consumer credit

Wall Street still overestimating the American consumer

Despite every effort from Washington, the American consumer continues to repair his/her balance sheet. The federal government has repeatedly gone back to what it knows and teased us with goodies (like cash4klunkers) in an effort to get us to spend money we don't have on things we don't need, but those days appear to be over.

(Bloomberg) -- U.S. consumer credit fell in September for an eighth straight month, the longest series of declines on record, as thousands of Americans lost their jobs and banks tightened access to loans.

Consumer Credit Decreases Again in 3rd Q

Here is the full Fed Reserve Release G.19.  Remember, these consumer credit numbers don't include mortgages.  The Great De-Leveraging continues on a seasonally adjusted and non-seasonally adjusted basis.

Consumer credit decreased at an annual rate of 6 percent in the third quarter of 2009. Revolving credit decreased at an annual rate of 10 percent, and nonrevolving credit decreased at an annual rate of 3-3/4 percent. In September, consumer credit decreased at an annual rate of 7-1/4 percent.

This is surprising because I thought Cash for Clunkers would increase non-revolving credit.  But the level are still high.  How long will this continue? 

Here are the tables:

 

 

Here are the not seasonally numbers.

 

Revolving Consumer Credit Drops 13.1% in August

The Federal Reserve has issued it's consumer credit report for August 2009.

Consumer credit decreased at an annual rate of 5-3/4 percent in August 2009. Revolving credit decreased at an annual rate of 13 percent, and nonrevolving credit decreased at an annual rate of 1-1/2 percent.

Revolving credit means credit cards in so many words. So, awesome Americans are starving the beast on those greedy bastards.

Total credit though, which means car loans, personal loans also dropped.

Bloomberg:

“Demand for credit has just gone through the floor,” said Ellen Zentner, senior macro economist at Bank of Tokyo- Mitsubishi UFJ Ltd. in New York. “Households are in paying- down-debt mode, they’re not in the mode of taking on new debt.”

Americans Reduce Personal Debt Load by $21.6 Billion in July 2009

Americans just reduced their debt load by $21.6 Billion or 10.5% in one month. This monthly drop is a record, going back to 1943.

The Federal Reserve current consumer credit release has last month's consumer credit at $2.4936 trillion and July consumer credit total was $2.4721 trillion.

That's still an astounding figure for consumer debt, $2.5 trillion and about the same total market as 2006. Of course the U.S. population has increased from that time.

Unfortunately the credit card companies didn't get as whacked, with only a 8% drop.

These numbers do not include mortgages, home loans.

My question is how much of this is by choice and how much is limiting consumers access to credit, charge offs and bankruptcy?

August credit card charge offs were at 10.55%...

Consumer Credit & Charge Offs

We might as well put on every post, Americans are flat busted!

The Federal Reserve released today the consumer credit numbers.

Consumer credit decreased at an annual rate of 5-1/4 percent in the second quarter.

Revolving credit decreased at an annual rate of 8-1/4 percent, and nonrevolving credit decreased at an annual rate of 3-1/2 percent. In June, consumer credit decreased at an annual rate of 5 percent.

At least Bloomberg is finally getting it's about the jobs man:

Delveraging Anyone?

Economic growth in the U.S. since the mid- 90's has not been organic - it was synthesized with CREDIT.

 From Reuters:U.S. consumers fall behind on loans at record pace

 

NEW YORK (Reuters) - Soaring U.S. unemployment and a shrinking economy drove delinquencies on credit card debt and home equity loans to all-time highs in the first quarter as a record number of cash-strapped consumers fell behind on their bills.

Federal Reserve Commits another $800 Billion

It's pouring money. Today the Federal Reserve committed $800 Billion more:

The Federal Reserve took two new steps to unfreeze credit for homebuyers, consumers and small businesses, committing up to $800 billion.

The central bank will purchase as much as $600 billion in debt issued or backed by government-chartered housing-finance companies. It will also set up a program of $200 billion to support consumer and small-business loans, the Fed said in statements today in Washington.

$200B is partially aimed at credit card debt. They want consumers to use more credit cards.

Great! Nothing on predatory lending, excessive fees...
yet another $800 Billion, just like that.

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