Vet67to82's Blog : Credit Card Debt

Really, doing our own research, and sharing our education makes us better investors. In the post above, I learned from V and MC about credit card transactions. Clearly, credit card transacttions were declining, BUT, more so for V, were being replaced by "debit" card transactions ... since V and MC get paid "Per transaction" whether it's a credit, or debit, card has little impact to earnings for V and MC, unless you know that V has pushed for, and achieved, MORE debit cards than MC. Since V and MC are processing transactions for OTHER companies, what V and MC are doing, and seeing, gives you a window into the other companies business.

This should also tell us that bank costs should be dropping ... b'cuz debit card transactions cost less to process than paper checks. It should also tell us that stand alone card companies, are getting squeezed. People are either paying down debt, or defaulting ... so the business of card credit is shrinking, along with any profits. Further, unless stand alone card companies combine/merge with a bank ... (good for FAS) they're looking at extinction. The comsumer got burned in the market melt down ... when, and it'll be on an individual by individual basis, will the consumer be confortable in reaching for the credit card instead of the debit card ... is anybody's guess.