Who Says There's No Credit!
This email from Citibank landed in our inbox this morning. With no prompting from us, they just increased our credit card limit by 50%. Go figure.
This email from Citibank landed in our inbox this morning. With no prompting from us, they just increased our credit card limit by 50%. Go figure.
I never get those, but I pay my balances off each month, so I’m not really a good customer. I remember a few years ago, my girlfriend had some crazy rate (like, over 20%) and she DID carry a balance, and her bank upped her limit, unsolicited.
I got a similar letter, although not with such a huge increase. One thing I did notice however was my interest rate was like 7.5% or something.
That is simply insane.
We get these all the time. They want us to to become total crackheads, but given how thinly we’re stretched, it is they who must be the true desperados.
And Montrose, I’ve gotten a whole new picture of life behind your genteel facade!
“I am tempted to buy more shares at this price, though.”
BRG, seriously that is not a bad idea. It can’t get much lower, but if it does, it’ll be bailed out or taken over by JPM, BofA or someone else. The other alternative is financial spiders, which I think isn’t a bad call these days.
What, do you really believe that the fed lets everyone know what they are doing. They have essentially started printing money if they are purchasing their own 10yr bonds which I hear is what they are doing. They have also started printing as soon as they start throwing money at bad companies. The tarp was originally intended to buy bad assets, assets that really had no intrinsic value. Monetization is the printing of bank notes by the central bank, that is what they have done when they started taking securities for currency , especially since alot of these currencies have no intrinsic value. The fed now has a huge balance sheet of little to no intrinsic value securities. That my friend is printing the presses. Its like the fed buying up that home that sold for 3 million last year for 3 million knowing quite well that it would only fetch 1.5. Though at least the home has intrinsic value those securities based on models have no intrinsic value.
Credit card companies are modifying limits according to the actual and forecast value of real estate in the area.
If you live in central Florida, for example, your credit line was snapped back to whatever your balance is. So was your HELOC. This has caused all kinds of problems with credit rating agencies because their formulas don’t really work well when banks take that kind of action and millions of people’s credit scores have been battered by no fault of their own, except that they live in an area where housing prices are falling.
On the other hand, banks make money by lending it. These loan-limit reduction actions have reduced risk, but are hurting the bottom line. So, they’ve correspondingly increased credit limits in areas where housing prices are going up (few) holding firm, or forecast to do so. You can read PMI’s actuarial forecast published in October that says NYC real estate has only a 7% probability of being lower in value by October 2010. Banks read that and adjust people’s credit card limits that live in NYC. Now, PMI’s actuarial analysis probably preceeded the Great Asset Crash of October 10th 2008, so banks might have been rash. But these are big organizations and processes in the pipeline are often cheaper to push through than halt, even if there’s a cost to pushing them through.
Can you buy shares of citi with an increased credit line like Mr. B’s….hhhmmmm.
I am tempted to buy more shares at this price, though.
“I have 500 shares of citi.”
That sounds like enough to wallpaper your apartment. I think wallpaper is probably more than $5.04 per square foot these days.
Oooo! Me, me, me!
Finally, my investment scheme of not investing has paid off!