Consumer Credit Plunges v2

And I thought last month was bad. Total consumer credit in April dropped by almost $15 billion to just above $2.5 trillion, on expectations of -$6 billion, a 7.4% annual rate reduction. As for the March revision, it just does not compute how manipulated higher that number initially was.

Someone tell that house of dimon SPY permabid that consumer credit down -> savings up -> economy bad.


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Consumer Credit Plunges

So much for the subliminal plan to get consumer to spend, spend, spend... Instead it seems the recent trend of save, save, save is picking up steam. The latest G.19 filing shows a massive drop in both revolving and non-revolving consumer credit, which has fallen to a one year low at $2.551 trillion, an $11 billion reduction sequentially in credit, split about even between revolving and non-revolving.

It is shocking, shocking that with unemployment breathing down everyone's neck, people are actually paying off their credit cards.

That great sucking noise is the 10 remaining Centurion cards sucking the life out of whatever imaginary green shoots the MSM is smoking.



and a good way to visualize this from a longer, second derivative (hey CNBC, there's the keyword - we make it easy for you) perspective:

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Consumer Credit Drops

Good news: consumers are deleveraging
Bad news: consumers are really deleveraging

The Fed's G.19 release indicates a February drop of $7.5 billion in total consumer credit, $4.5 billion more than consensus. The bulk of the monthly change was due to a significant reduction in revolving lines of credit: almost $7.8 billion or nearly a 10% change, while non-revolving credit demonstrated a slight increase.

Judging by the market's secondary knee jerk reaction, an increase in savings is a good thing for the bull rally.

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