Monday, August 19, 2013

Credit Cards: Magic Plastic


Click to enlarge.

Credit card interest rates are shown in red.
The Fed Funds rate is shown in blue.

I guess we can't count on the Fed to lower credit card interest rates any further. We're apparently stuck at the low, low rate of just 1% per month. A steal at any price!

December 27, 2007
Yahoo! Answers: Is it ok to buy stocks with a credit card?

Absolutely! I just read an article that says the world is doing okay!

December 19, 2007
No Recession, But...

With help from the Fed, consumers and businesses should be able to manage the crunch. "While consumers are likely to grow more cautious in 2008, solid income growth should prevent a sharp contraction in spending," says Ethan S. Harris at Lehman Brothers (LEH). Businesses will continue to expand their outlays and payrolls, since they are not overextended with debt, excess production capacity, or inventories, and the lower dollar is providing a stimulus for exports, especially since the rest of the world is doing O.K. But without effective Fed action, the credit vise could begin to squeeze too hard.

Oops. My bad. Lehman Brothers! Bah! ;)

Source Data:
St. Louis Fed: Custom Chart

7 comments:

Joseph Constable said...

That reminds me of Camelot II. When Bill was president I remember it being promoted that we may never see a bad recession again and certainly never a depression.

Mr Slippery said...

I don't trust those snakes at Lehman Brothers. There is this genius over at DREXEL BURNHAM LAMBERT, Michael something-or-other, that is making big bucks with high yield bonds.

Troy said...

The rest of the world was "doing OK" in 2007 because we were spending trillions of borrowed money on stuff.

http://research.stlouisfed.org/fred2/series/NETEXP

This is the 'illusion of prosperity' thesis of course.

Stagflationary Mark said...

Joseph Constable,

Well, there's one thing we can count on. The economy is always great!

Great Moderation -> Great Recession -> Great ____?

Stagflationary Mark said...

Mr Slippery,

Stick with the "Nobel Laureates" if you want high yield with low risk! ;)

Stagflationary Mark said...

Troy,

Yeah, you've given me blog naming remorse. Although "Illusion of Prosperity" captures the essence, I think "Stuff Glut" offers a more detailed description with fewer words. As an added bonus, it also feels a bit more whimsical, lol. Sigh.

Thank goodness that era is over. It is over, right? We don't have 90% market share in the world's booming self-storage industry, do we? Tell me we still don't have all that priceless* stuff!

* How can one really put a price on musty mattresses, 8-track tapes, PS1 games, and manual typewriters stored away for decades? Perhaps the price could be based on the money spent to store them, but what about all that sentimental value! ;)

Stagflationary Mark said...

Went shopping at the grocery store yesterday.

33 cent Tillamook 6oz yogurt? Jackpot! The fridge now runneth over!

Hey, I get my kicks where I can. It was a good day. It was on my trip back from the dentist (checkup and cleaning). It seems that all the work I had done a few years ago is holding up very well. :)