Wednesday, December 7, 2011

Consumer Credit (Excluding Student Loans) Now Below 50 Year Average

Bloomberg outlines:
U.S. consumer borrowing rose in October to the highest level in two years, propelled by gains in non-revolving debt like auto and student loans.

Credit increased by $7.65 billion to $2.46 trillion, the most since October 2009, Federal Reserve figures showed today in Washington. The advance was in line with the median forecast of economists surveyed by Bloomberg News that projected a $7 billion gain.
While overall consumer credit rose, consumer credit excluding student loans continued to decline as a percent of personal income from 15.74% in September to 15.71% in October. Of note, total consumer credit (revolving and non-revolving) is now below the 50 year average when viewed relative to personal income, with the big caveat that this excludes student loans*, a category that is now more than 3% of personal income (up from less than 0.5% on average the past 50 years).




* this assumes all Federal student loans are student loans.

4 comments:

  1. What is going to happen with all that student loan debt. Ugh.

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  2. Further splitting the haves (those able to develerage or relever) and have nots (students w/ loans and limited job prospects).

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