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Quote: Econintersect spends time on this generally ignored data series as the USA is a consumer driven economy. One New Normal phenomenon is the consumer shift from a credit to cash society – a quantum shift which changed the amount of consumption. Watching consumer credit provides confirmation that this New Normal shift continues. . . . . If student loans are backed out, consumer credit is growing slightly at an annual rate of 0.7%. . . . Econintersect backs out student loans as they are currently consuming an unusual and inordinate portion of USA consumer loans. . . . Was there was a pause in the expansion of consumer credit in August? It is student loans which distort the analysis as they grew ONLY 55% year-over-year this month – down from a 70% annual growth last month. Student loans this month were over 14% of total credit – and accounted for one-half of consumer credit growth. In some previous months, it has been literally the entire growth of consumer credit.
Remember that the Obamacare bill (the second of the two bills, to be precise) bought off some liberal congressmen who wanted single payer healthcare with (from out of left field), a single payer student loan program. Ha ha, I bet it was a health insurance lobbyist who figured out how to use banks as their human shields! Following the passage of the Health Education Reconciliation Act of 2010, the Federal Direct Loan Program is the sole government-backed loan program in the United States. http://www2.ed.gov/about/overview/budget/budget12/summary/edlite-section2d.html#ffel
Riddle me this, What impact is there, in stats or RW, that most student loans last year ($84B out of $104B) and all student loans this year ($116B) were issued out of TGA instead of banks?
4 comments:
Here is the link to the federal Reserve Statistical Release CONSUMER CREDIT August 2011
What do you mean ?
credit lines getting cut ?
again ?
Googleheim,
I believe that student loans are distorting the picture - see August 2011 Consumer Credit Contracts Due to Student Loans
Quote:
Econintersect spends time on this generally ignored data series as the USA is a consumer driven economy. One New Normal phenomenon is the consumer shift from a credit to cash society – a quantum shift which changed the amount of consumption. Watching consumer credit provides confirmation that this New Normal shift continues.
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If student loans are backed out, consumer credit is growing slightly at an annual rate of 0.7%.
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Econintersect backs out student loans as they are currently consuming an unusual and inordinate portion of USA consumer loans.
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Was there was a pause in the expansion of consumer credit in August? It is student loans which distort the analysis as they grew ONLY 55% year-over-year this month – down from a 70% annual growth last month. Student loans this month were over 14% of total credit – and accounted for one-half of consumer credit growth. In some previous months, it has been literally the entire growth of consumer credit.
Clonal, interesting point about student loans.
Remember that the Obamacare bill (the second of the two bills, to be precise) bought off some liberal congressmen who wanted single payer healthcare with (from out of left field), a single payer student loan program. Ha ha, I bet it was a health insurance lobbyist who figured out how to use banks as their human shields!
Following the passage of the Health Education Reconciliation Act of 2010, the Federal Direct Loan Program is the sole government-backed loan program in the United States.
http://www2.ed.gov/about/overview/budget/budget12/summary/edlite-section2d.html#ffel
Riddle me this, What impact is there, in stats or RW, that most student loans last year ($84B out of $104B) and all student loans this year ($116B) were issued out of TGA instead of banks?
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