h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

Mountain Home, Arkansas – February 1, 2007

It’s 4 AM and completely overcast with low gray clouds. There is five inches of fresh white snow on the ground. The small amount of light from neighboring houses reflects off the low clouds and onto the snow, making everything strangely bright and easy to see.

The pond is frozen over. I spent an hour yesterday, before it snowed, throwing big rocks up in the air to land on the ice. I love the sound the rocks make when they hit the ice. It’s a crisp, long Twangggg! that cuts the frozen air.

My friend here in Mountain Home is a national expert on credit and debit card transactions. He travels about the country keeping the heads of big banks and credit card companies abreast of new developments. We met in 1972 just after Vietnam, 35 years ago. I like to stop here, sample his homemade wine, and help him hang doors in the evening on the house in the woods he has been building, one piece at a time, for the last three years.

He tells me that the Republican controlled House and Senate passed a new law on credit cards last year. Now credit card companies can increase the rates they charge consumers if they are late on a single payment on any credit card or if the consumer’s credit rating drops slightly. Of course, he says, consumers in the US can no longer escape credit card debt though the bankruptcy process. The higher rates approach 40%, rather than the standard 20%.

Also interesting is the newfound ability of thieves to read the information on a debit card and calculate the card's PIN number. He tells me that a debit cards magnetic stripe contains an account number and a PIN number offset, which uses a 256 bit encryption algorithm, use to validate the PIN number. This information is read and stored each time the card is used at, say, Starbucks for coffee.

One US bank was hacked into and lost the information on 50 million accounts. The customers then began to find their accounts emptied though withdrawals at ATM in places like Latvia and Bulgaria. Paul believes that the PIN Number offset algorithm has been cracked, the only logical explanation for the Bank’s customer losses to date of $12 Billion dollars. Other banks and vendors have been hacked for account information.

The temperature is not projected to rise above zero degrees Centigrade for about ten days. We’d like to go to Florida and play tennis with friends camping in Sarasota, but driving out of here may be problematic.

If you do take off, be berry, berry careful.

Have you visited Hot Springs on any of your Arkansas trips? I may put it on my list of places to retire. It is way past it's prime as a tourist destination, but the area around it is just gorgeous.

Yes...I've been to Hot Springs...Many of Stephen Hunter's books about Bob the Sniper are set in Arkansas...including one titled "Hot Springs" ...The tennis courts here are covered with six inches of snow...Didn't Frankin D. Roosevelt die there? Shame that he's not in his 20th term...

FDR...and George C Marshall as SecState.

I think that was Warm Springs, Georgia.

Yep, FDR was one of those rare birds - a rich man who cared about the plight of ordinary folk. He accepted that priviledge comes with responsibility. Eleanor wasn't too shabby, either.

Of course I was brainwashed at a very early age about FDR. My dad was a huge fan of his.

Historians consistently rank FDR among the top 3 presidents.

Hmm. I wonder what rank the incumbent will be placed...

Dad always said there were three great men in history - Moses, Jesus and FDR.

The situation is fortunate only in that it will nail the dichotomy within amerkin society...the dumb****s will remain convinced that Howdy Dubya Doody was the best thing since sliced bread...and the people who are paying attention, have no qualms about removing him from consideration, as a valid president [to begin with].

Always happy to troll up a conversation about politics, sex, religion, money, music or poetry....

McArthur as Secretary of Defense?

Need to think about that....

I no longer use credit cards. Having narrowly escaped the financial abyss, I find I can do all my online purchasing using the debit card, and avoid debt entirely. As you pointed out, once usury was made legal by the Republican-controlled congress, bankruptcy wasn't a real option either. And don't forget that Smilin' Joe Biden voted for that bill. He's from Delaware, where some major credit card companies are based.

But now my debit card is vulnerable too, eh?

That's the opinion of my expert. He says the Dems are in the pocket of the credit card companies as well, so don't expect any regulation changes from the new Congress....

In fact, you have much more protection from fraud with a credit card, he says, than with a debit card....with a debit card your liability goes from $50 to $500 to balance of account over a 60 day period. The banks will stone-wall your clain not to have been in Latvia until the protections expire...and a new practice is to advance that $4 debit card overdraft and charge a $40 processing fee...annual returns on the advances may range to 20,000 percent or more....

This is not good news, Phred.

Samuel Johnson argued that debtor's prisons should be abolished as ineffective. He pointed out that generations had been imprisoned and died for debts as small as $.50.

In 1758 he said, "We have now learned, that rashness and imprudence will not be deterred from taking credit; let us try whether fraud and avarice may be more easily restrained from giving it."

Like Lil, I am trying to live my life on a pay as you go system. I thought my debit card was safe.

So, any difference in the safety levels of smallish banks VS large banks? Smallish cities VS large cities?

Let's see...a $40 fee on a $4 debit card overdraft for one day is 1,000 percent daily interest....annualized, that example is 365,000 percent interest...the "vig" on mafia loans is a relative bargain...and you don't even need to sign an overdraft agreement...they make the $4 advance without your permission...it's all legal now... sharks in the water...avarice...

If your debit card is with a bank that gets hacked or you buy from a vendor thatv gets hacked you are at risk, apparently...I only use my debit card at ATMs and at the very rare gas station that doesn't accept credit cards....

Since you should be able to get a credit card that offers at least a 1% rebate, I've always wondered why debit cards have become so popular that they are now used at Starbucks and to but Big Macs...call me old-fashioned...I don't keep my cell phone charged either....

Unfortunately it appears that having your money in a sock under your mattress isn't a bad idea. I wonder what the comparative odds are of having your house robbed and being a victim of credit card/debit card fraud?