Whatever happened to a penny saved is a penny earned? Ok, I’m Mexican, so we’re gonna’ have to talk pesos, but you get my drift; what the hell happened?

The world is in crisis; I know it’s pretty easy to sit back on our asses and blame all the blue eyed people in the world, especially Gringos, but come on, didn’t anyone see this coming? Weren’t there any clues that the gig was coming to an end?

Credit holders, especially credit card holders are getting pretty pissy here in Mexico as late payments and interest fees begin to reach staggering hights.

Millions of first-time credit card holders remade Mexico in recent years, buying everything from diapers to DVD players on credit and spurring a boom in consumer spending and bank profits.

Many now regret it: With interest rates, commissions and fees topping 100 percent a year, delinquencies have soared as the global economic crisis boosts unemployment and leads banks to raise rates even more.

“There’s no way out,” said Manuel Correa, a Mexico City messenger who saw his minimum monthly payments quadruple to 1,500 pesos, or $105, when he missed a few after losing his previous job. That amount is a third of his income.

“I’d have to choose between eating, paying the rent or paying the bank,” he said. He chose to eat.

Congressmen, grass roots activists, one of the world’s richest men and even the Roman Catholic Church are now rebelling against the rates, some of the world’s highest and equal to 10 times the top rate banks pay out on deposits.- AP

A funny thing happened in Mexico a few years back: Banks began offering credit cards to every Jose, Juan, and Jesus that could be found. No job? No problemo. No credit history, pues tampoco. What’s that, your only wordly possesions are a shopping cart, a flip flop, and a chihuahua named Nacho? Hell, you should have said so sooner, Amigo, let me set you up with two new cards.

Banking promoters gave credit to people who simply didn’t have the capacity to repay.” -Debtor activist Alfonso Ramirez Cuellar.

All of a sudden Mexicans were happy, real happy. Mamita might not have a car, but baby Rodrigo wears Nike and has a pacifier with bling, Don Juan’s shopping cart is Armour Alled bright and Nacho has a beautiful wardrobe of custom made sweaters. Hospitals, schools, gas stations, corner stores, and taco stands began announcing credit card terminals in mass; those always tight bi-monthly paychecks all of a sudden began, miraculously, lasting until the next. Life was good, real good.

While rates range from about 28 percent to 113 percent a year, the Association of Mexican Banks insists the average is about 37 percent. But even that is three times the median U.S. credit card rate of 12.1 percent last year.-AP

Fast forward to 2008: People are drowning; they are tens at times hundreds of thousands of pesos in debt, and no way to pay. Baby Rodri’s bling has been pawned and his Nikes are worn and rub his little feet, Don Juan is trying to pimp Nacho for stud fees, and those bi-monthly paychecks that used to be tight before the miracle card came about, well, nowdays they’re just damn worthless. How the hell does the Bank expect one to support their family and pay credit card payments on such meager earnings? What the Hell is wrong with them?

Congressmen, activists, one of the world’s richest men Carlos Slim and even the Roman Catholic Church are now rebelling against the rates, some of the world’s highest and equal to 10 times the top rate banks pay out on deposits

“Banks are acting with irresponsible voracity, demanding extremely high interest rates which in the end, people won’t be able to pay,” the Catholic Archdiocese of Mexico said in December. Banks’ “insatiable greed” is speeding an economic crisis that may spark social unrest.- Catholic Church of Mexico.

Everyone has jumped on the bandwagon blaming bankers and their Mothers. By the way Church, way to get in there and defend your faithful followers; what happened, are economics and credit card payments starting to affect the amount of monthly decimas you collect?

The truth is, it was individual consumer greed that got this ball rolling; you don’t have to be an economics expert to see the truth. Everyone knows.

Where the hell is the consumer responsibility? Where they forced to live beyond their means? Can billions of pesos of defaulted debt just be charged off? Are the banks unfare to continuing collection efforts? Should either party be faulted, if so, who?

The current economic crisis has meanwhile pushed banks to renegotiate balances and offer lower rates to reliable customers. Bancomer charges as little as 28 percent for clients who pay their debts on time for a year, and Banamex says it has helped 130,000 people restructure their credit card debts.

Banks have also scaled back promotions, removing credit card sign-up stands from shopping malls and supermarket check-out counters.

What is scariest are the memories, the memories held by those of us who did weather through the crisis of 1995. We lost our homes, our businesses, and our dreams as we were forced to give up everything and payout a $70 billion bank bailout.

There are a lot of people who have to use their credit cards to buy food” because of the current economic crisis, said Congressman Antonio Soto, who wants rates capped. “They are not going to be able to pay ... and the cost will once again be borne by the taxpayers.”

Almost fifteen years later, we were just getting back on our feet, only to come out and find ourselves face to face, staring the same high interests rates vs debtor default demons directly in the eyes, again.

When will we learn that treating a penny of credit like a penny saved makes only for very skinny pigs.