 --> 00:37:58,919
Speaker 3: a car.

695
00:37:59,400 --> 00:38:02,879
Speaker 2: I did really that. It's not exactly perfect, but it's

696
00:38:03,000 --> 00:38:03,560
Speaker 2: real close.

697
00:38:03,680 --> 00:38:06,960
Speaker 3: It's close enough to know roughly where your credit score is,

698
00:38:07,760 --> 00:38:11,719
Speaker 3: and based on what the salesperson told me, it was

699
00:38:11,800 --> 00:38:15,320
Speaker 3: real close. And it doesn't put a hard hit on

700
00:38:15,480 --> 00:38:18,440
Speaker 3: your credit score every time you check your score, whereas

701
00:38:18,480 --> 00:38:20,279
Speaker 3: if you apply for a new credit card is something

702
00:38:20,320 --> 00:38:23,880
Speaker 3: called a hard inquiry that actually can lower your score

703
00:38:24,239 --> 00:38:26,600
Speaker 3: and those stay on your account for a handful of

704
00:38:26,680 --> 00:38:28,880
Speaker 3: years before they drop off, But checking your score with

705
00:38:28,960 --> 00:38:30,040
Speaker 3: credit Karma doesn't do that.

706
00:38:30,400 --> 00:38:33,880
Speaker 1: And we'll tell you also, folks about the internal system

707
00:38:34,160 --> 00:38:37,839
Speaker 1: that financial institutions use, which is sometimes referred to as

708
00:38:37,960 --> 00:38:41,560
Speaker 1: the real credit score, not the consumer facing one.

709
00:38:41,920 --> 00:38:42,120
Speaker 4: Yeah.

710
00:38:42,239 --> 00:38:44,120
Speaker 2: Yeah, I think it's a beautiful idea. Let's get on

711
00:38:44,239 --> 00:38:44,720
Speaker 2: the docket.

712
00:38:51,400 --> 00:38:56,000
Speaker 1: Well, let's also note the Franklin National Bank put out

713
00:38:56,080 --> 00:38:59,759
Speaker 1: something in nineteen fifty two, a card that's sometimes called

714
00:38:59,800 --> 00:39:03,359
Speaker 1: the first true credit card because that's the one where

715
00:39:03,400 --> 00:39:06,680
Speaker 1: you could buy now you could keep a revolving balance

716
00:39:06,880 --> 00:39:10,480
Speaker 1: and just pay with interest. They're the ones who figured

717
00:39:10,480 --> 00:39:14,200
Speaker 1: out that if we get people to make a minimum payment,

718
00:39:14,719 --> 00:39:17,640
Speaker 1: then we will keep making money off of them at

719
00:39:17,760 --> 00:39:22,239
Speaker 1: least twelve times a year or actually compound interest, so

720
00:39:22,320 --> 00:39:23,480
Speaker 1: they're making way more than that.

721
00:39:24,200 --> 00:39:26,440
Speaker 3: Well, I mean, what the modern credit card system sort

722
00:39:26,480 --> 00:39:29,360
Speaker 3: of became. It's just a much simpler route to a

723
00:39:29,520 --> 00:39:33,000
Speaker 3: loan that you always have a revolving.

724
00:39:32,600 --> 00:39:33,360
Speaker 2: Loan, you know.

725
00:39:33,520 --> 00:39:36,719
Speaker 3: I mean, we've we've known about loans as far back

726
00:39:36,800 --> 00:39:40,160
Speaker 3: as this Again, there was money, and that was something

727
00:39:40,200 --> 00:39:44,480
Speaker 3: you had to organize with an individual or an organization

728
00:39:44,680 --> 00:39:46,480
Speaker 3: or a bank or whatever. A credit card is a

729
00:39:46,600 --> 00:39:50,080
Speaker 3: one time thumbs up that gives you an amount that

730
00:39:50,239 --> 00:39:53,440
Speaker 3: you can you can't over you know, overcharge past that amount,

731
00:39:53,640 --> 00:39:55,239
Speaker 3: and as long as you're paying it back, you've got

732
00:39:55,320 --> 00:39:59,120
Speaker 3: this revolving line of credit that is essentially a running loan, right,

733
00:40:00,440 --> 00:40:01,440
Speaker 3: a running loan that.

734
00:40:01,719 --> 00:40:06,560
Speaker 1: Is advantageous to the person's supply in the initial capital.

735
00:40:06,880 --> 00:40:10,880
Speaker 1: And this is why a lot of Americans were skeptical

736
00:40:11,239 --> 00:40:16,600
Speaker 1: about this new and I dare say ridiculously American invention. Again,

737
00:40:16,719 --> 00:40:20,120
Speaker 1: let's not forget this is the country that tried cocaine

738
00:40:20,160 --> 00:40:21,080
Speaker 1: and said needs a.

739
00:40:21,080 --> 00:40:24,400
Speaker 2: Little more pep. So they did.

