Counterparties like Goldman Sachs, knowing it could use the bankruptcy laws to force AIG to sell high quality assets to pay off its gambling debts, played them like a Vegas card sharp never losing a minute of sleep worrying that the rube might go broke.

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Borrowing figures released on Thursday showed another sharp rise in credit card lending.

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The result was a sharp rise in bankruptcies (and credit-card defaults) before the change came into effect, and an ever sharper fall thereafter.

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Its credit card portfolio, fortunately, did not see a sharp increase in deliquencies in December.

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The American Senate passed legislation, in a 95-5 vote, that promises to reform the credit-card industry by, among other things, banning practices such as sharp rises in interest rates.

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The Credit Card Act of 2009, signed into law in May, is intended to protect consumers from sharp or retroactive interest rate increases, harsh penalties, short payment windows and other abusive practices.

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