Do Stock Exchanges Create Any Value ?

Do Stock Exchanges Create Any Value ?

by tonytran2015 (Melbourne, Australia).

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(Blog No. 3xx).

#stock exchanges, #rip-off,

Western countries are proud of their stock exchanges. They claim that their Stock Exchanges are places where Entrepreneurs can get capitals from Investors to expand their successful companies. The reality is quite different.

1. Do Stock Exchanges match companies to investors?

This is the only legitimate function of Stock Exchanges but sadly it is not well executed in practice.

Stock Exchanges and their associated Corporate Regulations Enforcement Agencies often fail to enforce rules on timely disclosure of informations, disclosure of financial matters, disclosure of interests.


Figure 1: A crystal ball is needed to determine if any company is a suitable, profitable investment.

The results are that small investors are often lured into loss making investments.

Where are now the old rules of having made many continuous years of profits before a company can be admitted to be traded on an exchange ?

There is no excuse for setting up a market to sell counterfeit products. There is also no excuse for setting up an exchange to market loss making companies.

There should have been clear warnings to investors on declining (dead wood) companies which are still traded after their admission.

Existing Exchanged listed Companies should be flagged by the Exchanges as loss making companies if they made losses in any of the last ten years even if they are allowed to trade on the exchanges.

Naturally there would be private companies trying to buy and delist loss making  companies still traded on the Stock Exchange.  Crown Casino (Melbourne) was taken of Australian Stock Exchange in Dec. 1998 in this way.
PBL said the merger offer represents a 32% premium on Crown’s share price, based on Crown’s and PBL’s weighted average share price during the last month of 45 cents per share and A$6.54 per share, respectively. Shares in both companies were suspended pending the announcement on Monday, but Crown closed Friday at 49 cents a share and PBL finished at A$6.14.

2. Stock Exchanges have floated non-viable companies to investors.

The infamous example of the float of One-Tel (One.Tel Limited (ACN 068 193 153) in 1997 on Australian Stock Exchange ( have shown that Stock Exchanges can rip-off investors. The company had not had many continuous years of profits and was floated based solely on speculations.

The terrible thing is the Stock Exchange allowed the floating of non-viable new companies which had not had many continuos  years of profits and was floated based solely on speculations. Loss making companies listed on the Exchange were bought in whole, stripped off their assets, loaded with even more debts, even higher operational costs and floated back into the exchange for naive instestors to buy. They are known by analysts as zombie companies.

After committing equity of $450 million in 2006, the consortium was paid distributions of $560 million in 2007 (after the sale of the Melbourne property). With float investors paying $4.10 per share, the consortium has now turned its $450 million original investment into around $2 billion. Not bad for three years’ work.

The US-based owners, private equity groups TPG and Blum Capital, decided to sell all of their shares “to satisfy some of the excess demand at the final price of $4.10.”


3. Stock Exchanges Indices have been used by Governments as their false economic indicators to boast about their own performance.

The economy of a country comprises of many components. Companies listed on “honest” Stock Exchanges only represent a part of the larger scale economic activities. In details, the full economy consists of activities from:
– Exchange listed (traded) companies,
– Private companies that are not traded on Stock Exchanges,
– Non company business entities owned by families and sole traders,
– Cash-in-hand, unregistered, undeclared entities (like street vendors, street service providers).
– Labor cooperatives (like mutual child minding groups, mutual house servicing groups, communal kitchen groups, car pooling groups).

In countries like Italy or Greece, Exchange Listed Companies form only a component of the economy.

Greece’s “shadow economy” was estimated at 24.3% of GDP in 2012, compared with 28.6% for Estonia, 26.5% for Latvia, 21.6% for Italy, 17.1% for Belgium, 14.7% for Sweden, 13.7% for Finland, and 13.5% for Germany, and is certainly related to the fact that the percentage of Greeks that are self-employed is more than double the EU average (2013 est.).[103]

Greek and Italian shadow economy are estimated by IMF to be respectively 30% and 27% in 2016 (

From this consideration it is clear that the Indices of Stock Exchange do NOT represent economic performance of countries.

However governments, including US govermment, intentionally use easy-to-manipulate Stock Exchange Indices as their economic indicators. This allow them to boast about their own performance. The market had cried out:

The stock market is not the economy.

Rarely has that adage been as clear as it is now.

