Exploration of the liquid hand-to-mouth concept leads to another economic conundrum: the credit card debt puzzle. The puzzle refers to a situation in which a consumer simultaneously holds interest bearing credit cards debt and liquid assets. Economists have mused for years over why people engage in this obviously irrational behavior. Why not just use your… Continue reading The Credit Card Debt Puzzle: A Lesson in Cognitive Biases
I’m on a credit card kick. The credit card has gradually worked its way into the mainstream consumers wallet over the past few decades. Now, around 65% of American consumers have at least one credit card and the average American makes about 20-25% of their payments with a credit card – comparable to the usage… Continue reading Are credit cards losing their allure?