740
00:40:24,440 --> 00:40:27,439
Speaker 1: They weren't familiar with the concept of loans, and they said,

741
00:40:27,560 --> 00:40:31,759
Speaker 1: now let's make it spicy. So Time magazine talked about

742
00:40:31,800 --> 00:40:34,120
Speaker 1: this at length. They had an article in nineteen fifty

743
00:40:34,160 --> 00:40:37,799
Speaker 1: eight where they said the following credit, which was once

744
00:40:37,960 --> 00:40:41,080
Speaker 1: the sign that a person had troubled meeting his bills,

745
00:40:41,239 --> 00:40:44,720
Speaker 1: has taken on a glamorous new meaning in recent years.

746
00:40:45,280 --> 00:40:48,080
Speaker 1: Now a man with a credit card can rent a

747
00:40:48,200 --> 00:40:51,600
Speaker 1: plane or boat or car, live it up in nightclubs,

748
00:40:51,680 --> 00:40:54,719
Speaker 1: take a safari to Africa, and even get to Kelly

749
00:40:54,840 --> 00:40:59,080
Speaker 1: Girl for temporary office help why because of the credit

750
00:40:59,239 --> 00:40:59,960
Speaker 1: card game.

751
00:41:00,480 --> 00:41:06,399
Speaker 2: But isn't that describing living above one's means? Like, that's

752
00:41:06,480 --> 00:41:07,040
Speaker 2: what that is.

753
00:41:07,440 --> 00:41:11,319
Speaker 3: It's like selling that BS American dream that is all

754
00:41:11,960 --> 00:41:14,200
Speaker 3: based in gross capitalism.

755
00:41:14,560 --> 00:41:16,759
Speaker 2: You too, What the heck is a Kelly girl? Is

756
00:41:16,800 --> 00:41:19,600
Speaker 2: that like a girl Friday? It's like you're freaking like

757
00:41:19,719 --> 00:41:22,160
Speaker 2: a like a like an office assistant.

758
00:41:22,440 --> 00:41:25,600
Speaker 1: So in nineteen forty six, this was a hot new thing.

759
00:41:25,800 --> 00:41:28,920
Speaker 1: It was an agency perhaps it was like, yeah, it

760
00:41:29,040 --> 00:41:32,000
Speaker 1: was founded by William Russell Kelly, and you could hire

761
00:41:32,160 --> 00:41:37,200
Speaker 1: temporary workers to do office admin got it, secretarial where

762
00:41:37,239 --> 00:41:41,480
Speaker 1: we might now use a task rabbit for right, Right,

763
00:41:42,200 --> 00:41:45,319
Speaker 1: Because they started calling them Kelly girls because the vast

764
00:41:45,360 --> 00:41:50,840
Speaker 1: majority of the temporary workers were female, and because because

765
00:41:51,000 --> 00:41:54,440
Speaker 1: Kelly was a big company, they would accept credit cards.

766
00:41:54,600 --> 00:41:58,040
Speaker 3: I wonder if that's where Peggy Olsen originally came from

767
00:41:58,200 --> 00:42:01,800
Speaker 3: in the Mad Men series. It was a temp originally

768
00:42:02,200 --> 00:42:04,080
Speaker 3: like a typist, and then she, of course, you know,

769
00:42:04,280 --> 00:42:08,320
Speaker 3: graduated up the ranks and became a marketer or a seller.

770
00:42:08,600 --> 00:42:10,160
Speaker 2: But that makes sense, yeah, And they.

771
00:42:10,120 --> 00:42:12,799
Speaker 3: Would have been the lowest of the low in terms

772
00:42:12,840 --> 00:42:14,279
Speaker 3: of the office hierarchy.

773
00:42:14,520 --> 00:42:14,640
Speaker 1: Right.

774
00:42:15,600 --> 00:42:16,399
Speaker 2: It was a rough one.

775
00:42:16,600 --> 00:42:19,720
Speaker 1: You know, we've seen how temporary workers get treated sometimes

776
00:42:19,760 --> 00:42:23,200
Speaker 1: because not the best and once the idea of credit

777
00:42:23,280 --> 00:42:28,760
Speaker 1: cards was out there, the competition, of course begins. American Express.

778
00:42:29,160 --> 00:42:32,359
Speaker 1: They're already known for their travelers checks. It was even

779
00:42:32,680 --> 00:42:36,200
Speaker 1: within our lifetimes. It was even a pro travel tip

780
00:42:36,719 --> 00:42:40,440
Speaker 1: to get some MX travelers or cashier's checks because they

781
00:42:40,480 --> 00:42:41,759
Speaker 1: couldn't be used.

782
00:42:41,600 --> 00:42:44,440
Speaker 2: By people who might rob you.