4. Stock Exchanges Indices have been manipulated by Governments to boast its economic performance.

The US Federal Reserve have created a “moral hazard” by lending more money to the largest “too big to fail” financial companies listed on US Stock Exchanges. It successfully kept the Indices from crashing.

In 1998, William J. McDonough, head of the New York Federal Reserve, helped the counter-parties of Long Term Capital Management avoid losses by taking over the firm. This move was criticized by former Fed Chair, Paul Volcker and others as increasing moral hazard… Fed Chair, Alan Greenspan, while conceding the risk of moral hazard, defended the policy to orderly unwind Long Term Capital by saying the world economy is at stake.

Australian Government goes even further by confiscating the “imputation credits” of investors who day-trade or prudently “go short” on their shares. That means investors in Australia should neither day-trade nor lock-in the resale values of their shares.

The effect is Australian investors investing in Australian Exchange Listed Companies have to sit on their investment irrespective of the sudden decline in performance of their companies.

The holding period rule requires shares to be held ‘at risk’ for a continuous period of at least 45 days (90 days for preference shares) during the qualification period.

… Also excluded are days where the financial risk of owning the shares is materially diminished. For example, the financial risk may be reduced through arrangements such as hedges, options and futures.

The main point is that government may concentrate on artificially pushing up Stock Exchange Indices through loans to listed companies while neglecting the economy at large.

5. Stock Exchanges have been used by Governments to entrench their economic and superannuation/pension policies.

Australian goverment also steers Self-Managed Superannuation Funds to invest in companies listed on Australian Stock Exchange.

Listed Securities

If the asset is a listed security, then there is a definite market value at the time of transfer, hence the exception in s66 (2) (a) Superannuation Industry (Supervision) Act 1993 No. 78, 1993.

s66 (2):  Subsection (1) does not prohibit a trustee …acquiring an asset from a related party of the fund if: (a) the asset is a listed security acquired at market value…

For a typical Australian Prudential Regulation Authority (APRA) regulated Industrial Superannuation fund members are also steered to investment in exchamged listed companies or cash.

Your DIY Mix investment options

In this way the government increase investments in Exchange Listed Companies. At the same time, the government also claims that the high amounts of investment makes the Australian Stock Market less risky! There may be some truth in that but the government is then bound to make the Stock Exchange Indices steadily increasing to preserve its reputation and retain the political votes from superannuation participators.

Exchange Listed Companies can really go bankrupt due to their outrageous payments to their extractive Management Class and to the outrageous Management Contracts with their Floaters (described in Section 2).


6. Desired features of Stock Exchanges

Stock Exchanges should install the following features to regain trusts in non-sophisticated investors.

There should be separation between established, profit making (tax paying) companies and declining companies (that failed to make profit on a 10 year moving average) so that unsophisticated investors can clearly distinguish them. That is companies should be tagged as “blue chip” or not. Non sophisticated investors would then be able to direct their investments to only “blue chip” companies.

Companies which are not established, profit making (tax paying) should not be traded on the Stock Exchanges.

Companies that have been taken over should be delisted as any desired improvement on their performance can also be carried out by majority share holders with full public disclosure and their share prices can still be continuously monitored and “debt traps” can be avoided for companies.

Zombies companies should not be readmitted as listed companies.

Rules on continuous, timely disclosures should be more rigorously enforced.

All abnormal price movements on share prices due to derivatives trading (which are more obvious on option days) should be explained by the Exchange Houses of Derivative Contracts.

















Bankers earn more than interest margin on secured loans, posted on December 15 2016,


Bankers given outrageous incomes by their boards, posted on December 22 2016,




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Avoiding outrageous costs of roaming during oversea travel.

Avoiding outrageous costs of roaming during oversea travel.

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

#roaming, #internet rate, #phone, #SMS, #ripped off, #oversea,

Avoiding outrageous costs of roaming during oversea travel.

This Travel tip may save you from burning your house with your busy fingers playing unsmartly on your smart phones.

1. Beware of the HIGH COST of staying connected.

Figure: Screen capture of an actual Warning SMS from Australian Vodafone on the outrageous roaming costs at Singapore Transit lounge on 2018 December 13th. Internet roaming cost WAS INDEED $51000/GByte versus $2/GByte inside Australia.

As you can read from the screen capture:

Welcome to Singapore. Warning – you have activated your mobile device overseas. Significantly higher charges may apply. While you’re here, it will cost up to $5.39/min + 40c connection fee to make calls, $4.50/min to receive calls, $3.50 to send a TXT and data is charged $51.20/MB. It’s free to receive a TXT. … For help call +61426320000 – it’s free. Have a safe journey.

