Is it possible? Could the programmed trading bots actually be learning? What happens when the computers become self-aware?
Stocks stumbled out of the gate (deft Kentucky Derby reference) at the opening bell and today there was no turning back, as the major indices suffered telling losses, hitting resistance near 3 1/2 - 4-year highs.
More sluggish data and trepidation over Friday's non-farm payroll number had investors (and machines) taking profits and looking for places to hide.
First quarter productivity was lower by 0.5%, though expectations were for a larger decline of -0.8%. The missing and/or exceeding of poor expectations has become something of a sport on Wall Street, with the bullish head-cases believing that anything better than even lousy expectations is a good thing. It's not. Even the burliest New Jersey fixed income book trader should be aware of that.
Unit labor costs rose 2% in the quarter, a stick in the eye of the 1-percenters.
ISM Services was where the big miss occurred, however, breaking down to 53.5 for April on expectations of 55.5 after booking 56.0 in March. After the Poor PMI data earlier in the week and the anomalous ISM manufacturing number that showed modest positive spin, a breakdown in the services sector would be a death knell for the "recovery at all costs" addicts, since service has become mainstream to the US economy.
Meanwhile, it's been eerily quiet on the continent, as Europe slinks into recession. Some economist with a sense of sick humor actually penned an article pointing out how conditions were improving in Greece, of all places, where 80% of businesses in the Athens business district have closed their doors in the past two years and tax receipts are easily outweighed by bribes. The article was so obtuse and fundamentally flawed, it may have been scrubbed from the internet.
The best news of the day was crude oil dropping by $2.68 a barrel, it's biggest one-day decline in over a month, and long overdue, though all commodities were lower, especially gold and silver, a sign of redemption amidst what may be the beginning of a scramble for cash.
Everything hinges on Friday's job number: Obama's re-election bid, general confidence in the economy, and more. Many sleazy banker types around Wall Street are silently praying for a poor number, so that the Fed will continue it Zero Interest Rate policy and maybe drop another round of QE on their best buddies.
My, oh, my, these bankers are a sly lot. Not.
Dow 13,206.59, -61.98 (0.47%)
NASDAQ 3,024.30, -35.55 (1.16%)
S&P 500 1,391.57, -10.74 (0.77%)
NYSE Composite 8,049.74, -74.59 (0.92%)
NASDAQ Volume 1,824,468,000
NYSE Volume 3,966,676,500
Combined NYSE & NASDAQ Advance - Decline: 1566-4050
Combined NYSE & NASDAQ New highs - New lows: 202-104
WTI crude oil: 102.54, -2.68
Gold: 1,634.80, -19.20
Silver: 30.01, -0.64
Thursday, May 3, 2012
Wednesday, May 2, 2012
Bad Data Continues to Be Ignored by Equity Investors
In the continuing saga of the "recovery which refuses to jibe with reality," some data points delivered this morning shook things up for a while, though the declines were hardly notable.
Well before the opening bell, the monthly ADP Employment Report, which measure the change in private payrolls, came in well below expectations of 170,000, printing at a mediocre 119,000 for April. The survey, which serves as a precursor to the monthly BLS non-farm payroll report (due Friday) is forecasting a poor showing from the government's "official" report. As it is, the forecast for 162,000 net new jobs is just barely enough to keep pace with new entrants to the labor force (roughly 125,000), so any number below that on Friday will be a major blow to the proponents of sustained recovery.
Whether investors (or the machines actually doing 84% of the trades these days) will pay any heed is doubtful, though after April's sub-par showing, stocks put in their worst month in the past seven, so maybe somebody is paying attention to facts instead of relying on instinct and animal spirits.
At 10:00 am, March factory orders were announced at -1.5%, though expectations were for worse data, -1.8%, so this actually could have been seen as a win for equity participants (or their muppet clients).
