The above is the total consumer credit from 2000 thru July 2009. Note that it had been climbing at a rapid rate and then stopped as the economy took the tail spin and has been declining for the past nine months. This clearly means two things. First that consumers are spending less, a Keynesian problem, and second that consumers are saving more, the same type of problem.
The chart below shows the separate elements of the debt for the past two years. There does not appear to be any material change yet there is a noticeable decrease.
The final chart below depicts the housing starts in their separate elements. The good news is that authorizations and actual starts are now increasing. This is a result of the lower prices, the purchase of foreclosed homes, and the low cost of interest. In a sense it may be dominated by the foreclosure issue which means that the bad debts which housing has caused may be slowly being digested in the normal mode of things. I suspect that at this point if we have enough data on the purchase of foreclosures that it will be possible to value a great deal of what TARP was to have valued due to the mere fact that it is now being monetized. This data is slowly beginning to become available. It may not be as low as we expected.
These two metrics indicate a stabilizing in debt and in housing, the two key consumer elements. This adds additional credibility to the end of the recession. We await the next unemployment numbers.
The chart below shows the separate elements of the debt for the past two years. There does not appear to be any material change yet there is a noticeable decrease.
The final chart below depicts the housing starts in their separate elements. The good news is that authorizations and actual starts are now increasing. This is a result of the lower prices, the purchase of foreclosed homes, and the low cost of interest. In a sense it may be dominated by the foreclosure issue which means that the bad debts which housing has caused may be slowly being digested in the normal mode of things. I suspect that at this point if we have enough data on the purchase of foreclosures that it will be possible to value a great deal of what TARP was to have valued due to the mere fact that it is now being monetized. This data is slowly beginning to become available. It may not be as low as we expected.
These two metrics indicate a stabilizing in debt and in housing, the two key consumer elements. This adds additional credibility to the end of the recession. We await the next unemployment numbers.
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