The roaming phone cost is $5.39/min, the roaming SMS cost is $5.30. They are about 5 times the cost for equivalent service in Australia. But the dangerous killer is the roaming internet cost of $51.20/MB = $51200/GB which is 25000 times the cost of equivalent service in Australia.
Therefore someone watching a movie at the transit lounge may burn about $25000 for that 0.5GByte movie.


2. Preventing expensive roaming costs by not using post-paid phones oversea.


a- Bring along your trip only prepaid phone cards or sims so that you cannot spend more than you have paid into those cards.

b- Buy locally sold cards and use them in their issueing country. Send an identifying message prior to any communication so that recipients know who is talking to them.

 c-Before departing you may redirect all incoming calls to your pre-paid numbers (already pre-paid in your home country). This limits your spending.

, posted ,


, posted ,


, posted ,

, posted ,

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Miseries unleashed by push for Cashless trading

Miseries unleashed by push for Cashless trading

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No.77).

#bank gouge, #cashless, #rip off, #bank fee, #bank charge, #penalty, #overdraft.

Miseries unleashed by push for Cashless trading.

The bank advocates in Australia used the pretext of fighting tax evasion and organized crime [1] to advocate the abolition of cash. Is this their real motive? As usual, we have to think that bank profit is the real motive. The situation in Australia is just a local version of wider analoguous global events.

1. Definition of Cashless societies.

In setting up cashless societies, governments require each person to open a bank account and put all his earning and spending through that bank account. They claim doing this reduces tax evasion and organized crime.

2. Can tax evasion be reduced?

No. People can still form Work Parties to trade their works (tax free) ! Similarly, people can exchange their services for goods.

For evasions by trademen and retailers, random inspection can drastically increase compliance with existing GST, VAT system using cash.

3. Can organized crime be reduced?

a. It is now known that Russian organized crime flourished in the Soviet era as people could still give one another ration cards, goods, service, favours, etc.

b. The Commonwealth Bank of Australia did not get any fine for transgressing the rules on Cash transactions. (Yes, the Australian Government still shamelessly said that it wanted to fight organized crime by bank rules !)

So it is only hopeful talk on its effects [19], [20], , [24].

4. The real motive in making a cashless society:

a. Private International Bankers have owned Central banks of USA, England [2], and now they want a firmer grip on national finance of each country.

From partial ownership of Federal Reserve Bank, they annually collect $40 USD per American head (They love it to the point of assassinating 2 US Presidents and attempted (failed) assassination of another US President.). We have to imagine how much more they can collect if they also control individual accounts of each person.

b. Int. bankers failed attempts to lure people into Diner Club, American Express, Visa, Master Cards tell them that they have to herd users into their system by legal compulsion.

c. Their failure is caused by people’s aversion to their multitude of fees: joining, interests on debits of more than 28 days, penalties for not meeting monthly minimum payments, etc… (, [23]).

d. They tried to promote their cards again by TV advertisements, asking hired cars companies and hotels to limit business to only credit card holders.

e. They still failed.

f. So they realized that the easiest way to herd people into their finacial systems is to have cash removed. Finally, they had the Indian government doing exactly what they wanted!

Figure: The setting up of a fiat money.

In my illustration for the setting up of fiat money, just imagine that there was a banker in front of the government building intercepting all transactions between it and its citizens and even among the citizens. Can you trust that banker?

5. People are forced to put their savings into banks and give credits to stores.

People have to put their money in the banks to increase the ratios of money kept over all money on loans from those banls.

Stores will have to issue trade account vouchers to replace cash. Prudent people will have to buy these vouchers to avoid being left without foods, clothes and everything else if the internet or the banks or all shut down.

Prepayment of goods for about two month of supplies is in effect giving credits to the stores.

If the stores go bankrupt, your customer voucher cards may give you higher priority than unsecured trade creditors !

This has also been suspected as a real motive for the Indian goverment’s attempt to force cashless systems on Indian people [4].

6. How to avoid bank gouge.

(The long rules to avoid fees, rip-off penalties and inconvenience.)

In a cashless society, each person must have a bank account with a card. So you have to adhere to the following rules:

1. Select a card WITHOUT OVERDRAFT FACILITY from a bank with no joining fee, no monthly fee and no exit fees.

This may be possible but may also be impossible depending on competition between the banks. You also have to expressively tell the bank that you DON’T WANT ANY OVERDRAFT. Failing to say that may allow them to charge you hefty overdraft fees.

