Some good news among the bad, maybe?

While I'm waiting with bated breath to see which Democrats sell out their country to the Republicans and which ones show some backbone, let me take a minute to mention something that I've noticed in my own neighborhood that I'm taking as a cautiously optimistic sign.

In the less than one mile stretch of St. Charles Rock Road (a major state highway) that runs near my apartment, as recently as this winter there were five payday loan places. And yes, that worried the heck out of me. I know what it means about a neighborhood when they're the only storefront businesses that are expanding. But in the last couple of months, three of them have closed down. One more, the most recent one, looks like it might be shutting down; I'm seeing boxes piling up in their store window. (I could be wrong and they could be still moving in; I haven't gotten close enough to be sure.) And the oldest and biggest of them, the one that has had a gigantic "HELP WANTED" sign in its window since before I moved into the neighborhood 5 years ago, just took it down in the last month or two. Now the giant posters in their window advertise random drawings for prizes for new customers and a rewards program.

Dare I hope that the writing is on the wall for this whole vulturous industry? If nothing else, dare I hope that my neighbors in this solidly working class neighborhood are getting smarter, whether or not anybody else in America is?

I ran some Google News searches, and from what I can tell, all of the payday loan companies that are publicly traded are reporting increased earnings for their most recent quarters. But from skimming the headlines, it looks like at least one, maybe two of them recently took some share price pounding for having missed their forecast rate of growth. The only hard-numbers news article I found was specific to the state of Virginia, from today's Virginian-Pilot: "As Growth in Payday Lending Slows, Delinquencies Climb," by Tom Shean. It reports that in the state of Virginia, at least, the number of people taking out payday loans in 2006 fell by a little more than twelve thousand, or not quite 3%. The industry's slightly increased profits in Virginia came from the fact that more of their remaining customers are rolling over their loans every month. That of course means that a higher percentage of them are going to default; the industry is responding to that by stepping up debt collection lawsuits.

But that's a scorched earth policy, isn't it, one that is likely to put a customer under bankruptcy protection where they're prohibited by a judge from using your service? That's not exactly a robust customer retention model. How optimistic should I be, do you think?