Should the Government Step In and Dictate What Credit Card Companies Can Charge?
According to the Government, they bailed out companies in order to spur economic growth. And now, since the credit card companies have received this money, people are asking if the Government has the right to dictate how much the credit card companies can charge their customers? Putting it in a broader context, the Government has outlawed loan sharking. So, the Mafia can't charge you 100% interest and then break your legs if you don't pay. Or at least they are supposed to . . . And yet, some credit card companies are doubling and tripling the interest rate they are charging their customers, even those who haven't missed a payment. For instance, Capital One has increased its interested rate from 9.9% to 17.9% because they want to, not because a customer has missed a payment. Citigroup recently told cardholders that if they missed a payment, their interest rate could shoot to almost 30%. And Chase and JP Morgan stated that they will now charge a 10% service charge over and above what they already charge to those with high account balances. Should they have the right to do this? Let me make this clear. Credit card companies have the right to raise interest rates at any time and for any reason. Further, when it comes to other lending practices, some payday lenders are charging in excess of 400%, and it is legal. I guess Citigroup, Chase and JPMorgan are claiming it is the tough market. However, Citi received $45 billion in bailout from the taxpayers. Chase received $25 billion, and Capitol One $3.55 billion. Does this change your mind? Jack opens up the phones on Kogo radio and Kogo.com to talk about how much regulation we want. Jack also takes your calls at 1-800-600-5646.