2. Try to find sellers with no or low charges on your purchase transactions.

3. Keep track of your deposits and spendings on a WRITTEN piece of paper to match up your balance figures with those on monthly bank statements.

4. Find out the exact dates your deposits will be added to and various fees deducted from your balance. The delays on adding the deposit may be blamed on non-business days, 3 days delays for the bank to use your money for free, failure by their own computers or connection network !

5. Eagerly read your monthly statements to reconcile your balance after receiving it.

6. Leave about $10 in your account card to cover for the anticipated differences caused by different ways of calculating the balance (fees on your deposits, fees on your purchases). This prevents it going into negative, triggering an OVERDRAFT mode for that they can whack a huge FEE (penalty ?) of about $20USD on your account. (Please reread rule #1 !)

7. IMMEDIATELY notify the bank if statement fails to arrive. IMMEDIATELY report to the bank any discrepancy between the monthly statement and your own written record of the account. Non-reporting implies your acceptance of their statements and later discovery of any difference will not be LEGALLY accepted. (Please reread rule #3 !)

8. Only shop at your familiar shops, avoid shopping at unfamiliar shops which may run a card scam on you.
7. Do not enquire about your balance more often than you are allowed to (about 6 free enquiries per month, each additional enquiry cost you $1.00USD).

9. Do not purchase more often than you are allowed to (the relevant governments have to make rulings on the frequencies). Each extra purchase trip may cost you some transaction fees of about $2.00USD (estimation only).

10. If you transgress (or is trapped by ?) any of the bank rules (like not paying their arbitrarily imposed rip-off penalty) your account card will be locked up and have no way to access your deposits (whether they are your salaries or government allowances) until you open another account card at another bank (usually with high fees and penaties conditions). You have to live off your family and friends while waiting for the new card.

7. Incidental (rip off?) fees.

1. OVERDRAFT FEES if applicable ($30 AUD = $25 USD per triggering in Australia and much higher in the UK, at £90 per month [6]).

2. STATEMENT REPRINT FEES ($30 AUD = $25 USD per monthly listing in Australia).

3. Plastic card replacement fees.

4. Balance enquiry fees when exceeding allowed numbers.

5. Outrageous fees if you use you cards oversea ( [22]).

8. Systemic risks to account holders.

1. The internet can collapse at any time leaving account holders in the cold ( [7]), or some hacker may attack to lock up all customer accounts ( [7a]).

2. According to current banking rules in major English speaking countries, customers will lose their money deposited to their accounts if the bank goes bankrupt. Only 10% of total of all deposits are kept for them in the Central Bank (which may also be privately owned, as in USA and in UK !).

So if any bank has some misfortune, its customers can say goodbye to their strings of 0’s and 1’s. In the time following that they have to somehow survive, waiting for the Central Bank to intervene !

The risk is not imaginary. Multiple banks have been defrauded. The Bangandesh Central Bank have been defrauded by just a single of many possible scams ( [8]). Similarly, a giant French bank has been exposed to billions of loss ( [21]).

9. Social consequences.

1. Homeless have to beg for shelters, foods or clothings, not money.
2. Casual, unplanned cash in hand jobs for handimen will disappears.

3. Sunday markets, garage sales will disappear.

4. Small repairs and odd works are to be carried by registered handimen at much higher costs (with their well known tricks of making small jobs big).

5. Houses deteriorate due to high maintenance costs.

6. With a captive market, banks can increase their fees and impose penalties at their will. Bankers become a new ruling class.

7. Stores will have to issue trade account vouchers to replace cash. Prudent people will have to buy these vouchers to avoid being without foods, clothes and everything else if the banks shut down.
8. Economic slow down due to lack of fluidity of transactions (look at India after demonetizing for an example).

9. Underworld now trade in high value goods (companies, houses), influence, favours and forced, inhouse labours.

10. Conclusion.

You have been warned! Bankers are really desperate for your money [17].



[3]. India rupee ban: Ex-PM Manmohan Singh rubbishes Modi crackdown, BBC News Services,, 24 November 2016.



[7a]. tonytran2015, ., posted on

[8]. )

[9]. Neha Sharma and Shalu Yadav, The Indian village that has returned to bartering, BBC News Services,, 5 December 2016.

