#142 Pawnee

Every now and then, I encounter something so strange I gotta share it. Like when I was driving down the street the other day and I passed this pawn shop. It had a sign on the front that said “Back to School Sale” Hello! Since when does a pawnshop worry about back to school? Uh oh, its school time, don’t forget your used stereos, pawned rings and big banded watches.
But perhaps it’s a reflection of society in general. In the investment business, they talk of non-correlative stocks, stocks that go counter to the economic trend, and stocks that do well when other stocks are sucking. Kind of like now. If your portfolio is heavy in energy stocks, most notably oil, especially on the retail end, then you are one happy camper. If your stocks are in the trucking industry, forget it. It’s time to see if you can pawn a couple of 18-wheelers.
And so it is that pawn shops proliferate in times of economic woe. And so does the newest aberration in the “can’t pay it, figure out a way to borrow it” economy we have today, the cash advance store. The last line of defense for the “have-nots” or at least the “don’t-have-too-muches” is the pawnshop and/or cash advance store.
Used to be, you couldn’t charge incredibly high interest for a loan. There were laws against it. They called it usury. But laws were made to be circumvented by the people that pay off the lawmakers. The banks are no help. Truth be told, more than one bank has its sticky little fingers in the usury game. It makes sense that the traditional banks have a vested interest in charging such high check bouncing fees that the cash advance places can say, legitimately, that they are saving you money. Acquiring a high fee cash advance is cheaper than bouncing a check. Forget for a moment that revolving fees on the same 500-dollar not-paid-back-yet increment can amount to 50% interest. That stills leaves 50% to live on, or pay that car bill, or dare I say it, fill up that tank of gas so you can drive your old beater to your minimum wage greeter job. Of course, the head honchos of the big banks who own hidden interest in the cash advance places will tell you poor people are poor because they’re lazy. Yeah lazy, that’s it. Both parents working, each of them with multiple part-time minimum wage jobs because the big chains won’t let em work full time. Saving costs on that whole benefit thing, don’t you know, makes the company more attractive to shareholders. Be sure to lick the cream of your paw, fat cat. “Oh those poor people, they are so stinky. Don’t they sell deodorant at pawnshops? Hand me some cake, Marie.”
America, ya gotta love it.