Adding to the absurdity of economic data, another official figure showed oil stockpiles increasing by 2.840 million barrels, after last week's rise of 3.978 million. That data took oil prices lower by a mere 94 cents, though the price of a barrel of light, sweet crude continues to hover near 12-month highs, despite continuing slack demand. Chalk it up to corporate greed, excessive speculation and a Washington crowd that simply cannot afford to upset one of its main donor groups by actually clamping down on absurdly high prices at the pump.
In effect, the lower and middle classes of Americans now pay an additional tax in the form of these higher fuel prices, all the while oil drilling and recovery continues to be robust in North America. Perhaps the biggest insult to the American people is that oil currently being drilled in North Dakota and elsewhere in the states will more than likely be shipped abroad, where the oil cartel can fetch even higher prices.
So much for all the talk of energy independence and security. The empty suits in the nation's capitol don't deserve even a single vote in this November's elections, though a large number of Americans, stuck in their narrow world of cognitive dissonance with a healthy dose of normalcy bias, still believe in the two-party lie and will cast their votes for the lesser evil this fall, as if their individual votes actually counted (Hint: since 2000 they haven't.).
Days like today are tough on financial reporters, especially those who toe the official media line that all is well and things are getting better, when the evidence - and most public opinion polls - clearly displays the opposite. For those of us who like our facts served cold without garnishments, the temptation to break things or convulse in a spasm of disbelief is hardly bearable.
Come Friday, when the April non-farm reveals a bit more of the truth (though one can count on the BLS and their various fudging mechanisms to completely distort any data they can), perhaps the markets will begin to reflect what's really going in America: the complete and utter annihilation of the middle class and the remaining civil rights that haven't already been denied or abused by an oligarch government that's been off the rails for more than a decade.
Maybe, some day, when fewer than half the registered voters show up in the fall, the ruling class will get a hint that their reigns of power are not derived from the electorate, though it's doubtful they will even care.
Dow 13,268.57, -10.75 (0.08%)
NASDAQ 3,059.85, +9.41 (0.31%)
S&P 500 1,402.31, -3.51 (0.25%)
NYSE Composite 8,124.32, -39.71 (0.49%)
NASDAQ Volume 1,832,346,375
NYSE Volume 3,784,334,250
Combined NYSE & NASDAQ Advance - Decline: 2707-2890
Combined NYSE & NASDAQ New highs - New lows: 187-66
WTI crude oil: 105.22, -0.94
Gold: 1,654.00, -8.40
Silver: 30.64, -0.29
Well before the opening bell, the monthly ADP Employment Report, which measure the change in private payrolls, came in well below expectations of 170,000, printing at a mediocre 119,000 for April. The survey, which serves as a precursor to the monthly BLS non-farm payroll report (due Friday) is forecasting a poor showing from the government's "official" report. As it is, the forecast for 162,000 net new jobs is just barely enough to keep pace with new entrants to the labor force (roughly 125,000), so any number below that on Friday will be a major blow to the proponents of sustained recovery.
Whether investors (or the machines actually doing 84% of the trades these days) will pay any heed is doubtful, though after April's sub-par showing, stocks put in their worst month in the past seven, so maybe somebody is paying attention to facts instead of relying on instinct and animal spirits.
At 10:00 am, March factory orders were announced at -1.5%, though expectations were for worse data, -1.8%, so this actually could have been seen as a win for equity participants (or their muppet clients).
Adding to the absurdity of economic data, another official figure showed oil stockpiles increasing by 2.840 million barrels, after last week's rise of 3.978 million. That data took oil prices lower by a mere 94 cents, though the price of a barrel of light, sweet crude continues to hover near 12-month highs, despite continuing slack demand. Chalk it up to corporate greed, excessive speculation and a Washington crowd that simply cannot afford to upset one of its main donor groups by actually clamping down on absurdly high prices at the pump.
In effect, the lower and middle classes of Americans now pay an additional tax in the form of these higher fuel prices, all the while oil drilling and recovery continues to be robust in North America. Perhaps the biggest insult to the American people is that oil currently being drilled in North Dakota and elsewhere in the states will more than likely be shipped abroad, where the oil cartel can fetch even higher prices.
