Credit Card Points Are a Transfer from the Broke to the Comfortable • Hacker News Board

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#21

Post by SpicyLemonZest » Sat, Jul 18, 2026, 4:43 AM UTC

s1artibartfast wrote: post #11

SpicyLemonZest wrote: post #8

I don't dis agree with anything the author is saying. But the corollary, which the article doesn't really acknowledge, is that reforms like credit card interest caps and the Credit Card Competition Act would substantially limit consumer access to credit. That's the argument that banks raise every time and why interest rate caps always die in committee. If advocates want to team up with Dave Ramsay and say "that's rig…

I increasingly think people should have the option to define if they should be treated as an adult or not, kinda like an organ donor on their license. Those who opt out would be protected from their own choices.

I think you're severely overrating the average level of financial literacy. If Alice has $3,000 in the bank with no credit card debt, and Bob has $10,000 in the bank with $7500 in credit card debt, who's richer? A lot of people will tell you that Bob is (he has three times as much money!), and a lot of reasonable, hard-working Bobs will tell you with a straight face that they're paying off as much as their budget allows each month. I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to exploit his mental accounting bias.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#22

Post by xboxnolifes » Sat, Jul 18, 2026, 5:07 AM UTC

justinclift wrote: post #19

theandrewbailey wrote: post #14

Earlier quoted context omitted.

Merchants almost never pass along interchange fees to the customer. Instead, it's built into the prices that every customer pays the merchant, regardless if the customer uses a credit card, which means everyone pays for credit card rewards.

Are you saying that in the US, there's no "credit card surcharge" line item near the bottom of your receipts to cover it?

Sometimes, not always.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#23

Post by chneu » Sat, Jul 18, 2026, 6:46 AM UTC

imustbeevil wrote: post #16

pilotneko wrote: post #9

Earlier quoted context omitted.

Businesses raise prices to cover the interchange fee, which impacts lower income consumers disproportionately.

That's completely arbitrary though. They could also increase prices without any interchange fee. If people are willing to pay, the price goes up. Cost (of which the interchange fee is but one) only affects the lowest possible price. No one ever gets that price.

CC fees are transferred directly to customers. It isn't arbitrary. There are plenty of low cost stores that don't accept CCs for this reason: it hurts low income people more than others.

It saves 2-3% to the consumer for grocery stores.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#24

Post by s1artibartfast » Sat, Jul 18, 2026, 2:05 PM UTC

SpicyLemonZest wrote: post #21

s1artibartfast wrote: post #11

Earlier quoted context omitted.

I increasingly think people should have the option to define if they should be treated as an adult or not, kinda like an organ donor on their license. Those who opt out would be protected from their own choices.

I think you're severely overrating the average level of financial literacy. If Alice has $3,000 in the bank with no credit card debt, and Bob has $10,000 in the bank with $7500 in credit card debt, who's richer? A lot of people will tell you that Bob is (he has three times as much money!), and a lot of reasonable, hard-working Bobs will tell you with a straight face that they're paying off as much as their budget all…

Thats exactly what I am talking about. Make a class of people that are protected on the basis of the illteracy, comprehension deficits, or lack of self control.

Let people decide if they want to be protected from their choices.

> I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to exploit his mental accounting bias.

It seems you want to protection and agree it is needed. If it hurts Bobs feelings, make the system opt out instead of opt in.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#25

Post by soraminazuki » Sat, Jul 18, 2026, 2:38 PM UTC

applfanboysbgon wrote: post #3

It is jarring to read Claude talking like it uses credit cards or feels guilt over using reward points.

It's jarring to read a bunch of LLMs rushing to defend a predatory industry.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#26

Post by SpicyLemonZest » Sat, Jul 18, 2026, 5:29 PM UTC

s1artibartfast wrote: post #24

SpicyLemonZest wrote: post #21

Earlier quoted context omitted.

