I'm probably talking through my hat here.

Bank of America agreed to buy National Processing (that's their logo, from their home page), a major credit and debit card processor, for stock worth $1.4 billion.

National had been 83% owned by a bank anyway so this doesn't really change the balance of power between "independent" processors and "bank" processors.

The fact is big banks have been taking this territory over for years, at increasingly high prices. It's part of a general consolidation of banking in the U.S., and that's what we should worry about.

The problem with mammoth institutions is that when one fails the ripples can hurt everyone. That's why, in the 1930s, the Congress separated the investment industry into several pieces. (That's a BankAmerica building in San Francisco, from Microsoft.)

Over the last 20 years those walls have crumbled. Giant financial institutions now own insurers, investment banks, consumer banks, and merchant banks. If a Citicorp or Bank of America makes a mistake and goes down now you could easily get what the world got in 1931 when Austria's CreditAnstalt failed, causing a worldwide liquidity crisis.

This is an issue no one is considering today. I think they should.