Consumer Credit – a Healthy but Painful Correction….
by Tom on October 7, 2009
in Market Musings, banks
While short term this is probably a very painful report, for the long term, it’s actually not that bad. Let me explain:
- We got drunk on too much credit.
- While we were drunk on too much credit, we did some really bad things.
- Now it’s time to sober up and pay off that debt.
The fact that the amount of consumer credit has dropped for 7 months in a row says to me that we’ve, at least in a small way, turned the corner on the appetite for that alcoholic drink called “easy credit.”
We’re a long ways from being totally sober, but it’s a baby step in the right direction. Hurts like crazy, but it’s a step in the right direction.
Tom Vanderwell
U.S. Total Consumer Credit Falls $11.98 Billion in Aug. – Economy * US * News * Story – CNBC.com
Total U.S. consumer credit fell by a bigger-than expected $11.98 billion in August, according to Federal Reserve data on Wednesday that hinted at lackluster consumer spending amid high unemployment.
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