So much for all the talk of energy independence and security. The empty suits in the nation's capitol don't deserve even a single vote in this November's elections, though a large number of Americans, stuck in their narrow world of cognitive dissonance with a healthy dose of normalcy bias, still believe in the two-party lie and will cast their votes for the lesser evil this fall, as if their individual votes actually counted (Hint: since 2000 they haven't.).
Days like today are tough on financial reporters, especially those who toe the official media line that all is well and things are getting better, when the evidence - and most public opinion polls - clearly displays the opposite. For those of us who like our facts served cold without garnishments, the temptation to break things or convulse in a spasm of disbelief is hardly bearable.
Come Friday, when the April non-farm reveals a bit more of the truth (though one can count on the BLS and their various fudging mechanisms to completely distort any data they can), perhaps the markets will begin to reflect what's really going in America: the complete and utter annihilation of the middle class and the remaining civil rights that haven't already been denied or abused by an oligarch government that's been off the rails for more than a decade.
Maybe, some day, when fewer than half the registered voters show up in the fall, the ruling class will get a hint that their reigns of power are not derived from the electorate, though it's doubtful they will even care.
Dow 13,268.57, -10.75 (0.08%)
NASDAQ 3,059.85, +9.41 (0.31%)
S&P 500 1,402.31, -3.51 (0.25%)
NYSE Composite 8,124.32, -39.71 (0.49%)
NASDAQ Volume 1,832,346,375
NYSE Volume 3,784,334,250
Combined NYSE & NASDAQ Advance - Decline: 2707-2890
Combined NYSE & NASDAQ New highs - New lows: 187-66
WTI crude oil: 105.22, -0.94
Gold: 1,654.00, -8.40
Silver: 30.64, -0.29
Tuesday, May 1, 2012
May Day Mayday: Stocks Retreat into Close
All is not well on Wall Street.
Even though stocks continue climbing - the Dow made a four-year intra-day high in today's session - there's an underlying theme that profits and revenue aren't as good as they should be.
But, hey, the vast majority of those companies trading publicly on the exchanges - Groupon excluded - are making money, after all, so why the worry?
In a word, revenue. While second quarter profits were solid on an EPS basis, revenue beats were less frequent and minor, meaning companies have little room for error and even less inclination to hire new employees. Most public companies are running on fumes; in the private sector of small to medium businesses, those fumes have died out. Small business, the lifeblood of the economy, and, to some extent, to the larger public companies, are struggling just to hang on. Excessive regulation and taxation have small businesses on their knees, so to speak, begging for relief.
There's simply too much uncertainty for entrepreneurs to feel confident about starting new ventures or expanding existing ones. If growth is a bottom-up strategy, the federal government, with help from pencil-necked bureaucrats at the state and local levels, hasn't done a thing to assist small business or business creation. It could be assumed that they are impeding progress instead of promoting it.
This being a presidential election year, congress is not expected to make any dramatic legislative decisions, which will only exacerbate the current condition of loathsomeness, uncertainty and apathy, and that's the good news. What's troubling are the massive deficits being piled up second by second at the federal level and the coming debt ceiling debate (yes, you read that right; we're going to exceed our borrowing limit just a year after the debacle which cost the US its AAA credit rating last August.
At the current run-rate, the debt ceiling will be breached just in time for excessive and long-winded campaign speeches touting frugality, responsibility and discretion, all qualities the current occupants of our highest public offices have failed to achieve or even comprehend.
Thus it is that Wall Street is becoming a little nervous about the inability of government to do just about anything positive in a negatively-charged, partisan environment. Big business has gotten all the perks it needs, but still comes asking, with suitcases of campaign contributions, for more, and they're afraid they won't get enough to tide them over until a new regime takes hold in the nation's capitol. That's why stocks continue to make moves of trepidation, advancing slightly before taking back. Small business and individuals, meanwhile, have taken matters a step further: into black markets and a flourishing underground economy based entirely in cash, with disdain for taxes, laws and regulations.
