2 Credit Card Companies To Buy, 2 To Avoid

By Dividendinvestr: By Renee O'Farrell

By Jim Van Meerten: When I think of Visa (V) I think of plastic. Do you all remember the advice given to Dustin Hoffman in the Graduate? One word: Plastics. Plastics in the form of credit and debit cards have never been more popular and I think all four of the biggest card companies will have record years.

The fundamental truth right now is that the overall economy in Europe, the USA and Japan is weak and has some serious long term problems. But the connection between that and company weakness is not incredibly strong. Many companies have huge cash hoards, built up through the large profits they continue to make. Yes, the economy entering a serious downturn will hurt many companies. A railroad is going to lose some sales if retail sales decline (and so they don’t have to be shipped). Airlines (historically problematic companies to begin will) will struggle.

Every time you make a plane reservation or rent a car or pay for concert tickets, you're asked to provide a credit card number. Liz Smiley, a social worker in Florida, provides a debit card number instead.Smiley has lived without a credit card for more than four years, and she doesn't miss it a bit.

By Dividendinvestr: By Renee O'Farrell

In the first place debit cards are a bad idea. They don’t have the same protection as credit cards. Banks pushed them in the USA because of the huge fees they charged (hidden from users). Now those banks are not allowed to charge the hugely excessive fees (compared to any other country) they had been charging retailers. And the banks are now trying to push huge fees onto those using the cards. Just dump any debit card you have.

Debt Negotiators May Give Little Relief to Consumers “They never told me that the money I was paying wasn’t going to my debt, it was going to them,” said Hopkins, 59, who quit work in January 2008 after a brain tumor led to surgery. He now receives $1,539 a month in disability checks. “You are better on your own.”

A couple days ago, I got some pushback for arguing that the credit industry's tiered model amounted to a subsidization sch