December 3, 2012 at 6:15 am #605766
The folks that are so concerned about debts and deficits might want to get hip to this group- Rolling Jubilee, an offshoot of Occupy Wall Street, is buying up and retiring debt. Here’s how they describe it in their FAQ…
How Does Rolling Jubilee Work?
Banks sell debt for pennies on the dollar on a shadowy speculative market of debt buyers who then turn around and try to collect the full amount from debtors. The Rolling Jubilee intervenes by buying debt, keeping it out of the hands of collectors, and then abolishing it. We’re going into this market not to make a profit but to help each other out and highlight how the predatory debt system affects our families and communities. Think of it as a bailout of the 99% by the 99%.
It’s an interesting concept and, along with the work being done by Occupy Sandy (providing more on-the-ground assistance than Red Cross or govt agencies), you’d think the mainstream media might find some time to report on such grassroots efforts rather than airing more talking heads spewing about the fiscal cliff (a fiscal figment of their tiny imaginations).
Here’s their website if you want to read more or donate.December 3, 2012 at 4:57 pm #778903December 3, 2012 at 5:57 pm #778904
Is there some way to look into this to make sure the money is going where they say it’ll go? I don’t like to be a cynic, but I do like to be sure I’m not being scammed.December 3, 2012 at 6:18 pm #778905
By the time debt sells for “pennies on the dollar” it is basically uncollectible. The borrower has already defaulted and collection efforts have been exhausted.
From a brief glance at the webpage, this company makes no sense to me.
From the faqs: “Think of it as a bailout of the 99% by the 99%.”
So only the top 1% should repay their debts and the other 99% should default?December 3, 2012 at 6:45 pm #778906
“By the time debt sells for “pennies on the dollar” it is basically uncollectible.”
Not really. Collection agencies purchase debt at a discount and try to get back what they can. Say the bank has a 1000 dollar debt they deem uncollectable. They sell it to the agency for 200 dollars and write off the rest. The collection agency tries to make a deal with the debtor to pay 500. (these are made up numbers for the sake of argument)
“So only the top 1% should repay their debts and the other 99% should default?”
I don’t think this is the point they’re trying to make. I think it’s more like “when the 1% run up huge debts, they don’t pay them-they get bailed out by the taxpayers (see TARP, AIG bailout, etc). The 99% are now crowdsourcing a bailout of their own thru contributions (not tax revenue). I don’t believe they expect to retire all debt this way but rather to change the terms of the conversation, as Occupy Wall St did.December 3, 2012 at 7:25 pm #778907
Yeah, I like this idea, even though it is largely symbolic. Thanks, dobro.
The state of North Dakota had something like this during the Great Depression. Their state bank was already up and running when the Depression hit. The bank had to foreclose on a lot of poor farmers, but they let the farmers stay on the land and continue to farm it. When the Depression was over, they sold the land back to the farmers who were living on it.
In other places, there were farm communities that showed solidarity in the face of foreclosures. When the bank was auctioning off someone’s stuff, the other farmers would get together and low-ball the auctioneer. They’d get all the stuff on the cheap and give it back to the family that had lost it.
I’m not going to shed tears for some guy who loses his shirt speculating on real estate. But I hate to see some poor working stiff get tossed out on the street.December 3, 2012 at 7:45 pm #778908
I’m just not understanding how the borrower is benefitting. If there was a security interest/collateral such as a car or a house or a farm then the lender would have already taken it. What’s left is this unsecured debt that has almost no chance of being collected. That’s why it’s selling at such a huge discount. This organization isn’t saving someone’s house or farm or car. The irony is this organization is giving money (albeit a small amount of money) back to the lenders, the so called “1%” instead of letting the debt rot away to zero.
I pick and choose my charities carefully. With so many organizations doing amazing things I just don’t see any argument for supporting this “charity.” But to each his own. If you want to give some money back to Wall Street (or the shady debt collector) then go ahead and do it. Not me.December 3, 2012 at 8:02 pm #778909
skeeter you raise good points, and as a matter of fact there has been some discussion in the “Jubilee” group about whether they might be aiding debt collectors in the same way good-hearted folks unintentionally boosted the Sudan slave trade by buying slaves to free and thereby driving up prices.
I think the assumption with Jubilee is that the collection system will run its course with or without their intervention. The only difference it would make for you, as a debtor, to have your debt retired, is that you’d get the collection agencies off your back and maybe improve your credit history a bit. That’s not a lot maybe, but it’s something.
Have you ever had to deal with a debt collector? I hear they can be real hemorrhoids.December 3, 2012 at 9:28 pm #778910
I’ve never had to deal with debt collectors. Some lady, either by accident or on purpose, gave my phone number to her debt collector. I kept getting these annoying messages. I called them one day and explained I have no idea who this lady is and I never got bothered again.
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