Maxed Out
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  • Keep A Copy On Hand
    This is an important documentary. Everyone should keep a copy of this movie on hand to show to friends or family when the topic of debt comes up. Most people think debt and credit cards are not dangerous if you are responsible with them. What they don't realize is that they are traps that are designed to catch even the most responsible of borrowers in a growing spiral until they lose the battle. Even people who pay off their credit card balances each month should pay attention. The contracts on these agreements amount to slavery covenants. One slip up and you're in it deep.The Total Money Makeover: A Proven Plan for Financial Fitness is a book I'd recommend to fight the need to use debt as a financial planning tool....more info
  • Great DVD to go with the book
    I think this DVD makes more sense if you've also read the book. It could be watched on it's own, but it is a bit choppy. It is a great look into debt and how it affects people. I think he may have tried to fit too much into this one DVD, but overall it's a great look at this problem. Everyone with a credit card should see this! ...more info
  • Maxed Out
    1. Dee Hock believed the organization he created, Visa International would save the world by "allowing spontaneous interconnection into an equitable, enduring, twenty-first-century society in harmony with the human spirit and biosphere". The credit card has shackled individuals, imposed uniformity, destroyed value at an unprecedented rate, and, so far at least, has replaced neither the pound, the yen, nor the dollar. "Hock's company has arguably been the most powerful force behind a massive redistribution of wealth that has left this country less equal than at any time since the Great depression. Hock sought to save the planet from a rigid, hierarchical, oppressive, and bureaucratic organization.
    2. Hock worked his way into a job with Seafirst Bank in Seattle, Washington. Seafirst become a licensee of the BankAmericard, the first bank-issued credit card, a job no one wanted. Consumer credit was left to the loan sharks and pawnbrokers. "In Hock's eyes, Bank of America was not just bigness but management charts, uniform standards, titles, stupidity." The BankAmericard licensees were losing vast sums of money to credit card fraud and primitive technology and manual accounting practices. Shareholders want the problems fixed. In response to pressure, Hock reacted by creating an advisory committee (of bank members) called the Visa International which would become the most ubiquitous organization in the history of capitalism. The idea was to issue credit cards quickly, Visa would exist not for profit and exist to create a world of tangible currency replacing paper money with trillions of electronic transactions moving through the mainframe. "Visa would become the ultimate store of value" In practice it has become nothing more than a massive marketing campaign and an electronic swich that routed money from the bank of the payer to the bank of the payee. Hock remain dedicated to technology that would allow small transaction on a grand scale, hoping someday that this technology would empower the masses and give them freedom. Freedom to no longer be forced to interact with nosy, judgmental bankers! Credit cards had created a new currency and a new money supply. The bankers knew Credit cards was about selling a single product, debt.
    3. Banks were in the practice of borrowing money from individuals and lend that money to corporations. Consumer lending was not consider profitable because the small loans were time-consuming and the applicants financial situations poor and probable that they would be unable to repay the loans. Consumer credit speculation and poor lending practices had caused massive bank failures in the 1920 and 1930s. Extending credit to credit poor borrowers was "a noose with which to hang himself financially" and generally considered to be an immoral practice. Banks knew that if you give a consumer credit they will probably use it. Banks learned this lesson, in the 1920, when American had overextended themselves buying products of the industrial revolution on credit.
    4. Credit cards demand is a function of the supply of available credit. The more credit the bank supplies the more demand are created. The more people begin to depend on credit the more they need to keep accumulating credit, higher and higher credit limits; new credit to payoff old credit; mountains of credit. No other product creates this type of cycle. Credit card is the only product that its price changes: the charge, penalty fees, interest - combine to create a new price for the product or service - terms and conditions change. The Visa has become a natural monopoly.
