There are a lot of books on the subject, but the short answer is that it's just the most common standard at this point. Yes there are some things about it that don't make sense, but for whatever reason it seems to be the most coherent way for musicians to communicate using a common language.
It's popularity also has to do with what sounds pleasing to the ear (and brain) on a biological level.
A number of people have come up with alternative scales and notations systems over the years, but none of them have really stuck for one reason or another. Nonetheless, they are pretty fun to read about.
Also, if you aren't familiar with John Cage, you should check him out. His music and writing deals with a lot of the stuff you just brought up, and it's also a really great jumping off point to find other interesting artists and musicians.
Kind of fucked up that the article doesn't mention the fees associated with these cards until like 3/4 of the way into the article.
These cards charge 5 bucks a month, plus like 3 dollars to deposit cash, 3 dollars to withdraw cash, in addition to the 5-10 dollars up front for the card itself.
Because of this, a person using this type of card can easily spend $100+ a year on fees. Not exactly a great way to save money, and hardly better than overdrafts.
If at all possible, people in this sort of situation would be much better served by joining a credit union. While there are some drawbacks in terms of hours and atm availability, many CU's do not charge overdrafts and also have some form of atm reimbursement. This, along with the ability to deposit checks by snapping a pic with your phone make them a viable, and preferable alternative. Sadly, they are not as prominent, nor well advertised as the sort of cards peddled by Wal-mart, et. al.
Just read the article. It's $1 for the card and free cash withdrawal at a Wal-Mart banking center.
It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank.
More importantly, they aren't pulling the overdraft scams that banks are. The example right here is that the customer in question pulled $100 in overdraft fees over a $4 purchase, with a traditional bank card.
>It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank.
That might be true of the big national banks with a branch in every town small and big alike but it's not true of the smaller local banks and credit unions. My checking account at my credit union is free as long as I maintain a balance of at least 5 dollars. It has branches in the area with decent hours, it has an excellent online banking site, it has excellent customer service. When I walk in to do some business I'm not bombarded with sales pressure to waste my money in exotic types of accounts that the credit union offers that do more for the bottom line of the credit union than for me. If I travel across the country I can access my money through a national network of similar credit unions without paying any fees.
To my understanding this is extremely common among credit unions in other areas.
Oh and to reply to one of your comments below, my credit was extremely poor when I opened my account. I received nothing but highly professional customer service regardless.
Not all credit unions are equal, so just watch out. I had been actively using my efcu account then switched to usaa bank for the bulk of activity, and - my mistake - wasn't watching the efcu cu account closely enough and they started charging $5/month inactivity fees.
Skip the bank. Credit Unions are where its at: nation-wide shared branches, fee-free checking, sane overdraft policies, no minimum balances, reasonable interest payments, and in my experience, not a single instance of them blatantly trying to screw customers.
I just checked and my CU has a $30 overdraft fee, which can be disabled if you're willing to let things bounce.
CU member, and I'll mention one downside. Unless your credit union has a local branch, you will need to get used to all kinds of weird restrictions on what your satellite branch can do for you.
I just bought a car, and the satellite branch could only give me $1000 in cash. I had to beg the seller to take a cashier's check for the balance.
Sometimes the systems don't integrate well and so they have a hard time figuring out which account is which.
Finally, even though my spouse is listed as a co-owner of the account, there is very little she can do at a satellite branch (or even over the telephone to the main office).
Why don't you just close your account your CU and open up an account at the one closest to you? I have no loyalty to my bank. If I move and there's no branches around me, I'll just move to someone else that is local.
I had little (and mostly bad) credit when I opened my first CU account. Wasn't a problem, at all.
It might, OTOH, be hard with the same kind of bad account history that will stop you from being able to open a regular bank account, but that's different from regular no credit or bad credit.
Most small and medium size banks don't pull your credit report. Its Chex Systems to see if you have any deposit accounts in bad standing. Some also pull fraud scores from experian or equifax as well to see if you information has been used in identity theft recently.
Your comment would have been better if you had linked to examples rather than accusing the parent of spreading FUD.
Maybe you're a student or have multiple products (different types of accounts, credit cards, home loans, term deposits) with your bank?
I can't get a $0 / month account for everyday banking from my bank because I have a special rate home loan. They have a savings account that's $0 / month but you can only transfer from / to it via a regular $4 / month account.
