Excerpts: “There was only bad news in the just released Fed consumer credit report for the month of February.
First, the “good credit“, the one that consumer should load up on when they feel comfortable about the future, i.e., credit card, or revolving debt, continued its recent plunge, and in February crashed by $3.7 billion, following January’s $1 billion plunge. This was the worst month for revolving credit since December 2010 and explains perfectly why the consumer has literally gone into hibernation – it has nothing to do with the weather, and everything to do with the unwillingness to “charge” purchases, which in turn is a clear glimpse into how the US consumer sees their financial and economic future.
This plunge, however, was more than offset by a surge in “bad” credit, the type that even Obama wants to do away with, namely non-revolving credit, mostly student and to a lesser extent auto credit. In February, this debt funded almost exclusively by the US government, soared by $19.2 billion, the highest monthly notional since July 2011!
And while we will never tire of watching just how exponential this non-revolving credit chart has gotten, here it is again, for any non-frequent readers. Truly a thing of beauty.
“Good credit” is plunging and “bad credit” is surging. This is not confirmation of a healthy economy.
America’s government-managed economy is a dismal disappointment.
We need a bold new plan.
The Leviticus 25 Plan 2015 – $70,000 per U.S. citizen The Leviticus 25 Plan 2015 (852)