783
00:42:45,360 --> 00:42:49,239
Speaker 1: So anyway, American Express starts their credit card program in

784
00:42:49,320 --> 00:42:53,560
Speaker 1: nineteen fifty eight, the Hilton hotel chain says, all right,

785
00:42:53,640 --> 00:42:56,560
Speaker 1: we've already got a loyalty card, we'll make it a

786
00:42:56,640 --> 00:42:59,239
Speaker 1: credit card as well. That same year, in fifty eight,

787
00:42:59,400 --> 00:43:03,840
Speaker 1: Bank of amer America, which later became Visa, they tested

788
00:43:03,920 --> 00:43:07,680
Speaker 1: out something they called they test out credit cards by

789
00:43:07,760 --> 00:43:11,680
Speaker 1: doing their own weirdly militaresque campaign. They called it the

790
00:43:11,840 --> 00:43:17,200
Speaker 1: Fresno Drop. So they mailed sixty thousand Bank America cards

791
00:43:17,320 --> 00:43:22,960
Speaker 1: credit cards to people in Fresno, California. And this was

792
00:43:23,360 --> 00:43:25,960
Speaker 1: not perfect, to be honest. There was a lot of

793
00:43:26,040 --> 00:43:29,239
Speaker 1: fraud because people felt like they were getting free money.

794
00:43:29,480 --> 00:43:32,400
Speaker 1: But it was still successful enough that Bank of America

795
00:43:32,760 --> 00:43:35,840
Speaker 1: said we're going to expand this program. We're going to

796
00:43:35,880 --> 00:43:39,160
Speaker 1: do a Fresno drop across the world and now boom,

797
00:43:39,239 --> 00:43:42,399
Speaker 1: boom boom, we have visa and odds are a lot

798
00:43:42,440 --> 00:43:45,280
Speaker 1: of people listening to the show today have a visa

799
00:43:45,440 --> 00:43:48,960
Speaker 1: card or account somewhere attached to their identity.

800
00:43:49,400 --> 00:43:51,360
Speaker 3: Yeah, maybe we could talk a little bit about that,

801
00:43:51,640 --> 00:43:54,600
Speaker 3: But I mean, what makes visa so pervasive?

802
00:43:55,880 --> 00:43:57,520
Speaker 2: Do you have any insight into that bend.

803
00:43:58,040 --> 00:44:00,480
Speaker 3: Might be outside of the scope of this conversation. That

804
00:44:00,600 --> 00:44:03,480
Speaker 3: one seems to be the catch all, the biggest one,

805
00:44:03,640 --> 00:44:06,040
Speaker 3: the one that is accepted everywhere.

806
00:44:06,480 --> 00:44:09,640
Speaker 1: Well, I guess part of it is it's slightly more

807
00:44:10,520 --> 00:44:14,600
Speaker 1: skewed toward debit cards, right as well, Like a visa

808
00:44:14,840 --> 00:44:17,200
Speaker 1: is a debit cards, So already have people in the

809
00:44:17,320 --> 00:44:19,600
Speaker 1: door with a bank account that's a baby going down

810
00:44:19,719 --> 00:44:22,320
Speaker 1: or a checking the account so they can get what

811
00:44:22,480 --> 00:44:26,319
Speaker 1: they feels an advantageous rate on a credit card like MasterCard,

812
00:44:26,560 --> 00:44:31,560
Speaker 1: for instance, is much more associated with credit cards. And

813
00:44:31,680 --> 00:44:33,720
Speaker 1: it also says here I just did a quick search

814
00:44:34,480 --> 00:44:37,080
Speaker 1: that they have the lowest fees in terms of that.

815
00:44:37,160 --> 00:44:38,279
Speaker 1: That's really what it comes down to.

816
00:44:38,920 --> 00:44:42,120
Speaker 3: American Express can charge two point five to three percent

817
00:44:42,200 --> 00:44:46,000
Speaker 3: and merchant costs, whereas Visa and MasterCard just charge way

818
00:44:46,080 --> 00:44:46,480
Speaker 3: less than that.

819
00:44:47,000 --> 00:44:47,320
Speaker 2: Okay.

820
00:44:47,640 --> 00:44:51,320
Speaker 1: Yeah, and we're talking at this point about a trillion

821
00:44:51,440 --> 00:44:52,520
Speaker 1: dollar industry.

822
00:44:53,040 --> 00:44:56,239
Speaker 2: It is nuts. It might not even be real money.

823
00:44:56,520 --> 00:45:00,520
Speaker 2: But nobody blow on the house of cards too hard

824
00:45:00,760 --> 00:45:06,719
Speaker 2: or it'll all topple. Yes, that is a drug ball

825
00:45:06,760 --> 00:45:07,239
Speaker 2: thinko mix.

826
00:45:07,760 --> 00:45:12,359
Speaker 1: So there's this other thing that happens, a feedback loop.

827
00:45:12,440 --> 00:45:16,960
Speaker 1: Right as credit card companies grow, more and more merchants.

828
00:45:16,719 --> 00:45:19,720
Speaker 2: Want to be riding the wave. They accept these things.

829
00:45:19,840 --> 00:45:22,200
Speaker 1: They don't want to just be cash only because now

830
00:45:22,360 --> 00:45:26,560
Speaker 1: they're losing customers. It's like Apple pay today, you know

831
00:45:26,640 --> 00:45:29,320
Speaker 1: what I mean, Like more and more places take Apple

832
00:45:29,440 --> 00:45:33,080
Speaker 1: Pay because more and more people have iPhones. You meet

833
00:45:33,320 --> 00:45:36,479
Speaker 1: folks where they are and that's where you take their money.

