Face to Face with Inequality

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Shopping for a Payday Loan


Check Into Cash Rate Board

I’ve made two shopping trips and hit three payday loan stores and conclude that the situation is pretty straightforward. Around here, you can get up to $255 at a cost of $45 in each of the three check cashing stores I tried.  Must be a regulatory limit. The picture at left shows the whopping interest rate of 460% and peanuts. And you get to hang on to the loot for only two weeks.

All it takes is a paystub, your most recent bank statement (a printed version), a government-issued ID, and a check. In one store I was directed to cough up my social security number, for reasons unspecified. Social security number? When they are not actually checking your credit? I wonder if real customers feel ok just handing it over. (Perhaps I should hang out there for a while one Saturday and see what people do.)

If you compare this loan to taking out a mortgage, it is super-easy. But it’s actually not half as easy as I had imagined it to be. The printed statement is definitely a pain. And then you have to go back again, in person, at your next payday to hand over the entire $300. You have got to want that money.



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Boudreaux’s Cafe

Today’s field trip to Boudreaux’s Cafe in San Francisco yielded a fascinating perspective on idealism in action.

A small part of the collection at Boudreaux's

A small part of the collection at Boudreaux’s

Bob and Tunisia both trade in collectibles and have opened a space in Bayview with a good portion of their stock on display and for sale. It’s a treasure trove made up of part thrift store, part antiques store, part performance space (for music and spoken word), and part tutoring center. With free coffee. Oh, and they’ve done a voter registration drive. Eventually they hope to turn into a full-fledged coffee shop, with a kitchen, but they have only been in operation for 11 weeks and have made themselves a fixture in the neighborhood and a drop-in center for anyone who wants a hug. It’s a great model for delivering neighborhood services, firing on so many cylinders at once.