Step 2 in this analysis: Would you be able to get any of those accounts with a low credit score? I'm pretty sure when I opened my Schwab checking account they ran a credit check.
I've had most of those accounts since I had virtually no credit (and a low/nonexistent credit score). That being said, if you have a negative Chexsystems report they'll be hard to get.
I'm not trying to say the unbanked don't have barriers. I just didn't like the assertion that free checking is impossible, since that's what leads to even people on HN paying needless maintenance fees.
It's important to note that many large banks actively discourage customers from opting out of overdrafts. So much so that they even have scripts they make their tellers recite.
For example, if you attempt to opt out, the teller might say, "but what if you are at the gas pump and can't get gas because you have opted out of overdrafts?" The subtext being, "wouldn't it be better to get enough gas to get home and in the process incur a 40 dollar fee."
Solution: don't write checks? I use cashier's checks wherever possible, I get them for free and there's never a potential for overdraft nightmares since it comes out of my account right away - the only time I've written a check in recent memory is the registration fee for my daughter's preschool since my wife wanted to pay it on-the-spot if she liked the place.
I am willing to wager that those accounts have requirements for automated deposits into them and or are tied to other accounts that have similar balance/deposit requirements.
What do you mean by "It is $5/mo for accounts with less than $1000, but you're not going to get better than that at a bank."? Aren't there lots of banks that charge nothing even if you only have <$1000?
There aren't many anymore. Banks mostly eliminated or heavily restricted free checking accounts when overdraft fees got capped.
You may be able to find a couple credit unions that do this, but you still have minimum account balances and other hurdles that make it difficult to open an account if you have bad credit and little money (not to mention time or financial savvy).
My credit union requires I have a savings account with $5.00. The overdraft fee is $30. There are no recurring costs outside of that. Both checking and savings accounts earn interest - much less for the checking account - rather than costing me money.
I don't know about the credit check part; I set up with my parents years ago so that may have exempted me as I didn't have any credit history at the time.
In the UK its the opposite; the majority of checking accounts are free, some premium accounts charge a fee but generally come with rewards.
Overdrafts; there are fees for unarranged overdrafts, but its reasonably trivial to arrange a limit and this is generally fee-less (naturally you pay interest; mine is 1.2% calculated daily)
ATMs are largely free regardless of who your bank is.
In France they sure aren't free. Banks even charge a monthly fee for a debit card in addition to a monthly account maintenance fee. Of course banking in the France is stuck in the 1980s with many banking transactions requiring an actual visit to your specific bank branch and a consultation with your personal banker.
Interesting; my perspective (working in the finance industry) has been that European banks are ahead of the curve with technology and, importantly, technology for customers. It sounds like maybe not?
It grates for me when I withdraw cash. The most convenient ATM for me charges $3 when I withdraw money. My approach to this is to never pull less than $300, so the fee is 1% or less. But for people who are pulling $20 because that's what they have right now, this is a 15% tax. It's a perfect example of regressive taxation. For me it's a minor inconvenience, for most Americans it's a significant burden.
My debit card comes through a credit union. As long as I use the ATM of another credit union in the same network, I pay no fee. As it happens, there is such an ATM on the side of the building where I work, and for that matter I think there was one about half a mile from my late mother-in-law's house a hundred miles from here. I do resent paying $3 to Bank of America because I forgot to withdraw money before I left for work.
I wouldn't say it's hard, Wells Fargo has free checking for anyone with over $500/mo in direct deposits or makes 10+ debit card transactions per month. Even someone making part-time minimum wage can probably make the debit card requirements without an issue.
Every credit union in my area offers free draft accounts as well, just put the $25-100 member balance into savings and you're done.
Some people can't afford to be overly picky with their bank, and I know at least one person who has been screwed by at least one of the big (US, consumer) banks (Bank of America, Chase, Citi, US Bank, Wells Fargo) - all of them suck.
For as awful as they are, Wells Fargo even has the "opportunity" checking account that gives people who have negative marks on ChexSystems a second chance at having a proper checking account. Compared to the awful re-loadable debit cards from Walmart, et. al, it's a great option and the monthly fee can be waived with 10 debit transactions per month or $500 in direct deposits.
Would I go out of my way to say I LIKE Wells Fargo? Hell no, they've done tons of shady stuff - but compared to how US Bank has screwed over every one in my family at least once they've been at a "below average" level of suck.
