Credit card spending

Credit card companies have reported earnings in the past 24 hours and they are particularly well-positioned to weigh in on the health of the consumer. Visa is bullish. Here's CFO Vasant Prabhu who was queried with this on the conference call:

Q: Vasant, as we think about your baseline plan forecast, how are you factoring in the economy? I mean are we assuming resilient consumer, stable economy or are you assuming some mild downturn?

A: Well, we went through what we call our planning assumptions last -- on the last call for the full year, and we told you we had assumed no recession. As you can see, business trends have been remarkably stable. The spend levels just around the world, they've indexed in the mid-140s for almost 4 quarters right now, and there's no evidence of a change in trend. That's reflected in our second quarter outlook.

At this point, we're not changing any expectations for the second half. I mean, clearly, the dollar has weakened a bit so that will change the exchange rate impact in the second half, but we're not changing any of our views in the second half. I mean they are planning assumptions. And if there is a slowdown, then we will react accordingly.

Here's an answer to a separate question, where he touches on the consumer: total spend, it's remarkable stability. What's happening is as good spending slowed down a bit, services spending really took up all the slack. And so consumers have just shifted their spending, but they're spending the same amount, and that's why debit has stayed resilient.

Mastercard refereed to a 'resilient consumer' a total of 12 times in earnings call.

"So starting with the big picture. Consumer spending has remained resilient, and we are very well positioned to capitalize on the growth opportunities ahead."

"From an overall consumer spending standpoint, we expect the consumer to be relatively resilient. Spending patterns have largely normalized relative to the effects of the pandemic with the notable exception of China."

"On the macroeconomic front, as Michael laid out, we are monitoring a number of both positive and negative factors. We do expect consumer spending to hold up relatively well in this environment driven in part by the strong labor market"

"We continue to see a fairly resilient European consumer. That's our base assumption as we look forward."

American Express reported this morning and the conference call is underway but shares are up 8% and the commentary in the press release said "Our credit metrics remain strong."