[y66]

excerpt from The Card Game - How Visa, Using Card Fees, Dominates a Market

Quote

“A dollar is no longer a dollar in this country,” said Mallory Duncan, senior vice president of the National Retail Federation, a trade association. “It’s a Visa dollar. It’s only worth 99 cents because they take a piece of every one.”

Would love to see somebody turn the tables on these guys. Maybe Google will team up with the Bank of China. Now that would be priceless, for awhile anyway.

[barmar]

Middlemen and facilitators have long been getting a cut of most financial transactions. That's the price we pay for moving beyond one-on-one barter, which isn't even close to practical in modern society.

[y66]

Agreed. And with more middlemen (more competition), we can move even further.

[kenberg]

I have a sort of ominous feeling about VISA. Deja vu, maybe. Running up to the housing/mortgage/credit meltdown I was dimly aware of behavior of borrowers and lenders that seemed brain-dead stupid, but I was neither a borrower nor a lender so I saw it as not affecting me. There are some similarities with credit cards. I use VISA. Like probably everyone on this thread, we pay up promptly and incur no interest charges. The cited article speaks of transaction charges that get passed on to consumers. Yes, but then VISA gives us some sort of frequent buyer rebate at the end of the year so it somewhat balances out. In order to fully get the refund I have to use VISA when I would rather use cash, but I don't really care. Still, they are pretty clever about getting us all to use the damned thing, even those of us who have some disinclination to do so. Example: We recently had some work done on the house. My nature would be to write a check. But we pulled out the plastic. This will cost the company that did the work, but we will get some cash back. One more VISA purchase. So big deal, who cares. But we all now have seen that we have to fork over several hundred billion dollars to keep the economy afloat, the cause, at least in part, being that what looked stupid turned out to be stupid. Getting everyone in the country in debt to VISA looks stupid and no doubt will also turn out to be stupid. Hence the dread about how this is all going to play out.

[Al_U_Card]

Forget the credit cards and pay attention to the mortgage mavens.

Late in December, the Treasury and the Fed decreed that Fannie and Freddie would be given an "open" (read bottomless) support to remain solvent no matter what.

So all of the mortgage securities that have been "bought" by the Fed are now subject to guarantee by the Treasury.....without legislation. The original 300 billion in the HERA wasn't enough.

Now with the nominal backing (incentives) in the upcoming housing sales market, it is only a matter of time that the whole mess is delivered to the tax-payers.

This is the "formalization" of the transfer of all of the bad mortgage debt from the banks to the people.


Wish I were a banker...