Credit & Debit Cards

Bully for you, Bank of America.  Bank of America's starting charging monthly fees for debit card usage to some customers. This is being taken as an "I told you so" by opponents of the Durbin Amendment, who argued that it would only result in higher costs for consumers. Actually, the BoA move is exactly what we might expect:  consumers are having to pay for their rewards. That's how it should be. They might be paying too much, but that's another matter.  So what does Bank of America's move tell us?

Why do financial reporters insist on reporting interest rates on complex consumer financial products as if they were meaningful in isolation? To wit, anotherwise good New York Times story http://www.nytimes.com/2011/08/15/business/low-interest-rates-do-little-... reports an increase in credit card interest rates over last year. That figures doubly meaningless. First, interest rates are but one component among many of the cost ofusng a credit card.

It goes without saying that I think the Fed did a real jerk move on the Durbin Amendment rulemaking. But the more interesting issue is why? 

I've previously posted about my frustrations at being stranded abroad without a functioning credit card -- particularly at train stations -- and the refusal of American credit cards to adopt a technology that has been in my building laundry room for years.

King Solomon's judgment regarding the two women claiming to be the mother of the same child is a familiar story--the King proposed chopping the baby in two and giving each mother half of the child. One mother consents, while the other says that she will forfeit the child. The one who prefers receiving 0 child to .5 child is then awarded the whole baby because the real mother would never consent to the child being harmed.