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The article about Consumer Debt has a couple flaws as far as I'm concerned. Let me first state that I completely agree with Bill's point that if you have credit card debt Don't invest until it is paid off.

First of all, growth in credit card Purchases is not an indication of growing consumer debt. It is an indication that more consumers are paying with credit cards or debit cards period. More and more individuals pay for groceries, gas, clothes, utilities, etc… with credit cards to get miles or because it's easier. The issue that should have been discussed in More depth is credit card debt outstanding, not purchases (briefly mentioned in paragraph 8). By addressing only purchases you are assuming no one pays off their bill in total at the end of their payment cycle. I for one use credit cards because it creates “float”. I can leave money in my savings accounts earn interest for the month and then pay the credit card off at the end of the month. There is more that can be said here, but I would be interested to read other Fools' opinions.

Secondly, the issues at Bank One (ONE) and Bank America (BAC) have more to do with Corporate Debt (and Auto lease residual writedowns) than they do with consumer debt. I will spare you the details, but if you disagree feel free to read the earnings releases from this past week.

Third, why are you trying to single out the banks for consumer lending. Some of the largest lenders are non-banks. Companies such as: MBNA, Providian, Metris, Compucredit and Capital One. The majority of banks save Citigroup, Chase and Bank One have sold their consumer portfolios (Keycorp, Comerica, Huntington, etc…) To show the banks, as tyrants' trying to make you bankrupt is Wrong.

Fourth, banks make money through Net Interest income and Non-interest income. You're description in the 10th paragraph is far too simplistic.

If you want to talk about consumer debt I'm all for it. Personally, I don't think banks or non-banks should be able to solicit individuals that have declared bankruptcy due to debt burdens. It's almost like offering an alcoholic a beer as soon as they walk out of rehab. On the other hand, I would be very upset if I could not pay with credit cards/debit cards because they make life much easier. I am not a proponent of debt, but if you are going to argue the topic you need to present a balanced story.

This post will show up as my first ever post on the Fool, but I have read a lot of Bill's research and he is spot on with a lot of his comments, so please don't take my comments the wrong way. I have been in an occupation that I was unable to post, but now I'm able in certain situations. I look forward to interacting with many of the Fools.

I would welcome any criticisms or additions to what I have said above, since there is plenty more that can be discussed on the topic of Consumer Debt.

Have a peaceful and safe weekend.
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