I think you're severely overrating the average level of financial literacy. If Alice has $3,000 in the bank with no credit card debt, and Bob has $10,000 in the bank with $7500 in credit card debt, who's richer? A lot of people will tell you that Bob is (he has three times as much money!), and a lot of reasonable, hard-working Bobs will tell you with a straight face that they're paying off as much as their budget all…

Thats exactly what I am talking about. Make a class of people that are protected on the basis of the illteracy, comprehension deficits, or lack of self control. Let people decide if they want to be protected from their choices. > I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to ex…

To me, making the system opt out means ensuring that half the stores you go to and constant junk mail aren't urging you to get free credit cards. Credit cards should be more like investment brokerage accounts: something that anyone can open, and can do irresponsible things with, but clearly messaged as an advanced and complex financial product rather than something a typical person should make an everyday part of their life.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#27

Post by s1artibartfast » Sat, Jul 18, 2026, 8:53 PM UTC

SpicyLemonZest wrote: post #26

s1artibartfast wrote: post #24

Earlier quoted context omitted.

Thats exactly what I am talking about. Make a class of people that are protected on the basis of the illteracy, comprehension deficits, or lack of self control. Let people decide if they want to be protected from their choices. > I don't think our financial regulations should require telling Bob that he's a child who can't be trusted to take care of himself; people shouldn't offer him products that are designed to ex…

To me, making the system opt out means ensuring that half the stores you go to and constant junk mail aren't urging you to get free credit cards. Credit cards should be more like investment brokerage accounts: something that anyone can open, and can do irresponsible things with, but clearly messaged as an advanced and complex financial product rather than something a typical person should make an everyday part of the…

But credit cards arent a very complec financial product, and the vast majority of people can manage them just fine, and get the benefit.

Do you have any reason to think junk mail is big factor in people getting credit cards? I would assume most people like the idea of convenience, and dont think they will go into debt. most are right.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#28

Post by cyanydeez » Sat, Jul 18, 2026, 9:14 PM UTC

lyall wrote: post #7

You hear this argument pretty often, but it's not true. Credit card companies do make a lot of money off of interest. But they also make a lot of money off of interchange fees. Businesses want wealthy customers because they spend more money, so they're willing to pay a higher interchange fee to access those customers. Higher interchange fees mean card companies can offer better rewards, which in turn attract more wea…

I always assumed points, rewards, customer loyalty are economic choke points to ream the customer as much as possible.

Specifically with grocery stores, where they can track how price changes affect customer behavior; I'm pretty sure covid proved that they absolute will gouge when given cover.

secondary of course is the sales of data in the big data age.

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#29

Post by [deleted] » Sat, Jul 18, 2026, 9:36 PM UTC

pilotneko wrote: post #9

lyall wrote: post #7

You hear this argument pretty often, but it's not true. Credit card companies do make a lot of money off of interest. But they also make a lot of money off of interchange fees. Businesses want wealthy customers because they spend more money, so they're willing to pay a higher interchange fee to access those customers. Higher interchange fees mean card companies can offer better rewards, which in turn attract more wea…

Businesses raise prices to cover the interchange fee, which impacts lower income consumers disproportionately.

[deleted]

Re: Credit Card Points Are a Transfer from the Broke to the Comfortable

#30

Post by eudamoniac » Sat, Jul 18, 2026, 9:42 PM UTC

SpicyLemonZest wrote: post #21

s1artibartfast wrote: post #11

Earlier quoted context omitted.

I increasingly think people should have the option to define if they should be treated as an adult or not, kinda like an organ donor on their license. Those who opt out would be protected from their own choices.

I think you're severely overrating the average level of financial literacy. If Alice has $3,000 in the bank with no credit card debt, and Bob has $10,000 in the bank with $7500 in credit card debt, who's richer? A lot of people will tell you that Bob is (he has three times as much money!), and a lot of reasonable, hard-working Bobs will tell you with a straight face that they're paying off as much as their budget all…

But... Bob is a child. Why do we need to put training wheels and kneepads on every aspect of our world? Are we trying to completely decouple decision making from outcomes? Let the stupid people be stupid and let the smart people thrive, I say. If there is no such thing as a bad decision, nor is there a good one, thereby there is hardly any life left to live. Let people pilot their own lives.