'Maxed Out' Man James Scurlock, Right on the Money

I don't claim to predict the future, but if you ask me to hazard a guess, the default rate for mortgages is now higher than the default rate for credit cards by quite a bit. So people are giving up their homes rather than lose their credit cards. It's a really interesting phenomenon, because the assumption was always that people would do anything to save the house. . . . But who do the banks have to blame for that [phenomenon]? All of their marketing now is "Use your credit card to pay for groceries, prescription drugs, taxes and everything else." It's a huge paradigm shift.

Are credit cards the next shoe to drop?

Without question. One of the big problems, maybe the big problem, is that the financial services industry has redefined cash as credit. They have spent billions and billions and billions of dollars teaching people that a credit card is the same as cash, that home equity is the same as cash. And of course, it's not true. . . . And people have used their credit cards as their emergency fund instead of saving. People forget that credit is not something you own. It can be taken away at any time, the terms and conditions can be changed at any time, the costs can be increased at any time. That's what companies like the Countrywide Financials and the American Home Mortgages are learning. But I think consumers are about to learn that lesson as well.

What's your next project?

I'm working on a book about Larry Hillblom, the founder of DHL. He led quite an illustrious life. He disappeared in a plane crash in 1995 and his behavior ended up instigating one of the biggest paternity-slash-estate battles in American history.

Sounds like a movie.

We're in discussions.