Originally posted by RayEthier:
Originally posted by DrAchoo:
Originally posted by RayEthier:
... raking in unbelievable profits. |
You are going to have to show me some of these balance sheets as financials these days are among the last companies to tally "unbelievable profits". That's not to say they don't make money on their credit cards though. But let me ask the philosophical question, why do we think we have the right to unsecured, cheap credit? If people don't want to pay 19% interest, don't use your credit card or pay your balance off each month. Bam. Problem solved. There are few scenarios, in my mind, where one is truly forced to use credit card debt. But rather than reign in our standard of living we are all too willing to incur this deal with the devil. |
While I can appreciate your concerns Doc, the issue of prime consideration in this instance rests in the fact that these financial institutions do not pass on the reductions of the prime rates to the clients, and that is something that affects a lot more than credit cards.
Every single loan doled out in this country is affected by the Prime Rate charged by the Bank of Canada, and it is almost obscene that banks can pocket the difference in the interest charged by the Bank of Canada. I most certainly do not have a problem with financial institutions making a fair profit, but the rates charged in some instances is nothing short of what used to be viewed as "Usury". Couple this with all the nickel and dime charges the banks have and I have no doubt they are not suffering much.
You might wish to take a quick look at this article Canada's Bankswhich seems to suggest that although their profit margins have indeed dwindled somewhat, they are still doing quite well.
Ray |
Don't worry Ray, I don't have a beef with what you are saying. I don't like corporations taking advantage of us either. On the other hand, lower rates may ecourage people to do stupid things. I'm just talking here. I guess my thought is this. If the running rate for a mortgage is about 5.5% and the bank has the loan secured with a house and the running rate for a bank auto loan is maybe 6-7% with the loan secured by a car, what should the rate be for a completely unsecured loan? If you don't pay your credit card bill, the bank doesn't get your dinner back. But I digress. Let's all agree 19% is a loan rate which should be entered into very rarely. |
