Diners Club Credit Cards History

James D Scurlock’s “Maxed Out” focused on the revolving use of credit cards to charge now and pay later and the fact that once the credit card was maxed out another one was sent from the credit card companies and the whole process begins all over again. Scurlock’s essay made the reader aware of the downfalls and hardships that can occur when credit cards are constantly used for purchases compared to Kevin O’Donnell’s “Why Won’t Anyone give Me a Credit Card”.

Richard Fairbank and Nigel Morris, both diligent entrepreneurs, started laying the bricks for their eventual successful company, Capital One, in the late 1980’s. They both worked in the Virginia-based “Signet Bank”. Fairbank started noticing trends in the financial industry that he felt Signet was missing out on. These opportunities were in the credit card industry. He, as well as all of Signet Bank knew that the credit card industry was very risky, but Fairbank was ready to take a chance in this, what can be, highly profitable field.

Launch the credit card for middle class and affluent customers offering a premium and a basic service.

1979: Forbes quits his day job to focus his efforts on Comp-U-Card; the company launches Comp-U-Store Online.

The main argument throughout this documentary is that credit cards are the main cause of the debt crisis, which occurred in 2006 in America. Credit cards are portrayed throughout this documentary to carry negative consequences, aiding in the corruption of the system, and ultimately creating debt problems that America faces as a nation. The main question we are left with is, can we as a nation live without credit cards?

In the 1800’s I believe it was nearly impossible for people to spend more than they financial could because loans were not as easily accessible. In this modern age a common form of a loan that allows almost anyone to spend beyond their financial capabilities is a credit card. Credit cards are pieces of plastic that allow you to buy products and services with the money of the credit card company. However, this money isn’t given to you for free. All the money you spend must be paid back to the credit card company at the end of each month. This is where a potential problem could be created. If people spend more money than they can pay back they acquire debt. The acquired debt then accrues interest when you don’t pay what you owe. This causes the debtor to generate more debt every time a payment is unpaid.

The year was 1950 and people wanted to have a new and improved way to pay for things. In 1949, Frank X McNamara went out to eat with some of his friends and had a bill quite large, so when he was going to pay for the meal he forgot his wallet, in embarrassment he called his wife from the dinner to bring his wallet. From that experience, he never wanted to have that happen again. So he invented a card that could be used to buy things like shoes, clothes, large appliances and can even be used at different locations like gas. So in the 1950s, people used credit to buy expensive things and thus the credit card was born.

During the 1920’s consumerism started to develop when people wanted to have the latest items on the market when they had the money to purchase such items. The marketplace took full advantage of this by doing radio and paper advertisements. “Sears, Roebuck & Co., a company founded in 1893, regularly issued a mail-order catalog. By the 1920s, the catalog, nicknamed the consumer's bible, had become enormously popular. It completely revolutionized how people purchased items.” (“American Economy in the 1920s: Consumerism, Stock Market & Economic Shift,” 2003) When we buy something today we call it having a payment every month, back then they called this installment buying and buying on credit. This is the era where this stated to become more popular

     With religion playing an important role in the average Americans lives, consumerism began to grow in the white and blue-collar workers. Their families started to spend extra cash instead of saving it. Washing machines, dryers, and new cars became commonly bought items. The Homeowner who needed some extra cash, but couldn’t work enough hours to purchase that item when he needed it, started to use personal credit. This began the craze of credit cards. ”The Diner Club” introduced the first credit card in 1950: By the 1970s the ubiquitous plastic credit card had revolutionized personal and family finance”(Henretta, pg.790). The awareness of addition free time was aware

Credit was born from Alfred Sloan, “ He set up the nation 's first national consumer credit agency in the 1919 to make his cars affordable”( Digital History). Sloan wanted to make money, sloan was convinced that Americans were willing to pay extra for luxury and prestige. Thus he he created credit so people would buy his cars, even if they were costly. With this new product many americans began to buy cars, clothes,furniture,household products,e.t.c. Pretty soon cars came a symbol of the new society forming in the 1920’s.”In that year, one American out of every 5 owned a car, compared to one out of every 37 English and out of every 40 French car owners”(Digital History). In other words Sloan didn’t care about lowering his price so that more people could

Credit cards were not common during this period. First appearing in 1950, these were used mainly by the wealthy for convenience instead of carrying cash or a checkbook (Durkin & Price, 2000, p. 624).

Not only for those seeking to retire, the business motivated economy has transfigured how one must live in order to live comfortably. Building credit through credit cards is often perceived to be the only way in order for a buyer to appear credible. Yet in the quest for the optimal credit score people enter into debt. Considering and evaluating the risks and benefits to credit cards may contribute to opinions towards those flimsy pieces of plastic.

The first credit card allowed members to charge the cost of restaurant bills- only. This credit Card was by companies around the world for travel and entertainment. Frank Mcnamara of the inventors shared the story of when he left his wallet at home. He was dining at specialty restaurant with his wife when he noticed that he forgot his money at home. The next time he visited the restaurant he brought a small piece of cardboard with his signature on it to avoid the embarrassment again from happening. He discussed this with his fellow friends, also the other contributors of the makeing , ralph and Matty

The credit boom of the 1920’s is one of the things that contributed most to the stock market crash on 1929 and then the eventual cause of the Great Depression. “We find that the credit boom view provides a useful perspective on both the boom of the 1920s and the subsequent slump. In particular, it directs attention to the role played by the structure of the financial sector and the interaction of finance and innovation.” (Eichengreen) As many people know today, having a credit card and going shopping without realizing exactly how a credit card works can put the user in a tough situation. After a person puts something on credit they must pay it back at a later date. In the 1920’s the “credit boom” was where people had started to use credit more frequently and were getting carried away with the idea of credit. People putting more

The first credit card was the “Diner’s Club Card” and could be used at many restaurants. Borrowing money increased private debt by $150 billion from the beginning of the 1950s (Macce and