[10]. Patrick Bodenham, Will Spain’s coal belt survive through online barter?, BBC News Services,, 2 February 2017.

[11]. James Melik, Haggling and bartering gain appeal, BBC News Services,, 12 February 2009.

[12]. Mark Lowen, Greece bartering system popular in Volos, BBC News Services,, 12 April 2012.



[15]. Ex-HBOS banker ‘sold his soul for swag’, bbc new,, 2 February 2017.

[16]. Barry Ritholtz, Excessive CEO Pay for Dumb Luck,,, accessed 07 Mar 2017

[17]. tonytran2015, Bankers given outrageous incomes by their boards,, posted on December 22, 2016




]22]. tonytran2015,

[23]. ,,


Added after 2018 March 20:













[37]. Internet outage swoops across the US,

Attacks against a core internet firm play havoc with some of the world’s most popular websites.

Based in New Hampshire, Dyn is both a DNS service provider — translating URLs into IP addresses — and an internet management company, helping website customers get the best-possible online performance. It also filters out bad traffic headed to the websites,… and that’s where things fell apart Friday.

[38]. Telstra outage causes chaos as Commonwealth, ANZ and NAB ATMs and EFTPOS facilities crash AUSTRALIA-WIDE – leaving thousands stranded without cash,

[39]. Now fixed: Visa outage disrupted ‘millions’ of payments in UK and Europe,

[40]. Visa DOWN: Millions affected as ‘service disruption’ blocks payments across UK and EUROPE,


Just as Google wants all internet access to go through its portal, it appears fintech corporations want people to access and navigate broader economic decisions via their privately controlled platforms.



, Posted on December 15, 2016


Bankers given outrageous incomes by their boards, posted on December 22 2016,


, posted on December 1, 2016




crystal ball


Your fiat money (Part 2), Your fiat money, Bankers given outrageous incomes by their boards, Signs pointing to an impending crash for small investors, Bankers earn more than interest margin on secured loans.

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The Parasites of Western Economy, Part 1: Motorvehicle Insurance Scammers.

The Parasites of Western Economy, Part 1: Motorvehicle Insurance Scammers

by tonytran2015 (Melbourne, Australia).

Click here for a full, up to date ORIGINAL ARTICLE and to help fighting the stealing of readers’ traffic.

(Blog No.62).

#parasite, #motor vehicle, #transportation, #insurance, #scam, #rip off

The Parasites of Western Economy, Part 1: Motorvehicle Insurance Scammers.

If you have ever been to Vietnam, you will see more than 40 million motorbikes on the roads. They go on their daily routines, occasionally causing minor accidents and damage but people don’t threaten their road sharers with law suits. Owning a motorbike there is thus mostly an advantage and very rarely a liability (it is so only when the owner is outrageously stupid). How can they do that and why cannot Westerners do it?
They can do it because they have not been brainwashed and enslaved by Vehicle Insurance Parasites.

1. The Vietnamese way of handling non-fatal traffic accidents.

1a. If you lose a small paint scratch then consider it part of wear and tear of a quickly depreciating asset. You have to be tolerant to the other party who may be inexperienced just like you years ago, when you were young, or may be just like your kids.
1b. If you lose a turn indicator lamp then consider who has more damage and remain tolerant:
If the other party suffers no damage and is clearly at fault then ask him to pay a realistic repair cost to you right on the spot.
On the other hand, if he suffers much more damage than you do then consider that you have been lucky not to get hurt and he has already been taught a good traffic lesson.
1c. If your motorbike is badly damage:
You may ask the other party to pay for the actual repair costs and usually he will agree to it or beg you to let him pay by installments or only part of it.
You should think that accident avoidance is the responsibility of both him and YOU. Be tolerant and consider who suffers more damage.

2. The Enslaved Litigious English way of handling non-fatal traffic accidents.

2a. If you lose a small paint scratch then force the other party to follow a costly legal course of arguments to assign faults and threaten the other party with a law suit to take away his house. On the other hand, if you are at fault, you still employ a lawyer to reply to the other party that you won’t pay even a single cent for his fair repairs cost.
2b. If you lose a turn indicator lamp then take your vehicle to a shop that will try to assign hundreds of small previous wear and tear to the accident and ask the other party to pay for all that. You will hope to have a partially brand new vehicle after those repairs.
The reality would turn out that the shop WILL POCKET most of the costs and you will ONLY have the main damage shoddily repaired: You have been used by the repairer to scam money on the poor other party! Do you want to sue the repairer (your former partner in crime!) now?
2c. If your motorbike is badly damaged:
You may ask the other party to pay for the (often pretended) psychological damage for fear of traffic, plus inflated repair costs.