A recent Bloomberg/BusinessWeek article pegged the US underground economy at a laughable nine percent, while quoting the black markets of other countries at levels as high as 47%. All of this erodes the government's ability to collect revenue, but not to spend, making their position all the more untenable and indefensible. The mega-corporations may survive under such conditions, but even the most honest of small businesspersons cannot long resist stiffing Uncle Sam to feed daughter Sally.
Wall Street, as much as it has become a mirage of the economic condition, is actually more resplendent as an amusement park, twisted mirror image reflection of the society underpinning its shattered facade.
Dow 13,279.32, +65.69 (0.50%)
NASDAQ 3,050.44, +4.08 (0.13%)
S&P 500 1,405.82, +7.91 (0.57%)
NYSE Composite 8,164.04, +44.97 (0.55%)
NASDAQ Volume 1,855,537,125
NYSE Volume 3,789,438,750
Combined NYSE & NASDAQ Advance - Decline: 3183-2336
Combined NYSE & NASDAQ New highs - New lows: 340-31
WTI crude oil: 106.16, +1.29
Gold: 1,662.40, -1.80
Silver: 30.93, -0.09
Even though stocks continue climbing - the Dow made a four-year intra-day high in today's session - there's an underlying theme that profits and revenue aren't as good as they should be.
But, hey, the vast majority of those companies trading publicly on the exchanges - Groupon excluded - are making money, after all, so why the worry?
In a word, revenue. While second quarter profits were solid on an EPS basis, revenue beats were less frequent and minor, meaning companies have little room for error and even less inclination to hire new employees. Most public companies are running on fumes; in the private sector of small to medium businesses, those fumes have died out. Small business, the lifeblood of the economy, and, to some extent, to the larger public companies, are struggling just to hang on. Excessive regulation and taxation have small businesses on their knees, so to speak, begging for relief.
There's simply too much uncertainty for entrepreneurs to feel confident about starting new ventures or expanding existing ones. If growth is a bottom-up strategy, the federal government, with help from pencil-necked bureaucrats at the state and local levels, hasn't done a thing to assist small business or business creation. It could be assumed that they are impeding progress instead of promoting it.
This being a presidential election year, congress is not expected to make any dramatic legislative decisions, which will only exacerbate the current condition of loathsomeness, uncertainty and apathy, and that's the good news. What's troubling are the massive deficits being piled up second by second at the federal level and the coming debt ceiling debate (yes, you read that right; we're going to exceed our borrowing limit just a year after the debacle which cost the US its AAA credit rating last August.
At the current run-rate, the debt ceiling will be breached just in time for excessive and long-winded campaign speeches touting frugality, responsibility and discretion, all qualities the current occupants of our highest public offices have failed to achieve or even comprehend.
Thus it is that Wall Street is becoming a little nervous about the inability of government to do just about anything positive in a negatively-charged, partisan environment. Big business has gotten all the perks it needs, but still comes asking, with suitcases of campaign contributions, for more, and they're afraid they won't get enough to tide them over until a new regime takes hold in the nation's capitol. That's why stocks continue to make moves of trepidation, advancing slightly before taking back. Small business and individuals, meanwhile, have taken matters a step further: into black markets and a flourishing underground economy based entirely in cash, with disdain for taxes, laws and regulations.
A recent Bloomberg/BusinessWeek article pegged the US underground economy at a laughable nine percent, while quoting the black markets of other countries at levels as high as 47%. All of this erodes the government's ability to collect revenue, but not to spend, making their position all the more untenable and indefensible. The mega-corporations may survive under such conditions, but even the most honest of small businesspersons cannot long resist stiffing Uncle Sam to feed daughter Sally.
Wall Street, as much as it has become a mirage of the economic condition, is actually more resplendent as an amusement park, twisted mirror image reflection of the society underpinning its shattered facade.
