Interesting numbers

66Mustang

I like numbers and statistics and thought I’d share a few interesting things I either read or worked out (not super exactly) which are explained better using numbers

Due to compounding interest, if you took out a £100 payday loan for a fortnight agreeing to pay back £112 at the maximum legal interest rate of 0.8% per day, if you didn’t pay it back for 9 years and 1 month you’d owe more than the USA’s national debt of £27 trillion

Genghis Khan is arguably the person who has achieved the most with regards to sustainability and environmentalism. He slaughtered around 40 million people in around 1200-1220AD. If you extrapolate using the population growth rate, this has resulted in today’s population being around 1 billion less (11%) than it would have been

The 8 wealthiest individuals in the world combined possess about the same amount of wealth as the poorest half (~4 billion) of the the world’s population combined

A typical BIC ballpoint “biro” pen can draw a line 2 miles long

I hope you enjoyed these or find them interesting and does anyone else have any to share??

Rachel_Scope

The compound interest one is crazy! I wonder who has paid the largest difference between original loan and final payment? Hopefully nowhere near this much 😂

66Mustang

@Rachel_Scope I have a certain family member who is up there I reckon 🙄 😆

rubin16

Payday loans are such a scam, I remember when I was 18 and had a part time job and got one of these once not worrying about the consequences and ended paying back triple. It was before my official diagnosis of autism and didn't understand money alot. Also during the time they were advertised everywhere and didn't do enough checks on people. A few years later I got some of the money back as the government fined them and they had to pay back hundreds of interest.

66Mustang

I once read a payday loan website and they said their typical customer is "a middle class aspirant in their mid 30s who earns around £70,000, lives in the city and typically needs to borrow a few hundred pounds for a week or two to pay for a festival ticket or birthday gift"

What absolute drivel!!!

I think most customers probably live in poverty and don't / can't pay back the loan for months so the 1,500% APR kicks in and pushes them further into debt

LeeCVT

I thought 66% Apr on some credit cards was over the top insane but 1500% Apr... Just insane. I feel for those who have had to resort to payday loans to feed family.

66Mustang

@LeeCVT

For balance, the argument in defence would be that the loans are designed to be only for a month at most

The interest on a month loan is about 30% (which is still high) and you'd only pay back 1500% if you kept the money for a whole year and let the interest compound

They'd say people who use them as longterm solutions are abusing their product, but I think the elephant in the room though is that the lenders are probably hoping that their customers do exactly that

66Mustang

@Biblioklept

I wonder if you measured the amount of the ink in a letter, like if you stretched out an average letter into a straight line, then worked out the average amount of letters in a word, you could probably work it out!!

66Mustang

I missed your 2nd post @Biblioklept thanks for sharing those!!! They are awesome!

The cards one reminds me of the thing about the lottery - if you choose the numbers "1, 2, 3, 4, 5, 6, 7" you are just as likely to win as anybody else 🤩

Sandy_123

Im not a numbers fan unless it's my bank balance lol. Those payday loans were terrible I'm glad they've all gone

Jimm_Scope

My partner was actually surprised by payday loans in the UK. Though the States has less regulations on many things than the UK, they have stricter limits on acceptable interest rates. She was shocked that you can get a loan with an interest rate over 1000%!

66Mustang

Yeah that's surprising to me @Jimm_Scope

As someone who is quite into finance I spent most of my time that wasn't on UK markets dealing with US related stuff

I always found the US financial markets a lot more relaxed and the public are kind of treated less like children and expected to make their own decisions; in the UK we have lots of things in place to protect the most vulnerable which certainly help lots of people but do tend to suffocate those who are more confident by limiting their freedom of choice

Jimm_Scope

One thing in the US that is different to the UK is that if credit checks aren't properly carried out the lender is not liable.

In the UK, if a company gives you a loan, but didn't check first if you could actually afford the loan. They end up liable for it. Not so in the USA.

66Mustang

@Jimm_Scope

One thing I find weird is that sometimes people are told they can't afford a standard 25 year mortgage so they are offered a 35 year mortgage instead

However, because of compound interest and stuff, spreading the payments out by 10 more years, or 40% more time, only results in a 15% decrease to monthly payments

Furthermore… because you are paying only 15% less per month, but for 10 whole extra years, you actually pay 50% more interest overall!!!!!

At current interest rates a 35 year mortgage means you are paying back more than double as well

Basically, taking a £250,000 mortgage, they are saying … "we've decided you can't afford to pay £180,000 in interest so we're going to charge you £275,000 in interest"

I think it's strange how banks are allowed to convince people to take out debt for longer, because they have a direct interest in trying to get you extend your loan for as long as possible