Sugar-Coated Status Quos: Let the Markets Grow

January 9, 2010

As obvious through a recent PR Release, Rep. Carolyn Maloney believes that sugar-coating status quos will change what we have grown to know (as facts): “That 45-day period gives you nearly two billing cycles to do more than complain — to shop around for a card whose rate and terms of service you prefer.”  Wow!  Is it change — with teeth?  (Please.)  We have already been doing that for more than two years – while hearing foreign customer service agents of “banks” like Citi and Capital One tell us “If you don’t like it, you can close your account.”  Were interest rates capped?  No.  Since passing the Credit CARD Act, has First Premier Bank escalated a sub-prime rate to 79.9%, Legally?  Yes.  “Laws like the CARD Act are reasonable and allow markets to function as market enthusiasts imagine they should: with less friction, more transparency, and with bad actors being driven from the field.”  As a historic “bad actor,” was First Premier “driven from the field,” or, was it (like “prime” providers) emboldened?  Having collectively witnessed and experienced the results of a rampant savaging of our world’s citizens and overall economic system, is it “reasonable” to “allow markets” to go forward, basically unfettered with any returning or meaningfully modified regulation?  Moreover, how insulting (and detrimental) is it to have Representatives selling such a premise?  After 100 million people (including the best tier of customers) were gouged into 29.9% (Usury) rates, as redress, did they seek what was “reasonable” in the view of their predators?  “Once interest rates, terms and conditions are clearly stated . . . the consumer can make a clear-headed decision about what card to choose.”  Got that?  New language!  New (“responsible”) consumer choices!  Same results: “If you don’t like it, you can close your account.”  In July of last year, Rep. Maloney seemed to be amazed that Citi, Chase, and BoA, were continuing their predatory practices: “Issuers during this crisis should be using this period to adapt . . . , not raising rates and changing terms on those who are already meeting their obligations.”  Yet now, she is praising them – because they are making terms “easy to understand” (with notices): “There are some companies that seem to get it.  Chase and Citi have added cards and services to their lineup which are simple and easy to understand.  Bank of America sent notices far in advance to their customers explaining the new rules.”  Let us respondvociferously.  In this collusive scenario, our incensed reactions and motivated decisions are just as “clear-headed” now as before.  When the Act failed to take effect immediately, and did not cap rates or fees, all the relevant “actors” indeed “[got] it” – as we, the public, proceeded “[getting] it” in our updated terms (so to speak).

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Congress Shocked by Credit Card Predators?

July 6, 2009

05/19: Senator Reid: “We stood up for consumers and stood up to abusive credit card companies.  We said that big banks can no longer take advantage of hardworking Americans.”  Off The Record: “Well, you know, (like in December 08′) we are going to trust them to not go after their customers as predators (on a third wave) before these new measures go into effect.  And, despite giving them a year’s head start, we are certain they will not come up with other ways to bypass everything we have accomplished.”

Step-by-Step:
(1) They Let Us Down (05/21): Credit Card Protections With…Holes
Did not: “cap interest rates on credit cards, explicitly cap credit card fees, take effect immediately, limit interchange fees, or prevent issuers from finding new fees.”
(2) The Media Colludes In a Setup (06/15): Credit Card Defaults Rise
(3) And Finally, the Results (06/30): Citi Raises Card Rates On Millions

Are you Shocked, Sen. Reid and Rep. Maloney? (07/06):
“Citi has boosted interest rates on some cards to as high as 29.99 percent, according to a Credit Suisse report.  Chase raised rates as high as 23.99 percent. . . .  Capital One has kept rates steady for now, but warned consumers they will be increasing over the next year.”  “‘We expect purchase APRs to continue to trend higher ahead of the recently passed Credit Card legislation, slated to go into effect February 2010,’ wrote Credit Suisse analyst Moshe Orenbuch.”  “‘Issuers during this crisis should be using this period to adapt to the new rules about to take effect, not raising rates and changing terms on those who are already meeting their obligations’: Rep. Carolyn Maloney, D-N.Y., the prime sponsor of the bill.”

Nothing passed in May (beyond a 45-day notice) was immediate.  Caps on interest rate proposals by Sen. Sanders and a few brave others were overridden.  The credit card companies (and newly formed banks) were given another seven months (minimum) head start.  Did you really stand up for us, Senator Reid?  Are the banks continuing to “take advantage”  (after having received billions upon billions in taxpayer-funded bailout money that was supposed to “free up” the credit markets)?  Did you really expect anything different, Rep. Maloney?  Did you think there was any (actual) chance these Vultures would do what they “should be doing before the new measures took effect?  To them, this is what they Should Be doing – just like they were – since (before) December 08′ (and the 1 ½ year’s notice).

Update (11/19):  Credit Card Rate Freeze Killed

Time For a Credit Union Movement:

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