834
00:45:36,840 --> 00:45:39,080
Speaker 3: Yeah, and it's just so convenient. People are just whipping

835
00:45:39,080 --> 00:45:41,759
Speaker 3: out the phones to do a tap pay. If you're

836
00:45:41,800 --> 00:45:44,440
Speaker 3: not able to accept that, you're losing out on sales,

837
00:45:44,760 --> 00:45:47,440
Speaker 3: you know, it's just as simple as that. Also, more

838
00:45:47,480 --> 00:45:50,640
Speaker 3: and more people and vendors online are taking things like

839
00:45:50,800 --> 00:45:54,080
Speaker 3: Venmo and cash app, and I think there's probably going

840
00:45:54,160 --> 00:45:57,160
Speaker 3: to become there's going to come something of a reckoning

841
00:45:57,560 --> 00:46:01,440
Speaker 3: with all of this stuff. Right where Venmo, you know

842
00:46:01,520 --> 00:46:06,120
Speaker 3: you're transferring money without paying any fees. At what point

843
00:46:06,760 --> 00:46:08,960
Speaker 3: is the government going to be like, that's not how

844
00:46:09,040 --> 00:46:11,200
Speaker 3: this works. You can't keep doing that. It feels like

845
00:46:11,280 --> 00:46:13,680
Speaker 3: we've been on the edge of this wild west of

846
00:46:13,880 --> 00:46:16,799
Speaker 3: payment the payment wars for quite a while.

847
00:46:16,920 --> 00:46:17,080
Speaker 2: Now.

848
00:46:17,480 --> 00:46:21,640
Speaker 1: Yeah, and above a certain amount for a single transfer,

849
00:46:22,160 --> 00:46:23,280
Speaker 1: the taxman comes.

850
00:46:24,120 --> 00:46:24,520
Speaker 2: That's right.

851
00:46:24,600 --> 00:46:27,719
Speaker 3: And I'm wondering when that happens, because I just transferred

852
00:46:27,760 --> 00:46:33,200
Speaker 3: somebody via Venmo a substantial amount of money for my

853
00:46:33,320 --> 00:46:37,680
Speaker 3: part of a vacation rental home and there were no

854
00:46:37,800 --> 00:46:41,480
Speaker 3: fees charged that were visible. It was just my my

855
00:46:41,560 --> 00:46:44,399
Speaker 3: amount that I put in in on my end out

856
00:46:44,480 --> 00:46:46,879
Speaker 3: the same amount on the other end. So you gotta wonder,

857
00:46:47,280 --> 00:46:49,160
Speaker 3: at what point is the taxman going to come?

858
00:46:49,600 --> 00:46:56,439
Speaker 2: You know, knocking guys are going to space Jesus. So, yeah,

859
00:46:57,000 --> 00:46:57,839
Speaker 2: it is a good question.

860
00:46:57,920 --> 00:47:02,040
Speaker 1: We know the legislation will inevitably be reactive towards the

861
00:47:03,280 --> 00:47:07,040
Speaker 1: technological innovation. That's something that keeps happening still, right, which

862
00:47:07,120 --> 00:47:11,759
Speaker 1: might in some way explain predatory usurious credit card rates.

863
00:47:12,239 --> 00:47:16,640
Speaker 1: We did promise that we would talked about the magnetic stripe.

864
00:47:17,000 --> 00:47:20,279
Speaker 1: So nineteen fifty nine, right until nineteen fifty nine, a

865
00:47:20,320 --> 00:47:23,880
Speaker 1: lot of these cards are paper right or their actual metal.

866
00:47:24,160 --> 00:47:30,320
Speaker 1: American Express introduces the plastic charge card. Diners Club follows

867
00:47:30,440 --> 00:47:33,719
Speaker 1: up a few years later in sixty one, and in

868
00:47:33,840 --> 00:47:38,800
Speaker 1: the nineteen sixties, IBM develops the magnetic stripe. Our stuff

869
00:47:38,840 --> 00:47:42,239
Speaker 1: A genius how stuff works is coming out here. The

870
00:47:42,360 --> 00:47:46,840
Speaker 1: story is like this, So designers knew magnetic tape. They

871
00:47:46,880 --> 00:47:50,160
Speaker 1: were all very hot about computers at IBM. What no way.

872
00:47:50,560 --> 00:47:54,560
Speaker 1: They knew that magnetic tape could be a great information

873
00:47:55,400 --> 00:47:59,120
Speaker 1: medium or conveyor of info. But they couldn't figure out

874
00:47:59,400 --> 00:48:03,719
Speaker 1: how to KEYP bit on the friggin card. They were baffled.

875
00:48:03,880 --> 00:48:07,360
Speaker 1: And then, speaking of women not getting a lot of credit,

876
00:48:07,800 --> 00:48:11,360
Speaker 1: an engineer's wife at IBM, uh said.

877
00:48:11,719 --> 00:48:14,840
Speaker 2: Why don't you just try to iron it on the card?