    5. Walter Wriston, Citigroup Center guru, was the "first modern banker to realize that his job was not to teach customers how to save but how to spend as much as possible." In 1970s, Wriston was promising shareholders 15 percent annual increases in profits-just before a perfect economic storm of inflation, war, and technology bust ravaged the economy. Wriston believed countries can't go broke. Wriston was financing less-developed countries old debt replacing it with new debt, the reverse pyramid scheme. Larger and larger liabilities were being piled on top of the original debt. "Eventually the amount of new cash needed to service the old debt and new debt becomes too burdensome and the whole thing collapses beneath its weight. The only exception is where the player prints the currency with which the game is played, which makes the United States government unique among debtors." Wriston set out to conquer the middle class with Credit card debt and interest fees. "There was something seductive-addictive, even-about instant credit." "Wriston meanwhile, laid out his own vison of the promise land-a land in which millions of customers charged all of their purchases to a Citibank credit card and paid high, unregulated interest rates and fees for privilege." Millions of BankAmericard customers were sent letters explaining that their new visa card would soon be arriving: visa logo and name of bank on the front of the card. Wriston sensed opportunity, signed up to be a Visa bank, and sent out millions of Citibank Visa cards to his competitors customers before the replacement cards from their own banks arrived. Wriston preempted his competitors by a couple of weeks and they never recovered. When it came to easy credit, the average customer was lazy and lovestruck.
    6. "In 1996, Americans charged a record $1 trillion on the Visa cards." In 2004, with foreclosures, bankrupticies, and defaults all at higher levels than during the Great Depression, President Bush awarded Wriston the Presidential Medal of Freedom."
    7. Mortgage related bonds are the heavy weight of debt financing, weighting in at $6.5 trillion. The contenders are Corporate bonds, $5.4 trillion, US treasuries, $4.3 trillion, and Munical bonds at $2.4 trillion.
    8. The Subprime meltdown gave people what they wanted, homeownership. 70% of American's buy homes, 15% are deliquent, and 1 in 5 are expected to be diliquent. The blame for the rising number of foreclosures is poor loaning practices which extends credit to high risk buyers. Additionally, the adjustable rates after two years have power slammed the homeowner with a mortgage payment exceeding of their percent income they can afford. The unsound loaning practices will have the affect of tighting up the loan practice laws, more legislation laws protecting against poor loan practices, more tax based agencies to regulate loans and punish the banks for violations of regulation. The subprime meltdown starts with the loan origination which is sold to wall street investment banks, who pool the loans together into a mortgage backed security bond, Investors buy the bond and the mortgage payments pay dividends to the investor in terms of yield. Safe bonds pay low returns and high risk bonds pay higher rates and this is called securization. The carnage from the adjustable rate suggests more buyers are investing short term ownership of their homes.
    1. Mortgage companies are scrambling to work out deals for subprime borrowers to stay in their homes. However, Investors are fighting loan modifications because they are not in their best interest fearing Mortgage companies will give out to many, the loan modifications will go too dead beat borrowers with a high probablity of being late again in a reoccurring pattern, and a strong level of doubt that many of the subprime borrowers merit a rescue plan. 2. Lenders usually end up losing money on a foreclosure. 15% of the sub prime borrowers are 60 days late on payments. The practice of no money down on loans extended credit too borrowers with weak credit. The loan modifications include reducing the interest rate or stretching out terms. Two elements have moved against home owners: a. dropping house prices is causing an emerging buyers market b. too much credit is forcing home owners to fall behind on payments. (lenders want borrowers to keep up with their payments - run faster is the charge) 3. Different classes of investors have different interests. Holders of the highest ratings are first to collect payments on interest based on risk. The bond structure is such that there is cash flow for obligations to the investor and leaving a cushion for defaults. If after three years of good performance the cushion may be reduced. In some cases the cash goes first to the lower rate security investors and the high risk rates investors are last to get a payment. In this case loan mods benefit the low risk investor and boosting the credit ratings. The high risk investors want the residuals to be stockpiled as insurance against defaults, so they don't lose out on profits for their payments.
    10. The Subprime crisis will require billions of dollars in bailouts to stablize. Up to 1.5 million additional US homeowners may lose their homes to foreclosure. CDO collaterial is heavily backed by RMBS. ARM rates are due to adjust causing a new wave of foreclosures. Lender liquidity is expected to dry up. The subprime mortgage market is a trillion dollar business. Hedge funds are among the big losers in the Subprime sector. The subprime crisis will have an impact on the broader markets and economy.
    ...more info
  • Let the Buyer Beware
    It's a good message for the first half when it's expressing a cautionary tale on irresponsible borrowing. But the second half sorta derailed when it became a hit piece on Bush somehow being the brainiac [which no one has accused him of ever being a brainiac] that is forcing people underwater on easy/expensive credit. That doesn't fly, freedom means you are on your own. You are free to refuse credit... and I wish you would because the exuberant amount of fiat money in the system inflates all pricing for everyone, even for those who are financially responsible. This filmmaker obviously went to the propaganda film school of Michael Moore. The formula is simple, show half the story, emphasizing one side for effect. It's a disservice.