3. Where does the money go in the Enslaved Litigious English World?

3a. You pay the lawyers to threaten one another unnecessarily. All of you are forced to join insurance schemes and pay their excessive costs to avoid being threatened.
3b. You pay the lawyers to play expensive legal games. You also pay excessive repair costs to non-existent repairs.
3c. You pay the lawyers to play legal games to rip off other insurance contributors on pretended psychological injuries. You also pay excessive repair costs to non-existent repairs.
(See references [1,2]).

4. Parasites ripping-off your transportation system.

You now know why transportation costs are so expensive in English speaking White countries. There are parasites feeding on your transportation costs, you are enslaved into paying annual insurance premiums that is about 5 times the cost of the actual repairs if paid out directly by owners instead.
There used to be Mutual typed Insurance Companies (AMP, Colonial Mutual, NRMA) which are not for profit organizations (such as NRMA motor vehicle Insurance for member). The financiers had successfully used immoral ways to rip off the Mutual funds to give money contributed by many previous generations of members to directors and fund members at that only time. The rip off was called “Demutualization” (around 1995 in Australia). Those mutual insurers were then wound up to leave the market to only for profit insurers. Without competition from those non-profit organizations, insurance premiums have shot up.
You should demand a law reform to reduce the legal rip-offs by transport insurance schemes.
I am no fan of the political system in Vietnam but I admire the way the population there cooperates in their daily commutation. At least, each Westerner should experience the rip-off free transportation system in Vietnam (before it become infected by the Insurance associated parasites) to know how much you have been ripped-off by the parasites..
It should be remembered that a fish won’t know that it is in water unless it can somehow, sometimes jump out of the water.


[1]. wikipedia Compensation_culture, accessed 05May2017.

[2]. CompensationCulturePuttnam.pdf, accessed 05May2017.

[3]. the car insurance industry is a disgusting racket,



[6]. ALEKS DEVIC, Car crash racket runs rampant in Victoria, with thousands left without car, huge bills, Herald Sun, , May 22, 2016 9:00pm

Added after 2017 Dec 28:







Swann, owned by IAG, only paid out around 10 per cent of the $1.07 billion in add-on insurance premiums it collected over a 10-year period, the royal commission has heard.





, posted on 17 April 2017 ,

, posted on 07 May 2017 ,

, posted on 10 Jun 2017 ,


The Parasites of Western Economy, Part 5: Company Asset Strippers and Conspirators posted on 13 August 2017 ,


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Avoiding high costs of credit cards on oversea transactions.

Avoiding high costs of credit cards on oversea transactions

by tonytran2015 (Melbourne, Australia).

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(Blog No.33).

#credit card, #ripped off, #oversea, #purchase, #transaction


Have you ever felt ripped off when using your credit cards for oversea transactions?

You will get surprised when using your credit cards on oversea transactions. For each transaction, card issuers may charge you any or all of the following fees:

1. Fee for using the card outside the issuing country.

2. A separate fee for using a foreign card in the country of transaction.

3. A higher than cash price due to purchase with a credit card (about 3% to cover costs to seller).

4. A sizable profit margin on the foreign exchange rate (5% in Australia at this time of writing). I am not aware of any legal regulations to protect card users on this fat margin.

5. The card issuer has the right to view the fluctuating exchange rate for up to one year after your transaction and pick the most unfavorable time for your exchange rate and then make the bill for the transaction on that unfavorable date (as long as it is after your actual transaction and before the printing of the bill). So the bill will be dated on that unfavorable date but won’t be sent to you for a few months! The delay is due to their picking for your most unfavorable exchange rate.

You may have felt that they gave you some extra breathing space! They would say that you had been given the benefit of not having to pay for a few months.

6. Then they send the bill to you and you are given the benefit of upto 28 days interest free period to pay your total account.

If all the fees and costs from 1 to 5 outweights the benefit received in 6 (usually they do by a sizable amount) then you should better carry local currency (of visited country) to pay for your oversea transactions on the spot.

If you buy oversea goods on the internet, you should use Paypal which instantanously offers you the FINAL cost in your local currency BEFORE you make the final decision to go through with that transaction.

This is a small trick that can take care of YOUR COSTS in using your credit cards.


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