878
00:48:15,640 --> 00:48:16,560
Speaker 2: And they did.

879
00:48:16,680 --> 00:48:19,799
Speaker 1: They literally ironed the stripe onto a card.

880
00:48:20,160 --> 00:48:23,800
Speaker 2: No way, Yeah, the iron like for shirts. Yeah. And

881
00:48:24,200 --> 00:48:24,600
Speaker 2: that's the.

882
00:48:25,239 --> 00:48:29,120
Speaker 1: Story and this function for a long long time. A

883
00:48:29,160 --> 00:48:33,600
Speaker 1: lot of us listening tonight still have credit cards with stripes, right,

884
00:48:33,960 --> 00:48:36,480
Speaker 1: But more and more, I would say chips. People are

885
00:48:36,600 --> 00:48:37,600
Speaker 1: moving toward chips.

886
00:48:37,880 --> 00:48:41,080
Speaker 2: Yeah, you know what I found though, The chips wear

887
00:48:41,160 --> 00:48:46,120
Speaker 2: out way faster, faster. Yeah, I don't know about you.

888
00:48:46,200 --> 00:48:48,319
Speaker 1: I have to do that thing where it's like third

889
00:48:48,400 --> 00:48:51,040
Speaker 1: times the charm, try the chip several times, and you

890
00:48:51,160 --> 00:48:51,840
Speaker 1: have to swipe.

891
00:48:52,320 --> 00:48:54,120
Speaker 2: Yeah, it's weird. There's some you know, it's sort of

892
00:48:54,160 --> 00:48:54,600
Speaker 2: a mystery.

893
00:48:54,640 --> 00:48:56,360
Speaker 3: But it's like you got to try the chip a

894
00:48:56,440 --> 00:48:59,239
Speaker 3: certain number of times before it will allow you to

895
00:48:59,480 --> 00:49:04,560
Speaker 3: swipe as a secondary attempt. And it's all in the programming. Yeah,

896
00:49:04,680 --> 00:49:06,560
Speaker 3: I'm sure, I'm sure, but I think it's different. It

897
00:49:06,600 --> 00:49:09,320
Speaker 3: probably varies depending on the point of sale, you know.

898
00:49:09,400 --> 00:49:12,320
Speaker 4: Yeah, I've had a number of like, you know, gas stations,

899
00:49:12,440 --> 00:49:15,840
Speaker 4: and I remember my first chip card. The chip like

900
00:49:16,000 --> 00:49:18,600
Speaker 4: died so quickly, and it was like this gas if

901
00:49:18,640 --> 00:49:20,080
Speaker 4: I went to all the time and I put in

902
00:49:20,160 --> 00:49:22,120
Speaker 4: one time and the guy's like, uh huh, all right,

903
00:49:22,160 --> 00:49:22,800
Speaker 4: second time.

904
00:49:22,719 --> 00:49:24,120
Speaker 2: Third time, all right, and then swipe.

905
00:49:24,560 --> 00:49:27,839
Speaker 1: And then also you've got to check for the fraud, right,

906
00:49:28,080 --> 00:49:30,719
Speaker 1: just very quickly. You need to check whenever you're going

907
00:49:30,800 --> 00:49:33,439
Speaker 1: to swipe something, especially at a gas station, any point

908
00:49:33,480 --> 00:49:36,600
Speaker 1: of sale like that, even the chip. Now, what you

909
00:49:36,680 --> 00:49:39,200
Speaker 1: need to do is take your hand. Make sure to

910
00:49:39,239 --> 00:49:41,279
Speaker 1: clean your hands later, but take your hand and give

911
00:49:41,360 --> 00:49:44,800
Speaker 1: that little bad boy a jing jiggle because if it

912
00:49:44,880 --> 00:49:47,280
Speaker 1: jiggles too much. It might be a skimmer.

913
00:49:47,760 --> 00:49:49,160
Speaker 2: Oh yeah, that's absolutely thing.

914
00:49:49,200 --> 00:49:51,480
Speaker 3: And we've talked again, how do we keep this just

915
00:49:51,719 --> 00:49:53,239
Speaker 3: very much in the wheelhouse of stuff that I want

916
00:49:53,239 --> 00:49:53,560
Speaker 3: you to know.

917
00:49:54,040 --> 00:49:56,520
Speaker 2: I have talked recently about these.

918
00:49:56,440 --> 00:49:59,560
Speaker 3: New long range skimmers that can be a thing and

919
00:49:59,680 --> 00:50:03,279
Speaker 3: that can actually grab data off of those RFID chips.

920
00:50:03,320 --> 00:50:07,080
Speaker 3: So you might even consider having one of those wallets

921
00:50:07,160 --> 00:50:10,759
Speaker 3: that shields electromagnetically shields that thing.

922
00:50:10,840 --> 00:50:13,160
Speaker 2: Again, we're not suggesting that anybody live in.

923
00:50:13,239 --> 00:50:15,759
Speaker 3: Fear of being ripped off all the time, but it's

924
00:50:15,840 --> 00:50:17,520
Speaker 3: just good to have your wits about you and know

925
00:50:18,080 --> 00:50:19,440
Speaker 3: you know what's going on out there.

