Comments on: This and That: Taxwiki, Credit card rewards and more…

By: Canadian Capitalist

Canadian Capitalist — Tue, 03 Aug 2010 14:17:04 +0000

@Phil: It’s not overcharging that I have a problem with. If credit card companies are using their market power to force retailers not to offer discounts to those paying cash, I think it is a problem. If regulations disallow that, then the free market will decide which payment options consumers will prefer.

By: BenE

BenE — Tue, 03 Aug 2010 14:01:30 +0000

Phil S, you really think it is okay to scam people, force them to pay you even if they don’t use your product, take huge salaries and bonuses for yourself while doing it as long as you give a small % back to shareholders?! This is not a case where they are producing value in exchange. Giving out 1% rewards in exchange for taking in 3% behind the curtains is not value creation. The consumers should have used their debit card. If everyone had used their debit card, they would have saved almost 2%.

People can buy shares all they want, assuming the over leveraged banks don’t fall on a hiccup in the economy, they will get a share of the profits but they will never recoup the money they were scammed out of because much of it goes to pay for the operation of the scam and the yachts of its lead scammers. I can’t believe you think that’s anywhere near a solution to the problem.

By: Preet Banerjee

Preet Banerjee — Tue, 03 Aug 2010 13:25:56 +0000

Thanks for the link Ram, hope you enjoyed the weekend!

By: » Round-up of Financial Blogs Canadian Business Blogs | Advice on Investment in Canada, Stock Market, Small Businesses Opportunities

Tue, 03 Aug 2010 02:54:21 +0000

[...] Canadian Capitalist and Canadian Financial DIY draw attention to a new tax resource, taxwiki.ca, founded by Prof Ben Allaire [...]

By: Phil S

Phil S — Tue, 03 Aug 2010 01:28:14 +0000

@Slacker. I didn’t say that it isn’t an oligopoly. But we have the option of buying into many of the companies that people complain are overcharging. So, if you really think that we’re getting overcharged and there’s nothing you can do about it – you get an opportunity to get a piece of the action.

From an investment opportunity perspective, buying into names in an oligopoly can sometimes lead to some safe & secure dividend yields.

I didn’t buy into Amex, MC or VISA, but then again, I’m not one of the people complaining about their fees. I, for one, enjoy the convenience of carrying plastic as opposed to cash.

By: Slacker

Slacker — Mon, 02 Aug 2010 21:59:11 +0000

@Phil S: Your argument that this is free market is a classic oversimplification. This is not a free market, because VISA and MasterCard have overwhelming share of credit payment methods. The barrier of entry into this market is too high, and the oligopoly status allows them to force upon merchants with high fees, which are invisible to consumers.

By: Phil S

Phil S — Sun, 01 Aug 2010 00:51:45 +0000

This is a free market economy. If you don’t like credit card charges, you can always buy shares of mastercard, visa or american express (all on US exchanges, of course). Similarly, if you don’t like bank fees, then buy shares of the banks, if you don’t like high oil prices, then buy shares of oil companies. The list goes on and on.

For me personally, I prefer using my credit card purchases for everything, including small purchases because I don’t like to carry large sums of cash, nor do I enjoy frequenting the bank to take out small sums of cash. And I do enjoy my Air Miles.

By: Ray @ Financial Highway

Ray @ Financial Highway — Sat, 31 Jul 2010 13:45:43 +0000

Thanks for the link CC! Have a great long weekend!

By: BenE

BenE — Fri, 30 Jul 2010 17:40:03 +0000

I agree making the NSR rule illegal would probably solve the problem. That is a very good idea. There is no good reason why this legislation doesn’t exist yet.

By: Canadian Capitalist

Canadian Capitalist — Fri, 30 Jul 2010 16:29:14 +0000

@Slacker: I think NSR should be illegal here as well. Without a NSR rule, stores may offer, say a 1.5% discount on cash purchases. Then the free market would fix the problem identified by the Fed report.