Via bretibart.com, Obama: Send me credit card legislation this monthMost people know if your credit history is bad or even non-existent, you shouldn't expect to get the same kind of financial deal as others with a good credit history over a long period of years.
As it is, we boring ants who pay our cards off every month are paying the price for the defaults by those wild and crazy grasshoppers, yet they scream they're being "discriminated" against by the evil bankers. [Note: Skipper correctly reminds me in the comments below me that grasshoppers who pay the minimum required of them each month allow us ants to have interest free loans, often for tens of thousands of dollars. What I should have said here was that we ants also allow credit card companies to stay in business when grasshoppers leave the building completely.]
Not everybody deserves credit. Lenders must discriminate against people with a bad track record of defaulting on payments.
Even the besotted liberals in congress can understand that and BTW Mr. President, people who want to be adults in a free society need to take responsibility for that small print before they sign on the dotted line, not cry foul, when they don't live up to the terms of the contract they agreed to.
FTAThis is last sentence is doubly amusing coming from a guy who's hasn't yet told the truth about much of anything.
The bill's boosters are tapping into public anger over corporate excesses and the conduct of companies receiving billions of dollars in taxpayer money.Obama spoke to the public's frustration with credit cards."
"Instead of fine print that hides the truth, we need credit card forms and statements that have plain language in plain sight, and we need to give people the tools they need to find a credit card that meets their needs," he said.
6 comments:
One problem is this: money and credit is created by the government's central bank (the Fed) which is a monopoly. Since the government creates the money, it has no choice but to regulate it. It also does need to make it as fair and broad based as possible. It's a very difficult problem for which there is no provably good solution.
Specially from this congress and administration.
As it is, we boring ants who pay our cards off every month are paying the price for the defaults by those wild and crazy grasshoppers.Not, SFAIK, with respect to credit cards.
In fact, that we boring ants get the advantages of credit cards at no additional cost (i.e., other than the several or so percent the merchant gets charged on each credit card transaction) can be laid directly at the feet of the grasshoppers and their interest on unpaid balances.
The credit card companies have brought some of this on themselves. Increasing the interest on an existing loan, particularly when that increase acts to amplify the risk of loss that increase was reflecting in the first place seems both underhanded and stupid.
You're right. My post wasn't clear that grasshoppers who keep paying the minimum charge let us ants take advantage of interest free loans for as much as tens of thousands depending on our credit line.
My point which I'll amend should have read, we ants who pay up each month enable credit companies stay in business when grasshoppers stop paying the minimum charge and completely leave the building.
Well, even there I am not sure you have it quite right.
The ants do not allow the companies to stay in business, it is the grasshoppers.
The revolving interest they pay is the revenue stream. That interest is predicated on a bunch of things, and one of them is the risk of default.
Until enough grasshoppers default, the cost of those who default is borne by those who do not pay in full each month.
Until you start getting charged an annual fee to possess the card, that has not happened.
It's our timely payments that keep the cash flowing. I doubt credit card companies could survive otherwise, but that's a minor point.
The larger issue is credit card entitlements and Obama demanding that credit card companies do what he's never done in his public life -- openly tell the whole truth.
Post a Comment