Credit-card industry may cut $2 trillion lines: analyst

Credit-card industry may cut $2 trillion lines: analyst

news.yahoo.com

Closing millions of accounts, cutting credit lines and raising interest rates are just some of the moves credit card issuers are using to try to inoculate themselves from a tsunami of expected consumer defaults.

A consolidated U.S. lending market that is pulling back on credit is also posing a risk to the overall consumer liquidity, Whitney said.

Mortgages and credit cards are now dominated by five players who are all pulling back liquidity, making reductions in consumer liquidity seem unavoidable, she said.

(visit the link for the full news article)

I have been waiting for this part to come down the line.

Everytime I have used my credit card, I have wondered if it was going to go through or not (and that is not due to me - not paying my bill).

Can you imagine what will happen if people are cut off from their credit card? Especially if that is what they use to buy food and necessaties between getting paid?

Cutting off credit cards would be devastating to the U.S.m besides what it would do to ALL internet business - that runs by credit cards, including paypal.

This is going to be happening, soon, so the best thing people can do, is start carrying cash with them, for the day it does happen. I don't think we will be forewarned by our credit card companies, we will just find out as we are purchasing our weeks groceries.

BTW: I did the webbot - earthquake thread, well guess what......webbot got this over the summer - they said credit cards were going to go by the way side.



news.yahoo.com
(visit the link for the full news article)

I stopped using credit cards 3 years ago, thank gosh. This will be another straw on the back of the poor camel. How many more will it take?

If credit lines are unexpectedly frozen,businesses will shutdown=mass lay-offs,welcome to chaos!

[edit on 1-12-2008 by all2human]

Well it was a bad practice to begin with and one happily I am no longer a slave to, but can you imagine a cut of this magnitude. This is a major stape of American commerce (right or wrong). The internet commerce I would imagine would be doomed. I wonder what that would translate into as far as the drop in consumer spending. This is not really my strong point but I find it fascinating noneltheless. I don't much care for the Fed notes but they do in a pinch and are considerably more honest at least to the consumers intentions. I agree we should live in a credit devoid system but it better be seriously incremental so as to avoid total collapse. I mean lets face it. These products are not worth the prices we are being asked to spend on them. They jack up everything because we'll spend anything on credit.

Kind of like wimpy from Popeye "I will gladly pay you tomorrow for something today" the indoctrination began early.

[edit on 1-12-2008 by KMFNWO]

Internet businesses wouldn't be doomed. The credit cards would become debit cards. You'd have to have a positive balance on them before you could use them.

I smell a bailout coming!!! Do you think any relief will be offered to the consumers??? Banksters win again!!! Small lenders will be bought by larger banks that are "too big to fail" and those banks will be offered more bailout money. Ofcourse the irony being this money will be borrowed from the consumers because of irresponsible lending practices. Now who is the REAL deadbeat hmmm???

Originally posted by ghofer
Internet businesses wouldn't be doomed. The credit cards would become debit cards. You'd have to have a positive balance on them before you could use them.

Very true - until of course the banks close - which of course we won't have forewarning over either.

This will bring down most company's that where on the line.

I do not think most understand what this means to the economy and what it will bring to all of us to deal with after the first of the year.
Yes debit cards can be used, but that is not the same as a credit card.
The new's just keeps getting bleaker as time goes on.
It is going to take years before we will be back to where we where just last summer, and I think most of us will be doing without a lot as time goes on.
Only time will tell on this matter.

This no more than a proactive move by the credit card companies. Obama has already stated he wanted to rewrite the bankruptcy law to protect consumer. Credit card companies are trying to milk the golden cow for everything they can before Congress acts.

well I made a decision. I will sell my bussiness, pay all credits back and I am moving to my mountain house to learn the real life.

I am not going to watch the news and the money I will keep in sheeps or something valuable.

let the collapse rock and roll...

I decided about four months ago to cut up all the cards and deal with the debt.

I no longer have any credit cards whatsoever. It was tough at first but I'm getting along pretty well with little inconvenience.

And, I'm no longer paying 'interest' at an insane rate to equally insane people who are clearly milking the last few dollars out of the whomever before everything implodes.

I can U2U some tips on how I did it if you're interested.

reply to post by jam321


Hi Jam!

Hey also Obama said that he wanted to people to start saving and making responsible consumer choices.

This is all about the permanent changes that are going to come out of this financial crisis. Credit card are going to be issue to those who can afford having one. And people are going to go back to the old ways to pay for things but most importantly buy the things they really need.

The way I look at it, this is not all that bad is we take into consideration that deflation is settling in. There is no immediate remedy for this crisis and I think instead of just a bad economic cycle we are in for a major change in the way we conduct bussiness and the use of credit cards is one of those things that are going to be impacted.

This is bad, perhaps the worst news yet in this financial crisis. I can't believe it is not getting more coverage. This is going to cause medium and small businesses already stressed by the economy to go under only adding to an already worsening situation.

I never really thought about survivalist methods until seeing news like this, combined with the "Official report of Recession" the huge drop in the stock markets today etc. survival could be our only hope.

They say the fall isn't nearly as bad as the impact at the bottom... If they are going to stop this descent they had better do something really soon.

Scary news.

Originally posted by Walkswithfish
This is bad, perhaps the worst news yet in this financial crisis.

Scary news.

If you think that is the scariest news, then you have not seen this.

Derivatives collapse predicted months ago

That is the invisible elephant in the room.

Why is it invisible ? Because the OTC where most of it is hidden
is unlisted and unregulated.

It has already started to unwind, but hasn't built up to its true
level of destruction yet.

10's to 100's of trillions of dollars.

3 Steps to Outlaw Money

1. TELL everyone "government issues free money, everything's free".

2. Take only what's necessary from the stores without paying. If stopped, return to 1 above.

3. STOP paying utilities, taxes etc to "force" government to provide everything freely because government issues free money anyway.

NOW copy and paste this everywhere you can. EMAIL this. It's fight back time NOW or never!

Well credit cards are basically for folks that cant manage money no matter how you dice it in the end,they hand them out like sweeties in the uk and usa...hopefully it will teach people a lesson that relying on credit cards for the essentials to live is ridicolous.

[edit on 13-12-2008 by Solomons]