This episode of Freakonomics Radio was fascinating.
Apparently 50% of Americans could not get their hands on $2000 to deal with an emergency in 30 days. This includes money they're saved, or could borrow through a credit card, from another financial institution, or from friends or family. And it isn't just poor people. IIRC 30% of people making between $100k and $125k couldn't come up with two grand in a month. I'm frankly baffled how someone making that much money couldn't have about a week and half worth their income in savings OR credit available.
I'd love to know what these people are spending their money on instead of saving it. The only thing Freakonomics addressed is lottery gambling, which is distressingly common of course.
All of this was just a pre-amble to discussing a relatively new banking product which combines a bank account with a lottery. You deposit your money, earn no interest, and are entered into a drawing for prizes.
I have very mixed feelings about this. On the one hand, it does increase savings rates. On the other hand, it still relies on the innumeracy, irrationality, and undisciplined nature of its customers, just like a lottery. On the gripping hand, the state lotteries are pure predation, and at least customers are tricked/patronized into deriving some benefit for themselves.
Unsurprisingly, governments which have given themselves monopolies running numbers games don't take to these accounts so well.
I do have a problem with Dubner describing these accounts as "No Lose Lotteries." Customers lose by definition (if there is a non-negative inflation rate). They just don't lose in nominal terms, which is to say they lose, but most won't notice they are losing.
If people want to gamble in this way, I suppose I'm okay with it. But let's not be complicit in pretending they aren't losing.