Tuesday, December 7, 2010

The Consumer Credit Split

Bloomberg details:

Consumer borrowing in the U.S. unexpectedly rose in October for a second straight month, led by an increase in non-revolving credit, including student loans held by the federal government.

The report showed credit-card debt fell for a 26th consecutive time, showing Americans continue to pay down debt, one reason spending has been slow to recover. Car sales last month climbed to the highest level in a year and holiday purchases have perked up, indicating households may soon start borrowing again.
It looks like non-revolving loans have (for at least the moment) hit bottom, while revolving (i.e. credit card debt) continues to collapse.

Source: Federal Reserve