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This is mostly economically written people in general Price controls are a bad idealeading to outcomes such as lack and meals of goods and services. But when it comes to credit cards, understanding the price control goes out the window.
Senator Josh HawleyR-Mo., Announced that he joined with the consumed supporter of every poor economic idea, Senator Bernie Sanders, I-Vt., Introduce a arbitrary 10% limit on interest rates on credit card, something president Donald Trump Trump floated during the election during the election .
However, while Trump does a fantastic job in maintaining a promise, this is not what to maintain.
Senator Josh Hawley has announced that he has joined Senar Bernie Sanders to introduce a arbitrary 10% border at interest rates on credit card. (Tom Williams/CQ-Roll Call, Inc via Getty Images)
First, I want to be clear that interest rates on the credit card are ridiculously high and generally shameful. Also I am not an advocate of using debt for personal consumption and I believe that the balance should only be worn in the event of serious emergency. Personally, I never start a Credit Card Salda per month and advise everyone to buy only what they can afford.
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But I am also not an advocate of many other things – whether they are gambling or buying expensive new cars – I still don’t think the government should regulate them just because they are Bad Decisions on Personal Finance.
And no, I don’t believe in “Uzury” either, as some like to throw themselves away. But the Government does not deal with jobs in private credit insurance/decisions.
Although access to the loan is something that in my opinion should be done only for valuable investments, it is not my job or government, that I decide who should get access to the loan.
And the limit of interest on a credit card at 10% will ensure that fewer people have a legal access to a loan, such as a very predictable consequence of limiting interest rates on credit cards.
If the interest card on the credit card is limited, especially in high interest rates, expect many middle and lower -class people to not be able to get a loan at all.
So – a Interest cover They will not reduce the costs for most people-they will tell them for the best borrowers and ensure that they do not have access to financial institutions without almost perfect loans. Also, expect the companies to charge multiple access fees to make up for any losses derived from interest limit.
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When people with lower credit ratings who want loan, banks exclude (and, of course, everyone will scream that it’s unfair), what’s going on? These borrowers will look for a loan from alternative sources, including bad actors whose “bankrupt” and “collection” plans are much less delicious than those from legal financial institutionsoften accompanied by a broken hand or nose.
Furthermore, anyone who would choose the limit of interest rates as random, a hard number that is not bound to any financial standard (such as X basic points above the secured funding rate of overnight (SOFR), for example) should be completely neglected.
Good intentions do not suit good outcomes.
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And while I agree that the credit card rates are too high and people who cannot afford things should not buy them except urgent situations, it is for them to decide on their own free will.
The best way to combat high credit card rates are financial literacy and personal responsibility. Government, which has a deficit of close to 7% of GDP -ai has its own problem with longYou should probably first take care of your debt.