    For instance, the 'filmmaker' heavily glosses over the majority of borrowers that game the system for every drop they can, default to chapter 11, and walk away scot free. And then he devolves into advocating socialized medicine and the iraq war. Not really the point of the movie. I suppose he could have brought it back around by talking about leftist agendas of forgiven foreign debt to developing nations... which also induces the moral hazard and keeps them impoverished. That wouldn't fit in with his template of course....more info
  • A Must See To EVERYONE!
    Whether you are a student, unemployed, homeless, or a multi millionare, if you still have a pulse, you need to see this movie. This movie should be a requirement for high school graduation. I believe if it gets through at least 1% of the high school graduation class, then it would make a tremendous impact on a person's life. I try to show this movie to as many people as possible. ...more info
  • Wake up, wise up, settle up...
    This is a good film that illustrates the trouble people can get into with credit debt, but remember that these are people that got into that trouble on their own. No one forced them to sign on for credit, and no one blacked out the fine print that they should have read, but probably didn't.

    Face it, people sign on the line and ignore the rules, then sit around wondering how they got in their mess. And then they do it again (and again!), as shown by the folks who have 6, 8, or 10+ credit cards. Some get the extra cards to play the balance transfer game, but then they end up being unable to resist that new decorative plate/plasma TV/concert tickets and they charge up the new card as fast as the old. Most just get a new card because the last one 'maxed out' and there's more stuff they want to buy.

    Responsible spendiing and personal budgeting will be the only way that people get out and stay out of debt. Blaming the credit card company, the economy, or the President because of debt created by luxury items is whiny fingerpointing. And while this movie does an admirable job of painting the credit industry as an evil empire, it simultaneously implies that many of its 'victims' are hapless wide-eyed rubes who got suckered.

    Credit is a business. Yes, they are out to make money and make their stockholders happy, just like the Gap or Starbucks or McDonalds. But what they offer is attractive to people because basically they're offering the opportunity to buy things that can be paid for 'later'. Should they be stricter about limiting who they give credit to? Probably, but then they would have to put up with accusations of fairness and discrimination when denying credit.

    However, Maxed Out does a disservice to its viewers in not illustrating, or even mentioning, the number of solutions and programs that the major credit card companies actually offer to help cardholders pay off their debt. There are divisions in these companies whose sole job is to offer programs and set up more affordable payment plans to cardholders who are in trouble, often at reduced or even zero interest. However, thanks to the common and negative perception of credit card companies as predatory and harassing, many people refuse to listen to anything that is offered. Maxed Out misses its opportunity to clue people in to these solutions, choosing instead to focus on the broader target of the Bad Ol' Credit Card Companies being mean to the Little Guy.

    If you're in credit debt, you should definitely call your credit card company, tell them you are having difficulty and ask about any programs that can help you pay off your debt. You'll be surprised at the solutions that are available.

    And if you have no idea about how the whole credit industry works, Maxed Out is a good introduction, despite its idealogical and political slantings. Use it as a starting point to do some research of your own....more info
  • Sign of the times...
    They forgot a quite significant definition:

    RESPONSIBLE

    Main Entry: reˇ¤sponˇ¤siˇ¤ble

    Pronunciation: ri-'sp?n(t)-s&-b&l
    Function: adjective
    Etymology: Anglo-French responsable, from respuns

    1 a : liable to be called on to answer b (1) : liable to be called to account as the primary cause, motive, or agent (2) : being the cause or explanation c : liable to legal review or in case of fault to penalties

    2 a : able to answer for one's conduct and obligations : TRUSTWORTHY b : able to choose for oneself between right and wrong

    3 : marked by or involving responsibility or accountability



    Man, it's just so easy to blame everything on someone else these days, e.g fast food for being fat, big tobacco for cancer, blaming banks for uncontrolled spending. Jeeez.

    I can just about guarantee if "these poor people were given a second chance with bankruptcy being an option" 85% would end up in the same damn boat all over again.

    ...
    more info
  • Already there...
    This is a powerful documentary for me mainly because it hits close to home. I've known some people who got themselves into deep doo-doo with credit problems and have taken a long time to dig themselves out.

    I find it interesting that the negative reviews for the film argue that it doesn't mention "personal responsibility" and places the blame for all of this at the feet of the corporations and the government. I'll agree its fairly one-sided in that regard but when the problem has been created by the corporations and the government to begin with, then that's arguably where most of the blame *should* lay. The evidence is at the end when the congressional committee doesn't even question the corporate wonks - just lets them make their statements and "have a nice day". Yeah, nice. And lets blame the borrowers...

    I give this four stars because I'll agree somewhat with the one-sidedness. But it also loses a star because I don't think it really goes into the psychological hell that people experience when they run into massive debt. Why would credit card companies provide offers to people they consider to be high risks for bankruptcy? Wouldn't it make sense to just ignore that group and not try to get their business? Of course not - for two reasons. 1) (which was mentioned in the film) the companies don't want to lose any money - *ANY* money - they don't need to. 2) (and this wasn't really covered in the film) the companies (I think) know that the high risk people have problems with money. Just like people who have problems with gambling, alcohol, drugs, or sex, I think these companies know that people who are "high risk" for bankruptcy are also some of the biggest spenders and worst managers of their own finances - and they take advantage of it. I would have liked to have seen more development of this potential angle.