926
00:50:19,680 --> 00:50:22,320
Speaker 1: Don't live in fear, but live informed and be prepared

927
00:50:22,480 --> 00:50:24,400
Speaker 1: not to sound too much of an eagle scout about it.

928
00:50:24,880 --> 00:50:27,120
Speaker 3: I think that's a good expression. Don't live in fear,

929
00:50:27,360 --> 00:50:30,279
Speaker 3: live informed. That's really that's a T shirt right there.

930
00:50:30,480 --> 00:50:34,160
Speaker 1: Oh okay, we'll write it out. Hang on, I'm actually

931
00:50:34,320 --> 00:50:39,160
Speaker 1: in our research brief putting this in. Okay, that's very good,

932
00:50:40,960 --> 00:50:44,320
Speaker 1: all right, living forward, All right, we got that, folks,

933
00:50:45,239 --> 00:50:47,239
Speaker 1: NOL thank you so much for the shout out on that.

934
00:50:47,640 --> 00:50:50,479
Speaker 1: So we didn't want to leave you without a dope

935
00:50:50,560 --> 00:50:53,480
Speaker 1: beat the step two step two, step two, step two.

936
00:50:54,520 --> 00:50:57,080
Speaker 1: Wi Wick, did you ever want a black card?

937
00:50:57,360 --> 00:51:02,520
Speaker 2: You guys? Well, my face card is black and quite heavy.

938
00:51:02,719 --> 00:51:04,920
Speaker 3: It is not an official black car, which I know

939
00:51:05,080 --> 00:51:08,640
Speaker 3: is the invite only amx I believe, but I meant

940
00:51:08,680 --> 00:51:09,600
Speaker 3: to mention this earlier.

941
00:51:09,960 --> 00:51:12,480
Speaker 2: You know, the whole history of the plates.

942
00:51:12,120 --> 00:51:15,080
Speaker 3: And all of that, like, that's why amx is are

943
00:51:15,120 --> 00:51:17,600
Speaker 3: all about the gold and the platinum and they look

944
00:51:17,760 --> 00:51:19,719
Speaker 3: like But I do believe that some of the real

945
00:51:19,800 --> 00:51:23,239
Speaker 3: exclusive ones are printed on metal. There are ones that

946
00:51:23,360 --> 00:51:27,760
Speaker 3: actually have some kind of metal content. If I'm not mistaken, you're.

947
00:51:27,600 --> 00:51:28,880
Speaker 2: One hundred percent correct.

948
00:51:29,440 --> 00:51:31,719
Speaker 1: I have a hefty well, I have one of those

949
00:51:31,800 --> 00:51:35,600
Speaker 1: hefty amxes, and that that's like a psychological hack.

950
00:51:35,719 --> 00:51:38,359
Speaker 2: They want you to feel the weight of it. That's right,

951
00:51:38,800 --> 00:51:39,520
Speaker 2: and you yailed it.

952
00:51:39,680 --> 00:51:43,040
Speaker 1: With the invitation only cards, one of the most famous

953
00:51:43,160 --> 00:51:46,839
Speaker 1: is the Black card, friending fans of hip hop. It's

954
00:51:47,160 --> 00:51:51,920
Speaker 1: technically called the Centurion card from American Express. And then

955
00:51:51,960 --> 00:51:55,760
Speaker 1: there's the other invite cards are like the JP Morgan

956
00:51:55,840 --> 00:52:00,160
Speaker 1: Reserve card. Dubai has one, City Group has one. The

957
00:52:00,280 --> 00:52:03,640
Speaker 1: main difference is you are expected to spend a lot

958
00:52:03,719 --> 00:52:06,960
Speaker 1: of money with those cards, and in return they give

959
00:52:07,040 --> 00:52:09,759
Speaker 1: you bonkers perks, you know.

960
00:52:10,239 --> 00:52:14,000
Speaker 3: Damn. I think even our meager American Express Platinum cards

961
00:52:14,160 --> 00:52:16,400
Speaker 3: have some metal content in them. They do have a

962
00:52:16,480 --> 00:52:17,960
Speaker 3: bit of hef to them. I didn't think about I

963
00:52:18,000 --> 00:52:19,960
Speaker 3: thought I didn't think we were Dang, we're with the

964
00:52:20,000 --> 00:52:20,760
Speaker 3: swells already.

965
00:52:20,840 --> 00:52:21,000
Speaker 2: Man.

966
00:52:21,600 --> 00:52:24,759
Speaker 3: Nice, Not quite but no, you're right that idea of

967
00:52:24,880 --> 00:52:29,080
Speaker 3: a limit. But again, you know, there have to be

968
00:52:29,200 --> 00:52:32,319
Speaker 3: some serious perks to a card like that. Otherwise what's

969
00:52:32,360 --> 00:52:34,680
Speaker 3: the point. Is it just about the prestige? Like what

970
00:52:34,800 --> 00:52:37,640
Speaker 3: does it get you? We can mere mortals like us

971
00:52:37,719 --> 00:52:38,720
Speaker 3: even google that stuff.

