During the past week there has been a flurry of Federal Reserve reports and commentary concerning the levels of credit in the current economy. The two most notable were:► On July 8th they reported that the level of seasonally adjusted outstanding U.S. Consumer Credit (their G.19 report) decreased during May by $9.1 billion, representing an annualized rate of credit contraction of 4.5%. Although even this change is above the average for the preceding twelve months, it is much smaller than a quiet revision to the previously published April U.S. Consumer Credit figure -- which is now reported to have decreased by $14.9 billion (a 7.3% annualized contraction rate).
The Federal Reserve fails to put these numbers into perspective:
1) Consumer credit has contracted during 15 of the past 16 reported months, and it is down a record total $148 billion over that time span. (more)
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