Credit cards are a huge benefit and a huge risk because they make it easy to spend. And since you don't have to pay the bill for 30 days or so, the hit can sometimes take consumers by surprise. This is why you can get an important read on consumers by looking at the credit card businesses of large banks like Bank of America (NYSE: BAC), JPMorgan Chase (NYSE: JPM), Citigroup (NYSE: C), and Capital One (NYSE: COF). The read after the third quarter: the consumer is looking good. Here's the proof. While credit cards usually carry the logos of companies like Visa (NYSE: V) or Mastercard (NYSE: MA), those companies are just payment processors. They charge small fees for facilitating financial transactions; the banks that issue the credit cards bear the financial risk. If a customer doesn't pay their credit card bill, banks like Bank of America, JPMorgan Chase, Citigroup, and Capital One have to eat the cost. Image source: Getty Images.
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