972
00:52:38,960 --> 00:52:43,520
Speaker 1: Yeah, private planes, VIP services, you can call. You can

973
00:52:43,680 --> 00:52:45,719
Speaker 1: call a twenty four to seven line.

974
00:52:45,560 --> 00:52:47,120
Speaker 2: Concier type of stuff.

975
00:52:47,320 --> 00:52:53,400
Speaker 4: According to the Great Repository Knowledge Wikipedia, is ten thousand

976
00:52:53,480 --> 00:52:57,000
Speaker 4: dollars to join, with a five thousand dollars per year

977
00:52:57,320 --> 00:52:58,960
Speaker 4: annual fee for the Black Card.

978
00:52:59,160 --> 00:53:01,160
Speaker 2: Five thousand year per er.

979
00:53:01,239 --> 00:53:03,640
Speaker 4: Yes, as you are sold the amount of money you

980
00:53:03,719 --> 00:53:05,319
Speaker 4: have to spend a thing because granted, you're gonna get

981
00:53:05,520 --> 00:53:07,480
Speaker 4: incredible points back on it, but you have to be

982
00:53:07,560 --> 00:53:09,320
Speaker 4: spending a ridiculous amount of money.

983
00:53:09,560 --> 00:53:11,360
Speaker 2: Because it takes wealth to make wealth.

984
00:53:11,840 --> 00:53:15,720
Speaker 3: Well, I'm not super proud of this, but it's something

985
00:53:15,760 --> 00:53:18,840
Speaker 3: that I'd like to change in my behavior. But I

986
00:53:18,960 --> 00:53:21,400
Speaker 3: buy a lot of stuff on Amazon, a lot a

987
00:53:21,480 --> 00:53:26,480
Speaker 3: lot of stuff, and I have an Amazon Rewards Chase card,

988
00:53:26,880 --> 00:53:31,480
Speaker 3: and I rack up some serious points from all the

989
00:53:31,520 --> 00:53:33,360
Speaker 3: stuff that I buy, and I actually use that to

990
00:53:33,440 --> 00:53:34,080
Speaker 3: pay the card.

991
00:53:34,400 --> 00:53:35,160
Speaker 2: You can even use it.

992
00:53:35,280 --> 00:53:38,759
Speaker 3: It gives you monetary value points that you can go

993
00:53:38,960 --> 00:53:41,839
Speaker 3: back and use it to pay your credit card if

994
00:53:41,920 --> 00:53:44,279
Speaker 3: you want to. So you know, I have done the

995
00:53:44,360 --> 00:53:48,240
Speaker 3: math on that one. The interest rate's pretty low in general,

996
00:53:48,480 --> 00:53:50,920
Speaker 3: and it gives you those perks. And like I've I've

997
00:53:50,920 --> 00:53:52,719
Speaker 3: gotten to a place where I have like three or

998
00:53:52,719 --> 00:53:54,680
Speaker 3: four hundred dollars in points that I can use to

999
00:53:54,719 --> 00:53:57,200
Speaker 3: buy something for my kids, you know, or whatever. Again,

1000
00:53:57,280 --> 00:53:59,719
Speaker 3: this is not this is having the opposite effect of

1001
00:53:59,760 --> 00:54:03,440
Speaker 3: what I intended. I do think Amazon is a problematic company,

1002
00:54:03,520 --> 00:54:05,680
Speaker 3: but god damn it's so convenience.

1003
00:54:05,360 --> 00:54:09,840
Speaker 1: Especially with their new medical services. Whoe betide. Folks be

1004
00:54:09,960 --> 00:54:13,560
Speaker 1: well aware for statistics to end in the modern day.

1005
00:54:13,600 --> 00:54:16,360
Speaker 1: At the end of twenty twenty three, per Forbes, the

1006
00:54:16,560 --> 00:54:21,400
Speaker 1: average credit card debt per borrower was six three hundred

1007
00:54:21,400 --> 00:54:24,640
Speaker 1: and sixty bucks. That's about ten percent higher than twenty

1008
00:54:24,800 --> 00:54:30,399
Speaker 1: twenty two. This is ushering in an all time high collectively,

1009
00:54:30,719 --> 00:54:32,960
Speaker 1: and part of this is due to all the financial

1010
00:54:33,040 --> 00:54:38,279
Speaker 1: stress of the pandemic and the inflation involved tech. Right now,

1011
00:54:39,360 --> 00:54:43,160
Speaker 1: we are estimating that there is fifty billion dollars in

1012
00:54:43,360 --> 00:54:47,399
Speaker 1: new debt in a single quarter of the year, which

1013
00:54:47,520 --> 00:54:49,919
Speaker 1: leads us to a total of one point one three

1014
00:54:50,360 --> 00:54:56,319
Speaker 1: trillion in overall US card debt. Not super great. Don't

1015
00:54:56,400 --> 00:55:00,480
Speaker 1: live in fear, live informed. We'll get the t shir. Yes,

1016
00:55:00,719 --> 00:55:03,520
Speaker 1: that is a good slogan, ben. I hope it doesn't

1017
00:55:03,520 --> 00:55:06,040
Speaker 1: already exist in my but I bet it doesn't, you know.