Technically true, many banks charge a monthly fee, but most/all credit unions do not.
What's the benefit of personal banking through an actual bank over a credit union? I see none currently except it's a bit more difficult to send/receive money internationally through mine (I'm fairly sure it isn't all CU's that have this issue).
They could probably win on goodwill if they waived that fee freely for anyone who walks into a Walmart every month, or makes a single transaction, or is part of some group considered vulnerable or worth subsidizing (veterans, benefits recipients, etc.)
At lots of places, yes. They usually wave the fees for modest account minimums or accounts that regularly deposit paychecks.
There are enough banks/credit unions that don't charge fees that it is more of a way of asking people not to open an account than it is a problem with access to banking.
I read it. Maybe you should go to a store and actually get one of these cards, then let me know how it works out.
Seriously though, these cards, like many "financial products" come with a variety of price points and fee structures. If you re-read my comment, you'll see that I didn't claim my figures were definitive, but they are definitely in the ballpark.
As I said, there are a variety of cards on offer, from a variety of sources, but they all seem to fall within the same range cost-wise, even if the fees are structured differently.
It's as if we are arguing about cars, and you want to debate whether the pinto in question had power-windows or not, while ignoring the fact that it will explode in a routine accident.
Dude, you really need to think carefully about whether you are approaching this topic honestly, or if you are hunting for reasons to reinforce your belief that this card is a scam.
The precise things you claimed about this card are _not true_. Those are facts. If you want to debate, use _facts_.
Nobody is denying that WalMart _could_, if they wanted to, offer a savings card which is a scam. But also consider their motives going into this, compared to the average bank:
- Wal-Mart's goal is to get people to spend money at Wal Mart. This card makes it easy to spend money at Wal-Mart.
- Banks exist entirely from interest on saved money, and on fees.
Since these customers have very little saved money (the whole point of this article), the money made is entirely from fees, unless you have another reason to get people to use the card. Wal-Mart does -- it is totally reasonable for them to run this program at-cost to attract customers. You cannot say the same for any bank.
If you want to disagree with the merits of people spending money at Wal-Mart, that's a different topic. But the evidence points to this card being a good deal for an underserved part of the population.
Not sure why you are accusing me of intellectual dishonesty, unless the goal is to derail the conversation.
You are right to say that a few of the specifics I gave were not correct. I was clearly not arguing that. However, the specifics you gave were not 100% correct either. For instance, if you go to an atm machine in a wal-mart and attempt to withdraw cash, you will be charged 3 dollars. The fee breakdown I linked bears this out. A fee breakdown, I might add, that is several pages removed from the main page describing the class of card in question.
> You can withdraw cash from your card at any Walmart register or MoneyCenter. This service is free for the Walmart MoneyCard product with Cash-Back Rewards.
That number isn't for ATMs in Wal-Marts, it's the general "at an ATM" fee. If you look below,
> Walmart Card Cashing / Withdraw cash without a fee at Walmart MoneyCenters and Customer Service desks. / No Fee
there's no fee for withdrawing cash in any Wal-Mart.
That seems to be the same as any other normal bank -- except for some credit unions that reimburse you, you don't get free withdrawals at random ATMs (I have BoA, and it's the same for me).
I suppose you're in the wrong income bracket to have considered services from them.
Yes, they do charge fees at the register, regardless your link. When I went and deposited the $200 check from Wal-mart at a register, and $197 goes in... yeah. You can link URL's all you want. But 3$ disappeared in that transaction for "reasons".
I know because I've used the plans that people here are talking about. Unlike the rest of you, I've had them. I've used and been used by them.
Withdrawing cash != cashing a check. Stop accusing people of not being familiar with these products just because they aren't conflating different services the way you are.
Ah, another silver-spoon apologist who has never seen or used these plans.
No shit the act of depositing and withdrawing are different. But they still get their $3 cut for each of these. How about you go spend 3 packets of $200 on this and report back your results instead?
You do realize you're talking to people who've never had to use these services, never made under $40K (except when living at home), and are many steps removed from ever having to go through this?
Yeah. I have. I did the Green Dot. Pile of shit, with hidden service fees, usage fees, loading fees, fee fees. Oh yeah, YC.
Ive been on food stamps. I've been on unemployment. Even been homeless for a time. Right now, I have a significantly better job... But I still live in a trailer.... err, "Tiny House".
