Usury Law, Payday Loans, and Statutory Slight of Hand

From the introduction: "Throughout the history of the American republic, all but a small minority of states have capped interest rates on loans to consumers with usury law. But in the past twenty years, for a variety of complex historical, macroeconomic, and cultural reasons, these rules have increasingly yielded to a new, largely unregulated credit marketplace. While many different types of businesses have stepped into this breach in the edifice of consumer protection law, payday lenders have been at the financial services industry vanguard."

Elizabeth Warren blogs about Peterson's paper on the Credit Slips blog - saying "Peterson's findings are shocking--and depressing. Peterson not only finds that state usury laws have become far more lax, he also finds that they have become far more deceptive." She suggests that you "keep the aspirin (or bourbon) nearby as you read."