[quote=UCGal]I read that article yesterday, also, ER. And had the same gut reaction you did.
But at least they’ll be able to BK out of it when it collapses. Unlike if they were borrowing against home equity (cash out refi’s or helocs) to get the money to wager in the market. With cram down off the table – you will have to lose your house (short sale or foreclosure) if you get your gambling money from that source… But with credit cards… BK can wipe out your “investment mistakes”.
Real investing doesn’t happen anymore. Investing is where you put down money on companies that have good long term growth potential. Now it’s all day (or week) trading… buying on the rumor, selling on the news… Hoping for short gains. It seems to be a lot closer to gambling that investing.[/quote]
Yeah, UCGal. I had a bit of dejavue with the feeling I had during the last bubble. The thing that worries me is I think the number of people doing this must be really high. I just mentioned earlier in this thread about meeting a guy and him doing this. Then I see it in the WSJ.
And this guy wasn’t some loser. He was a professional with a good stable job, a family with kids and an educated guy. A guy who should know better. If guys like him are doing it then that means many others are (also evidenced by the fact that they are trying to ban use of credit card use to invest).
If people are using their credit card cash advance checks to sink it in the stock market then I would HAVE to believe they are also going to use their HELOCS to sink it into the market as well.
Yes, I guess they can write it off in bankruptcy but it just makes me shake my head that people are doing this so quickly after the last crash. And the scary thing is these people REALLY think they are “investing”.
So true UCGal. Many people are mistaking this for “investing”. Oh well…