But anyways, good luck explaining what you mean. These people don't get it, and their societal structure means that they won't get it, even if you linked the very documents to them. It's out of their worldview.
I think another point to be made is the OP is correct - most non-bank alternatives are horrible, but so much of modern society is inaccessible if you do not have a bank account or bank account analog.
Also, to quote from the article.
"Check-cashing outfits, payday lenders, and similar businesses are often thought of as merely preying on poor people, who, the conventional wisdom goes, tend to make bad financial decisions. Lisa Servon, a University of Pennsylvania professor of city and regional planning, offers a different angle in her recent book, The Unbanking of America: How the New Middle Class Survives. During Servon’s research working as a teller at a check casher and payday lender, consumers told her that the fee structures of nonbank alternatives were more transparent and predictable than those at conventional banks—crucial to anyone living on a budget."
I understand where you're coming from, I was in the payday loan trap at one point.. robbing peter to pay paul as it were, I made much less than 40k a year, its only in the last 5 years I've started to get north of 50k, and gotten comfortable.. now I save save save..
> I think another point to be made is the OP is correct - most non-bank alternatives are horrible, but so much of modern society is inaccessible if you do not have a bank account or bank account analog.
Indeed. And I'm still paying for it after many years. I got fucked over with payment reordering for bank-profit maximization, even with "overdraft" disabled. Didn't matter. Because whatever the bank says, is the ordained truth. And when your name gets on ChexSystems and other lists, you're done for.
My wife was did in similarly. The local credit union said she owed $120 for previous account issues that pertained to her then ex-husband. Didn't matter. The bank said it was hers, and too bad. There is no recourse. The bank/CU is god, no if's ands or buts. And suffice it to say, if you're in this position, there's no money for a libel suit (which is what it is, without a court determination).
> "Check-cashing outfits, payday lenders, and similar businesses are often thought of as merely preying on poor people, who, the conventional wisdom goes, tend to make bad financial decisions. Lisa Servon, a University of Pennsylvania professor of city and regional planning, offers a different angle in her recent book, The Unbanking of America: How the New Middle Class Survives. During Servon’s research working as a teller at a check casher and payday lender, consumers told her that the fee structures of nonbank alternatives were more transparent and predictable than those at conventional banks—crucial to anyone living on a budget."
I would agree with the transparency discussion. But it's also much more predatory. They get their pound of flesh. And this flesh is taken every time you use it. Banks do cover up and obfuscate their fee structure, but if you have the usual minimum balance, you'll never see this. Banks also rely on lack of CSR's for rich people. Because money's nothing, not a big deal. Bills are minuscule compared to income.
> I understand where you're coming from, I was in the payday loan trap at one point.. robbing peter to pay paul as it were, I made much less than 40k a year, its only in the last 5 years I've started to get north of 50k, and gotten comfortable.. now I save save save..
Yeah, it's not common to see people here who know what this all means. Fortunately, I was able to avoid the payday trap.. But not student loan trap, credit card trap, medical trap.. Right now, I have a garnishment for an injury sustained in 2008. Had insurance, but the physical therapy "wasn't approved". For a while, I was job hopping a bit and stayed ahead of the garnishments. And unemployment is ungarnishable in Indiana.
Credit cards.. Well. I had them when I had a job. Paying them down is hard without one. But it's easy money to get food and basics when you're waiting for unemployment. Fortunately, a few of them have been written off.. but that just burns another bank. At least Google Voice allows me to shitcan creditors, especially when I dont have the capability to pay.
School debt is a whole 'nther area. I got into my accident which caused my medical debt, but also caused all those classes to fail. But the school gets their cut, regardless if you do well or not. The school can do horrendously, apathetically, and cutthroat.. and they're guaranteed their money no matter what.
I did schooling at a "proper 4 year university" with frankly nothing to show for it. And I believe this burden should also be shared in part with the organization that also failed me in my educational goals. But, even this "Public University" is run much more as a Business than a public trust or institution. But likely, I'll be paying this off with garnishments in my Social Security.
In reality, this whole area is a sore point. Many people here, given the focus of HN, will never have to suffer like this. They'll also never know the pain of hurting, and not being able to fix (no medical care). They'll not know what it means to go hungry because you're waiting for the unemployment to start along with food stamps. They won't know the shame of walking into the food pantry, or using the foodstamp card. Nor will they see the looks you get, when you borrow your mother's vehicle to get the groceries... How dare you not be dressed in tatters and driving a rust-eaten beater truck.
