The big lending institutions are at it again, making high interest loans to people who have no ability to pay those loans back. Only this time it isn’t home loans . . . it’s credit cards!
The financial community made $50 billion last year in credit card fees. Citibank just announced it’s 7th straight profitable quarter and a 74% jump in quarterly profits. Bank of America made $6.2 billion in the third quarter, Morgan Stanley announced 3.8 Billion. They’re lending to unqualified buyers at usurious rates. Why lend money for 30 years at 4% when you you tap into a 20%-plus opportunity that people can’t escape from, even in bankruptcy? We currently have more than 800 million credit cards in circulation domestically, more than two for every man, woman and child in the country. These predatory practices are targeted towards students and those in need, then packaged in complicated derivatives that kick off high returns, hence the 80% interest rates currently legal thanks to our compromised Congress. Look out, this crash will be more frightening and wider than the last one. Demand credit card reform before it’s too late.
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