I know the Discover Card does what the ordinary banks do like the
money market savings and the mortgage services. I wonder why the
Discover Card is severely suffering in this sub-prime crisis, though.
It may be positive that the mortgage business is not the bread and
butter for the Discover Card. I seem to understand the relation
between the credit card industry and the whole mortgage market, but to
be honest, I just don't know what's going on.

Will this mortgage crisis bring the whole economy down? Won't people
spend too much money because they lost their homes, lost their jobs in
financial fields? Could it be the reason the credit card companies
such as MasterCard and Discover Card are going to suffer?

I imagine that before people go bankrupt they might accumulate debt on
their discover card and then default on their payments.

MA doesn't loan out money. They are being thrown out with the bath
water.

This dynamic might be contributing to the market slide.  A lot of
investors who bought securities backed by sub-prime mortgages boosted
their purchases with borrowed money. They're seeing some serious
losses now.  In order to raise funds to pay back those loans, they may
be selling stocks - a lot of stocks.  Once the planet has upchucked
its former feast on mortgage backed investments, the sun will come out
again.  I think DFS and MA are good stocks with a future.  Think long
term and hang in there.

I agree with Dill.

I'm in the Discover will suffer the least if not at all. Discover got
burned five years ago and I don't think they agressively lent or
pursued new cardholders like AXP did. So even if many homeowners take
a hit, Discover won't experience it.

Personally, a lot of people at work with no assets and no credit
history seem to be able to get AXP, however, only those with long
credit histories and substantial savings and other assets have DFS.

Well here is one rather unsettling article - I did sell my shares of
DFS just lately (at a loss) to finance some other stock purchase...so
I don't really have long/short position.

Rising credit cart default rates:
http://www.msnbc.msn.com/id/20464621/

Discover will beat the earnings. Subprime will not hurt DFS, MA. But I
do think AXP will get hurt big time.