Consumer Credit Evaporates

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By Douglas A. McIntyre Published
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If our calendar and math are correct, the data from the Fed just released on consumer credit in August shows that the rate of borrowing has come down to levels not seen in 10 years.  Consumer credit fell by some $7.9 billion down to $2.577 trillion. That was following a $5.2 billion rise in July. Economists were looking for an increase of $5 billion or more for the month of August.  As a reminder, consumer credit data excludes home mortgages and other real estate-secured loans.

This might not be good for growth in the retail and consumer spendingsectors.  But the world is de-leveraging rapidly.  Main Street isde-leveraging just like Wall Street.  With the comments from Bank ofAmerica yesterday showing how fast credit quality and conditions aredeteriorating, it may set the tone that credit will  continue itscontraction ahead.

Jon C. Ogg
October 7, 2008

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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