Jump to content
House Price Crash Forum
Sign in to follow this  

Consumer Credit Rises At Fastest Pace Since June 2008... Or Does It? How The Fed Used Every Trick In The Book To Fudge The Number

Recommended Posts


A quick glance at the headline of the just released Consumer Credit data may leave one with the impression that things are quickly improving for the US consumer. After all, at a monthly change of $7.6 billion in total consumer credit, this is not only a big beat of expectations of $4.7 billion, but is the highest monthly increase since June 2008. Time to declare an "all clear" for the consumer who based on this misleading data is now aggressively releveraging? Absolutely not. In fact, the Fed threw the kitchen sink in manipulating this monthly data. First, it pull page 1 from the BLS SOP: it revised the January increase from $5.01 billion to $4.44 billion, thereby making the change bigger. Second, the all importnat revolving credit number was once again negative at ($2.7) billion. This is the second consecutive drop in revolving credit after a brief pick up in December when consumers bought Made in Taiwan trinkets with their credit cards, and is the 29th out of 30 consecutive declines in the category. Offsetting this drop was the surge in Non-revolving credit: i.e., loans given by the US government and Fed-backed banks for car purchases and student loans. Next, all these numbers were seasonally adjusted: the NSA number actually plunged by $16 billion, from $2.433 trillion to $2.417 trillion. And the piece de resistance: the only source of funding in February, wait for it, was the federal government, as all other traditional sources of credit continue to retrench.

A recover is a recovery...

Share this post

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.