It comes down to understanding "Us" vs "Them". I was an "Us", and remember that well. I'm on my way to being a "Them". Faking it, living the culture, understanding the nuance. But I understand, and seeing many posters here in this thread brings back all that anger of being taken advantage of, and having no power to do anything about it.
Hey thanks for the support. While I don't think making sweeping generalizations about HN readers is necessarily constructive, I would definitely agree some of us are working from very different assumptions here.
I guess the main thing I was attempting to communicate is that the facts on the ground are very different from the facts as presented in this article and elsewhere online. While it's definitely difficult to convey this in brief internet comments, I do feel there's a worthwhile discussion going on, so thanks to all involved as well as those reading. :)
As someone from the UK I always find it astounding that Americans are used to paying money to.. withdraw or deposit their money. How did this become the norm? I find it a bit disgusting actually.
The only cash machines that charge over here that I've seen are rented ones at packed events (clubs, concerts etc).
It's not the norm. Most Americans (at least in my experience) will go out of their way to use an ATM that doesn't charge them. Accordingly, picking a bank with a large ATM network is a major consideration when choosing a bank. Some smaller banks compete with this by reimbursing fees charged by out-of-network ATMs, making all ATMs effectively free.
It is certainly possible to pay for those services, but it's not normal. Some people let it happen out of laziness, or due to not being aware that they can do better.
We do have a fees problem, but it's mostly with other services. For example, many banks will charge some outrageous amount (like $5, outrageous compared their cost) to give you an electronic copy of a past bank statement. High overdraft fees are common. If you accidentally use your debit card to make a purchase that exceeds what you have in your account, the bank will often charge you a ~$35 fee rather than reject the transaction. This is optional, but they push it hard and sell it as a "service," since it means you're never left unable to complete your transaction. Never mind that being out a bunch of money is bad too.
Even worse, some banks (at least for a while) would intentionally maximize your overdraft fees by sorting your transactions on any give day from largest to smallest before applying them. For example, imagine if you have $99 in your account, and you use your debit card to make purchases, in order, of $1, $1, $1, and $100. The last transaction should overdraw the account, hit you with a $35 fee, and your balance will be -$39, right? Wrong! They'll run the $100 transaction first, overdrawing the account, and then run the $1 transactions on the overdrawn account. Net result: four $35 fees and a balance of -$144.
So yes, many of our banks suck, especially larger ones, but it's not quite as bad as everyone paying to withdraw and deposit.
I believe the CFPB has at least put the fear of god into most banks, at the very least Wells Fargo changed from largest-first to time-of-transaction ordering for debits from the account in the past couple years - and I believe most of the other big banks have done so as well.
Of course, the CFPB is looking pretty dead at this point, so who knows what they'll do after Trump dismantles it.
I've got a Charles Schwab account mainly because it refunds all my ATM fees at the end of the month. It's great never having to run around looking for the right brand of ATM.
ATM fees are unusual in the UK, as the parent post said, though we use the term "cash machine".
Using a cash machine is free, for the majority of cases — those in banks, supermarkets, shopping centres, railway stations and so on are run by one of the banks and are free for customers of all banks to use. It doesn't matter if the machine or customer is with/is a major bank or a small one, they're all on the same network and charge the same: £0.
The exception is captive markets. Cash machines within a stadium, nightclub or a convenience store often charge. I've never used one of these, it's so easy to avoid doing so.
The fee isn't a huge deal the times I've needed an ATM and my bank didn't have any of theirs nearby. It's a couple bucks which isn't too bad.
Free would be nice but I can understand why banks would charge non-customers fees. If your ATM is in a very high traffic and convenient place, you are going to be servicing and refilling the machine more often which costs more money. If you can control the usage a bit by charging non-customers a fee then you can reduce service costs.
In Britain, I think the banks charge each other. According to [1], 98% of withdrawls in the UK are free.
I assume this averages out amongst the large banks, who probably each have their fair share of convenient places. The small banks pay for their customers' convenience; presumably a very worthwhile cost for some of the new banks or Internet-only banks.
People usually pay fees for using ATMs outside their banks network (some banks join broader networks in order to offer more ATM locations to their customers.)
