BIG by Matt Stoller • 29794 implied HN points • 22 Feb 24
- Capital One is trying to purchase Discover for $35 billion due to a loophole the Federal Reserve left in banking laws, which allows Capital One to have control over pricing in ways its competitors cannot.
- The credit card system in the U.S. involves a complex web of fees and intermediaries that result in high costs for merchants, driving the merger between Capital One and Discover in a pursuit for more pricing power.
- The merger faces opposition from various groups due to concerns about increased monopolization and reduced competition in the credit card industry, highlighting the need for reforms to promote fair commerce and innovation.