    This film is an excellent wakeup call and provides some great information for people who may not be aware of the way things are in this country. It shows just how deep the companies and the government are in this together. For that, its worth more than the price.

    I would love to see an update - since most of the stuff in here is from 2005, I want to know how the Nevada real estate agent is doing these days. Is the median price for a home still over $268,000? I believe it may not be.

    I also want to know if some of the people interviewed in this film are still alive.

    The Harvard professor mentions a two-tiered society in the America of the future. As far as I'm concerned, we're already there....more info
  • Decent eye-opener for those who may not know
    This movie is a documentary on the lending system of the U.S., mainly on the credit industry. This is heavily weighted to the anti-credit card side of the issue, but still a well made documentary for people to see if they do not realize how bad things can get for other people. A wise girl once told me to always pay yourself first before you pay others back, and that philosophy works well, and helps build savings and assets. Along with that, if you don't "Need it", don't buy it, that's what the folks always said. Wise use of credit cards is possible. I lived 28 years without one, but eventually, traveling forced me to get one due hotels taking out big "hold charges" for rooms, being too much for my debit card. almost 3 years later, still a 0 balance at the end of most months, no interest ever paid. Many of my friends are the same. Be wise with your credit. See this film if you want to re-affirm how fortunate most of us really are....more info
  • never received product
    I never received this product although I waited ample time allowing for holiday mail. Since there is no phone number to contact a customer rep and no easy way to e-mail, I have asked my credit card provider to charge back the fee and they agreed. You are entirely too difficult to reach. I mentioned the fact that I had not received this product when I rated the other dvd I ordered at the same time and I tried an e-mail address and reported that I had not received the dvd but no one has ever contacted me. I will think long and hard before I order anything through Amazon again because it is too difficult to contact customer service. Consider me an very dissatisfied customer....more info
  • Great start that loses its way
    The first half of Maxed Out should be required viewing for anyone thinking about getting a credit card for themselves (or especially for their children). Viewers are presented with sobering stats about predatory lending practices, mafia-like interest rates and the unspoken desire of banks to see their clients "get behind" and tread water by paying the minimum payments for years or even decades.

    The film takes the noble and tough love approach by showing the mistakes made by people who find themselves in credit card debt and the blissfully ignorant attitude many pay to skyrocketing interest payments and compounding late fees. For irresponsible people with bad credit, a $50 purchase on a credit card will likely turn into $200 by the time it is no longer on their balance. By not making responsible choices, people throw away thousands of dollars each year, and greedy bankers get richer and richer.

    I was halfway through watching Maxed Out when I thought it was one of the most important documentaries I had ever seen...and then it falls apart. Like all documentaries these days, George W. Bush had to make an appearance as the creator of everything bad in the world, as the man personally responsible for everything that has gone wrong for the last eight years. The film provides far-reaching ideas about how Bush's relationship with bankers and his desire to pass tougher bankruptcy laws somehow causes people to go to Best Buy and purchase $5,000 plasma televisions they can't afford.

    Sadly, the filmmakers lose focus on the real story: that people make poor choices to get into bad situations. All of the check-cashing stores and pre-approved credit card offers won't make a responsible person do the wrong thing. Presenting irresponsible people as victims of "the man" is a disservice to a country currently being strangled by financially irresponsibility.
    ...more info
  • Not suited for education
    I purchased this video for a high school business class. I did not appreciate the "F-Word" dropped by one clip of a stand up comedian. The video had some good parts, but was way to slow in developing ideas. I've already thrown it away. D. Simpson, WYO...more info
  • Eye opening info that should be taught in high school!
    This movie is really disturbing, but literally should be mandatory watching BEFORE anyone uses a credit card. This is the side Capital One doesn't want you to see! I wish the producers would have beeped out the one time the comedy guy used the "F" word, because my kids NEED to see this! I have purchased copies for my grown siblings! Borrowing should come with stronger warnings than cigarettes!
    Laure Gill...more info
  • Movie failed to turn the corner on the debt problem
    Full disclosure: My family and I are fans of, and practioners of, Dave Ramsey's The Financial Peace Planner: A step-by step guide to restoring your family's financial health. As people who have used his guidance to successfully get out of debt, we were expecting a lot from this movie because he's in it and he endorsed it.

