Banking and Credit
Since the Great Depression, Congress has passed a series of laws to preserve stability in the banking and credit industries, protect consumers from unfair and deceptive practices and make affordable credit available to middle class and low-income families and small businesses. Beginning in the 1980s, the deregulation of financial institutions has fed speculative booms and devastating busts. Privatization of low-cost government credit for student loans and mortgages and weaker consumer protections has driven up the cost of credit and put consumers at risk.
Commentary
Information is power… and that’s the problem
Why #OccupyWallStreet?
Cry Wolf Quotes
Legislation likely to result in higher interest rates for consumers is not the answer. [This bill] would broadly constrain the ability of financial institutions to price risk, likely resulting in less access to credit and in higher interest rates for consumers.
[The bill], while well-intentioned, will increase the cost of credit for consumers and small businesses across the country, result in less access to credit for consumers and businesses alike, and may further roil the securities markets -- all at a time when our economy can least afford it.
There is no evidence of significant discrimination in mortgage lending.
There’s little doubt that the rating agencies helped inflate the housing bubble. But when we round up all the culprits, we shouldn’t ignore the regulators and affordable-housing advocates who pushed lenders to make loans in low-income neighborhoods for reasons other than the only one that makes sense: likely repayment… in 1995 the Clinton administration added tough new regulations. The federal government required banks that wanted 'outstanding' ratings under the act to demonstrate, numerically, that they were lending both in poor neighborhoods and to lower-income households. Banks were now being judged not on how their loans performed but on how many such loans they made. This undermined the regulatory emphasis on safety and soundness.
Related Laws and Rules
Evidence
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Banking Lobby's Warnings About CARD Act Disproven
What happened after credit card reform bill passed Congress in 2009 (it worked).
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The Successes of the CARD Act
The Consumer Financial Protection Bureau describes exactly what the act did and what the effects were one year later.
Backgrounders & Briefs
A Timeline of the CARD Act
An interactive timeline of credit card reform.
Resources
The National Community Reinvestment Coalition works against unfair lending and banking practices, particularly those targeted towards low and middle income families.
