After some rummaging around I finally found the data series showing total consumer debt outstanding. This series includes both home and non home debt.
I have blogged before (2009 October 7) about the year over year decline in non-home-debt outstanding but thought it would be prudent to chase down the TOTAL consumer debt outstanding to see if it is falling as well.
Yup, it is. The data shows the same trend as the subset previously mentioned. Like all the other credit/loan/debt outstanding I have recently presented the year over year numbers are negative, show no signs of stabilizing, and are unprecedented in their decline.
I usually dislike the term 'It's different this time' but this time, it really is!
We may see a resumption in consumer debt growth once all the credit regulations have been fully implemented and the consumer lending institutions have finished squeezing down credit lines. Once the bank's bad balance sheets have finished contracting relative to the new regulations we will start seeing consumer credit growth again.
ReplyDeleteOnce the bad balance sheets.... That's the problem. Between commercial and residental real estate is may be a while until they are able to completely repair their balance sheets. That is one reason I think there is a lot of excess cash deposited at the Fed. The banks know they will need the cash soon and so they are not lending it out.
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