Dow 13,279.32, +65.69 (0.50%)
NASDAQ 3,050.44, +4.08 (0.13%)
S&P 500 1,405.82, +7.91 (0.57%)
NYSE Composite 8,164.04, +44.97 (0.55%)
NASDAQ Volume 1,855,537,125
NYSE Volume 3,789,438,750
Combined NYSE & NASDAQ Advance - Decline: 3183-2336
Combined NYSE & NASDAQ New highs - New lows: 340-31
WTI crude oil: 106.16, +1.29
Gold: 1,662.40, -1.80
Silver: 30.93, -0.09
Monday, April 30, 2012
Window Dressing Day Spoiled by Chicago PMI; Fantasy Economics Meets Reality
Normally, the last day of the month is marked by incessant buying of momentum stocks by fund managers and other hucksters hoping to impress clients by owning shares of the most popular companies, but today's shopping spree was truncated by a terrible Chicago PMI report, which weighed down markets, sending all of the major indices into the red.
The PMI report, which was released to the public just fifteen minutes into the session, printed at 56.2, the lowest number since November, 2009, missing expectations of 60.0 by a country mile.
Despite any and all opinions to the contrary, this number was just another in a string of disappointing economic data, highlighted by last week's first estimate of first quarter GDP of 2.2% annualized growth. While commentators have thus far downplayed the importance of the GDP figure, the evidence is stark, especially when reinforced by the PMI today.
Not wishing to face the bitter truth that the US - and by many measures, the global - economy has stalled out once again, Wall Street refuses to set about the arduous task of taking profits and marking stocks down to reasonable valuations, whatever those might be. Stocks have been trading far from fundamentals and investors haven't paid heed to the undercurrents of decline in Europe, Asia and here in the Western Hemisphere, though that line of thinking may be changing soon.
Sell in May and Stay Away goes the timeless adage. Why stocks should encounter such a seasonal variation is of questionable veracity, but if oil prices (which declined today) remain elevated as they have been through the summer, the banking and investing goons and their paid servants in Washington DC might get a dose of bad medicine courtesy of Mr. Market, delivered by Adam Smith's fabled invisible hand that routinely cycles in and out of market dynamics and pays special attention to bubbles and irrationality.
Beyond high oil prices, the US housing industry is still in a shambles, despite the clarion call to investors rushing in to snatch up foreclosed properties with the intent to turn them into rentals. This current calamity-in-the-making ignores the most basic tenet of community: home ownership is an issue of pride. Taking what were once owner-occupied dwellings and turning them into rentals (to whom and at what price we do not know) is a basic destructor of neighborhoods and communities. The dwellings fall into disrepair, the neighborhood deteriorates and eventually, the fine "rental investment" becomes a rat hole and drug house, surrounded by wary neighbors who decry their falling property values and eventually abandon the area.
Once a neighborhood changes from owner-occupied to rental status, the changes, though subtle, are irreversible, the tipping point likely reached when at least 40% of the properties assume rental status. The changes may take years or even decades in normal times, though in the current situation, in which home values have already been whacked for a loop, buying at bargain basement prices, while alluring to investors and productive of cash flow, may turn out to be just the beginning of a non-virtuous cycle. Renters move in, neighborhoods decline, property values continue to fall and recouping the original investment may never materialize. The next step in the process is that of the investors walking away, having milked the value from the properties via rental income, the community destroyed by their ravenous profit appetite. That's why neighborhoods become ghettos in the first place and stay ghettos, ever after. Wash, rinse, repeat.
Beside the ill-conceived notion that the real estate market has bottomed (a laughable and lamentable idea if ever there was one - it was the topic of a one-page feature in the current issue of Esquire, so there's that canard), the Fed is stalling on plans for more stimulus, which is apparently needed, even though it doesn't work long run, and Europe is fast-falling into recession. China's growth is being internalized, austerity policies haven't done squiddly-doo to revamp broken sovereign balance sheets and the debt bubble continues to expand.
Some day, the Keynesians in and out of government and the policy houses will finally be outed by forces of markets which are stronger than any academic noise and nonsense. The real world doesn't always cooperate with economic theory and we are seeing it played out at breathtaking pace.
