Dr. O

Monday's Closing Update

I believe at this point the equity/commodity and forex markets are completely controlled/manipulated.

I believe we are experiencing a pause in a depression-like world-wide downturn. I believe all asset classes will continue falling over the intermediate-term (months to years).

I believe one has to diversify across currencies and precious metals to preserve wealth. Forget about generating wealth for a while.

The only people making money are working at Goldman Sachs, and they earn money not by analysis or speculation: they trade off inside information and front run the big money they manage.

They don't throw darts at a board, they only bet on sure things. And one thing is for sure, this market is being propped up long enough for banks to issue secondaries and big money to unload merchandise. This market will crash again before its all said and done.

The Next Major Financial Crisis

>>From our vantage point, the nearly $1 trillion in outstanding U.S. credit-card debt could be the next major crisis to roil the economy<<

That's one of them.

Singing the American Express Blues

Sorry for your horrific Amex experience. Is this the best business practice AMEX can come up with to mitigate their loss risk after you've been a stellar customer for a quarter of a century?

I thank you for the note, because I have a couple Amex cards too. No problems so far. However, I have had a Crapital One card that I used frequently, paid in full each month, never late, and my interest rates were raised from 7.99% to 17.99% on purchases.

It didn't affect me because I don't carry balances, but I was so insulted (wouldn't 12.99% APR been sufficient?) that I canceled the card. No, I didn't have another late payment anywhere else.

And these credit card companies are still running thousands of TV commericials weekly trying to get people to sign up, while running off their old customers. I don't get it.

Why is the Market Ignoring American Express's Bad Report?

The big pop in AXP, like other financials, was likely short-covering and "bargain hunting." Stocks like AXP had been shorted/dumped into near oblivion in the belief that they were nearing bankruptcy. Clearly that is not the case, for now. Don't look to the stock price to tell you what a company is "worth."

Credit Card Crunch: Creating a New Generation of Subprime

I use credit cards for everyday purchases because I only use checks to pay bills, only use a debit card to obtain cash. It's safer using a credit card, in terms of consumer protections available.

Never had a late payment. Can't remember the last time I carried a balance. Definitely a high-FICO score. Nonetheless, Capital One Financial sent me a notice that my monthly APR on ordinary purchases was going from 7.99% to 17.99% beginning mid-May.

I had to reread this a couple of times. I became concerned that something negative had happened to my credit rating, as one late payment can trigger all your credit providers to raise their rates. Nope. No problems from my end.

I could only conclude that Captial One didn't want someone who paid their balances off every month, and, had no late payments. They weren't making money off of me, I guess.

I canceled the card, a Visa. My default credit card now is an Amex Card. Citi still hasn't touched my Mastercard or its credit line, but I rarely use it.

Something is going on in credit card land.