The Fed and the Democratic-controlled Senate, the drivers behind this move, are "assuming that merchants will take any savings and just pass it along to consumers," the analysts say. But, they add, Australia and other countries that tried to force low fees saw merchants "pocket a lot of the savings."
I thought that was the idea. Struggling merchants (even including giant chains like Wal-Mart) have more clout than unpopular banks in Washington these days.
But Janney says the banks have come to depend on high debit-card fees and would respond to cuts by imposing "much higher banking fees," the Janney duo says.
They conclude: "Goodbye free checking, hello increased minimum deposits."
Where dollars die
Billionaire investor
Warren Buffett has famously pointed out that the airline industry made "next to zero" for investors in the last 100 years, when you consider its total costs, profits, and losses.
Analyst Craig Moffett of Sanford C. Bernstein makes a similar argument about today's telecommunications networks: It might be a "Golden Age" for makers and users of cable and satellite TV and mobile phone and Internet - but for people who bought phone and cable stocks, "The returns on investment capital during the decade have been, at best, anemic."
Yet Moffett still hopes for a payoff: "Cable returns have improved dramatically" as Comcast and its cable peers have become dominant Internet providers. "They should remain so," Moffett argues, to discourage much stricter government regulation, or a return of the outrageously high-priced mergers of the 1990s and early 2000s.
Bakers and bankers
