Letters to the Editor
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Which is why MasterCard will soon have GSE status
There is no reseasonable way to slash consumer credit rates across the board without government intervention. When you consider where consumer rates are and where they could go, you have to think there is another bubble yet to be inflated. Central bankers have never seen a bubble they could refuse to inflate.
Among the lessons learned from the housing debacle, one, there is no way to lower consumer credit rates selectively, those who are least able, should not be forced to pay higher interest rates. Secondly as long as the Congress agrees there is no bottom to the toxic cesspool of bad loans, Freddie and Fannie, and maybe Mastercard and Visa. If taxpayers are going to bale anyone out, low income mortgage borrowers deserve just as much help as the investment banks, and probably more.
Thirdly the risk of default is really quite a bit less for credit card holders, than for mortgage banks, where the borrower leverages up to a half a million dollars in assets. Consumers are much more protective of their CCs than their mortgages, since these cards put groceries on the table, no matter if you have to eat them in the park.
And finally what CC company would mind making government backed loans at half the current rate? Not many probably.