
Bernie Sanders interest-rate cap could end credit-card rewards programs - xivzgrev
https://www.marketwatch.com/story/guid/B3E7BB2E-733A-11E9-BFD5-1F1CC48B2404
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willio58
Good. Credit card rewards are great for the few people who have enough self
control to not get into debt, but terrible for everyone else. They drive
people into a spiral of debt.

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liamcardenas
For what it’s worth, it took me a long time to raise money for my startup.
Throughout that process, I relied heavily on my credit cards.

I don’t believe this would have been possible without high interest rates. I
took a calculated risk.

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xivzgrev
More importantly it could end credit card access to subprime members. There
already aren’t a lot of cards to build (or rebuild) your credit.

It is possible that issuers would respond by replacing with secured cards but
consumers hate those and introduces a lot more friction into process.

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HarryHirsch
_There already aren’t a lot of cards to build (or rebuild) your credit._

I never understood that. You'd think that creditworthiness means that you have
a habit of paying your bills on time, and that your scheduled payments are in
proportion to your income. Nothing more. But in America they insist that you
have a credit card and have a history of paying that. It's a problem when you
are a recent immigrant and seek to get a mortgage because you'd like to settle
in a certain town. If the Sanders proposal does something about that craziness
I'm all in favour.

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konschubert
Credit card rewards create a very bad incentive because they push consumers to
choose cards with high merchant fees, who then have to rise their prices and
make everybody pay the bill.

Thus creating a race to the bottom with ever-increasing credit card fees.

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sitkack
This needs to be stated in more ways. Credit cards themselves encourage
inflation (credit card fees, offset payments, lack of savings to pay for
goods). And those same rewards programs are paid for with merchant fees,
further encouraging price inflation.

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olliej
And that is bad because..?

Credit card reward programs exist to encourage spending on massively over
market interest rates.

Also, capping the interest rate doesn’t reduce the benefit to making
encouraging people to spend and carry debt, so I doubt they’ll go away.

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gizmo686
>Also, capping the interest rate doesn’t reduce the benefit to making
encouraging people to spend and carry debt, so I doubt they’ll go away.

That is exactly what it does. The benefit to people carrying debt _is_ the
interest they pay. If you reduce the interest rate, you reduce that benifit.

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oil25
Lots of speculation, mostly from owners of Web sites which profit off
marketing credit cards. The article tries to claim that low-interest loans are
BAD for consumers because they "generally set at a higher amount each month".
Do they really expect any intelligent person to believe this shit?

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HarryHirsch
_Do they really expect any intelligent person to believe this shit?_

The Fox News commentariat will swallow it wholesale, and they are more
numerous.

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girlsrule1234
Are they more numerous, though? I don’t know, but recall that Dems did win the
popular vote.

More vocal and likely to act in a coordinated effort? Unfortunately, probably.

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rando444
I live in a country where credit cards can't carry a balance. Everyone pays
them off every month.

If you need a loan, you ask the bank.

In the absence of credit card interest rates, we pay yearly fees for cards
depending on the rewards offered by each.

It's kind of the best of all worlds if you ask me.

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sethgecko
What if you don’t pay?

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ddingus
Seems simple. No credit, until you do.

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sethgecko
But then you carry a balance

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ddingus
Not when the law says differently.

