President Obama to clamp down on credit card abuses

[cal04]

Source: Associated Press

White House says it will back efforts to keep companies from hiking rates

The White House said Sunday that it will back congressional efforts to clamp down on credit card abuses in an effort to address the recession's effect on Main Street.

The House and Senate are considering a credit card bill of rights to limit the ability of credit card companies to raise interest rates on existing balances and to require greater disclosure. White House economic adviser Larry Summers said people need to save more, but that the government also needs to curb credit card pitches that addict people to plastic.

President Barack Obama is "going to be very focused, in a very near term, on a whole set of issues having to do with credit card abuses, having to do with the way people have been deceived into paying extraordinarily high rates that they wouldn't have paid if they knew what they were getting themselves into," Summers said.

Read more: http://www.msnbc.msn.com/id/30292784/

[pattmarty]

1. We don't need is "clamp down". What we do need is................

..........tough laws with real "teeth" like big fines AND jail time for the worse offenses.

[primavera]

5. Exactly

That's so often the problem with corporate crimes - the penalties, in the unlikely event that the offender is even caught and successfully prosecuted, are a pittance next to their ill gotten gains, so any simple actuarial analysis will direct the corporation to ignore the law, as it's more profitable to pay the penalties, if any, than it is to forgo the profitable scheme.

[quiet.american]

2. Excellent. nt

[Faygo Kid]

3. About damned time. The Bush era needs to be over.

The nightmare of the last eight years needs to end, in all its forms, now.

Enough with ripping off consumers with impunity.

[checks-n-balances]

4. k&r - Hope both branches of gov't don't back down

And if bankers take it to court, hope the judicial branch doesn't back down either.

Otherwise, the middle class won't be able to spend any more and help the economy to move - pure & simple.

[SOS]

6. Better 31 years late than never

nt

[jwirr]

7. It is too late to help me if they do not force the credit card companies

to lower their rates - even better back date the bill.

[defendandprotect]

8. We need to reapply usury laws -- especially on Student Loans which are infinite . . .

Student Loans used to have a 6 year limit --

Now they have none!!

DE-REGULATION IS HOW WE GOT INTO THIS MESS AGAINST ALL COMMON SENSE ---

RE-REGULATION IS WHAT WE NEED TO GET OUT OF IT --

Re-regulate criminal capitalism!!!

[SpartanDem]

9. Good this industry

has been allowed to run around unchecked far too long.

[OnyxCollie]

10. Discover just sent me a letter.

"We are changing your fixed-rate account to a variable rate account. Prepare to be fucked. Hard."

Never missed a payment, always paid more than minimum. I'm guessing it'll be 26.9%.

[DCKit]

12. If you say "NO", the worst they can do is cancel your account - at the current rate. n/t

[OnyxCollie]

14. I'm going to pay what I can

and transfer the balance to another card. (Although I suspect they all work in collusion. Hopefully, I'll get a reprieve.)

Fuckers.

[Qutzupalotl]

20. Read the fine print before you transfer.

They'll try to charge you a transaction fee... 3 or 5 percent is not uncommon.

My strategy was to make the biggest payments I could for the first few months, so the interest I did pay was on a smaller principal. Good luck.

[prolesunited]

16. I got the same letter

and like you, for no good reason. I'm reluctant to cancel because it's my oldest card.

[dogfacedboy]

24. I got a letter from HSBC cutting my limit.

It's a card for Guitar Center, on which I have a whopping balance of $32.80.
My limit was $3000.00. Now they're cutting it to $1305.00
I must be a bad customer. I always pay off new purchases quickly. They never collect any interest off of me.
The letter states that it has nothing to do with my credit standing, or any actions on my part. They say they have to "protect their exposure", whatever the fuck that means.

[WatchWhatISay]

11. Nice talk, but I don't believe they will have the nerve to tell banks how much

they are allowed to earn. Too afraid of being called socialist.

Sorry, but I just don't see it happening. But it would be nice to be wrong.

[w4rma]

13. Now Obama is **starting** to get to the heart of the nation's economic problems.

More jobs, more unions, less outsourcing (not more outsourcing as too many in the Obama administration apparently feel) is also just as important.

[hunter]

15. How 'bout we cut interest rates to 9.9% max.?

Including all "fines" and other charges.

Nationalize and dissolve any corporation that won't play by the new rules, and sell their accounts to corporations that won't abuse their customers.

[melm00se]

18. playing devils advocate

what happens when interest rates, when being used to control inflation, are higher than that? if it costs more money to lend than could be earned back, what incentive is there to lend $$? especially for things like: cars, houses, business operations or business creation?

[hunter]

19. Why not use taxes to "control inflation?"

There, that was easy...

[Psephos]

21. lol just wait until the "control" on inflation caused by huge deficits kicks in

The deficits are being funded by printing money...more money, same amount of goods = prices go up. Big deficits, big inflation. Should start next year, as soon as the economy stops contracting.

[Terry in Austin]

27. And where did the inflation come from in the first place?

Fictitious "extra money" -- including all the money that doesn't represent actual results of productive activity. Like interest.

If we wanted to get really devilish in our advocacy, we could advocate outlawing interest altogether and take care of a really big source of inflation, doncha know.

Oh, wait! That's the whole basis of capitalism? Sa-a-y -- we might be onto something!

:evilgrin:

[L0oniX]

17. I won't hold my breath waiting for it to happen.

Not to mention it most likely will not be retroactive.

[Vidar]

22. Giving his performance so far, I don't believe him.

[4_TN_TITANS]

23. Coming from Larry Summers, this is not exactly comforting...

Like many, I'll believe it when I see it.

[depakid]

25. "they wouldn't have paid if they knew what they were getting themselves into"

What this telegraphs to me is that the regulations will have few teeth and rely on "more disclosure," -which of course sounds nice, but as a practical matter ends up being largely ineffective- particularly when they're not vigorously enforced.

[Blackhatjack]

26. The "horse is already out of the barn" unless they roll back rates and fees

That is why the 10 mo implementation delay was so damaging. It gave the credit card companies plenty of time to raise rates and fees across the board before the reforms took effect.