[quote=davelj][quote=scaredycat]it’s just funny that their decision is so utterly irrational in terms of risk management. [/quote]
Actually, this is one of the MORE rational decisions I’ve seen by a financial institution in the recent insanity. Pay off the $50K and I bet you’ll see your credit limit on the Barnes & Noble card increase. This is the price you pay for financial gamesmanship. 2.5% on $50K is $1,250 pre-tax. After tax, probably $900 or so. And you’re having to pay down the balance with a minimum payment, so you’re not getting the full $900 in the first place. And we’re assuming you didn’t have to pay a 3% transaction fee to get the $50K, which is highly unusual. All in all seems like waste of time given the hassle involved and the pittance of a return. I mean, why bother? I don’t get it.[/quote]
I know. I got a friend who does the same stuff. He goes around getting these zero percent cards. I think he got 3 total. He takes the money out and puts in CD’s. By the time you pay all the hidden costs and taxes and encumber your credit its not worth it at all.
What makes evern nuttier with him is he has about $2m in cash and his daddy who is in his early 80’s has about $20m in cash and stuff.