A few banks (USAA, Schwaab, others) offer ATM fee reimbursal, but most US ATMs will charge you unless you're part of that bank's network. It's really not the best, especially when you're at cash only places, which seem to be popping up a lot near me.
One reason I think is that a lot of the time you're not withdrawing money from your bank's ATM or one associated with any bank at all, partially because of sheer land mass, so the operator has to have some way of recooping the expenses of operating those machines. A lot of banks provide free withdraws from their own ATMs and some even just the fees for their customers like my bank.
But withdrawing and depositing money is a service that costs the banks money to do doesn't it? I'm can see why you don't like but I can't see it as morally 'disgusting'.
Would you look after someone else's meagre current account for them, and give it back on demand, for free? I wouldn't.
I don't really know who covers that cost in the UK. It's certainly not interest they earn lending out our savings is it? Especially this type of customer since they have no savings because the point of the card is to encourage them to do so, and since interest rates are so low.
Who is paying to cover the costs of a basic bank account of someone who doesn't save? I've no idea.
> But withdrawing and depositing money is a service that costs the banks money to do doesn't it?
It's literally their job. It's their function. Why am I reimbursing them? I'm giving them my money essentially to invest, why am I also paying them to support basic business functions on my money, with my money, while they make money using my money?
It's easy to say "hurr durr why are you paying them for a service they provide, who does that??" but that's missing the point. Banks are a special case.
> I can't see it as morally 'disgusting'.
It disproportionately affects the poor, and for no real reason than 'I can charge this so I will'. Apparently some places charge you to even check your balance? What the hell.
> I don't really know who covers that cost in the UK
The big, fat, rich banks do. Because the total cost of running all their ATM's is a fraction of a rounding error on their yearly turnover.
Historically, retail banks made their money off of the spread between their loan interest rate and the rate they pay out on deposits. So they borrow from your deposits at 2% and loan it out at 5%, pocketing the 3% difference. Over the past 20 or 30 years, extremely low interest rates and competition with money market funds and other more complex savings vehicles have reduced depository interest to essentially nothing, which sets a ceiling for the spread. So for a bank to make money off a regular joe who doesn't have enough money to access investment banking services, they need to charge fees to make a profit. For example, if you have an average $1000 in your account, the bank may only make $10 off of that in a year. Many lower end clients, the ones who tend to pay high fees for overdrafts, have even less money than that deposited on average. Also it's worth pointing out that most banks charge withdrawal fees only if you use another bank's ATM. It's entirely possible to have a checking or savings account at a bank and never pay significant fees if you don't overdraft or drop below minimum amounts. Of course, those issues tend to affect poorer customers disproportionately, but it's not without reason even if it is problematic socially.
> So they borrow from your deposits at 2% and loan it out at 5%, pocketing the 3% difference. Over the past 20 or 30 years, extremely low interest rates and competition with money market funds and other more complex savings vehicles have reduced depository interest to essentially nothing, which sets a ceiling for the spread.
It sets a floor for the spread, not a ceiling. All else being equal, the bank should make more money when the amount of interest it has to pay its customers drops.
But what about those people who aren't giving the bank any meaningful capital to invest? What is the bank getting in return in that case?
Or are you arguing that banks should be forced to provide it as a kind of social service even if they don't earn anything? I can understand that kind of point of view.
Or are you arguing that banks should be forced to provide it as a kind of social service even if they don't earn anything?
Since banks, especially systemic critical, large banks make a shit ton of money based on an implicit guarantee by the tax payer, yes, I'd argue exactly that.
The answer to "not enough people are giving banks capital to invest" is not "charge people more", it's to work out why nobody is putting their money in banks. Could the charges be a factor? Or a paycheck-to-paycheck economy?
The people not giving the bank any meaningful capital are going to cost them much/anything,because it's not as if Joe Bloggs with $500 in his account is going to be doing a thousand withdrawals and balance checks a month.
The point is the banking fees hit those who can least afford to pay them the most. It doesn't have to be like that, and I can understand a kind of point of view that supports it.
In many countries, this limited bank runs out of the post office. TBH, that isn't a terrible idea for the US. It would shore up the USPS, which primarily makes money by delivering junk mail, and it provides lower cost banking for those who would wind up paying check cashing fees.
At the scale larger banks are operating at, you could argue that even customers storing a few dollars each represent a significant block of capital in aggregate.