1018
00:55:06,080 --> 00:55:10,239
Speaker 3: And one way too to think about credits is you

1019
00:55:10,400 --> 00:55:13,480
Speaker 3: are paying for a service, and there are times where

1020
00:55:13,560 --> 00:55:17,160
Speaker 3: if the interest rate is low enough, sometimes carrying that

1021
00:55:17,320 --> 00:55:19,640
Speaker 3: balance is in the end of the world if it

1022
00:55:19,719 --> 00:55:22,600
Speaker 3: allows you to free up your cash. If I don't

1023
00:55:22,680 --> 00:55:25,040
Speaker 3: have to pay for this now, and I've committed to

1024
00:55:25,160 --> 00:55:28,200
Speaker 3: paying a slightly higher price for the privilege of paying

1025
00:55:28,239 --> 00:55:31,920
Speaker 3: for it over time, that's cool. I also have a

1026
00:55:32,000 --> 00:55:34,200
Speaker 3: line of credit through PayPal. There are a lot of

1027
00:55:34,239 --> 00:55:36,600
Speaker 3: opportunities if you have a good credit score. PayPal credit

1028
00:55:36,920 --> 00:55:41,400
Speaker 3: lets you buy things with zero percent interest for six months,

1029
00:55:41,480 --> 00:55:43,520
Speaker 3: So if you pay the thing off in six months,

1030
00:55:44,000 --> 00:55:46,200
Speaker 3: you don't pay any interest at all. So it's basically

1031
00:55:46,400 --> 00:55:49,320
Speaker 3: like free money or free you know, free credits, and

1032
00:55:49,400 --> 00:55:53,000
Speaker 3: that's pretty cool too, so and it accumulates or accrues

1033
00:55:53,080 --> 00:55:56,040
Speaker 3: that per purchase, so that's something to look into as well.

1034
00:55:56,400 --> 00:55:59,479
Speaker 1: If the rate of interest that you're paying is less

1035
00:55:59,520 --> 00:56:03,400
Speaker 1: than the rate of inflation, which is difficult to imagine

1036
00:56:03,440 --> 00:56:05,560
Speaker 1: these days, but if that occurs, then you're in a

1037
00:56:05,600 --> 00:56:08,440
Speaker 1: good spot, sort of like if you are investing in

1038
00:56:09,160 --> 00:56:12,759
Speaker 1: stocks or indexes and so on, then you want that

1039
00:56:12,920 --> 00:56:17,240
Speaker 1: return rate to be ideally higher than the rate of inflation.

1040
00:56:17,560 --> 00:56:21,439
Speaker 1: It's an internal battle, just like our battle on whether

1041
00:56:21,560 --> 00:56:23,480
Speaker 1: or not we wanted to make this a two parter.

1042
00:56:23,600 --> 00:56:27,680
Speaker 1: I think our consensus is beefy one parter BF one Pete.

1043
00:56:28,440 --> 00:56:30,400
Speaker 2: We're beefed up with this, folks.

1044
00:56:30,440 --> 00:56:32,080
Speaker 1: Thanks so much for tuning in. We're going to have

1045
00:56:32,200 --> 00:56:35,360
Speaker 1: an episode on credit scores coming out. We're returning to

1046
00:56:36,040 --> 00:56:39,239
Speaker 1: micro nations, wal also answer the question about micro state

1047
00:56:39,360 --> 00:56:40,280
Speaker 1: versus micronation.

1048
00:56:40,600 --> 00:56:43,280
Speaker 2: All that to come and more our ridiculous history.

1049
00:56:43,360 --> 00:56:47,520
Speaker 1: Thanks so much to our super producer, mister Max Williams.

1050
00:56:48,080 --> 00:56:54,600
Speaker 3: Eves, Jeff codes here and Spira aj Mohammas, Jacobs the Quizler, Jonathan.

1051
00:56:55,640 --> 00:56:59,440
Speaker 2: Mad Dog, Strickland the Puzzler. Wait a minute, flip that reverse?

1052
00:56:59,520 --> 00:57:02,919
Speaker 2: It wonk of those bad boys, you know what I mean. Ben.

1053
00:57:03,200 --> 00:57:06,320
Speaker 3: Thanks to you for being the research associated extraordinariy on

1054
00:57:06,480 --> 00:57:07,520
Speaker 3: this episode.

1055
00:57:07,600 --> 00:57:09,839
Speaker 2: I learned a lot, and I hope y'all at home

1056
00:57:10,160 --> 00:57:13,279
Speaker 2: did too. Thanks folks, We'll see you next time.

1057
00:57:20,200 --> 00:57:24,000
Speaker 3: For more podcasts from iHeartRadio, visit the iHeartRadio app, Apple Podcasts,

1058
00:57:24,080 --> 00:57:26,200
Speaker 3: or wherever you listen to your favorite shows.