Odysseas Papadimitriou

Why Credit Card Interest Rates Won't Be Capped

I do not doubt that you can do it on a small scale, but the question is how much can you scale before you start losing money?

My experience says that you can not do it, but if you guys have found a magic formula I would be more than happy to help you thru cardhub.com to scale-up and help more people.


On Jan 02 01:59 PM Felix Salmon wrote:

> Actually, Odysseas, I'm one step ahead of you: I'm on the board of
> the Lower East Side People's Federal Credit Union, which offers a
> 9.99% visa card to people who otherwise have 20%+ rates. And yes,
> we make money on it.

Why Credit Card Interest Rates Won't Be Capped

Felix -- If you think that all credit-card companies have conspired to charge people much more than their credit risk warrants, why don't you start a credit card company and offer a 10% rate to most of the people that have a 20%+ rate?? I am sure you will get a lot of business... :)

What Price Better Credit?

Hi Felix,

My exact comment was:
"Even when the cost of credit is astronomical, for people in true emergencies, it's much better than not having access to credit"

This does NOT necessarily mean that you apply for the card when you have the emergency. It means that you can have the card in your wallet with a $0 balance, so that you can use it when you have a true emergency. And yes, having access to expensive credit during a true emergency is much better than having no money to pay for your emergency!

Finally, the best way to build up your credit history is with a secured credit card: www.cardhub.com/credit.../
A secured credit card helps your credit in the same way as an unsecured card and with a minimum deposit of $200 you are guaranteed approval. Also the cost of having a secured credit card can be very reasonable. For example, the Orchard Bank Secured MasterCard has a 7.9% APR and a $35 annual fee that is waived on the first year.

Feel free to email me if you want to chat more about this.

Happy New Year,
Odysseas

BofA Testing the Legal Limits

I guess you missed the whole point that my assessment is that they will be prohibited from raising annual fees on existing customers after the new law goes into effect and they have not realized it!


On Nov 04 03:23 PM Big Jack58 wrote:
> BAC is finding ways they can profit when they offer additional
> services (even if they originally gave it away). So for cash back,
> frequent flyer miles, etc type cards they might get clients to pay
> an account fee ... wow, they are going to charge customers for a
> service they offer? That's almost capitalistic!

BofA Testing the Legal Limits

Definition of Finance Charges according to Regulation Z:
www.fdic.gov/regulatio...

FDIC Glossary -- look under the definition of finance charges, annual fees are explicitly mentioned
www.fdic.gov/regulatio...


On Nov 04 09:27 AM Free Markets Rule wrote:

> I think the author is thinking of cash advance fees being counted
> as finance charges. I have never seen membership fees counted on
> my statements as "finance charges". Plus, Bank of America could have
> raised my rates AND added added a membership fee. So far, they have
> done neither, unlike some of their competitors, so I have to disagree
> with the premise here. Sorry.

In Public Companies, If You Don't Vote, It Still Counts

I think you will all enjoy this article:
www.walletblog.com/200.../

More specifically, I am suggesting to remove term limits from Board seats, to limit the Board size to 8 members, and to allow anyone (or any group) with 12.5% of the stock full access to 1 Board seat (i.e. appoint anyone they want and fire them immediately if they do not do their jobs) in order to ensure full representation of the shareholders desires.

Why AIG Needs to Go into Prepackaged Bankruptcy

There is a big difference between the Lehman Bankruptcy and the Chrysler Bankruptcy that is a prepackaged bankruptcy. I advocate a prepackaged bankruptcy for AIG, because it is nonsense for AIG to have to honor obligations that do not present a systemic risk to the US economy.

Why AIG Needs to Go into Prepackaged Bankruptcy

normthefedup -- I guess you are not familiar with prepackaged bankruptcy. After bankruptcy the US goverment will still owe the vast majority of AIG, but it will owe a much healtier company that has freed itself from obligations that do not present a systemic risk to the US economy -- like the $33 Billion that went to foreign banks!

The Housing Bubble: Greenspan's Wayward Son

Peter I could not agree more and your article does not even touch on the fact that Greenspan had MUCH MORE LEVERAGE than moving the short-term interest rates.

Greenspan was the top financial regulator for the country. He could had imposed much stricter underwriting practices, he could had prohibited shady practices in the mortgage and credit card arenas. He could had identified Credit Default Swaps as an area of HUGE systemic risk, etc. BUT he chose not to do ANYTHING!

Why Stock Charts Are Misleading

We all know that. Unfortunately the average investor does not know that. All too often they look at the stock chart to determine how cheaper or more expensive is a stock than it was X years ago.


On May 13 08:22 AM BobD wrote:

> The purpose of a stock chart is NOT to determine value but to determine
> price direction! If you want price look at the fundamentals.

The Senate Voted Wisely on 'Cram Down' Bill

As a taxpayer that need to pay for the bailouts do you want to maximize the losses for the banks or minimize them? I think we all agree that we want to minimize them. Thus, who do you think will do a better job in minimizing the banks losses. The bank itself (even with all its shortcomings and inefficiencies) or a bankruptcy judge?