Considering how credit card companies are cutting limits, I have to wonder how much of this is just denial of service due to high credit utilization in a bad economy. Someone carrying $5000 on a $10000 card trying to buy $2000 worth of silver is a bit funny. Credit utilization is being scaled back right now, and depending on the person's income situation they may be a bad risk.
a year ago he was free to max out the credit card no problem, and that when he did AMEX would simply up the credit line.
Those days are gone for now. My credit card limits were cut because I didn't use enough of the credit, whereas a year before every time I charged $100 (paid off immediately) they'd raise the limit without me asking. I had enough credit to get myself so deep in trouble I wouldn't get out, ever. Now, not so much, and I expect more letters any day now explaining why my credit limits are being reduced.
tl;dr: I bet it's more how much is owed and the purchase size instead of what's being bought.
A good take, but massively tightening credit could be an even worse indicator for the status quo lol.
I'm not saying that credit limits being lowered is a good thing - it isn't. It means issuers know they issued too much already and need to correct.
I just think that the people buying silver are getting hit less because of what they're buying and more because they're already somewhat risky, buying an investment with credit.
Yeah after reading the article I think you're right. I use my cards only as debit cards. I would never have debt with the banks so the concept of "only using 50% of your credit line" sounds completely alien to me.
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