There's truly only one solution for an overhang of malinvestment and debt: loss. And it will surely visit those who have the most to lose.
Mark down April as the worst month for stocks thus far, but lay bets that there will be worse to come.
Dow 13,213.63, -14.68 (0.11%)
NASDAQ 3,046.36, -22.84 (0.74%)
S&P 500 1,397.91, -5.45 (0.39%)
NYSE Composite 8,118.95, -32.96 (0.40%)
NASDAQ Volume 1,585,325,125
NYSE Volume 3,379,976,250
Combined NYSE & NASDAQ Advance - Decline: 2056-3568
Combined NYSE & NASDAQ New highs - New lows: 190-40
WTI crude oil: 104.87, -0.06
Gold: 1,664.20, -0.60
Silver: 30.96, -0.39
The PMI report, which was released to the public just fifteen minutes into the session, printed at 56.2, the lowest number since November, 2009, missing expectations of 60.0 by a country mile.
Despite any and all opinions to the contrary, this number was just another in a string of disappointing economic data, highlighted by last week's first estimate of first quarter GDP of 2.2% annualized growth. While commentators have thus far downplayed the importance of the GDP figure, the evidence is stark, especially when reinforced by the PMI today.
Not wishing to face the bitter truth that the US - and by many measures, the global - economy has stalled out once again, Wall Street refuses to set about the arduous task of taking profits and marking stocks down to reasonable valuations, whatever those might be. Stocks have been trading far from fundamentals and investors haven't paid heed to the undercurrents of decline in Europe, Asia and here in the Western Hemisphere, though that line of thinking may be changing soon.
Sell in May and Stay Away goes the timeless adage. Why stocks should encounter such a seasonal variation is of questionable veracity, but if oil prices (which declined today) remain elevated as they have been through the summer, the banking and investing goons and their paid servants in Washington DC might get a dose of bad medicine courtesy of Mr. Market, delivered by Adam Smith's fabled invisible hand that routinely cycles in and out of market dynamics and pays special attention to bubbles and irrationality.
Beyond high oil prices, the US housing industry is still in a shambles, despite the clarion call to investors rushing in to snatch up foreclosed properties with the intent to turn them into rentals. This current calamity-in-the-making ignores the most basic tenet of community: home ownership is an issue of pride. Taking what were once owner-occupied dwellings and turning them into rentals (to whom and at what price we do not know) is a basic destructor of neighborhoods and communities. The dwellings fall into disrepair, the neighborhood deteriorates and eventually, the fine "rental investment" becomes a rat hole and drug house, surrounded by wary neighbors who decry their falling property values and eventually abandon the area.
Once a neighborhood changes from owner-occupied to rental status, the changes, though subtle, are irreversible, the tipping point likely reached when at least 40% of the properties assume rental status. The changes may take years or even decades in normal times, though in the current situation, in which home values have already been whacked for a loop, buying at bargain basement prices, while alluring to investors and productive of cash flow, may turn out to be just the beginning of a non-virtuous cycle. Renters move in, neighborhoods decline, property values continue to fall and recouping the original investment may never materialize. The next step in the process is that of the investors walking away, having milked the value from the properties via rental income, the community destroyed by their ravenous profit appetite. That's why neighborhoods become ghettos in the first place and stay ghettos, ever after. Wash, rinse, repeat.
Beside the ill-conceived notion that the real estate market has bottomed (a laughable and lamentable idea if ever there was one - it was the topic of a one-page feature in the current issue of Esquire, so there's that canard), the Fed is stalling on plans for more stimulus, which is apparently needed, even though it doesn't work long run, and Europe is fast-falling into recession. China's growth is being internalized, austerity policies haven't done squiddly-doo to revamp broken sovereign balance sheets and the debt bubble continues to expand.
Some day, the Keynesians in and out of government and the policy houses will finally be outed by forces of markets which are stronger than any academic noise and nonsense. The real world doesn't always cooperate with economic theory and we are seeing it played out at breathtaking pace.
