Credit card industry threats

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It was only to be expected; banks don’t give money away for free, and will limit their risk as regards to lending as much as possible. The fact that they are cutting a massive chunk of credit cards completely is a slight surprise, but the fact they are raising interest rates definitely isn’t.

Credit card industry threats

The U.S. credit-card industry may pull back well over $2 trillion of lines over the next 18 months due to risk aversion and regulatory changes, leading to sharp declines in consumer spending, prominent banking analyst Meredith Whitney said.

The credit card is the second key source of consumer liquidity, the first being jobs, the Oppenheimer & Co analyst noted.