Saturday, January 31, 2009

8K PPT at the SEC by DFS

Earnings season usually goes hand in hand with boring PPT presentations embedded in 8K's: but not Discover Financial Services (DFS). Check out this recently filed PPT at the SEC by DFS (come on, all seriousness and no play makes Verily boring). Smack in the middle are some pretty scary slides.

By far, the scariest slide is the one on pg. 26, which shows a map of bankruptcy filings in the United States. In four states — Arizona, California, Nevada, and Idaho(!) — filings have more than doubled since last year. In another five states — Florida, Oregon, Utah, Washington and Vermont(!), they’ve increased between 50% to 100% since last year. Only five states — North Dakota, South Dakota, Texas, Louisiana and Pennsylvania(!) — saw bankruptcies increase less than 15%. The national average is 35%.

The slides also have some interesting details about several of Discover’s competitors, including American Express (AXP) and Capital One (COF). For example, fully 26% of Amex’s receivables are in two of the hardest-hit states: California and Florida. Bank of Ameria (BAC) and Citibank (C) are both only slightly better at 22% each. On pg. 24, there was also an interesting graph that shows a rising trend of both unemployment (which is well known) and a much harder figure to measure: underemployment, which seems to be growing pretty dramatically.

While all of this data is probably out there in different places, the slideshow pulls it together in one cohesive place to present a pretty scary view of how much further this crisis has to go.

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