It's also clear that banks aren't losing money. What's at issue is how they earn their money and at whose expense.
So, where I live there's at least 5 different banks that offer free accounts, domestic transfers are free, and I think about three of them offer free withdrawals from any ATM in the country. Withdrawing from a foreign ATM in Europe is like 0.3 EUR. Oh and they give you a card for free, of course.
And it's not like they are about to go out of business either.
When banking becomes optional, I agree, however I need a bank and I ain't paying to take money out of it. When banking is optional, by all means they may charge, but I will take my cash in £20 pound notes in Royal Mail Special Delivery at the end of the month cheers!
billing systems always expand to be as maximally complicated as the system will survive. Consider telephone billing toward the end of the last century, until the cost of billing exceeded the revenue from exotic billing systems, there were all kinds of insane schemes about internal, intra-LATA, inter-LATA, in-State, nationwide-LD, international, it was a complete circus. Eventually the cost of administrating that exceeded every other cost of providing service and now we just get "minutes" or even unlimited (provided with a weirdly billed data plan of course)
For another laugh buy a house or car with a loan and there's zillions of little fees and commissions tacked on to the base price. Complexity only increases over time, and it only decreases with collapse.
This is part of the logic of the old great depression "liquidate liquidate liquidate" guy who sounds heartless in retrospect but in practice the only way to reallocate poorly allocated resources in the modern capitalist system is to flush and start over, so not knowing the GD was going to be as bad as it turned out, the guy was correct, the faster the obsolete stuff gets flushed, the faster we get back to real living. Which is analogous to current conditions, and why many people are unhappy nothing has been fixed in the banking system (or another example is health care, obamacare and trumpcare have in common that they fix none of the core problems, which is our health care allocation system is an expensive disaster)
You don't order food from a restaurant and have the restaurant take/withhold a portion of your meal off you to cover the cost for bringing it from the kitchen to your table.
But they do charge you more than what it costs to make the food. I know what a USDA Choice ribeye costs and it sure isn't what the steakhouse down the street charges me. You could also say that your restaurant bill is covering all the food they have to throw away at the end of the night. Not to mention tip, there's another 20% add on.
Those are the costs associated with running a bank. It's paid for by giving them access to our capital, that they can use to invest.
Have we forgotten what a bank is for? It's to conveniently and safely store money. Part of that convenience is to withdraw and store money at many locations. If a bank didn't offer that they wouldn't get my money.
"Free checking" is a relatively new practice in banking that really only caught fire after ATMs were invented. Banks would charge fees on transactions--like most financial services do.
Even now, most free checking accounts only require a certain amount of money, transactions they collect fees on, etc.
With interest rates so low, they don't make much just holding onto 500 dollars for someone.
Savings accounts had less fees, but you couldn't use them to write checks out of, etc.
> It's paid for by giving them access to our capital, that they can use to invest.
What capital? The people referred to in this article don't have any savings. Many working class people have no savings at all, and only a few thousand in their current accounts.
A person being a customer of a bank means the bank has first access to that persons business when they need mortgages, other loans, home insurance, buying funds for retirement savings etc.
I suppse where bank accounts are free including services like ATM that might be an indication that banks compete for all customers - which might ni turn be an indication that all customers are reasonably likely to buy financial products such as taking loans or savings products in the future.
I can't give a super accurate history of how we got here, but it seems as though it's been a gradual process. Once the banks saw that people at bars, casinos, and high end hotels would pay these 'convenience' fees, they said to themselves, "why not do this everywhere?"
It also ties in to how banks are regulated. Now again, I'm not super well versed in the history here, but as I understand it, after the stock market crash in the 20's, congress passed the Glass-Steagall act which, among other things, said that the banks either had to be an investment bank, or a commercial bank, but not both. That way the commercial banks, which are holding regular folks money, can't gamble it all away. That seemed to work pretty well, so much so that congress was later convinced to repeal large portions of Glass-Steagall.
Once that happened, investment bank culture, which never really left commercial banks, once again came to prominence, along with it's emphasis on making money for shareholders.
The reason I mention all that is to say that during Glass-Steagall commercial banks had to go back to making money slowly but surely through giving out safe loans and charging modest fees for basic services. In the meantime, their shareholders, having had a taste of the large dividends generated by investment fees and the like, came to expect more than the safe, modest returns commercial banks used to provide. In order to appease investors, commercial banks then had to look for other ways of generating profits. That's where things like atm fees, excessive overdraft charges, monthly checking account fees, and the like come in.
