Trump's credit card cap proposal would hurt the very people it's designed to help: Michael Strain
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- Опубликовано: 1 дек 2024
- Natasha Sarin, Yale University professor, and Michael Strain, AEI director of economic policy studies, joins 'Squawk Box' to discuss President-elect Trump's proposal to cap credit card interest rates at 10%, whether the move the make it harder for consumers to qualify for credit cards or access liens of credit, and more.
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I've had huge rates even with an 800+ score, sooooo what exactly is a non subprime person......
I was just about to say the same thing.
Great explanation of how credit card industry is defrauding the consumer. Why should a consumer paying in cash subsidize a credit card customer?
how are consumer subsidizing credit card holders?
Imagine defending 30% interest rates on people already suffering...
I'll do it. That person with 30% rates defaulted several times, didn't pay their landlord, has several collections accounts... would YOU lend to them?
Lending is a risk, and you account for that risk by the interest rate you offer borrowers. Assume you cap the interest rate, well, then the lender will just be more conservative with who they lend money to. No one is required or obligated to give your credit, so restricting how much insurance you can build into the risk will only mean you become less risky.
And that is fine, but it means the people with the most risk, will just be pushed out.
exactly! imagine being against a 10% APR on credit cards!
@@jcf2322 and actually that would be a good thing! They end up with mountains of debt that is mostly interest!
@@icare4air perhaps, but not being able to access credit at all on the whole is also not great for the individuals or the economy. We’re a consumer driven economy, if all of a sudden it’s driven mostly by liquid cash on hand, that would have huge ripple effects for individuals and their families. Credit history is important in this country, and if you are deemed too risky because of the demographics it makes it harder for good individuals to get credit.
We the people demand action against predatory lending! Business often get 2% even 0%
The only people mad about the credit card cap are the ones getting rich off credit cards with high interest rates
Credit card companies won't deny people based on a 10% rate versus 20%+, they want the customers. They will be hungry to attain more customers to meet the same revenue before the policy.
The American consumer’s lack of self-discipline when it comes to spending even when they can’t afford it keeps so many from achieving financial independence. If you want to buy that $2000 purse, new Mercedes or trip to Europe and can afford it - great. If not, then scale back what you buy and start investing instead. The problem is our whole consumer-driven economic model is built on folks buying more than they can really afford, and it keeps them from getting ahead as the years go by.
So these experts think banks are helping people who are not credit worthy by lending to them and charge them with high interest rates. Am I missing something here
Most all credit cards charge 25% even when my credit score is 800. So that goes against the pricing varying by risk.
It's ironic that the GOP opposes the SAVE student loan program, which caps interest accrual, while supporting credit card interest caps-despite credit cards often funding frivolous spending. Their excuse? "Not everyone has student loans." But not everyone has credit card debt either. It feels like the GOP favors a system that keeps people reliant on wages rather than helping them improve their skills through more affordable education loans.
Don't use credit.
There's a reason why some people are having difficulty getting a credit card. Guess what that reason is......
What a joke u can have a interest charge that off sets risk w out it being 20 to 30% come on now WTF
If you charge somebody 21% interest rate because they’re higher risk, how does that help your odds of getting the initial borrowed amount paid back.
Anyone who doesn’t or can’t, use a line of credit to pay their outstanding credit card balance shouldn’t be using a credit card. Stay with cash. Unfortunately financial literacy is not common amongst too many people. 🤷♂️
FYI, the profit margin of Visa and Mastercard is 50%. All the proof you need that they can "stomach" some losses from the not-so-credit-worthy individuals.
The positive spin on this is, it helps lower credit worthy types to learn to budget better, save, invest and not give banks billions every three years at 24% interest rate.
Rather than go after credit cards, cap on pay day lenders.
Both should be regulated
My credit score is 800 and my APR is still closer to 30% cmon now. imagine CNBC being against a 10% APR? we see your lies.
To what degree do we protect people from themselves?
99.9999 % of consumers will benefit, for the rest a government rate subsidy could be appropriate
zero interest rates made lots of suckers. didn't even ask why rates were at 000000000000000000000000000000
The economists create these situations/financial industries that become traps that people can't get out of. Mostly it boils down to ' It takes money to save money'. People that can buy without using credit always get the best price. People that can't, become credit slaves.
Who is this natessa? She is telling Okay to pay 30% interest for rewards. Please choose some intellect guest and not amature
She sounds like an idiot can’t conceptually understand anything in a bigger picture over 2 steps 😅
Can she talk about food stamp?????????? Why should we pay for them??????? Not fair
How about you only buy things that you can pay for when your bill is due? Then interest rates won't matter.
Who in particular opposed the Magna Carta? Who opposes the in duplum rule? In a business transaction you have the possibility of a profit or a loss and if you are rigging the game from you ever having a loss then you aren't an astute business man/woman
she is wrong, poor people use credit card and they load up with unpaid bills because groceries are way higher than people can afford these days.
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This is comical😂 I don't feel compassion for credit cards
This may keep folks from building so much debt that they can never get out of! At 30%, they will never get out. This man is a fool!
too bad. can't afford it don't buy it.
In general, yes, but a lot of the economy runs on credit, and it would have a lot of ripple effects if we transitioned back to a very liquidity driven economy. Basically for the vast majority they would only spend with what cash they have on hand. That's not great for a consumer driven economy.
If the host listened half as much as she interrupts guest who are more informed and can provide valuable insights, she would actually learn something… gosh please stop
Interrupting the guests so much please !!!!
Credit cards are like drugs, just say no.
Nope banks would need ot issue more credit cards to makeup the losses
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ppl with low credit are often the ppl who need credit?? this guy delusional??
Good! Cap the cards.
The contempt that guy and the anchor (ie nyc elites) have for poor people is beyond me. #Trump2025
It's not contempt, it's concern. High interest rates on poor people is unfortunate, but many of those same people also have very high default rates. The way lenders attempt to account for potential default is by charging higher interest rates to individual lenders, if the government caps the amount of interest you can charge the effect will be that fewer lenders will be open to extending credit to riskier borrowers.
No one is under an obligation to give you credit, and if they cannot build in structures to protect themselves from going into default, then they will just be more conservative and not extend as much credit in the first place. And that will have the effect of disproportionately hurting the very people this is meant to help.
Feel free to offer interest free loans on just good faith with your money. 😂
Good Move.
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Yeah not a good policy idea