Today the big man announced plans to cap card rates at 10%, which is somewhat problematic for segments of the market where costs plus credit losses exceed that. Bread stock is down a little over 11% today, which might be justified.

I spoke briefly with my son-in-law this weekend on this subject. He's a managing director and risk manager for one of the largest US banks. He said if this happens, they'll simply have to issue credit cards to only those whose credit justifies a 10% interest rate. So a large segment of the population will lose access to credit cards.

This came up because we were discussing that XOM's CEO told "the big man" that Venezuela was "uninvestable" under current commercial and legal conditions - not to mention security of assets. He spelled out what would be needed. He also offered to send project management experts to Venezuela provided (a) their security was provided, and (b) both the Venezuelan government and the US invited them. This would permit a realistic estimate of what investment would be needed to make Venezuela competitive in world markets. not investment numbers pulled out of the air - with no US backing. This would be a necessary first step for any major investments in Venezuela - because the decades long payout period of these investments.

"The big man" didn't like that response. I was telling my SIL how proud I was of Woods telling truth to power, and pointing the way to what's needed. And a willingness to help. There's a long post on this at the METAR if anyone is interested. Shrewd'm: Macroeconomic Trends & Risks board at Shrewd'm

These kind of issues simply demonstrate a disconnect between reality and basic economics by the hastily spoken words of "the big man." The unfortunate thing is that such words can impact us all.