    Yes, it is tragic that credit card companies take advantage of people and this movie clearly spells out how and why they do it. However, the film failed to turn the corner on the other part of the debt problem--people who just buy too much STUFF they can't afford.

    The most heartbreaking story in the film, in my opinion, was the 50+ year-old woman who was losing her home due to debt caused by paycheck loan overuse and the unexpected death of her spouse. Her home appeared to be filled virtually from top to bottom with expensive collector plates, which she had to sell off one by one to get cash.

    And what was the 40-year-old developmentally disabled man doing with a credit card if he couldn't even sign his name? Who was using the credit card on his 'behalf?' What were they buying?

    I wish the movie had focused more on how a credit score is developed--people wouldn't be so anxious to have a high credit score if they knew what goes into the calculations. It was also enlightening to learn how college campus areas are a breeding ground for student credit card debt.

    Other reviewers have commented on the political nature of the movie and I agree: Blaming George Bush because you can't continue to bankrupt yourself away from your credit card debt is wrong. Blame the credit card companies for your high interest rate and fees if you want, but the only person who can solve your debt problem is YOU.

    At the end, the movie even managed to get Dave Ramsey to look like a hypocrite--his debt-elimination message is vitally important for people to hear, but at the end, they included a shot of him doing an advertisement for an expensive mattress. (If you're in debt, the last thing you need to buy is a $3,000 mattress!) Yes, I know he needs to do his advertising spots for his radio program, but it just left a bad taste in my mouth because it seemed deliberately included to undercut his message of personal responsibility. ...more info
  • mandatory viewing for better money management
    The best things in life are free
    But you can keep 'em for the birds and bees
    Now give me money (that's what I want)
    That's what I want (that's what I want)
    That's what I want (that's what I want), yeah
    That's what I want

    Your lovin' gives me a thrill
    But your lovin' don't pay my bills
    Now give me money (that's what I want)
    That's what I want (that's what I want)
    That's what I want (that's what I want), yeah
    That's what I want

    Money don't get everything it's true,
    What it don't get I can't use;
    Now give me money (that's what I want)
    That's what I want (that's what I want)
    That's what I want (that's what I want), yeah
    That's what I want

    People want money. The credit card moguls prey on consumers who don't read the fine print before they sign their lives away; elected government officials including presidents "borrow" money from Social Security; and the average person wants an endless income. As my grandfather used to say, "Rich or poor, it's good to have money."

    Maxed Out is an excellent documentary that, although somewhat disjointed, does do a very good job of exploring and explaining to people--in plain English--the risks of too much debt and the responsibilities they must face when it comes time to pay back that debt. We get fascinating interviews with unsuspecting, everyday people who unknowingly were fooled by creditors to become saddled with more debt than they could handle. We also see examples of families shattered when a member of the family actually kills themselves rather than face the shame of debt or bankruptcy. In addition, look for some excellent insights from Elizabeth Warren from Harvard University and former Federal Reserve Chairman Alan Greenspan.

    Maxed Out can be difficult to watch. After all, the stories we learn of are rather sad and unpleasant. We learn of credit card companies so driven to sign anyone up they give out credit cards like candy to college freshmen working a mere 12 hours a week. It's scary. We learn how four consecutive presidents "borrowed" money from social security just to pay interest on government loans and to keep the government open. (Actually, even this failed when the government closed for three days a few years ago.) Ay!

    Worse yet, we are introduced to people at collection agencies who rather heartlessly leave messages with relatives and neighbors of the people in debt so that the debtors can be publicly embarrassed about getting a call from a collection agency. The shame is so great that according to Elizabeth Warren a bankruptcy is often referred to as "the event" because people can't bear to hear the word bankruptcy.

    Of course, there is the other side of the coin. We see Dave Ramsey, a radio DJ who coaches individual responsibility when it comes to money management. I also had the sense, although the movie did not spell this out, that many parents simply assume that their eighteen year olds would never be given a credit card--and so too many parents never teach their kids about the risks of racking up debt. Parents and schools need to teach lessons about money management very, very carefully.

    Overall, Maxed Out is an excellent film that deals with all of the above and more. The DVD also comes with interesting bonuses including another interview with Elizabeth Warren; a 1950's educational film about credit and money management that should still be shown to young students today; and we also get another close look at Dave Ramsey who counsels people on the radio about debt and getting out of it.

    I highly recommend Maxed Out for anyone who wants to better understand just how predatory credit card companies can be--and just how much we still need to know about overall money management to avoid much more debt than we could ever repay. This movie also benefits from an excellent soundtrack. Although this subject matter could be dry, the movie keeps it all interesting by also showing interviews with everyday people about their financial problems and other film clips.
    ...more info