Some thoughts on credit card fraud from a fellow academic, Corinne Cooper:
Interest rates are made up of three things: 1. The cost of money (interest goes up and down based, in part, on the supply of and demand for money, just like any commodity.) 2. The expected inflation rate (so the lender gets back its money in constant dollars) 3. A risk premium.
This is a companion discussion topic for the original entry at https://talkingpointsmemo.com/?p=1257560