MA is not exposed to defaults on debt by card holders. Neither is Visa. AMEX is. From what I've been able to gather, MA had higher compensation costs (shareholders are pissed) and also a one time expense to settle litigation with AMEX, which resulted in a 746 million dollar loss. The question now is whether MA cardholders will use their cards less or more frequently, and for bigger or smaller purchases, as MA's income is a direct function of both (they take a % processing fee).
I'm short COF. i have not played V or MA, mostly out of analysis paralysis. I'm long UYG, short COF: Has to do with expectations: sentiment for financials is already extremely bearish. Capitulation is to be expected. But some transparency is returning, CDOs are being sold off balance sheets for pennies on the dollar. Can't imagine a larger black swan hitting, since the worst is already assumed. The consumer credit bubble hasn't received any real headlines. The precedent of moral hazard set in the housing market will spillover to the consumer credit market, IMO. The mass defaults are probably just a little delayed.
I know the feeling. You watch a stock continually go up and just kick yourself for not getting in along the way. 2 years later its at record heights and watch it drop in glee. Well, it doesnt matter, you missed the move and you could have doubled or tripled your money along the way if you had played ball versus going long in those other junk stocks.
It would've required idiocy, not balls, to short it ahead of earnings, but the gleeful drop gave me a nice bounce play off support for a very quick $3800 yesterday. MA is a rock-solid company, and the panic reaction is handing investors a solid entry price IMHO.