What does a TRUMP presidency look like?

[The Minsky Moment]

Cap = 5 X federal discount rate.

Problem solved.

A problem potentially solved, though you would have some interesting results when the discount rate approaches zero.

Cap can't go lower than 12%

[Tamas]

You know what happens when people with bad/horrible credit rating can't get credit/loan from banks because they are deemed too risky? They go to loan sharks, that's what. The past decade it became an epidemic in the rural poor parts of Hungary where of course no sane bank would ever give credit to a living soul.

If there's a demand for something, you can't just regulate that away. You can only drive it underground.

And the primary problem here is people either choosing or forced to live on fucking credit. If you have a problem with that, try to reduce that, don't try to make it cheaper for them to get said credit.

[Admiral Yi]

Cap can't go lower than 12%

Then we write off the high risk/no credit history people who need a card, and we're good to go.

[The Minsky Moment]

You know what happens when people with bad/horrible credit rating can't get credit/loan from banks because they are deemed too risky? They go to loan sharks, that's what.

What happens when people with horrible credit borrow from the Bank of Fancy Suits at 25%, inevitably fall behind on payments, and then get with enforcement actions against the now inflated principal?
Don't they go to the same loan sharks for the same reasons?  Only for a now larger sum that is even harder to repay?

[Admiral Yi]

What law of nature compels people to build up a balance?  I missed that lecture.

[Tamas]

You know what happens when people with bad/horrible credit rating can't get credit/loan from banks because they are deemed too risky? They go to loan sharks, that's what.

What happens when people with horrible credit borrow from the Bank of Fancy Suits at 25%, inevitably fall behind on payments, and then get with enforcement actions against the now inflated principal?
Don't they go to the same loan sharks for the same reasons?  Only for a now larger sum that is even harder to repay?

So you are saying they are better off going off the grid sooner?

[Oexmelin]

What law of nature compels people to build up a balance?  I missed that lecture.

Poverty

[The Minsky Moment]

So you are saying they are better off going off the grid sooner?

I'm saying the problem of loan sharks isn't solved by making loan sharkery legal when it's done by guys wearing a tie instead of track suits.

[crazy canuck]

What law of nature compels people to build up a balance?  I missed that lecture.

Why do you think credit card debt is as high as it is?

[dps]

What law of nature compels people to build up a balance?  I missed that lecture.

Why do you think credit card debt is as high as it is?

Because real incomes have been stagnant or even declined for many people over the past 40-some years?

[crazy canuck]

What law of nature compels people to build up a balance?  I missed that lecture.

Why do you think credit card debt is as high as it is?

Because real incomes have been stagnant or even declined for many people over the past 40-some years?

Yes, while the real cost of living has gone up.  That would be my guess also.  Wondering what Yi thinks.

[PDH]

Because real incomes have been stagnant or even declined for many people over the past 40-some years?

And productivity has also risen along with prices!  Win win!

[Admiral Yi]

Poverty

I'm guessing there are at least two or three people in poverty who have not run up an unpayable credit card balance, so that's not quite a law of nature nor inevitable, but leaving that aside let's take a look at the trade off you're endorsing.

People run up balances because their expenditures are higher than their income.  You would compel forced budgeting.  I suppose that's defensible.  The tradeoff of course is cutting out those people (in poverty or otherwise) who spend within their means but use the flexibility of credit for an occaisonal indulgence or emergency that they then amortize over a period of time.  Not to mention the difficulty of making online purchases without a credit card.

So I'm OK with denying those things to poor people, or people with no credit history, or people with bad credit, but don't complain about credit card issuers "gaming the system" when this happens.

[Oexmelin]

I'm guessing there are at least two or three people in poverty who have not run up an unpayable credit card balance, so that's not quite a law of nature nor inevitable, but leaving that aside let's take a look at the trade off you're endorsing.

I don't know what you are talking about.

[Admiral Yi]

None of it?