Obama And His Magic Wand

Since US President Barack Obama came into office in January 2009, he had extingished a lot of Bush fire that went out of control by his predecessor.

Credit reform had taken place. Cost cutting on military operations, strengthening of bilateral ties with many countries. Taking a strict rule on money handouts by government to rescue institutions in this Financial Crisis. Improving consumer confidence, etc.

The latest sweep came in the form of Credit Card Reform, aiming to shield consumers from predatory fees and shock rate hikes. Even though over protecting consumers can lead to another case of overspending, but a timely reform can help debtors handle their existing debts better.

The new bill includes:
- forbids rate increases on existing balances unless consumers are at least 60 days late paying their bill or the initial rate was a promotional rate that has expired,

- requires 45 days' notice to raise rates.

- bans fees for payment processing -- such as surcharges for paying by telephone

- imposes steep restrictions on issuing cards to people under 21 years of age

- requires that promotional interest rates on new cards stay valid for six months

When a person faces financial difficulties, they will start delaying repayment, default on payments, further extending their financial woes with credit card, etc, before they go bust.

At a time where economy is still not on a recovery route, such credit reforms are good to help debtors manage their existing debt, allowing them to start repaying. On the other hand, it will help those who are not in debt, to start spending with more confidence.

More financial reforms must be done in America, including housing loan reform as the current financial crsis originated from the Sub-Prime problem.

Let's hope the global economy will start seeing the storm clear up by year's end. Signs are already there, that depressing economies are starting to see smaller GDP decline.