Since Credit Card customers, particularly the 99%ers, including many small businesses, have been suffering so much financially, and thus they have had to increase their credit card balances, with much of it at seemingly extremely high interest rates along with exorbitant other fees charged, I think it would be helpful to see how the US Big Credit Card Corps, clearly some of the 1%ers, have been doing.
There are four large Credit Card Corps that are independent publicly-owned corporations: American Express, Visa, Discover Financial Services, and MasterCard. And since Capital One Financial generated 66% of its Total Revenues and 75% of its Total Profits in annual 2010 in its Credit Card Segment, I am also including it below, thus making this a US Big Credit Card Corp five pack.
In the 3Q 2011, these five Credit Card Corps had Total Pretax Income of $6.4 bil, an increase of a very robust 23% over the 3Q 2010. And for the first nine months of 2011, these five Credit Card Corps had Total Pretax Income of $19.0 bil, up an exceptional 35% over the previous year's comparable nine months.
And these robust earnings increases are across the board. The lowest percentage earnings increase in the first 9 months of 2011 of these five Big Credit Card Corps was 16%, generated by American Express. I wonder how many 99%ers, including small businesses, had their financial earnings increase by 16% this year. I bet it's less than 10%.
Here are the Pretax Income amounts in these recent periods for these five US Big Credit Card Corps:
...............................................Capital..Discover................Total
...................American...............One.......Fincl.....Master.....All
....................Express...Visa......Fincl....Services....Card......Five
Pretax Income......(all amounts in millions of dollars)
3Q 2011.........1,711....1,354....1,235.....1,047.....1,030....6,377
3Q 2010........1,640....1,195....1,153........432........767.....5,187
% Increase.......4%.......13%.......7%.......142%........34%.......23%
9 Mos 2011...5,208...4,274....4,016.....2,694.....2,758...18,950
9 Mos 2010..4,487....3,430...3,297........684......2,175...14,073
% Increase.....16%.......25%......22%.......294%........27%.......35%
Let me give a longer range view of what happened with these US Big Credit Card Corps just before, during, and after the financial meltdown.
Here's the Total Pretax Income of these five US Big Credit Card Corps for the past six years:
2011 Annualized*.....$25.2 bil, up 33% from 2010
2010.........................$19.0 bil, up 87% from 2009
2009........................$10.2 bil, down 5% from 2008
2008........................$10.7 bil, down 24% from 2007
2007........................$14.0 bil, up 18% from 2006
2006........................$11.9 bil
* Nine months ended September 2011 actual Pretax Income annualized, except for Visa, which has a September fiscal year end.
So, these US Big Credit Card Corps, along with their supporters in the US Congress (all Republicans and even some Democrats), are constantly whining about how the Obama Administration and Ben Bernanke have just devastated their industry?
Give me a break! This credit card industry was hurt by the financial meltdown. The earnings of these five Big Credit Card Corps declined from $14.0 bil in 2007 to $10.2 bil in 2009, or by 28%, but this is peanuts compared with what happened to their US Big Financial Corp cohorts.
But yet, even though their total earnings were only damaged by 28%, these earnings increased from $10.2 bil in 2009 to a nine-month actual annualized $25.2 bil in 2011, or up an incredible 148%.
And their 2011 total earnings of $25.2 bil are even an incredible 80% higher than they were at their 2007 peak earnings before the financial meltdown hit of $14.0 bil.
I suggest that the 99%ers are the ones severely damaged, and not as yet even close to being made whole, by the financial meltdown, not the US Big Credit Card Corps.
There is a reason the Occupying Protesters are having such a positive impact. It's calling out the economic injustices like this one, and they are expecting the US Government to function properly and correct them.