There's truly only one solution for an overhang of malinvestment and debt: loss. And it will surely visit those who have the most to lose.
Mark down April as the worst month for stocks thus far, but lay bets that there will be worse to come.
Dow 13,213.63, -14.68 (0.11%)
NASDAQ 3,046.36, -22.84 (0.74%)
S&P 500 1,397.91, -5.45 (0.39%)
NYSE Composite 8,118.95, -32.96 (0.40%)
NASDAQ Volume 1,585,325,125
NYSE Volume 3,379,976,250
Combined NYSE & NASDAQ Advance - Decline: 2056-3568
Combined NYSE & NASDAQ New highs - New lows: 190-40
WTI crude oil: 104.87, -0.06
Gold: 1,664.20, -0.60
Silver: 30.96, -0.39
Saturday, April 28, 2012
Debt Collection Agencies Must Follow the Law
The financial calamity of 2008 and the recession it produced took its toll on business and consumers across America. Personal and business bankruptcies have been a common thread to the weak recovery since the near-fatal economic collapse, and many people still struggle with high debt loads and unrealistic repayment schedules.
Conditions such as have existed for most of the past four years have led to a boom in collections, but also a great deal of abuse by banks, phony credit counseling agencies and the collections firms themselves. Mostly innocent consumers have been berated by phone calls, threatening letters and outlandish demands from unscrupulous operators seeking to capitalize on the misfortune of others.
Fortunately, there are strict laws in almost every state and federal statutes that prohibit many of these bad practices, such as threats of job loss, excessive phone calls at unusual hours and other abhorrent behavior. while the majority of collection firms abide by the laws, there are shady operators who skirt the boundaries and make life miserable for many.
In the Golden State, where the calamity of mortgage debt, job scarcity and personal indebtedness have created a perfect storm for collection agencies, there are many law firms and counseling centers which help stop collection harassment California through advocacy, letter writing and legal tactics that often bring the violators to justice.
Proper procedures must be followed by the collection companies, and they are enumerated by a strong set of laws throughout the country which can help stop collection harassment for good. Collectors, for instance, are prohibited from threatening or harassing consumers. The proper and prohibited procedures are spelled out in simple language in the Fair Debt Collections Practices Act (FDCPA), which gives power back to the people instead of in the hands of the banks and collections agencies.
Having excessive debt isn't always one's own fault, nor is the inability to make timely payments. Fortunately, there are laws which protect consumers and good-hearted companies and lawyers that can help make dealing with debt collectors a little less daunting and in line with the law.
Conditions such as have existed for most of the past four years have led to a boom in collections, but also a great deal of abuse by banks, phony credit counseling agencies and the collections firms themselves. Mostly innocent consumers have been berated by phone calls, threatening letters and outlandish demands from unscrupulous operators seeking to capitalize on the misfortune of others.
Fortunately, there are strict laws in almost every state and federal statutes that prohibit many of these bad practices, such as threats of job loss, excessive phone calls at unusual hours and other abhorrent behavior. while the majority of collection firms abide by the laws, there are shady operators who skirt the boundaries and make life miserable for many.
In the Golden State, where the calamity of mortgage debt, job scarcity and personal indebtedness have created a perfect storm for collection agencies, there are many law firms and counseling centers which help stop collection harassment California through advocacy, letter writing and legal tactics that often bring the violators to justice.
Proper procedures must be followed by the collection companies, and they are enumerated by a strong set of laws throughout the country which can help stop collection harassment for good. Collectors, for instance, are prohibited from threatening or harassing consumers. The proper and prohibited procedures are spelled out in simple language in the Fair Debt Collections Practices Act (FDCPA), which gives power back to the people instead of in the hands of the banks and collections agencies.
Having excessive debt isn't always one's own fault, nor is the inability to make timely payments. Fortunately, there are laws which protect consumers and good-hearted companies and lawyers that can help make dealing with debt collectors a little less daunting and in line with the law.
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