Optimism around holiday spending, strength in the stock market for the second half of 2009 and wishful thinking about the economic climate aren't going to be enough to turn the situation around. And, there's more to the story than the 10% unemployment rate. Moody's Investor Services said Tuesday that more people fell behind on their credit card payments in November.

The charge-off rate on credit cards increased to 10.56% last month, according to the Moody's Credit Card Index. It had fallen in September and October, settling at 10.04% before ticking back up last month. Fortunately, this remains below the June level of 10.76%, a record high.

Today was a multifaceted news day. There was tame inflation and a better jobs report, but oil went through the roof as there was a big draw down in gasoline inventory and weak refinery trends. The earnings reports are now coming on in full force.

Here were today's unofficial closing bell levels:

Dow 10,062.94 +47.08 (0.47%)
S&P 500 1,096.56 +4.54 (0.42%)
Nasdaq 2,173.29 +1.06 (0.05%)

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This morning, Target Corp. (NYSE: TGT) reported grim numbers for its fourth-quarter ended January 31. Profit dropped 41% to $609 million, or 81 cents per share (two cents below analysts' estimates). In the year-ago period, the discount chain banked $1.03 billion, or $1.23 per share.

Revenue, meanwhile, dipped 1.6% to $19.02 billion (south of the Street's $19.5 billion consensus view), and same-store sales were down 5.9%. For fiscal 2008, profit dropped 22% to $2.86 per share and revenue edged 2.3% higher during the year to $62.88 billion. The stock has dropped nearly 3% in early trading and is within a chip shot of its 52-week low of $25.60.

In addition to crimped consumer spending, rising unemployment numbers and an unsettling economic landscape have created challenges for Target's credit-card business. The retailer's credit-card unit took a one-time, pre-tax loss of $135 million during the quarter as TGT had to add $245 million in reserves to cover delinquencies.

The housing crisis has been going on for over a year now. As the value of peoples' homes drops and loans reset to higher rates, foreclosures rise. But up until recently at least, car loans and credit card payments have been holding their own. This was a sign that consumers still had some money in their pockets.

The Wall Street Journal reported that "about 4.5% of auto loans made in 2006 to top-rated borrowers were at least 30 days delinquent as of the end of September, up from 2.9% the previous month, according to a Lehman Brothers survey of companies servicing these loans."

Investors in financial stocks have probably been hoping that home loan worries, which are a problem at financial firms, would be written off and most of the bad news would be in the past. But $575 billion in car loans are made each year, and that is a huge pool for potential defaults.

Car loans are put into pools the same way home loans are. Those pools are bought and sold based on the overall value and default rate of the loans in the pool.

Now, it looks like the value of those car loan pools is becoming compromised. Which financial institutions own all of those instruments? It is hard to say. But as they start to fail, it is likely that they will become visible.

Douglas A. McIntyre is an editor at 247wallst.com.

Time Warner Cable Inc.'s (NYSE:TWC) CEO Glenn Britt told the Goldman Sachs Communacopia Conference today that the cable TV operator is seeing a small increase in bad debt from subscribers in subprime housing areas. This was noted as a "little uptick" from customers who could not pay their bill in markets populated with subprime home loans.

The funny thing is that is this is historically a counter-trend. When times get tough, people may cut down on going out to eat or spending in other areas, but cable has traditionally been a good recession-proof business because families stay home more. Obviously, with the Triple Play scoring larger wins, this makes for higher subscriber prices and that might explain part of it.

The company signaled that it would not be increasing discounts for triple play in subprime ridden areas in an effort to retain subscribers. Britt also noted the cable company is interested in making strategic acquisitions where it can, although not on an overly aggressive basis.

Comcast Corp. (NASDAQ:CMCSA) will have its COO presenting at the same conference at 2:50 PM EST today, so it will be interesting to see if they have the same reports. It's hard to imaging they would be immune.

Supposedly one of the economic issues that Ben Bernanke investigates is what is going on with cable bills.

Jon C. Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.