The fees and stuff actually got so bad that congress passed a law mandating that the banks had to allow people to opt out of overdrafts, among other things. Unfortunately, this law had been kicking around for several years by the time it got passed, so the banks had plenty of time to weaken it and/or find work arounds. For instance, where you used to get a single overdraft charge for each time you overdrafted, many banks went to a system where you got a daily charge for every day your account was in the negative. I've literally seen someone crying in the bank upon being told that what should have been a single $40 charge had grown in the course of a week or so into a $400 charge. Sadly, this is just one of many such examples of how commercial banks have changed their practices to prioritize profits over public service.
Hope that all made sense. As I said, I'm not a historian, and a lot of the stuff I discuss is widely debated, but if you find it interesting there's a lot of good info on wikipedia and youtube, not to mention your local library. :)
The article sort of addresses the consumer motivation for choosing prepaid cards over traditional banks:
During Servon’s research working as a teller at a check
casher and payday lender, consumers told her that the fee
structures of nonbank alternatives were more transparent
and predictable than those at conventional banks—crucial to
anyone living on a budget.
Prepaid cards offer this predictability, and over time
their reputation for transparency has improved.
Bluebird, a Walmart/Amex prepaid product has $0 fees for nearly everything (including even free foreign currency transactions). And offers free checking for the 'unbanked'. https://www.bluebird.com/#fee-chart
Is there data on the number of CU's that don't charge fees because I haven't found one that doesn't charge overdraft and have seen a monthly low aggregate balance fee?
My credit union has a $5 minimum savings balance. That is it. No monthly fees, but it does have an overdraft fee. It is going to be exceedingly hard to find any bank that doesn't have overdraft fees - that is where a lot of their revenue comes from.
I couldn't say, but would be interested to find out. As far as CU's are concerned, I'll admit that I'm speaking anecdotally.
Obviously each CU is different, and I can't really speak to the specific terms that each one offers, but overall they seem to be more attractive than the terms offered by the large chain banks and the payday lender style banks that originated the style of debit cards discussed in the article.
And yet, thousands of people who started using the cards have increased their savings more than they would have otherwise. Yes a credit union is preferable, but the point is that this demographic of people wasn't using them (or regular banks) and that these cards have encouraged better behavior through a new psychological angle. If the net result is positive, I wouldn't get hung up on the fees.
The whole concept of Fyre Fest I'd leveraging social media influencers to extract money from the influenced; it's it exactly a Kickstarter-friendly concept (well, unless you use the influencers to promote a KS itself.)
As to a Kickstarted festival of the type Fyre purported to offer purchasers, it seems to be explicitly prohibited by Kickstarter's terms, falling squarely into the travel services / vacation packages prohibition.
Found a video of one of their prototype scanners. IIRC they looked at like every scanning solution available and also got a bunch of universities and libraries to help them purchase and operate scanning equipment. Pretty cool stuff.
Damn shame. EEVblog is one of the shining examples of the sort of program that could only come about on a platform like youtube. I've often wondered why netflix or amazon haven't picked it up or made similar programming, and yet I have a hard time seeing them producing content of such quality and depth.
> I've often wondered why netflix or amazon haven't picked it up or made similar programming,
Because due to how the economics works, once you add a corporation behind a genuinely informative project, it becomes an advertising machine losing about all of its value. EEVBlog works because it uses Youtube and not the other way around; if it was produced by Youtube things would be way different.
I know you guys are joking, but there is a whole class of cell phone that is designed specifically with the prison market in mind. Not too sure on the specs of the higher end models though.
It's popularity also has to do with what sounds pleasing to the ear (and brain) on a biological level.
A number of people have come up with alternative scales and notations systems over the years, but none of them have really stuck for one reason or another. Nonetheless, they are pretty fun to read about.
here's the whole history of notation https://en.wikipedia.org/wiki/Musical_notation
Also, if you aren't familiar with John Cage, you should check him out. His music and writing deals with a lot of the stuff you just brought up, and it's also a really great jumping off point to find other interesting artists and musicians.
Indeterminacy, a work he did with David Tudor is a great starting point https://www.youtube.com/watch?v=_lOMHUrgM_s