Federal Reserve data just out shows consumer revolving and non-revolving debt continues to drop. August showed a 3.4 percent drop in revolving debt.
More disconcerting was the reduction in the pools of securitized assets where issued credit cards are packaged and sold. August’s 40.3 billion is anemic and is not a good indicator that banks can initiate and move larger quantities of consumer debt.
Consumer revolving debt outstanding moved from 792.3 in July to 790.1 in August. The last time we were close to these levels was August 2004, but that’s not taking inflation into account. The real number would have been some time prior to that if adjusted.
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