Consumer credit continues falling. The rate of decline appears to have stabilized but this means consumer credit continues to contract with no anticipated point of stabilitzation.
Longer term a deleveraged consumer is good news. Getting there is not pleasant, whether it be from consumer paydowns or bank writing off debts. As I have mentioned before the decline in consumer credit and debt prevents a strong recovery. Not only is the added impulse of new debt (and thus spending) missing but the additional drag of debt reduction is still present.
After the inventory bounce recedes in the next 2 quarters GDP growth will remain muted in my opinion.
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